GRAND RAPIDS — Coming off its merger with eMerge West Michigan earlier this year, Grand Rapids-based Start Garden LLC has spun off its venture capital arm into a new entity.
Wakestream Ventures LLC will now serve as the main investment vehicle for Start Garden, the organization founded by Amway scion Rick DeVos in 2012 as a $15 million pre-seed venture capital fund that’s since changed gears to administer many entrepreneurial services for the city of Grand Rapids.
DeVos will serve as CEO of the new organization, according to a statement. Kim Pasquino and Mike DeVries will serve as Wakestream’s chief investment officers.
According to state of Michigan records, Wakestream was formed on Aug. 1, 2014. The fund has $21.25 million in assets under management, according to the Michigan Venture Capital Association’s 2016 Michigan Entrepreneurial and Investment Guide that was released this week.
Start Garden chose to spin off its privately financed venture capital arm, but was not required to do so to receive city funds.
“With early stage, venture capital investment comes significant risk, which our ecosystem needs, and the separation with Start Garden ensures there will be no confusion between the investment activity of the fund with the social investments being made through Start Garden,” DeVos said in a statement. “The Midwest is rich with investment opportunity, and Wakestream will continue to lead and co-invest in early stage, series-A or pre-series-A investment rounds that expand the ecosystem.”
As MiBiz previously reported, Start Garden’s roles in administering the various entrepreneurial support programs have been split into two entities: SG Ecosystem Inc. and the nonprofit Start Garden Foundation.
The services were previously administered by Grand Valley State University.
Start Garden’s one-year $725,000 contract with the city of Grand Rapids’ Local Development Finance Authority (LDFA) took effect on April 1 of this year.
According to the terms of the Memorandum of Understanding between the parties, Start Garden needs to raise a total of $530,000 while meeting incremental milestones ending on Jan. 1 of next year to receive the entire allotment of city funding.
Messages to Start Garden officials seeking further comment were not immediately returned as this report was published.
Editor’s note: This story has been changed from its original form. It has been corrected to indicate that Start Garden chose to spin off its venture capital fund and was not required to do so as a condition of receiving city funding.