Mayor Michael Nutter launched a new initiative Friday to support Philadelphia tech startups. On the roof deck of the Independence Visitor Center, Nutter kicked off the proceedings with a nod to the past.
“Philly is a perfect place for founders, people looking to start businesses and make things,” said Nutter.
The city’s entrepreneurs drive the economy, the mayor said. And city government needs to help out — especially with a growing sense of momentum around Philly tech startups.
“But here’s our challenge,” Nutter continued. “Once these ideas are conceived, developed and built into businesses, many Philadelphia entrepreneurs are too often forced to leave in search of additional funding.”
That’s where the new StartUp PHL Seed Fund comes in.
The city is putting up $3 million to be matched and managed by a private venture capital firm. The goal is to hang on to Philly’s early-stage tech companies.
“Seed funding is one of those areas where a spark can make all the difference,” said Bob Moul, president of Philly Startup Leaders. “We’ve had a stunning $1 billion worth of companies move to other cities in search of financing in the past five years. A billion dollars.”
Moul wants the city’s new initiative to be a rallying point for local startup activity. And he’s not alone.
“Six million dollars is not a lot of money; but symbolically it is a lot of money,” said Alex Urevick-Ackelsberg after the announcement. Urevick-Ackelsberg is the CEO of Zivtech, a Philadelphia company that builds web apps for other companies. He’s also the organizer of a handful of local tech meet-ups.
Urevick-Ackelsberg says the city’s commitment is what matters.
“It’s a signal to other startups that the city wants to work with them, wants to make the city work for them and really understands the job creation potential that these startups offer,” Urevick-Ackelsberg said.
City government will now receive offers from venture groups interested in both managing the fund and investing at least $3 million of their own money. Bidding closes in early December. City officials say the fund should be up and running by early next year.