The proposed Herman Malone Fund would benefit minority- and women-owned businesses through equity investments, according to the Mayor's office.
Mayor Michael Hancock has been preparing his proposed equity investment fund for the last year, but his administration just showcased the plan earlier this month.Mayor Michael Hancock is pushing Denver City Council to approve a $15.2 million marijuana tax revenue allocation for a business investment fund.Economic Development & Opportunity
Later this month, council is expected to consider a request to approve a partnership between the city and the, a Denver venture capital firm that invests in early-stage businesses founded by owners from marginalized communities. Under the proposal, the city would allocate 1 percent of Denver's marijuana sales tax each year from 2023 to 2025 to the fund; the amount is estimated at between $4 to $5 million annually, but would not exceed $15.2 million over the duration. Ultimately, the goal would be to extend the contract and use successful investments to build it into a $50 million evergreen fund.
"In this case, they'll invest in the companies on our behalf. Any money paid back into the account from successful funding or [other ventures] goes back into the fund," DEDO director of entrepreneurship and innovation Mike Bevis explains. "Research shows that equity financing is one of the better ways to lift companies up quickly. [But] we think the biggest benefits of the program really are the technical assistance and wrap-around services we're providing.
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