University System of Maryland Launches $25 Million Fund to Back Start-Up Companies Formed from Campus Research
The University System of Maryland (USM), has launched its own $25 million early-stage investment fund, called the Maryland Momentum Fund. USM Vice Chancellor J. Thomas Sadowski stated in the system’s press release that the new Maryland Momentum Fund will “…help our entrepreneurs address funding gaps, gain access to other sources of investment capital and gain marketplace footing, further enhancing the system’s high impact on the Maryland economy.” Sadowski also stated, “The endeavor to build on USM’s success in new company creation brings more national prestige to the system.”
The press release goes on to explain the objectives and requirements for the fund:
The fund has a $10 million commitment from the USM in place, and the system is collaborating with UM Ventures and the University of Maryland, Baltimore County (UMBC) to reach out to area venture capitalists and angel investors for an additional $15 million. UM Ventures is a joint initiative of the University of Maryland, Baltimore (UMB) and University of Maryland, College Park (UMCP) to commercialize technologies and expand industry collaboration.
As it approaches the $25 million level, the Maryland Momentum Fund will leverage this financial support to achieve several objectives:
- Accelerate the success and profitability of USM start-ups
- Attract promising entrepreneurs and innovators to USM institutions
- Seize the opportunity to commercialize valuable USM intellectual property
- Develop long-term financial returns that can be reinvested in future start-ups affiliated with the USM
Eligible companies must be in Maryland. Eligible companies must also be based on USM-owned intellectual property; founded by USM faculty, students, or alumni; or in USM incubators, research parks, or RISE Zones.
Individual investments will range from $50,000 to $500,000 per company. Select investments will require at least a one-to-one match by outside investors.
An external investment board, comprised of successful investors, will set policies, make investment recommendations, and refer potential opportunities. The external investment board will consist of six-to-eight leaders from the private sector, including venture capitalists.
The USM accelerated its efforts in technology commercialization during fiscal year (FY) 2014, when the USM Board of Regents approved the Policy on Investments and Loans to Maryland‐based Businesses that License University Intellectual Property (Policy No: VIII – 14.00). The policy helped establish investments and loans totaling $400,000 in five start-ups during FY 2015 from UM Ventures.