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Tulane University’s Innovation Institute will launch a $10 million startup fund for women and minority entrepreneurs. It is intended for groups that have historically faced barriers in accessing funding to start a business.
The Tulane Ventures fund, built from $5 million in federal funding matching $5 million from Tulane, is the university’s latest move to boost innovation in New Orleans.
Applications for funding are expected to open early in the New Year. The seed round will have up to $200,000 available per applicant and will be invested over five years.
Kimberly Gramm, Chief Innovation and Entrepreneurship Officer, David and Marion Mussafer, Tulane, said:
The funding was announced just before the Albert Lepage Entrepreneurship and Innovation Center at Tulane’s AB Freeman School of Business released its annual Greater New Orleans Startup Report.
The report’s findings reinforced the need for such new funds. After a slight increase in equity funding from angel investments, convertible bonds, and venture capital for women- and minority-founded companies in both the New Orleans area and nationally, the 2022 survey found funding reported a decrease in
federal subsidy
In December, Louisiana received $113 million from the American Rescue Plan’s State Small Business Credit Initiative (SSBCI), a federal program aimed at revitalizing small businesses.
SSBCI was first established in 2010 as a way for the federal government to help states assist small businesses that have credit but lack access to capital.
$113 million has been allocated to venture capital and seed money programs. Tulane received his $5 million stake.
The Tulane Ventures fund is intended to be self-sustaining, Graham said, and if the Treasury Department and Louisiana Economic Development Guidelines permit, the proceeds when companies are sold will help support more startups. returned to the fund to
While plans are still underway for what will come with participation, Gramm said he expects the Innovation Institute to provide programming and support for entrepreneurs. Portfolio companies also receive consulting, mentoring and guidance from the Innovation Institute’s network of resources.
The ultimate hope, she said, is for entrepreneurs to stay in New Orleans and reinvest their funds here.
required funds
According to the Startup Report, members of underrepresented groups who want to start a business have unequal access to capital.
“The 2022 report shows that access to equity investment in BIPOC (Black, Indigenous and People of Color) companies has declined across the board. This reflects national data showing that funding for
For example, 6% fewer companies with BIPOC founders than last year reportedly used venture capital funding, while companies with non-minority founders increased 11%. A similar decline was seen in his BIPOC founding companies, which reported using angel investments and convertible bonds.
“Nationally, these numbers are dire, but they’re still the majority of the population in our community,” Graham said.
The Startup Report also said that minority-founded firms still lag behind non-BIPOC-founded firms when it comes to traditional bank loans, though the gap has narrowed slightly since last year. .
Tulane, the center of NOLA entrepreneurship
With the addition of the Innovation Institute, launched in 2022, Tulane is poised to establish itself as a key communicator of entrepreneurship in the city of New Orleans.
Tulane’s first entrepreneurial fund, the Venture Fund, is “a big win for our community,” said Gramm.
“It’s like having your first baby,” she said. ”
Graham said Tulane’s leadership backing the fund underscores the university’s priority on innovation.
“They are like flags to help the wider community understand the impact that science and innovation can have on working hand in hand to help people, not just the community within the university. “It’s about creating opportunities for intergenerational wealth,” she said. “When our leaders say they want to support and nurture such an environment, that’s a big deal.”
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