The first investment from Rev1 Ventures' latest pre-seed investment fund demonstrates that maturing Columbus tech companies are budding off new entrepreneurs.
Redi.Health Inc. – founded in July by managerial employees who left CoverMyMeds and Beam Technologies Inc. – turned to Rev1 first for connections to professional services and office space. Now the nonprofit's Future Value Fund I has joined an undisclosed investment led by Cleveland-based Mutual Capital Partners.
CoverMyMeds, Beam vets found startup taking on chronic disease management
The startup's three co-founders are building anew after being part of skyrocketing growth. Parent McKesson Corp. merged four tech units under the CoverMyMeds brand this spring, four years after acquiring it for $1.44 billion. Digital dental insurer Beam in March raised $80 million – doubling its outside investment raised over nine years – and grew to 250 employees.
"We have successful companies and have successful exits and have the creation of wealth," Rev1 CEO Tom Walker said.
"These companies are creating a great entrepreneurial culture," he said. "You’re going to see those who have that taste of success come up with new ideas and want to do it all over again, right here."
Rev1 had launched the $10 million fund in March, along with Ohio State University matching $5 million from Ohio Third Frontier.
Central Ohio's largest investment fund to date for startups at their earliest stage is expected to fuel up as many as 15 startups to fill a crucial capital gap, Walker said.
A record $632 million venture capital was invested Central Ohio technology companies in 2020, according to Rev1 analysis of data that's not all publicly available. But three-quarters of that was concentrated in 13 of 53 transactions.
That record has been left in the dust already this year. To date, seven companies in the Drive Capital portfolio alone have raised more than $900 million.
But all those businesses had to start with an idea.
"Our mission here in Columbus is to help grow new tech companies and we start at the earliest stage," Walker said. "That’s money that entrepreneurs have a very difficult time finding – there’s usually not a lot of organized funds around at that stage."
Founded during the pandemic, the seven-member Redi team works remotely but has space at Rev1, 1275 Kinnear Road. The startup also has used Rev1's network of mentors, attorneys, marketers and other professionals.
"One of the difficult things when you're starting from scratch is understanding what service providers are going to do the best job for you," Redi co-founder and CEO Luke Buchanan said. "Rev1 has done a lot of that legwork."
