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TEDCO refocus aims to create ‘big, giant successes’

Andy Jones, managing director of the Maryland Venture Fund and chief investment officer at TEDCO. (Submitted photo)

Andy Jones, managing director of the Maryland Venture Fund and chief investment officer at TEDCO. (Submitted photo)

Under the Maryland Technology Development Corp.’s reorganization efforts, TEDCO’s funds will focus on being disciplined and making good investments, with an eye toward overall economic value towards the state.

The organization does not want to just fund Maryland startups, it wants to fund the next Under Armour, a company that can be an economic development star by bringing significant jobs and revenue to Maryland.

“We took this on with the belief that if you build great businesses, great things happen economically,” said Andy Jones, TEDCO’s chief investment officer and managing director of the Maryland Venture Fund. “But let’s just start with building great businesses.”

Last October, just four months into his new job, TEDCO CEO George Davis announced during the organization’s annual Entrepreneur Expo that TEDCO would be revamping how it interacts with Maryland’s startups under TEDCO 2.0.

The new TEDCO would focus on collaborations and partnerships, being more than just a funding vessel for the state’s nascent companies. That included growing executive leadership, mentorship and training at promising startups.

“The entrepreneurial world moves very fast, and we need to keep up,” he said at the time. “We don’t want you to wait 90 days for a ‘yes’ or a ‘no.’ I know how long that is in startup world. We want to get there quicker, so you can keep moving forward and we can help you do it.”

As part of the reorganization, the Maryland Venture Fund assumed control of the TEDCO’s Seed Fund. The venture fund focuses on capital for early-stage companies while the seed fund focuses on newer companies.

Jones and Parag Sheth, who direct the venture fund, have experience as both investors and creating successful companies. That experience is something they hope connects with businesses as they try to find Maryland’s next big companies.

“They want to be able to talk to people who have been there, done that themselves, and understand it,” Sheth said. “Running a company is hard work. Every day they are facing challenges.”

But they will not just give money away at TEDCO.

Instead, their focus is on funding companies that can be build for the long term, to make an economic impact.

“We have to continue to only allocate capital to the companies that are worthy of capital,” Jones said. “We’ve got to really raise the bar and raise quality businesses that can last.”

The venture fund team hits the road frequently to meet businesses and actively tries to find the startups that fit what TEDCO is looking for, not just waiting for a business to come to them.

They also believe their experience operating and not just funding companies will help increase their success rate.

“Nobody bats a thousand, but we have brought a heavy discipline and some serious operating backgrounds to the process,” Jones said. “I do think it can raise your batting average significantly.”

While Maryland has seen some small and mid-size successes in recent years, including Harpoon Medical’s $100 million acquisition last fall, the TEDCO team is waiting for a big success to really be a process validation.

Venture fund-backed companies like Aledade and Personal Genome Diagnostics could be the next companies to make a big impact in Maryland. Their successes could be a huge boon for Maryland and its startup community.

“We still need to put some points on the board,” Jones said. “This is a long-term game, and it takes years to build big sustainable businesses.”

But when the time comes and Aledade or Personal Genome Diagnostics go public, the results will be clearly visible and could be a sign that Maryland is a serious player.

“(Smaller successes are) a stamp of approval,” Jones said. “But the real stamp is when you start being associated with big, giant successes.”

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