On October 15, 2015, Michael Wiley, Vice President of Foundation Venture Capital Group (FVCG) an affiliate of the New Jersey Health Foundation, spoke at the Commercialization Center for Innovative Technologies (CCIT) as part of the “Meet with Money” series. He delivered a talk on impact investing: funding that values both the social impact the venture may have and the financial return it provides to the investor.
FVCG’s portfolio of healthcare companies—currently comprised of therapeutics and medical device startups—are part of what FVCG considers its “evergreen” fund. Wiley explained that, “As opposed to a traditional venture capital fund which usually has a stated duration… in our case it’s evergreen in concept. We intend to continue doing this. We want to get returns on our investments so that we can make more investments and help more entrepreneurs and more companies, while at the same time meeting the mission of our affiliate, New Jersey Health Foundation.”
Among the portfolio companies that potentially have a significant social impact is Actinobac Biomed, a biopharmaceutical company working to develop treatments for ailments such as blood cancers and HIV. Actinobac Biomed uses a protein called Leukothera ®, which is a natural biologic agent that specifically targets and depletes disease related white blood cells. Novopedics, another FVCG portfolio company, is developing an implantable medical device that restores mobility to patients suffering from severe meniscal knee injuries.
FVCG provides their portfolio companies with a range of support services, in addition to investments. All members of FVCG’s team are involved in support activities such as accounting, finance, public relations etc. These services relieve startups of multiple responsibilities, leaving more time and resources available for them to focus on other research, development and commercialization activities.
Wiley explained FVCG’s thinking behind their services, “We don’t expect our founders to be experts in every aspect of starting and running an early-stage company. They certainly have and will continue to pick up some of those skills. But our model allows them to focus on the things that they already do well, which is the science that attracted us to the opportunity in the first place.”
FVCG’s network of contacts and resources are also beneficial to their portfolio companies. “We leverage our relationships with outside partners and consultants to augment our team and the founding team to provide support as the company is growing and gaining more internal capacity and capability,” Wiley stated.
Affiliate partners include Kessler Foundation, Princeton University, Rowan University, Rutgers University and Stevens Institute of Technology.
New Jersey Health Foundation has established three funding programs. Its Annual Grants program provides funding with grants up to $35,000 each for research project that demonstrate exciting potential. Over the years, NJHF has given over $54 million to support this program. The second program is the Innovation Funding Program; which grants between $10,000- $50,000 to each promising researcher that receives an award. The third program is Foundation Venture Capital Group, which provides companies with up to $500,000 as vital pre-seed funding and with professional help so that founders can concentrate on advancing their research.
Perhaps most noteworthy about FVCG is their investments in startups at an early point in development—pre-seed funding–something that venture capital firms rarely do. “We provide the seed investment that we feel is not readily available in today’s market. We don’t see very many people getting in at this early a stage. We are literally meeting with prospects in the laboratory and directly assisting in moving promising science and technology from the laboratory to the marketplace where in a healthcare setting it can have direct impact in improving people’s lives,” Wiley stated.
As a mission oriented venture fund, FVCG continues to look for healthcare startup opportunities within its affiliate partner network that have the potential of achieving medical and healthcare breakthroughs through innovative research.
