Gov. Eric Holcomb used his first legislative session to secure $250 million to use as venture capital for startup firms.
Creating and funding the Next Level Fund was part of Holcomb’s larger legislative agenda, which included a major transportation and infrastructure funding plan, an expansion of the state’s pre-kindergarten program, and money to double-track the South Shore Lines in northwestern Indiana.
The Next Level Fund, officially formed July 1, is successor to the Next Generation Trust Fund, a decade-old pool of money originally funded by former Gov. Mitch Daniels’ lease of the Indiana Toll Road.
That $500 million fund’s investments had been restricted to low-risk-low-return asset classes, but Holcomb in April signed the law allowing up to half of it to be invested in high-yield asset classes such as venture capital.
The fund tapped prominent investor Bill Godfrey, the former CEO of marketing software firm Aprimo, and Cindy Lucchese, Hulman & Co.’s chief financial officer, as its two non-governmental board members. They join State Treasurer Kelly Mitchell, Indiana Economic Development Corp. President Elaine Bedel and Indiana Office of Management and Budget Director Micah Vincent.
The Next Level Fund’s $250 million venture capital allocation has been widely praised by entrepreneurs and venture capitalists, who have sounded the alarm for years about the dearth of venture capital in the state. Hoosier companies drew in about $2.5 million per deal in 2016—the 13th-lowest rate in the country—according to a PwC/CB Insights MoneyTree report. Over the past four quarters, that average has been $2 million.
Holcomb also signed into law an expansion of the state’s preschool program. The preschool pilot will expand from five counties to up to 20. Funding also increases by $9 million yearly, to $22 million, with an additional $1 million sent to an online preschool program.
The governor also signed bills aimed at addressing the opioid crisis, including one that allows local governments to establish their own needle-exchange programs.