The Accelerate Blue Fund, which will provide early-stage investment capital for U-M startup companies, has raised $1.5M of its “first close” goal of $2M thanks to the generous donations of its Founders Circle Members and Supporters. Accelerate Blue has a target size of $20 million, which will be raised through philanthropy but The Fund will begin considering investments in U-M startup companies when it reaches its first close goal. The University of Michigan is actively seeking donors for the Accelerate Blue Fund.
The University of Michigan is the nation’s largest public research university and an engine for creativity, discovery and innovation with more than $1.6 billion in research expenditures each year. This expansive research enterprise results in over 500 new inventions per year, generating 150+ issued U.S. patents and leading to the launch of 20+ startup companies annually. The Office of Technology Transfer provides intellectual property development, licensing support and operates a Venture Center to assist U-M startup companies working to commercialize U-M’s research discoveries. As a result of these combined strengths, an impressive number of U-M startups have succeeded in the marketplace. A few U-M startups of note in the tech sector include Arbor Networks, Crossbar, May Mobility, and Ambiq Micro.
There is a significant mismatch between the intellectual capital created by the University of Michigan’s expansive research enterprise and the investment capital available within the state. Data from the Michigan Venture Capital Association (MVCA) shows Michigan has the largest gap in the nation regarding the ratio between available in-state investment capital (low) and research expenditures (very high). Many high potential U-M startups face a daunting challenge in raising the necessary early-stage capital needed to succeed due to the lack of local risk-tolerant seed capital. Pitchbook data shows that startups based in the Midwest take nearly 2 years longer to secure their first $500,000 of investment capital compared to similar companies on the coasts. This lack of capital in Michigan slows the achievement of key business milestones and hinders startups’ ability to attract quality business leadership, often forcing companies to move out of state. When these companies leave the state, Michigan misses out on the potential they possess to grow and fuel the region.
Addressing the challenges outlined above and strengthening the innovation commercialization ecosystem were driving forces behind the University of Michigan launching the Accelerate Blue Fund. The Fund will be managed out of the Office of Technology Tranfer’s Venture Center.
The Venture Center team has significant entrepreneurial and investment experience across many industry sectors, with deep ties to investment and entrepreneurial communities. The team has real-world experience in starting companies, investing in startup companies, and growing companies to realized exits.
The Venture Center works closely with the Tech Transfer Licensing team and the inventors from a very early stage to help develop the best commercialization path for new discoveries. The Venture Center’s team also works to recruit and mentor the startup founding team. This work is equivalent to conducting years of due diligence, long before a startup is launched and well before an investment from the Accelerate Blue Fund would be considered.
The Founders Circle
Accelerate Blue seeks to have a first close of $2M by the end of 2020. Supporters that make a significant financial commitment to the Fund’s first close will be invited to join the Founders Circle. Founders Circle members will be included in networking events to meet with portfolio company teams and University leadership. Founders Circle members will have early visibility to a curated portfolio of promising startup companies emerging from the innovation ecosystem at the nation’s largest public research university. Current Founders Circle members are listed below:
For more information on how you can support Accelerate Blue, please contact:
- Kelly Sexton, Ph.D. – Associate Vice President for Technology Transfer and Innovation Partnerships
- Michael Psarouthakis, MBA, MS – Director of the Technology Transfer Venture Center, Managing Director of the Accelerate Blue Fund
- David Thompson, JD, LLM, MA – Director of Major Gifts, Office of University Development