Finding funding is one of the hardest things for first-time entrepreneurs at any stage of life. But doing it while you're in college and before you've made a lot of connections in the startup ecosystem is even harder.
Now, student founders at The University of Texas in Austin have a new opportunity to get a little funding to start a business and, perhaps more importantly, to connect with UT alumni who have built successful companies or have helpful insights and strong professional networks.
The Genesis Fund, which is part of the Genesis Program launched on campus in 2016, is raising its second batch of money to support student startups. And, in the first few days of its crowdfunding campaign, Genesis says the fund has generated more than $1 million in contributions. The group set an initial target of $1.2 million, and its crowdfunding campaign on UT's HornRaiser will run for about 30 more days.
Two years ago, @utgenesis was announced at LSL Demo Day. Today they have raised over $1 million in funding for student startups. ?? pic.twitter.com/3ACI1Fs43D
— Longhorn Startup (@LonghornStartup) May 4, 2018
While UT has several organizations that assist startups, the Genesis Fund is unique in that it operates similar to a venture capital fund while keeping students involved. Student partners conduct due diligence on the startup they meet with, access risks and decide which companies to back. It's different than venture capital in that the money they invest comes with no strings attached -- the startups don't have to give up a share of their company and the Genesis Fund focuses on philanthropic-based returns by building an entrepreneurial culture on campus and helping the startups they fund succeed.
“A lot of time investors are looking for some traction and some success," Jacob Cordova, co-founder and managing partner at Genesis, told me. "And college students often don’t have access to capital like that.”
Students from any part of UT at any age or stage of their course work can apply for funding.
With its first fund, Genesis invested in 16 companies working on a variety of innovations in artificial intelligence, prosthetics, consumer packaged goods, biotechnology and more. Cordova declined to say how much Genesis typically invests with student startups.
It's unclear how large the second fund may get. In its early days on HornRaiser, it received three $50,000 checks from well-known Austin tech leaders. One came from Capital Factory founder Joshua Baer and his wife, Amy. Another came from Hurt Family Investments, which was created by data.world founder Brett Hurt. A third came from Offers.com founder Steve Schaffer. Cordova said several other major donors asked not to be named.
While the new money fills a void for many student founders, Cordova said one of the most valuable parts of Genesis is how it connects students with alumni who can help unlock the networks, seed funding and expertise needed to scale a startup.
“It’s not just a source of funding for student startups," he said. "It’s an experiential learning platform."
