Venture capital funding is headed to rural Colorado through the support of several investment groups.

The Colorado Venture Capital Authority and the Colorado Office of Economic Development and International Trade announced  Jan. 25  the Authority renewed its partnership with the Greater Colorado Venture Fund. This partnership will bolster access to venture capital for entrepreneurs and startups in the state with a focus on rural areas. The authority committed nearly $11.2 million to the venture fund in this renewal.

The authority began its partnership with the state’s venture fund in 2018, at which time the contribution to the program was $13.3 million. That served as an anchor to the venture fund’s first fund, totaling $17.5 million. In four years, it made 29 investments that raised $40 million and created more than 150 jobs in rural areas of the state. This time around, the venture fund has raised nearly $25 million and the Venture Capital Authority provided its funding through the State Small Business Credit Initiative.

The initiative aims to support businesses with less than 10 employees and those from under-resourced communities, according to a news release. Of the initial $31 million in this program, more than $19 million was directed to the authority to create new partnerships with venture capital firms. These numbers could increase over the next five years, reaching about $104 million in State Small Business Credit Initiative funding.

This was one of the first venture funds in the nation to focus on rural investments, according to the release.

“This exciting partnership builds upon our ongoing work to boost Colorado’s strong economy, bring good-paying jobs to Coloradans in rural communities, and support small businesses,” Gov. Jared Polis said in the release.

Thea Chase, chair of the authority’s Board of Directors and a rural Colorado resident, said there was a gap because investments of this nature were largely on the coasts in New York City of Los Angeles, for example. She said the Venture Capital Authority does not fund companies directly, but instead establishes relationships with fund managers who then make investments into businesses.

Now that there’s more venture capital in the state that largely supports early-stage new businesses, Chase said they are now trying to identify where to lean in from here. These investments are providing high-value jobs to these areas, Chase said.

“Venture capital congregates in, like I mentioned, in the coasts and then it also congregates where there’s high volume,” Chase said. “Well in rural areas, you see less volume so there’s less attention. [That] doesn’t mean that there’s not good companies to fund, it just means that there’s less attention.”

Marc Nager, co-founder and managing partner of the Greater Colorado Venture Fund, said the long-term goal of their efforts is to be able to reduce venture capital funding by raising awareness and interest for private investors to support funding instead.

“What we’re trying to do is validate these markets, these underserved markets, and attract private capital,” Nager said. “And over the long-term, if we’re successful and we can show results, we’ll be able to attract more private capital and reduce the reliance on state capital or venture capital funds.”

The authority also partnered with New Community Transformation Fund-Denver in late 2022 — the first Colorado-based venture capital firm that is Black-owned and Black woman-led. Authority officials expect to create two more partnerships which should be announced in coming months. With these partnerships, projections show they will create or retain 2,900 jobs over the next 10 years.