The Mississippi Development Authority (MDA) wants to stand up a new venture capital non-profit to handle $52 million in COVID funds coming to Mississippi. A bill is pending in the Legislature to do just that.
Hmmm.
In 1994 the Legislature undertook a nearly identical venture. It put $20 million into Magnolia Venture Capital Corporation, a private non-profit under the control of the Mississippi Department of Economic and Community Development (MDA’s predecessor). The venture failed, did not start-up any new ventures, and was investigated for extravagant expenditures and corrupt activities.
“We ended up with a scandal before,” said state Sen. David Blount when the bill came through the Senate. “If you look at history, any time government gets involved in private business affairs like this, you end up with misspending, strong arming, cronyism and corruption,” said state Sen. Chris McDaniel. As suggested by Mississippi Today, when Jackson Democrat Blount and Laurel Republican McDaniel align, you know something unusual is in the woodpile.
The Greenwood Commonwealth questioned MDA’s move, recommending the Legislature utilize existing, experienced venture capital organizations such as Innovate Mississippi to manage the money rather than a new start-up controlled by MDA. “These organizations have the proper vetting mechanisms and an excellent historic track record,” the paper stated. Using them “would be fruitful. Creating a new state venture capital agency from scratch would not.”
Indeed, MDA’s push to start a new agency leaves seems strange. Innovate Mississippi already coordinates its activities MDA. It was founded in the late 1990s by John Palmer and other successful business leaders as a public/private partnership to spur technology and other innovative start-ups. A review by Site Selection Magazine stated, “In the two decades that Innovate Mississippi has been in business, more than 1,500 startups have been connected to over $181 million in seed and venture capital, resulting in the creation of thousands of new jobs.”
This may be something from the woodpile – MDA is a state agency under the direct control of the Governor while Innovate Mississippi is under the control of an experienced private sector board.
The Senate passed a bill to utilize the federal money, but excluded the language MDA wants to set up a new venture capital non-profit. The bill went to the House where the Ways and Mean Committee put in MDA’s requested language. As this was written early Friday the bill was awaiting action by the full House.
Perhaps the members of the House Ways and Means Committee weren’t paying attention. Mississippi has been down this road before. No. Mississippi has run off this road, through the ditch, and into the gully before. “Venture capital is by definition making risky investments,” noted Sen. Blount. “That’s not our job.”
The Commonwealth’s “better solution” to stick with proven venture capital organizations like Innovate Mississippi is on target. Hopefully, the Legislature will not shoot itself in the foot again and turn $52 million over to a new entity under the control of the Governor and his political appointee at MDA.
“I will instruct you and teach you in the way you should go; I will counsel you with my eye upon you.” – Psalm 32:8.
Crawford is a syndicated columnist from Jackson.
20 comments:
This time it will be better. This time we will have minority ventures like the Metrocenter Mall, Socrates Garrett, and that lady’s Bean themed startup stocked incubator, stocked with Chinese 3D printers!
Coming from a guy who never worked a day in his life..m
Lmao @ 2 comments
Covid money = bribing the taxpayers with their own money.
1) we already have one agency doing exactly this, although their claims of success are exaggerated by 500x
2) this sounds like a cookie jar to spread favors to political connections. Look for the young kid from Rankin to end up with another taxpayer funded biz.
3) our lack of start up technology companies is not for lack of venture capital. There’s more venture capital and private equity available in the US today than ever before In history. And that venture capital knows no borders. It would land here for the right concept. Our lack of STEM grads is the biggest detriment. That’s what they need to address.
4) if a truly stellar concept gets off the ground, Barksdale or Rayburn will invest in it before MDA ever hears of it. The only things headed to MDA for money will be founders who have no idea what they are doing. Unless of course they are looking to play CEO for a few years at taxpayer expense.
GOP donors start lining up.
If you have a great start-up idea, immediately move to Atlanta or Austin where there is an ecosystem of talent and experience. The money will find you if the idea is worth a crap. All the money the MDA can come up with won’t help you if you can’t find experienced (and educated) talent.
1:38: You nailed a good part of the problem. Companies want a talent pool for recruiting mid- to senior- level management, not just workers. It's a problem facing other areas such as New Orleans and Baton Rouge. Look at the companies that moved out of those areas. Shaw, Smoothie King, Amedisys, Raisin' Kanes, and now Walk Ons are moving to better ecosystems.
Of course, if we try to develop something similar here such as the Golden Triangle, every one else in the state starts screaming for their fair share. Thus by pleasing everyone we get nothing.
@1:34 PM I fixed it for you: Dem recipients start lining up.
I say go with a proven entrepreneurial innovator...like the hair dresser who overnight became a cleaning company. Talk about innovatin'!
But, since all the honest men - Leland Speed, Billy Graham, Reverend Pollard, Billy McCoy and Ellis Bodron are all up in Glory Land....That only leaves us with Gerard, Kim Waid and Russ Latino...The three most important men in town (If you ask them).
Of those three, Gibbert is the only one who has ever accomplished anything and frankly he needs to go back to what he is good at. Same for Bomgar. They both seem like lost ducks without the CEO title.
Steve Davenport will probably get $51 million
402, its amazing how you are able to correctly identify the three current "most important" and by who's measurement while at the same time get such an idiotic list of the ones gone. Ellis Bodron? Reverend Pollard? And Billy McCoy???
Surely you jest. But mixing those in with Leland Speed who actually did some good work and was honest makes me think you actually think the same about the others.
@6:33 PM
I do.
Sounds like the perfect slush fund for greasy men and women. 4 DOLLAR GAS. THIS should be the focus.
@8:32
Humans survived for thousands of years without gasoline.
The real problem is food security. While Biden and Kamala are fiddling, China is quietly buying all of the grain and protein products they can get on the market for any price. What are our leaders doing for food security right now?
https://www.reuters.com/business/china-ensure-agricultural-product-supplies-including-grains-2022-03-05/
What are our leaders doing to prevent the panic that is inevitable? My guess will be rationing.
Everybody loves to post comments when we are picking on Jackson. But this thing might be the crime of the century and nobody is paying attention.
One word..... Kemper
@11:22
Brown lignite coal is abundantly found all over the planet. We had visitors from as far away as Germany and Australia who were interested to see if we could get the coal gas turbines working. And coal gasification isn’t a new idea. They were using coal gas to light their crystal chandeliers in the antebellum homes in Natchez in the 1800s. It is unfortunate that this technology failed to produce the desired results.
9:57 : Yes humans did indeed survive without it. Until we got it. Remember Katrina ? We can feed ourselves IF we re-boot D.C. .......sure, many will parish but at least we will give my daughters children a chance to make things right.
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