The Times Herald (Norristown, PA)
Official confident venture fund will attract tech firms
The recently announced Venture Chesco will use money from the county’s pension fund and from Ben Franklin to attract young companies
Chester County officials don’t expect the $4 million venture capital fund they recently established to make them the country’s next big tech hub, but they do hope it will put the county on the map for young technology-based companies.
The Chester County Retirement Board voted Dec. 21 to enter into a partnership with Ben Franklin Technology Partners of Southeastern Pennsylvania, or BFTP, to invest $4 million in emerging companies already located in or willing to locate to Chester County. The partnership, dubbed Venture Chesco, will see $2 million in county pension funds matched by $2 million in BFTP funds.
“Available capital is what drives places like Silicon Valley,” said Chester County Commissioners’ Chairwoman Michelle Kichline. “While we don’t have those kinds of aspirations, we do want to be viewed as a place where innovation is happening. Venture Chesco should help us achieve that goal.”
The fund is similar to one established in Bucks County in 2014. There, the Capital for Bucks County, or VC4BC, was established with the county and Ben Franklin each committing $2 million. As in Chester County, Bucks County’s portion came from its pension fund.
Kichline said such investments from pension funds are not unusual.
“Many pension funds invest a portion of their available funds in what are called ‘alternative investments,’” she said. “These can be real estate, commodities, venture capital, and others. In our case we are using less than one half of 1 percent of the county pension fund (valued at around $420 million) to invest in Chester County companies. This is intended to be an investment that generates a positive return for the pension fund while at the same time it helps grow a new generation of Chester County companies.
“No pension funds are or will be used for any county