As reported by the Austin Business Journal, the Texas Emerging Technology Fund, an economic development fund run by the office of Gov. Perry, has recently committed to invest more than $17 million in fourteen startups that have failed or gone bankrupt.
Of the fourteen failed startups receiving funds, eleven of them have been made public, receiving an aggregate of approximately $13 million of the funds recently made available. The remaining $4 million was disbursed to three companies have not been made known, but will be announced in a report later in the month.
The Texas Emerging Technology Fund has been financing technology and research in early stage tech companies since it was established by the Texas Legislature in 2005, and has currently invested approximately $204 million dollars through commercialization grants to 143 companies. However, over the last year charges of self-dealing and potential corruptionhave been levied against the fund, when a former high-ranking fund official joined the board of Genprex, Inc., a biopharmaceutical company founded by a campaign donor of Gov. Perry that was later discovered to have received a $4.5 million grant from the fund without proper approval. As a result, in last may the Texas Legislature decided to allocate only $50 million to the fund, rather than the $139 million requested by Gov. Perry’s office.
While the Texas Emerging Technology Fund has enjoyed some successes, the inherent problems with state-run organizations acting as venture capital firms, coupled with political scandal, have lead many to question the merits and continued viability of the fund. Regardless, the recent recipients of commercialization grants from the fund are unlikely to complain, as these companies have been reported to be in serious need of funding.
Companies receiving commercialization grants include:
- Advanced Receiver Technologies Inc., $250,000
- Bauhaus Software Inc., $500,000
- Nanocoolers Inc., $3 million
- NanoTailor Inc., $250,000
- Net Watch Solutions Inc., $500,000
- SeprOx Corp., $750,000
- Speer Medical Inc., $2.5 million
- Star Vision Technologies Inc., $750,000
- Sunrise Ridge Algae Inc., $250,000
- Terrabon Inc., $2.7 million
- Thrombo Vision Inc., $1.5 million