In a Faculty Senate meeting where discussion among senators and top Ohio University administrators ran the gamut — from athletics spending to parental leave — a recent university investment was the main focus.
Last week, OU pledged $15 million in a new partnership with Ohio State University to be put toward a venture-capital fund to provide additional sources to help create and keep jobs and provide opportunities for a collaboration between public and private entities, universities and businesses, OU President Roderick McDavis said.
Concerns arose about the long-term goal and purpose of the fund along with how risky the multimillion-dollar investment is.
“How are we going to use the resources to reach a long-term goal?” said Joe Slade, a senator for the School of Media Arts and Sciences.
The fund is intended to provide resources for funding students and faculty who have an interest in being entrepreneursand creating projects.
Some of the long-term goals are to bring more inventions to the marketplace, cure disease, produce more healthful food and advance alternative-energy solutions, McDavis said.
The best turnout would be for the fund to act similarly as it did in areas such as Silicon Valley, Calif., and the research triangle, McDavis said.
“Students and faculty were in discovery mode but needed funding to turn ideas into business and ultimately it resulted in products and jobs,” he said. “This will leverage substantial university resources and assist in bringing the best talent, funding and facilities to the state of Ohio and jumpstart entrepreneurial activity and venture creation.”
The Ohio University Foundation will fund the $15 million for the project, keeping OU from taking resources from other areas within the institution, he said.
OU and OSU decided to use the DHI model, different from the University of Michigan, which made a similar move six months ago when it announced it was taking a $25 million endowment. That is something OU did not identify as a model appropriate for its size and structure, said Stephen Golding, vice president for Finance and Administration.
“The model we set up is the model that has brought in a third-party general-party with a demonstrated track record of achieving market rates in return,” Golding said.
To follow U.S. Security and Exchange Commission regulations, a separate entity, Dominion Ventures Inc., based in Walnut Creek, Calif., was hired as the general partner for the fund, acting as a wall between the institutions and fund.
“This might take 15 or 20 years to pay off, but ultimately it not only puts the $15 million back but brings in a lot more,” McDavis said.
McDavis added that there is potential for involving other universities in Ohio, pending the fund’s success.
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