Two top leaders in Maryland’s Technology Development Corporation have resigned, the CEO informed employees on Tuesday.
Andy Jones, chief investment officer at TEDCO and the managing director of the Maryland Venture Fund, and Parag Sheth, director and chief marketing officer of the Maryland Venture Fund, will both be leaving TEDCO effective June 7, according to the message.
An email from CEO George M. Davis said he would be working with Jones over the next few weeks to ensure a smooth transition.
TEDCO, and the Maryland Venture Fund specifically, have been under fire since winter after a damning audit and inquiries from lawmakers into the agency’s investment practices.
The audit concluded that that there were significant problems with the Maryland Venture Fund, the largest of more than a dozen programs operated by TEDCO; as of last June 30, $102 million of TEDCO’s $114.7 million net position related to the venture fund.
Among the issues cited were reliance by the TEDCO board on advice from an ad hoc three-member investment advisory committee not established in state law or regulation. Two of the three members were associated with venture firms that had previously received $21 million in commitments through the fund. The audit also found that TEDCO investments were made to companies not based in the state of Maryland at the time of the investment or following the investment, and that investments in third-party venture firms weren’t being passed on to Maryland start-up or tech companies.
“TEDCO is an incredibly important agency for economic development in Maryland’s technology sector. These departures offer an opportunity for a fresh start within the parameters of the new law,” said Sen. Cheryl C. Kagan (D-Montgomery), the lead Senate sponsor on a bill passed last session designed to bring more transparency to the agency starting June 1.
The bill increases oversight on investments by reinstating Venture Fund Authority, clarifies that board members may not have financial conflicts and increases reporting requirements, including on investments made and compensation of TEDCO employees.
In response to emailed questions from Maryland Matters, Davis said Jones and Sheth were resigning to pursue other opportunities.
“We appreciate their collective service to TEDCO,” Davis wrote.
The corporation is in the process of searching for a new venture fund director and in the interim, Davis said he will assume the position.
TEDCO and Maryland state government officials are expected to meet soon to discuss succession plans within the corporation.