GRAND RAPIDS – New Community Transformation Fund (NCTF), a statewide venture capital fund based in Grand Rapids, announced today the first close of its new $20 million Fund II. The public-private fund includes an investment of up to $9.8 million from the Michigan Economic Development Corporation’s Small Business Venture Program. The state investment requires NCTF to raise $10.2 million in private capital in order to receive the full commitment from the Michigan Strategic Fund.
This first close includes $2.55 million in private investment and a matching amount of $2.5 million from the MEDC. The objective of Fund II is to invest in historically underserved start-up entrepreneurs and business owners throughout Michigan.
“The establishment of Fund II is a strategic expansion of our mission and something we’re very excited about.” said Birgit Klohs, co-founder and Executive Chair of NCTF. “With the involvement of the MEDC, this new initiative will be able to reach more start-up entrepreneurs across Michigan.”
NCTF was founded in 2020, and quickly attracted a prestigious list of private, public, and philanthropic stakeholders. The organization has raised nearly $12 million for its first Fund, and has invested in 11 Michigan start-up companies, six in the last 12 months.
“Momentum continues to build for NCTF and that positive vibe has really taken off with the investment from the MEDC,” said Skot Welch, co-founder and Managing Partner of NCTF. “Our stakeholders are committed to supporting innovation in every county in Michigan in hopes of driving job creation and generational wealth. With Fund II, we can now assist even more entrepreneurs who historically have not been able to access capital.”
NCTF leaders will now look to identify suitable start-up and early stage companies for possible investment, while also continuing to engage new investors. Michigan Capital Network, a strategic partner with NCTF, will assist with those efforts.
“This new Fund II is a powerful tool that can really stimulate the entrepreneurial ecosystem in our state,” said Abid Ali, who’s a Principal at Michigan Capital Network and also serves as Managing Director at NCTF. “When you combine the MEDC and private investors, with the expertise and passion of the NCTF leadership, there’s really nothing that can’t be achieved. This is truly an exciting opportunity for investors and entrepreneurs in need of capital.”
Fund II will seek to support a variety of Michigan based start-up entrepreneurs, who are focused on growing their business, creating jobs, and hopefully attracting workers and other businesses to our state.
“This first close is a testament to the commitment of the NCTF leadership and its stakeholders to support entrepreneurs and spur business growth,” said Chris Cook, managing director for capital access at the MEDC. “It’s exactly the type of investment and potential job growth we’re looking to encourage through this initiative.”
About New Community Transformation Fund
NCTF, based in Grand Rapids, Michigan, was established in January 2020. The venture capital fund aims to primarily invest in companies owned and/or operated by diverse business leaders while providing suitable risk-adjusted returns to its investors. The fund focuses on scalable early to mid-stage businesses and transitioning succession companies within financial technology, health care, advanced manufacturing, and information technology. NCTF maintains an investment committee comprised of local and national members and is governed by a board of directors. https://newcommunityfund.com/
