Investing Opportunities

 


Funding New University Spinouts

Basic research often takes years, leading up to the "aha" moment when it's obvious that the discovery can have practical value. However, bringing a new product to market can be expensive. Just when the IP shows value, commercializing it is beyond the scope of basic research funding grants. This is called "The Valley of Death." The research is beyond grants but short of showing investment value to Venture Capitalists. 
 

Catch 22!

Most Iowa State grants (I6 and Demonstration) and Federal grants (SBIR) are available to early stage ventures to fill this gap. These funds require a 1:1 or 1:2 match, which is often difficult to find at these early stages. Private investors can play a significant role at this stage where a small investment can be multiplied by 2-3x. While these ventures are high risk, the return to the university, the community and society can be immeasurable. 

The University of Iowa Research Foundation and the State of Iowa are attempting to also fill the gap with non-matching commercializtion awards, but these funds fall short of what is needed for the most promising opportunities.

Where can you help?

Seed stage ventures are in critical need of funding in eastern Iowa.  Seed funds are most often "non-profit" because there is high risk at this early stage of company formation and development. On the other hand, seed funding of $5,000 to $50,000 can go a long way in proving the technology, building out the business model, and preparing these startups to attract long term capital. For more information, contact UIRF.

Individual angel funding (private investing) and angel networks are the next source of cpatial for starups. UIRF can connect you with angel groups in the midwest. For more information, contact UIRF.  

Interested in Funding New University Spinouts?
Funding Type Stage Need
GAP (Proof-of-concept) Pre-venture Most university and hospital related research needs to be translated into an investable product. These non-profit investments are used to develop the IP beyond basic research grants generating data and/or prototype devices, or software. No ROI should be expected at this stage.
Seed          Venture Formation It takes money to start a venture, even with sweat equity. Seed investment allows the founders to form the company, generate a solid business plan, financials, continue development, and search for additional funding. For medical devices and drugs, prepartion for FDA approval begins.
Angel        Beta / rollout Angels often co-invest with earlier seed or later venture capital investors to build the company organization, capturing the first clients, and preparing for growth. For medical devices and drugs, FDA submission can attract large strategic partners and licensing opportunities.