The embattled Texas Emerging Technology Fund came under the spotlight Monday at the first meeting of the House Committee on Technology. It?s one of several stops fund managers will make in the coming months as lawmakers decide how much money will go into the program this year.
A few weeks ago, the ETF caught flack due to a report that concluded employment at ETF-funded companies is down in the past year. Some lawmakers already want to drastically cut back on what once was a $200 million investment fund.
But the ETF received a lot of praise at the committee meeting Monday. The majority of the 140 companies invested in by the ETF since it began in 2005 are still around, said Patrick Boswell, ETF?s interim director. Three companies have ceased operations, four are in bankruptcy proceedings and six are involved in litigation, he told lawmakers.
Plus, he said, the fund has managed to turn a profit for the state. After investing $184 million, Boswell said, current asset capital is valued at $186 million and $5 million has already cashed in by the state.
Each investment the ETF makes carries risk due to its focus on funding early-stage technology startups, said State Rep. Angie Chen Button, R-Richardson, committee vice chairwoman. But these sorts of companies are ?the future? and need to be leveraged to help Texas remain a technology state.
Previous criticism of the ETF highlighted a lack of transparency. Since a 2011 state auditor?s report, the ETF has done a good job of implementing recommendations to become more transparent, Boswell said.
The ETF has also attracted criticism due to investing in companies that failed. Two company CEOs appeared before the committee and explained how ETF investments enabled their companies to grow, generate jobs and succeed.
Source: http://feedproxy.google.com/~r/vertical_44/~3/qxr_sY5VeM4/controversial-texas-startup-fund.html
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