University of Illinois Venture Capital Fund Set to Invest

A new private venture capital fund affiliated with the University of Illinois is open for business.

The Illinois Emerging Technologies Fund closed its first round of financing late last month with $12 million to invest in high-tech start-up companies.

By:
Paul Merrion
Crain’s Chicago Business

http://www.nasvf.org/web/allpress.nsf/pages/8483

"We’re actively investing now," says John Banta, CEO and managing director of the fund’s manager, IllinoisVentures LLC, which has offices in Chicago and Champaign. The fund is negotiating the terms of its first investments, Mr. Banta says, but he wouldn’t disclose the companies.

Backed by U of I alumni, other individuals and in situations, the fund surpassed its initial goal of at least $10 million and expects to raise another $8 million within a few months, notes Mr. Banta.

Fund manager IllinoisVentures was created five years ago to help U of I researchers start companies, and is part of the university’s mission to create jobs by finding commercial applications for academic research. In addition to consulting, IllinoisVentures makes seed-stage investments of up to $175,000 in the form of debt that can be converted to equity. The firm is funded by the university and the state of Illinois.

The Illinois Emerging Technologies Fund was created to help later-stage startups get their first major venture capital investment.

"I wouldn’t characterize (the $12 million) as groundbreaking, but I would characterize it as a fairly aggressive effort," especially for a public university, says Dan Berglund, president and CEO of the State Science and Technology Institute, a non-profit resources center in Columbus, Ohio, for technology-based economic development groups.

IllinoisVentures will have a pipeline into deals generated on the university’s Chicago and Downstate campuses, but the Illinois Emerging Technologies Fund won’t be limited to university spinoffs or Illinois companies.