Entrepreneurs FAQ

Entrepreneurs FAQ

We’re here to serve our IU affiliated entrepreneurs.

Welcome IU affiliated entrepreneurs! We invite you to review our FAQ below. If you don’t see your question in the list, our team is available to answer any questions you might have for us.

FAQs for IU Affiliated Entrepreneurs / Companies

Our team is here to answer any question you may have about getting involved with IU Ventures.

How do I introduce my company to the IU Ventures team?

There are a few easy ways you can introduce your company to our team.  You can either reach out directly to a member of our team by going to the “Contact” section of the IU Ventures website or you can submit your information to us via a link on the “Entrepreneurs” section of our website.  Once we receive your request, a member of our team will reach out to you to learn more about your company and your interest in connecting with IU Ventures.

What IU affiliation is required by IU Ventures to be considered for investment?

Companies with a founder or a member of the C-Suite that is an IU alum, faculty, staff, student or parent. Also, companies based on technology licensed from Indiana University also meet the requirement for IU affiliation.

What documents should companies seeking investment from IU Ventures have prepared?

For initial meetings, companies should at minimum have a corporate overview presentation describing the market opportunity, the company’s solution, and the current team, as well as other information such as current and potential customers and partners, competitors, and any other information the company would deem appropriate. Financial projections would also be appropriate for an initial meeting. Subsequent meetings and due diligence, if any, will cover additional topics more in-depth, and could include product usage statistics (e.g., orders, shipments, subscribers, active users, downloads, website traffic, etc.), product development plans / roadmaps, pricing plans, detailed historical and projected financial statements, capitalization tables, hiring plans, partnership and licensing agreements, customer contracts, customer and prospective customer reports, marketing survey results, product ratings and reviews, intellectual property documentation, and other corporate documents.

Does IU Ventures sign non-disclosure or confidentiality agreements with companies it is considering for investment?

IU Ventures does not sign non-disclosure or confidentiality agreements. For investments considered by the IU Angel Network, company information is shared with members through an online platform. Members are expected to keep all information confidential and to use information only for purposes of making investment decisions. At later stages in the diligence process, individual members may be asked to sign an NDA directly with the company. These agreements will not include IU Ventures and the IU Angel Network as a party.

What is the IU Angel Network?

The IU Angel Network is a membership network of accredited individual investors with an IU affiliation. IU Angel Network members invest their own capital directly into IU-affiliated companies and their investment proceeds, if any, are returned directly to the member.

What is the IU Philanthropic Venture Fund?

The IU Philanthropic Venture Fund (IU PhV) consists of philanthropic contributions that are invested in high potential opportunities across the global IU community. The IU PhV may invest alongside the IU Angel Network in certain companies.  All proceeds of IU PhV investments are returned to the IU PhV for reinvestment. Indiana University has committed $11 million to start the fund.

What is the difference between the IU Angel Network and the IU Philanthropic Venture Fund?

The IU Angel Network is a membership network. Members must be accredited individual investors with an IU affiliation and pay an annual membership fee of $1,500. IU Angel Network members invest their own capital directly into IU-affiliated companies and their investment proceeds, if any, are returned directly to the member. The IU Philanthropic Venture Fund is a philanthropic fund that receives donations and invests those donations into companies that have been selected by its investment committee.  All proceeds of IU PhV investments are returned to the IU PhV for reinvestment. Indiana University has committed $11 million to start the IU Philanthropic Venture fund.

IU Angel Network Specific FAQs

What are the requirements to receive an investment from the IU Angel Network?

IU Angel Network members will have the opportunity to invest in IU-affiliated startups. Companies must meet the following criteria to be presented to the membership:

  • Have a founder or executive in the C-Suite who is a IU alum, faculty, staff, student, or parent;
  • Be raising seed or Series A equity capital of $300,000 to $3 million or syndicating later-stage equity financings with an existing institutional lead investor; and
  • Be located in the United States.

