The University of Wollongong has launched a $10 million seed fund for start-ups which join its new iAccelerate business incubator.
First launched in 2014, the fund will be managed by Artesian Venture Partners. The university has contributed $2 million to the fund and the other $8 million comes from investors. The iAccelerate business incubator is open to investment in companies taking part in the university’s iAccelerate programs. Start-ups accepted by the incubator in its current round of applications will be eligible to apply for capital from the fund.
iAccelerate is built around a robust educational program, which provides formalized business acceleration monitoring and one-to-one mentoring. It also offers innovating businesses the unique opportunity to partner with a university comprising over 30,000 students, 2,000 staff members, and a significant portfolio of faculties and business units.
The university of Wollongong generates over $2 billion in economic activity each year and it utilizes a multi-faceted approach to accelerating sustainable business growth to deliver the greatest economic impact. The University offers a two stream program with up to a three-year incubation period, which is unique to the Australian startup landscape.
The seed fund will have rights to participate in further follow-on rounds of investment in companies which come through the process which is successful. The fund is expected to run for four to five years.
All of the start-ups will be able to use space in the iAccelerate building at subsidized rents. Start-ups do not have to be linked to the university to participate in the program.
Omar Khalifa, CEO of iAccelerate, said the fund will look to help commercialize research and innovative ideas and encourage entrepreneurs to pursue their ideas. He adds,
Without access to early-stage funding, many people are reluctant to identify as entrepreneurs because they feel they don’t have the financial means or it’s too great a personal risk. Knowing this funding is available, along with the suite of support and mentoring programs we have at iAccelerate, will be the catalyst to grow a unique innovation ecosystem across the Illawarra district.
Professor Paul Wellings, the vice-chancellor of the university, said the seed fund its key to the University’s goal of delivering economic diversity and sustainability in the Illawarra; traditionally based around mining and heavy manufacturing, the Illawarra is facing the transition to the digital economy. He said,
Entrepreneurs choosing to come to Wollongong have the benefits of partnering with a world-class, research-intensive university and the opportunity to recruit high-quality graduates from the university. Now they also have access to critical early-stage funding.
iAccelerate runs two programs, Start and Advance. Focused at those with ideas or early stage businesses, Start is an incubator program looking to help entrepreneurs in validating their business idea, connecting them with mentoring and professional services. On the other hand, Advance is focused on accelerating businesses into high-growth companies. Khalifa said,
For existing start-ups, the funding will allow them to continue their growth trajectory to a point where they are as a size and scale that makes them attractive to institutional investors.
Since its 2012 commencement, iAccelerate has backed 65 companies and created over 200 jobs, but this is the first time the center has offered to back its participating companies with a seed fund.