Heart of Wisconsin
Business & Economic Alliance and
Community Foundation of
South Wood County
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A Joint Initiative Between Heart of Wisconsin Business & Economic Alliance and Community Foundation of South Wood County |
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Breaking News July 2, 2006 - Funds would help new companies By: Carlos Gieseken, Central Wisconsin Sunday U.S. Rep. Dave Obey, D-Wausau, has announced the first step in the approval of $300,000 to be used for start-up companies in 10 central Wisconsin counties, including Portage, Wood, Adams and Marathon. The funds, which were given the green light by the House of Representatives Appropriations Committee, still need to be approved by the Senate and President Bush. If approved, the money will be part of the 2007 Department of Housing and Urban Development budget and will be used to start a technology-focused revolving loan fund for the region. "Basically, it's a pool of dollars that have been aggregated from a variety of different sources," said James Hanke, economic development planner with the Wausau-based North Central Wisconsin Regional Planning Commission. "The revolving part is where you have say six companies that you have loaned dollars to. As those companies pay the money back, you can then lend that money to other companies. In theory, the money is revolving through companies in the community." Representatives from the NCWRPC met with Obey earlier this year to request the funds and discuss the changing trends in the regional economy. "It's no longer good enough to do new company recruitment and retention," Hanke said. "You really need to be cultivating entrepreneurial growth and development and really creating a climate in your community that's conducive to entrepreneurial growth." The money could be used for the testing and development of a product that takes place before a patent, according to Leon Ostrowski of the Central Wisconsin Business Angels. "It's a nice way for these start-up businesses to get access to additional capital," he said. "That could help get some of the concepts established and validated. You've built prototypes and tested them to show some data to show it works. Sometimes things appear to work in theory, but in practice don't work quite as well." The Business Angels were formed just over a year ago to provide seed investment money in start-up companies and provide support through referrals to attorneys, accountants, bankers and others. In their first year, they invested approximately $1 million in three companies and helped them acquire an additional $1 million from local and state governments and private banks. They are currently negotiating with five companies and expect to sign agreements with them in the next few weeks. "There's risk associated with those because they're early stage companies and they can't all be successful," Ostrowski said. "But the ones that are will be very successful and will generate hundreds of jobs in the community." He gave the example of companies like Copps or Consolidated Papers that were founded by families around 100 years ago. They eventually grew to be large employers in the community. "As we go through a process in Wisconsin and particularly central Wisconsin and see the continued decline in manufacturing, the question is, where are the companies for tomorrow that are going to replace the manufacturing jobs?" asked Hanke. "We do anticipate attracting entrepreneurial talent that will develop businesses." |
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