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FEATURE STORIES

Deutsche Bank Affiliate Commits $100 Million to Utah Fund of Funds

Capital availability is one of Utah's key initiatives for economic growth, and the state's venture capital investment program got a huge boost last week when the Utah Capital Investment Board (UCIB) announced Deutsche Bank AG affiliate, DBAH Capital LLC, is investing $100 million (the entire allocation) in the Utah Fund of Funds.

"This is a big win for the program to receive the entire $100 million from such a respected institution," says Jeremy Neilson, venture manager for the Utah Fund of Funds. "We have closed the fund and will now begin investing in venture capital firms that agree to work with Utah entrepreneurs."

Investment To Pave the Way for Increased Venture Capital Availability in Utah

The Legislature created the Fund of Funds to increase venture capital investment in Utah. Its main objective is to encourage the availability of venture capital in the state by helping to build a permanent source of capital to serve the needs of Utah's entrepreneurs. Neilson says Deutsche Bank's investment in the program is a great example of public and private partnering in order to achieve economic success. Fund of Funds monies do not have to be invested in Utah companies, but the venture capital firms that tap into the monies must agree to establish a working presence in Utah.

The legislation that created the Utah Fund of Funds requires that Fund monies be invested in private venture capital funds rather than direct investments in individual businesses. "This way, seasoned professionals can make prudent investment decisions," says Neilson. Cincinnati-based Fort Washington Capital Advisors, Inc. will manage the Fund of Funds, and is expected to open an office in Salt Lake City. Fort Washington has managed state-sponsored programs like Utah's Fund of Funds for the past five years.

Launched in January, the Fund is a state-sponsored private equity initiative financially supported by contingent tax credits. The tax credits will be used as a backstop to ensure Deutsche Bank's return on investment. "The objective is to repay Deutsche from the Fund's long-term performance over its 15-year life, and not to utilize the contingent tax credits," says Neilson.

In the course of obtaining the Deutsche Bank investment, the Utah Capital Investment Board (UCIB) established the investment product and the conditions upon which the contingent tax credit will accrue. Tax credits will only be used if the rate of return does not meet preset investment goals.

Neilson says the Utah Capital Investment Corporation (UCIC) will notice, likely on its website, the venture capital funds invested in. Furthermore, the UCIC will issue annual reports regarding investment performance. (Click here for more information about the UCIC.)

The fact that Deutsche is willing to fill the entire $100 million allocation is no surprise. Neilson said both the UCIB and the UCIC were confident they could find one institution interested in the entire amount.

Deutsche Bank is a leading provider of financial solutions and ranks among the global leaders in corporate banking and securities, transaction banking, asset management and private wealth management. The bank was recently awarded Bank of the Year, Bond House, Structured Finance House and Derivatives House for 2005 by International Financing Review magazine.

Deutsche Bank is a leader in Germany and Europe, and is continuously growing in North America, Asia and key emerging markets. With 992 billion (Euro) in assets and 63,427 employees, Deutsche Bank offers financial services in 73 countries throughout the world.

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Utah's 'Life Elevated' Brand Important to Economic Development

Seven and a half months ago, when officials from the Utah Office of Tourism began searching for a new brand, they wanted to create a feeling that summarized and reflected what Utah does best: "Put you on high ground and provide you with a new set of eyes." The search culminated last week with the launch of "Life Elevated," Utah's new brand. At the ceremony, Governor Jon M. Huntsman, Jr. described the brand as the embodiment of the heart and soul of the state by declaring, "Our quality of life and growing business environment are second to none."

"'Life Elevated' speaks to everything Utah has to offer," says Mike Deaver, deputy director of the Utah Office of Tourism. "The brand captures the essence and diversity of Utah."

The new branding platform describes it this way: "You come to Utah to see; you leave with new eyes. You see vistas like nowhere else on the planet. You see desert scapes that are haunting. You walk in the footsteps of ancient civilizations and follow paths cut by weather and the forces of nature. The result: your emotions are stirred, your senses are lifted. You soar. Your spirits rise. Your life is changed. You are elevated."

The Utah Office of Tourism, which is part of the Governor's Office of Economic Development (GOED), is using the new slogan, logo and other brand elements to market Utah to out-of-state visitors, including urban escapists, action travelers and families. Of the tourism office's $10 million budget, $400,000 has been invested to develop the new brand; $2 million will be spent on a Cooperative Marketing Program; $750,000 will go to the Utah Sports Commission; and the remainder will go toward ad creation and placement in various advertising mediums such as print, television, online promotions and other media opportunities. For the next year fiscal year, which begins July 1, $11 million has been appropriated for out-of-state tourism promotion.

Deaver says his office is currently conducting nationwide research on Utah brand awareness to give state tourism leaders a snapshot of perceptions visitors may have about the state in conjunction with the placement of a new advertising campaign. A similar survey will be conducted in the future to measure any increase in awareness of Utah as a world-class tourism destination.

Utah tourism is a $5 billion industry and an important element of economic development. Traveler spending in 2005 is estimated to have generated $433 million in state and local taxes, or about $494 per housing unit. "We take our jobs very seriously," Deaver says. "Tourism has an enormous impact on the state's economic vitality, especially in rural Utah where the economies of some counties are built entirely around tourism-with as much as 50 percent of the workforce employed in some form of the industry." According to Utah Office of Tourism estimates, about 10 percent (119,900) of Utah jobs are in or related to travel and tourism.

Tourism has other important influences on Utah economic development. Deaver says many visitors experience what Utah has to offer, fall in love with the state, and decide to locate here-some even bring their businesses and employees with them. Furthermore, one of the first interests expressed in Utah is from a lifestyle perspective. "Utah is known for its great outdoors, its fantastic skiing and its quality of life." When deciding to relocate, businesses want lower costs, but they also want quality of life.

The new brand was developed by W Communications in Salt Lake City, in partnership with Utah native Gordon Bowen of mcgarrybowen, an independent advertising agency in New York City. A well-attended branding tour took the Office of Tourism to 14 cities across Utah last fall. Residents also submitted their slogan ideas to the state online. Focus groups were also held in target U.S. markets and in London during the World Travel Market.

For more information about the Utah Office of Tourism, click here.

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