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Future Arizona high-tech startups may get a boost from new sources of venture-capital money.

Last month, the Arizona Economic Resource Organization, or AERO, received state money to establish an Arizona "fund of funds," a program that raises investment capital from investors and reinvests those funds in several professional venture funds.

Investors and tech-growth advocates say the state needs "seed money" to help burgeoning startup companies, including from university-affiliated tech transfers.

"The impetus for all this is the recognition that Arizona is blessed with some very cutting-edge technologies, emanating in large measure from the university system," said Larry Hecker, a Tucson attorney active in local economic-development efforts and an AERO board member.

"There is tremendous potential for commercialization, and it translates into jobs and a stronger economy," he said.

Hecker co-chaired the non-profit AERO committee to search for venture funding with Bill Hardin, an attorney with Osborn Maledon in Phoenix.

AERO will serve as the catalyst in establishing an Arizona "fund of funds" to increase the size of the venture capital industry in Arizona during a two-year period, organizers said. Recently, the Commerce and Economic Development Commission gave AERO $325,000 to stimulate the formation of the fund.

About 40 other states have a fund of funds, Hecker said, but not Arizona — until now.

To qualify for an investment from the fund of funds program, each target venture fund must satisfy certain criteria, including a requirement that projects invested must be headquartered in Arizona or have a main office here.

Participating funds must agree to match the initial monies on a three-to-one basis. AERO's goal is to establish a $50 million fund of funds, which will be managed to attract overall investment of at least $200 million "to commercialize Arizona innovations."