An anonymous donor’s transformational contribution will support impactful innovation and startups that result from the work of university faculty, staff and students.
An anonymous donor has made a $1 million gift to the Wildcat Philanthropic Seed Fund – an early-stage fund designed to help fund University of Arizona startups launched to commercialize ideas and innovations stemming from the work of university faculty, staff and students.
The Wildcat Philanthropic Seed Fund is designed to establish an evergreen funding source to help young companies get through the “valley of death,” the period of time soon after a new venture begins when the risk of failure is high due to lack of early-stage financial support. Contributions to the Wildcat Philanthropic Seed Fund are tax deductible, and proceeds from positive events such as acquisitions will be reinvested to grow the fund for future investments.
The fund also will provide hands-on investing experience for students.
The fund was spearheaded by – and will be administered by – Tech Launch Arizona, the office of the university that works with faculty, staff and students to commercialize inventions stemming from their research and innovation.
“The University of Arizona is committed to leading the innovation ecosystem in Southern Arizona by fueling discoveries and inventions, commercializing intellectual property and fostering entrepreneurship,” said University of Arizona President Robert C. Robbins. “Access to capital is often one of the biggest hurdles to commercializing the inventions of our researchers and students, and the Wildcat Philanthropic Seed Fund provides a new resource to bridge that gap between launch and revenue generation.”
“Research and innovation are the cornerstones of the University of Arizona,” said Elliott Cheu, interim senior vice president of research and innovation and associate vice president for University Research Institutes. “This fund not only represents another resource to bring those innovations to bear for the public good, but also serves as a unique opportunity for our students to actively engage with startups, participate in funding decisions, and develop an entrepreneurial spirit.”
Doug Hockstad, associate vice president for TLA, said the goal will be to reach $2 million before making any investments. The ultimate objective, he said, is to grow it to $5 million.
“Our target is to be able to make investments ranging from about $25,000 to $250,000,” Hockstad said. “Along with investments, a key feature of the Wildcat Philanthropic Seed Fund will be to involve students helping with due diligence and investment decisions. They’ll have a seat at the table, and through the experience we hope to plant the seeds that will inspire them toward impactful entrepreneurship in the future.”
As a philanthropic fund, the seed fund works differently from traditional venture capital investment funds. Donors interested in strengthening the innovation ecosystem, helping create societal impact from innovations developed at UArizona and supporting student experiential opportunities will be able to make gifts to the fund through the University of Arizona Foundation, and the foundation will hold any equity resulting from fund investments. Proceeds resulting from successes, such as when startups are acquired or go through an initial public offering, will go back into the fund for future investments.
The anonymous donor holds a passion for innovation and entrepreneurship, as well as student engagement opportunities at UArizona.
“Outside of a few resources like the Desert Angels and UAVenture Capital, the investment capital available to advance our local startup community is relatively slim,” the donor said. “I’m excited by this program’s engagement of students in the investment world, as well as the potential the fund has for infusing this ecosystem with new and exciting innovations. I hope this contribution helps seed the ground for further growth of these kinds of resources to help our newest and most innovative Wildcat inventors and entrepreneurs to go out there and make their mark on the world.”
By Paul Tumarkin, Tech Launch Arizona