TARP money funneled to help Washington startups

12/13/2011

The W Fund, a $25 million investment fund to aid in the growth of biotech startups at the University of Washington and other local research institutions, recently received $5 million from the state's Troubled Asset Relief Program, TechFlash reports.

According to governor Chris Gregoire, the donation is part of a five-year, $19.7 million plan to increase small business lending, Xconomy reports. The W Fund will be used to invest in early-stage technology, life sciences and IT companies, with hopes that it will attract more money from angel investors.

"This is a great example of the state and Department of Commerce being really sophisticated in their use of federal stimulus money to leverage private investment dollars to insure that there is sufficient earliest stage capital in the local economy," said Linden Rhoads, vice provost of commercialization at the University of Washington and overseer of the fund, as quoted by TechFlash.

Xconomy adds that the five-year loan was rerouted from money obtained through the 2010 federal Small Business Jobs Act.

Thus far, a total of 282 financial institutions have used the funds to pay back TARP, the Phoenix Business Journal adds.