MSU Foundation launches venture fund
A new $5 million venture investing subsidiary of the Michigan State University Foundation called Red Cedar Ventures will help MSU-based business startups and technologies overcome early funding gaps, accelerate growth and provide growth-stage capital.
“We have been working hard to put together a campus-wide ecosystem for entrepreneurs that embraces all of the creative talents across the university,” MSU President Lou Anna K. Simon said. “The creation of these programs addresses a critical capital gap for our own startup companies. Through Red Cedar Ventures, we can make sure the groundbreaking ideas created by Spartans reach those who need them most.”
In the past four years, the MSU foundation has deployed more than $2 million in pre-seed funding to more than 20 companies. Red Cedar Ventures will continue this kind of pre-seed investment. Additionally, the Red Cedar Opportunity Fund allocates $5 million to participate in select, follow-on investment rounds that are led by professional venture firms.
“Many of our Michigan State University startups are working on breakthrough ideas and solutions that could greatly benefit the public,” said Randolph Cowen, chair of the foundation’s Board of Directors. “However, because early-stage private investment capital is not broadly available in East Lansing, these ideas struggle to get translated into commercial success.”
Both Red Cedar Ventures Pre-Seed and Opportunity funds will be overseen by a board of directors composed of members from the foundation’s own board. The foundation’s executive management team will oversee the day-to-day fund operations. An advisory board will be established and will draw on the expertise of leading venture capitalists from across the nation, as well as student venture analysts from MSU’s Broad College of Business.
“The Greater Lansing area is fast becoming an attractive place for inventors and entrepreneurs to start and grow their businesses,” said David Washburn, the foundation’s executive director. “Red Cedar Ventures signals the foundation’s ongoing commitment to the health and growth of our area’s entrepreneurial ecosystem.”