For startup companies strapped for funds, making it to product launch can take a long time. Most get there in three to five years, but for others it can take longer, even a decade.
The University of Minnesota’s new Discovery Capital Investment Program will help accelerate the process of turning breakthrough research into a commercially available product by providing startups the seed funding needed in the highly critical early stages. The program, part of the Office for Technology Commercialization, will invest up to $350,000 in qualifying startup companies formed from university technology that are currently developing their product or service. The amount must be matched by an equal or greater investment from an outside investor and approved by the U’s Discovery Capital board of advisers.
“We’re excited to launch this first-of-its-kind program in response to a shifting startup environment where seed-stage funding plays a growing role,” said Brian Herman, the U’s vice president for research. “The Discovery Capital Investment Program shows the U is committed not only to advancing knowledge and transforming the resulting breakthroughs into real-world improvements, but also to supporting entrepreneurship for the benefit of our community and Minnesota as a whole.”
Companies interested in receiving funds must submit a business plan and an investor presentation outlining the fundamentals of the business opportunity. The university will choose eligible companies for funding based on the university’s potential return on investment, its interest in commercializing technology developed through federally funded research and its desire to keep faculty involved with early-stage companies.
“Discovery Capital gives our office another way to accomplish its goal of accelerating the transfer of technology to market,” said Jay Schrankler, executive director of OTC. “By kick-starting new companies and providing industry another opportunity to interact with and support the commercialization of innovative technology, this program expands the reach of the U’s world-class research and creates new possibilities for future startups.”
To be eligible for the Discovery Capital Investment Program, a startup must have a license agreement from the U valid for the same field of use it indicates when submitting a business plan for the funding. Companies that have previously received equity capital from other outside investors will not be considered.
The U expects to receive applications in six areas:
- Energy and the environment
- Engineering and the physical sciences
- Food and agriculture
- Medical devices
- Pharmaceuticals
- Software and related services
Startups interested in applying for the funding should contact their representative with OTC’s Venture Center.