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Startup PHL: First Round Capital chosen to run $6M Philly seed fund

Mayor Michael Nutter announced the winners of the city's $3.5 million "Startup PHL" initiative that aims to grow the local tech scene and encourage companies to stay in the area.

Full Disclosure: Technically Philly applied for a Startup PHL grant and its offices are in First Round Capital HQ.
Updated 12:55 p.m. 3/20/13 to add details on the other venture capital firms the city was considering to run the fund.

First Round Capital will run the city’s first $6 million investment fund, Mayor Michael Nutter announced today. It’s part of the Nutter administration’s Startup PHL initiative that aims to encourage early-stage companies to mature and stay in the region. Nutter also announced winners of the $500,000 “Call for Ideas” innovation grants — find the full list below.

The fund is made up of $3 million from city economic development agency the Philadelphia Industrial Development Corporation (PIDC) and $3 million from First Round Capital and will only be invested in local companies. First Round Capital will not get a management fee for the work, according to the announcement.

The move fits into First Round Capital’s mission of “helping the next generation of Philadelphia entrepreneurs grow,” as managing partner Josh Kopelman put it. It’s yet another First Round initiative to support the local tech community, along with its relocation University City from Conshohocken and the launch of the Dorm Room Fund, a student-run investment fund that aims to fund 25 Philadelphia student startups.

The two other top contenders were DreamIt Ventures and a team of Benjamin Franklin Technology Partners and Safeguard Scientifics, the Inquirer reported.

PIDC will also invest $500,000 in the University City Science Center‘s QED program, a proof-of-concept funding program for healthcare and life sciences technologies. This will be through the PIDC’s Penn Venture Fund. Read more of our coverage on QED here.

The winners of the $500,000 “Call for Ideas” grants, according to the release, are:

  • Ben Franklin Technology Partners/Campus Philly – $25,000: to create the Targeted Internship Matching Program to place Philadelphia-area college and university students at BFTP portfolio companies in Philadelphia this summer. The goals of the program are to provide Philadelphia startups with talent and to connect college students to startups/mentors, increasing the likelihood that they stay in Philadelphia post-graduation. Matching funding will be provided by the companies hosting interns. [Read about Campus Philly’s growing interest in the technology sector here.]
  • The Enterprise Center, Center for Culinary Enterprises, Philly Food Innovation Program – $15,000: to support the development of a workshop series for 25 early to middle stage food entrepreneurs to help accelerate their businesses. [Read more about the Center for Culinary Enterprises incubator here.]
  • Greater Philadelphia Chamber of Commerce – $18,400: to develop an online Entrepreneur’s Resource Directory, working with Select Greater Philadelphia, PACT and the Philadelphia startup community. The Directory will provide a centralized location for entrepreneurs to find information on funding sources, professional and technical expertise, specialized facilities and professional services. Matching funding will be provided by a corporate sponsor or the Chamber.
  • Philly CORE Leaders – $15,000: to support the Supporting Entrepreneurship in Education (SEED) program, which includes a pitch event for education entrepreneurs to compete for funding. The winning teams will then participate in the Fels Institute Social Innovations Lab to further develop their ideas. Matching funding will be provided by corporate sponsorship. [Read our coverage of Philly CORE Leaders and SEED here.]
  • Startup Corps – $20,000: to support the expansion of the high school entrepreneur program that provides programming to a diverse range of teenagers looking to develop entrepreneurial skills and build businesses. In 2013, Startup Corps plans to expand the number of students served by 50 percent and develop new partnerships with organizations that support entrepreneurs. Matching funding will be provided by private sponsorship. [Read more of our coverage on Startup Corps here.]
  • VentureF0rth – $25,000: to create a ‘community commons’ space at the existing VentureF0rth co-working facility that will provide an increased range of services to the startup community, including daytime programming, job training for individuals looking for work in the technology sector, and an increase in the number of entry-level low-cost spots available to entrepreneurs. [Read about Venturef0rth’s launch here and find more of our coverage here.]

When it comes down to it, First Round was the local front-runner at the start. Among VC firms in Philly, they’re the gorilla in terms of reputation nationally and their new University City headquarters showed them making a high-profile bet on Philadelphia.

The winners of the Call for Ideas are bets on groups with good reputations, in addition to supporting the expansion of younger efforts, like Startup Corps and SEED.

Companies: Ben Franklin Technology Partners / Campus Philly / City of Philadelphia / First Round Capital / Chamber of Commerce for Greater Philadelphia / PACT / Philadelphia Industrial Development Corporation / Philly CORE Leaders / Startup Corps / University City Science Center / Venturef0rth

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