Urban Innovation Fund, a San Francisco-based venture capital firm investing in "the future of cities," has opened an office in Minneapolis, becoming the latest fund from the coasts to establish a presence in the heartland.
"We didn't want to just shape Silicon Valley," said Andrew Felbinger, a Minneapolis-based associate with Urban Innovation Fund. "Our goal is to impact urban dwellers around the world."
Urban Innovation Fund provides seed capital and regulatory support to startups solving challenges faced by city dwellers everywhere. The firm has already backed 14 companies. The fund's portfolio includes a broad range of companies creating everything from a logistics platform for local farmers to a breast milk shipping service for traveling, breastfeeding mothers.
Urban Innovation Fund was founded by Julie Lein and Clara Brenner, creators of the accelerator program Tumml. Established five years ago, Tumml aims to empower entrepreneurs solving urban problems such as transportation, housing, health and public safety. With the Urban Innovation Fund, Lein and Brenner are expanding this mission. In June, the firm announced that it had closed $22.5 million for its first fund.
Felbinger, who joined Urban Innovation Fund in September, told Minne Inno that the firm aims to invest anywhere from $100,000 to $500,000 in its startups.
"We don't want to be known as just another Silicon Valley fund. We want to get involved in the Twin Cities."
Urban Innovation Fund's arrival comes as the venture capital community increasingly sets its sights on Midwest startups. Steve Case's Rise of the Rest Fund aims to back non-coastal startups with its $150 million fund. Earlier this year, Rise of the Rest Partner Mary Grove arrived in Minneapolis, giving the national fund a local presence.
Columbus, Ohio-based Drive Capital is also backing startups in the center of the country. Drive was created by Mark Kvamme and Chris Olsen, formerly with Sequoia Parnters in Silicon Valley, and is investing $300 million in Midwest startups.
Last month, Comeback Capital, a fund led by Scott Shane, an angel investor and professor at Case Western University in Akron, Ohio, announced that it has closed on a $2.25 million fund to invest in startups outside the coasts.
Felbinger said that Urban Innovation Fund considered a number of Midwest cities before selecting Minneapolis as its regional home base.
"Minneapolis has been receiving much more outside interest, which I think is a testament to its growth, and how it's on a path to becoming a national player," he said. "We don't want to be known as just another Silicon Valley fund. We want to get involved in the Twin Cities."
