The startup grind. It’s known for sleepless nights, skipped meals and lean financial times, to say the least.
By contrast, a new venture fund that’s focused on underrepresented founders in former Rust Belt areas including Western New York is taking a human-centered approach to investing. Bold Ventures is built on the idea that at the heart of every great investment, company or idea are real people who need to be taken care of mentally, emotionally and physically in order for the venture to thrive.
“Our approach is not just good for people and the right thing to do,” said Lindsay Karas Stencel, co-founder. “It happens to be good for business.”
The fund, a blend of private and public funding, launched earlier this year and has since made two investments in Cincinnati companies and one in the Hudson Valley area. In addition to the health, underrepresented founder and geographic focuses, Bold Ventures typically makes investments from seed rounds through Series A rounds in industries that are trying to solve “big world problems.” That includes agriculture tech, supply chain and logistics, fintech and clean tech.
Initial investments average around $250,000, but the fund reserves capital for follow-on investments.
Along with co-founder Karas Stencel, who is based in Columbus but travels to Buffalo frequently, the fund’s partners include Danielle Blount, Alex Killian and Scott Terhaar, all based in Western New York.
After the team came together, wanting to bring a human-centered approach to investing, they first launched in 2020 a nonprofit called Bolder, which provides non-diluted capital resources for startups’ mental, emotional and physical health. The nonprofit works with companies beyond just Bold Ventures portfolio businesses.
“The VC market is very grind-until-you-can’t-see-straight-anymore and if you fall apart and get brushed in the process, most oftentimes the firms just find a new CEO or team and replace those people and move on,” Karas Stencel said. “It’s capitalization at its worst, traditionally.”
The team researched S&P 500 companies that implemented wellness programs and found they outperformed the market by about 22%, she added.
There have been venture funds that have aimed to focus on wellness using different methods, but typically the math doesn’t leave many resources dedicated to health, according to Karas Stencel.
“That’s why we created a nonprofit first and then launched into the for-profit side,” she said. “I think it’s important to talk about that.”
Bold Ventures’ deal evaluation process in many ways mirrors that of a traditional venture fund. However, there’s an added layer of talking with startups’ team members to better understand where the companies stand when it comes to overall health. The fund focuses on wellness not just for founders but for the whole startups’ teams.
“If the whole team isn’t functioning at its best, you’re only as good as your weakest link,” Karas Stencel said.
The fund has a multi-state Small Business Credit initiative strategy and is currently working through that application process for New York state.
Bold Ventures expects to have a Western New York investment by the first quarter of 2024. The area is an attractive region for the fund because of its growing startup ecosystem and it’s convenient location in regards to Canada and the New York City area.
“For us, we think about not just Western New York but our footprint as a super region" for scaling companies, said Blount. “Western New York is a good anchor point for it and the tech and talent that comes out of here."
