As Michigan awaits today's results of the gubernatorial primary races, Ann Arbor venture capitalist and Republican candidate Rick Snyder's investment track record is getting further examination.
The Wall Street Journal's Venture Capital Dispatch blog this afternoon analyzed Snyder's career as an investor and founder of Ann Arbor-based Avalon Investments, which exhausted its investment funds in the early 2000s, and Ann Arbor-based Ardesta, which stopped making new investments in 2008.
"We may never know exactly how well his investments have panned out, unless he’s compelled to release that information during his campaign," the blog reported. "No matter his funds’ performance, Snyder is certainly more of a job creator than any of his opponents."
Rick Snyder
Snyder, a former president of Gateway Inc., is competing for the Republican nomination against U.S. Rep. Pete Hoekstra, Attorney General Mike Cox, Oakland County Sheriff Michael Bouchard and State Sen. Tom George.
Highlights from the WSJ analysis:
- Ten of the 36 companies that received funds from Avalon or Ardesta were based in Michigan.
- Of all the investments, four companies went public, 13 were acquired or merged with other companies, 11 are still private companies and seven went out of business, WSJ reported, citing data from VentureSource. Although two Michigan companies went out of business, "that doesn’t indicate poor fund performance since venture-backed companies have a high failure rate," WSJ said.
- University of Michigan startups HealthMedia, sold to Johnson & Johnson in 2008, and HandyLab, which was sold for $275 million in 2009 to Becton, Dickinson and Co., are "among Snyder's successes." Those companies collectively employ nearly 300 workers in the Ann Arbor area.
Snyder, WSJ points out, claims to be a "job creator."
"We’ll give him the benefit of the doubt on the job-creation front, even though venture capitalists don’t actually create jobs - the companies they invest in do the hiring," WSJ reported. "As for his funds’ success in Michigan, the results, you might say, are too close to call."
Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.
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