Investment is the lifeblood of our economy
that provides nourishment for our cities. Without investment we don’t grow,
business doesn’t expand and people don’t get hired. Everything comes to a
standstill and in and good fortune ceases. Cities like Los Angeles, San
Francisco and San Diego are attracting investments to their unique industry
clusters. Letting the world know what
San Diego has to offer in terms of investment opportunities can be a catalyst
to greater growth.
Nationally, the last quarter experienced
$13.4 billion dollars in investments and about a third of that took place in
San Francisco, Los Angeles and Orange County (as cited in Somerville, 2015). According to the Venture Capital Association
and Price WaterhousCoopers a total of 19 San Diego companies received around
$270 in late stage venture capital funds (Money Tree, 2015). Not the largest
share but certainly a sizable one.
Much of the money comes from large institutional
investors that are looking for solid growth opportunities. Of these large
investment opportunities around 36% were from hedge funds and mutual funds (As
cited in Somerville, 2015). There is
still plenty of room to draw new investments from international investors that
are also seeking high probably income outcomes.
Companies invest in late stage start-ups
because they can reduce their risks. Another option is to invest in a basket of
companies to hedge the potential of loss on any one entity. The problem is that
without knowledge of local investment opportunities investors are unlikely to
fulfill to help businesses reach their full potential.
Ensuring that emerging companies are easy
to find and the proper mechanisms for investment are available will help
further international investment in San Diego. Ensuring information is on
public display via websites, is easily accessible from outsiders and targeted
to both small and large investment entities helps to keep new industries
budding and growing in a way that encourages local economic development.
Freeman, M. (April 17th, 2015). San Diego start-ups net more venture capital. UT San Diego. http://www.utsandiego.com/news/2015/apr/17/MoneyTree-Dow-Jones-VentureSource-ATyr-pharma/
Somerville, H. (2013). Tech companies continue to land mega VC deals. San Jose Mercury News. Retrieved http://www.mercurynews.com/business/ci_27932457/tech-companies-continue-land-mega-vc-deals
The Money Tree. Retrieved April 18th, 2015 from https://www.pwcmoneytree.com/
