With a limited state-funded budget and an increasing demand for seed money, the Slater Technology Fund is looking for support in the form of private capital from wealthy investors, companies, and venture capital firms.

Already, Slater has cut costs to put more of its money into investments. In 2005, five Slater funds focusing on separate market clusters were combined into a single entity. The full-time staff was pared to four people. And from fiscal years 2005 to 2006, Slater’s expenses dropped from $1.76 million to $1.46 million as its investments jumped from $1.5 million to $2.5 million.

Unlike most funds however, Slater is chartered to only finance Rhode Island-based ventures and measures returns not only in financial terms but also in number of jobs created and amount of outside investment attracted. In addition, Slater focuses on providing seed capital and loans to early-stage startups, high risk investments that are often passed over by traditional VCs.

Since 1997, Slater has either invested, awarded in the form of grants, or distributed as loans slightly more than $10 million, to 90 ventures, and has committed to invest another $5 million, according to financial statement provide by the fund. The fund has been able to recoup about $1.9 million from those investments so far.

Meanwhile, the fund reports, Slater-funded companies have produced a total of 623 jobs and attracted $193 million in investments from other entities. Horan noted that the companies also add to the state’s economy by paying for legal, accounting and other services.

Despite Slater's efforts, neighboring Massachusetts, with one of the largest venture-capital clusters in the country as well as more state funding for startups and biotechnology, has pulled many promising startups out of RI.

Slater hopes that adding private capital will allow them to raise their maximum investment from $500,000 to $1 million, thereby increasing the incentive for companies to stay in state.