River Cities Capital Funds, a Cincinnati-based venture capital firm, is investing $200 million in an effort to bring start-ups to the city, says Glen Mayfield, CEO and founder of the group. For most Israeli start-ups, getting $2 or $3 million from a venture capital fund is a dream come true. A start-up with the right kind of technology could get up to $20 million from RCCF as it shops for tech in Israel.
On a visit to Israel last week, Mayfield discussed RCCF’s new fund, and how the organization would be happy to finance Israeli start-ups. In exchange, the firms would have to set up a facility in Cincinnati, considered by many to be “out of the tech loop.” Cincinnati is far from New York or Silicon Valley, the “power centers” of tech. Many entrepreneurs believe that if they can’t bring their company to those locations, they won’t have a chance to succeed.
The entrepreneurs who look at Cincinnati that way are out of the loop, Mayfield said on the sidelines of the MIXiii Israel Innovation Conference. “There are a lot of advanced technologies in Cincinnati, including medical devices, biotech and IT. There are dozens of top US companies in and around the city, and you can be in New York in under two hours if necessary. We’re far from being in the ‘middle of nowhere.’”
Mayfield is looking for mature start-ups and larger companies that can open facilities in the Cincinnati area. RCCF has invested in several Israeli companies, including Simbionix, which develops simulators for hospitals to enable personnel to learn and practice surgery techniques. Simbionix opened a sales office in the Cincinnati area 12 years ago, with its R&D remaining in Israel. “That’s a good example of the kind of deal we are looking for,” said Mayfield.
Greater Cincinnati is home to a dozen Fortune 500 companies and hosts operation facilities for for more than 400 of the Fortune 500, according to REDI, the Regional Economic Development Initiative of Cincinnati, which acts as the economic development agency for the Greater Cincinnati region. In addition, the area is home to more than 450 foreign-owned firms. More than 300 information technology companies are located in Cincinnati, with access to over 30,000 IT professionals. This represents a big advantage for Israeli tech companies that are looking for trained personnel in the US, REDI said.
Mayfield was one of about 40 top business and civic officials from the Greater Cincinnati area who were in Israel to promote the idea of a Cincinnati presence among Israeli firms. The delegation was organized in part by REDI. Officials of the organization “identified Israel as a key international market to build relationships and generate opportunities from Israeli businesses seeking to expand in the US,” said REDI’s Tammy Riddle. “The Greater Cincinnati region recognizes Israel as a frontier for innovation and believes there is much to gain by both markets developing strong business connections.”
Members of the delegation met with Israeli companies in industries such as 3D printing, data intelligence/big data, cyber security, consumer-tech, fintec, connected devices/wearable tech, medical devices and pharma-development. Members of the delegation also attended an event organized event in partnership with the city of Netanya which has a strong, long-standing collaboration with Greater Cincinnati as a result of their partnership with the Cincinnati Jewish Federation. Netanya’s Mayor Miriam Fireberg co-hosted the event.
“Cincinnati’s global corporations are seeking innovative partnerships that Israeli companies can offer,” said Riddle. “And Israeli companies seeking to grow in the US can benefit immensely using all the tools and resources Cincinnati has to offer.”