Cintrifuse fund of funds manager Tim Schigel, far right, leads investment of venture capital funds nationally in a way that makes those funds want to set up offices in Cincinnati and invest in local startups. Kareem Elgazzar | WCPO Digital
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Cintrifuse CEO Jeff Weedman
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Cintrifuse names investors in its $40 million fund of funds

P&G leads the way in Cintrifuse effort

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CINCINNATI - The founding funders are set for Cintrifuse, the downtown-based venture that's trying to help local startups by boosting availability of venture capital in Cincinnati.

After weeks of speculation about who delivered initial investments to its $40 million fund of funds, Cintrifuse made the list public this morning. The money will be invested in up to 10 venture capital funds nationwide, with the goal of making those funds more active in the Tri-State.

The initial investors in Cintrifuse Early Stage Capital Fund I are Procter & Gamble Co., Western & Southern Financial Group Inc., Duke Energy Corp., the University of Cincinnati and Cincinnati Children's Hospital Medical Center. Western Southern, Children's and UC confirmed initial investments at $5 million each. P&G and Duke declined reveal their amounts.

However, a July, 2012 memo prepared for UC trustees, said Duke's anticipated contribution was $5 million. That would put P&G's investment at $20 million, or half of the initial closing amount.

Cintrifuse has said it hopes to raise up to $100 million over time. Macy's Inc. and Kroger Co. are still considering potential contributions. 

"We see it as an investment that has the potential for a number of benefits," said Children's Hospital spokesman Terry Loftus, confirming its initial investment of $5 million. "We're hoping it could get the next big idea to the market place, which could benefit our patients and families."

Western Southern sees its $5 million investment as  an extension of its institutional private equity division of Fort Washington Investment Advisors Inc. Fort Washington Capital Partners manages six funds of funds with assets of $2.3 billion.

 "The more the merrier," said Maribeth Rahe, Fort Washington CEO. "The reason the coasts have been so successful is they have a huge group of firms that are very actively involved in the business. Money attracts money. For us to be significant, we need to have more than just Fort Washington in the business."

The new Cintrifuse fund is timely, said Bob Coy, president of CincyTech, a seed-stage investor whose portfolio includes more than three dozen startups.

"We projected last year that our portfolio companies alone were going to need $200 million in capital over what we invest over the next five years," Coy said. "So, if Cintrifuse is successful in engaging more out of town venture capital firms to get active here, that will make our job much easier when it comes to raising follow on capital for our companies."

Cintrifuse CEO Jeff Weedman, a P&G executive on loan, said in a press release that the fund will build on "terrific assets" already available in Cincinnati.

"We're home to world-class research institutions, accelerators, incubators, early stage funding as well as offer a path to product testing, collaboration with business leaders and potential customers. It's an incredible model, every participant gains value from the insights, and the business connections," Weedman said.

 

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