Stetson University's Hatter Angel Network — which teaches students how to be angel investors — wants to expand its program.
The program — where entrepreneurship students at the DeLand-based university pitch startups to a venture capital fund backed by Stetson alumni and faculty — typically has 15 to 16 students per academic year, but it is looking to grow "substantially," program co-founder William Andrews told Orlando Inno.
The college does not have a set number, but wants to increase the number of students who can take part in the hands-on program.
The fund recently invested $135,000 in New York-based biotechnology startup EVQLV, which uses artificial intelligence tied to the development of new drugs.
Why this matters: Venture capital helps startups scale to reach levels where they can produce revenue.
"We feel very fortunate to have Hatter Angels as part of the company and joining us on this journey," EVQLV co-founder and CEO Andrew Satz said in a prepared statement. "Their support will help us accelerate our growth and continue to drive innovation in drug development."
Meanwhile, Andrews — who co-founded the group with Dan Glunt and Milt Douglass — said the fund has made four investments totaling $655,000 since it started in the fall of 2021. The fund typically targets early stage funding or as part of a Series A offering, usually makes an investment of between $125,000 to $250,000 on average and is not tied down to a certain sector of startups.
The alumni-backed fund helped the program provide students with hands-on experience with companies, as many would not talk with them without the funding opportunity at first.
Andrews said one perk of the program is the companies the fund invests in often allow for a student board observer, which allows the student to sit in and see the drama and excitement of a rapidly growing company. In addition, when students attend the Florida Venture Forum pitch competition, they often learn fast how to ask the tough questions to vet companies.
“It’s really great to watch and see how the students step into that role. At first they’re usually a bit ambivalent, but before long, they are asking tough questions like, ‘So, how does your product differ from what’s already out there?’ or ‘You have a burn rate of x, and we see you have a cash runway of eight months, so what’s your plan to make sure you stay solvent?’ ”
Students take their research to the alumni to consider investments. Andrews said there are about 25 to 30 similar programs in the nation, but many are affiliated directly with a university versus the alumni structure of Stetson's program. Having the program tied to Stetson alumni and faculty limits the university's liability, said Andrews.
Meanwhile, PitchBook and the National Venture Capital Association found that estimated venture activity in the U.S. for 2022 was at $238.3 billion, down from $344.7 billion in 2021 but up from $171.2 billion in 2020.
"On an annual basis, deal activity in the angel and seed stages remained relatively resilient in 2022, with $21.0 billion invested across an estimated 7,261 deals," the report stated. "However, the four consecutive quarters of declining deal counts could foreshadow a continued slide in 2023."
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