Mayor Vincent C. Gray has created a city-sponsored venture fund and designated a technology corridor as part of a new strategy to bolster the District’s burgeoning technology sector, District officials said.
The economic development initiative, dubbed Digital DC, is part of the mayor’s five-year effort to add thousands of jobs and millions of dollars in tax revenue to the District while weaning the city from its economic reliance on the federal government.
The venture fund would allocate grants of $25,000 to $250,000 to District-based start-ups. The amount of money allotted to the fund, which will come from existing economic development programs, as well as the criteria for eligible companies, is to be determined by a yet-to-be-named third party, District officials said.
Gray is expected to reveal the full plans Wednesday evening at the recently opened WeWork office space in Shaw.
A District-sponsored venture fund has long been sought by both city officials and local tech executives. Neighboring jurisdictions in Maryland and Virginia have poured millions of dollars into companies through state-run venture funds and other programs.
The District fund would be different initially because its grants would not give the city an equity stake in the upstarts. While that makes the money more attractive to companies that don’t have to relinquish a piece of their business, it means the city would not benefit directly if the business takes off and the investment becomes more valuable.
“We’re still in the pilot stage,” said Jenifer Huestis Boss, the District’s interim director of business development and strategy. “We’ll continue to explore other options and what other jurisdictions are doing.”
Still, the officials said bringing companies and their employees to the District will ultimately add to the city’s corporate and income tax rolls.
The young companies that receive money from the program are expected to establish an office along the newly formed technology corridor — a stretch of city blocks where officials hope to create a geographic hub for the sector.
The tech corridor would be several blocks wide and extend from the intersection of Kansas and Georgia avenues NW to the intersection of 7th Street NW and New York Avenue NW. The corridor tracks along Metro’s Green Line from the Petworth to Mount Vernon stations, an artery of the city that has become increasingly populated by young, highly educated residents in recent years.
“A lot of businesses that we talk to, their employees bike to work or they don’t own cars. They need to be near Metro stops,” said Erin Horne McKinney, the city’s technology and innovation sector manager. “So we felt like this is a perfect match.”
Also located on the Green Line: The St Elizabeths campus where District officials intend to establish an office park filled with technology companies.
Businesses along the corridor are also eligible for up to $85,000 in assistance for building rehabilitation or office construction as part of the District’s existing Great Streets program, which is designed to attract businesses to less desirable parts of the city.
The final component of Digital DC is a national marketing campaign, anchored primarily by a new Web site and social media presence, to make others aware of the city’s tech initiatives and start-up success stories, officials said.
The site, digitaldc.co, will be operated by the Office of the Deputy Mayor for Planning and Economic Development. It will be touted at a series of panels and parties at South By Southwest, the annual technology and entertainment festival in Austin.
“The tech sector in some ways sells itself. As we go to various events where people from all over the country are coming together, we’ll be able to reach out to them there,” Boss said.