The IU Angel Network connects its members to companies seeking capital, which may have the potential for high growth and significant financial returns. When filtering opportunities for review by IU Angel Network members, the IU Angel Network operating team generally looks for the following attributes:

  • A large market opportunity;
  • A unique value proposition;
  • Proprietary technology, intellectual property, or other basis for sustained competitive advantages;
  • A dedicated management team;
  • A corporate structure that allows for equity investment at defined terms and conditions; and
  • A strategy and plan that has the potential to produce venture grade returns.

The IU Angel Network operating team does not provide investment recommendations. All investment decisions are made by individual members and all investments are made directly by members to companies. The team itself and/or through third-parties operates an information sharing platform and process designed to enable informed decision making in a timely manner.

What is the process for companies seeking investment with the IU Angel Network?

Companies initiate the process by completing an online application. Once the application is complete, the following process steps will be followed:

  • Initial Screening: The IU Angel Network will assess the company’s readiness for investment and fit with investor member preferences.
  • Posting: Successfully screened company information will be posted to an online collaboration platform that allows members to review company information and indicate any initial interest in the investment opportunity. If sufficient interest is generated from members, the company will be informed that the network would like to move into diligence.
  • Diligence: The IU Angel Network will form a diligence team with a diligence lead who will interact directly with the company to move through the diligence process as quickly and effectively as possible. This process will involve pitch sessions in person or remotely via video/teleconference.
  • Subscription: Results of the diligence process will be disseminated to all members, and interested members will subscribe to the investment opportunity directly with the company.
  • Transaction: The syndicate of interested members will work with the company to complete the investment transaction.

The IU Angel Network operating team will provide appropriate administrative support and resources at all stages of the process.

What role will IU Angel Network members play in the companies they invest in?

In addition to being shareholders in member invested companies, IU Angel Network’s members can provide support and guidance to such companies based on experience and expertise. This could include advice on business strategy and tactics, introductions to potential customers or partners, assistance with recruiting, and facilitation of future financing rounds or exits. When appropriate, members may be asked to serve on the board of directors of member invested companies. Members will not be required to serve on boards.

What value-add capabilities does the IU Angel Network bring to companies its members invest in?

In addition to the involvement of members with relevant experience and expertise, the IU Angel Network enables member invested companies to leverage the broader resources of the global IU community. This could include support from University faculty, project assistance from student internships, and targeted access to the University’s alumni and partner network. Most importantly, the operating team will actively match companies with expertise in the global IU network.

Are members committing capital to a fund? Is there a requirement that members invest in opportunities that other members have decided to invest in?

No. IU Angel Network members are not committing capital to a fund and are not required to invest in any deals. Individual members are free to either invest or not invest in any opportunity as they so choose. Although IU Ventures employees will not participate in investments presented to the IU Angel Network, the IU Philanthropic Venture Fund and other Indiana University affiliates may participate in such investments and in doing so may limit the availability and/or size of investment opportunities for IU Angel Network members or invest based on superior information or on alternative, and in some cases potentially more favorable, terms.

Does the IU Angel Network continue investing in later rounds for companies it has invested in previously?

Members will consider investments in follow-on financings on a case-by-case basis. In general, companies should assume that IU Angel Network members will not be a source for significant additional capital. Members are typically focused on helping companies get through the early stages of growth with seed stage capital.

Can entrepreneurs and companies see a list of members in the IU Angel Network?

No. The IU Angel Network respects the privacy of members and will not publish a membership list. As companies enter the formal diligence process with the IU Angel Network, interested members will be introduced to the company. Background information can then be shared directly by members with companies.

IU Philanthropic Venture Fund Specific FAQs

Is the IU Philanthropic Venture Fund a real venture fund?

The IU Philanthropic Venture Fund is a new, early stage venture fund launched in 2018 and managed by the IU Ventures team.

  • Like any new venture fund, we are raising money, looking at where to put our money to work and managing our operation and portfolio for venture grade returns.
  • Unlike a typical venture fund, our source of funds is donors, which allows the fund to be evergreen. 
  • Unlike a typical venture fund we invest only in IU related opportunities. 

The IU Philanthropic Venture Fund makes investments for equity like most funds, but any equity realizations are returned to the fund (instead of individual and institutional limited partners) for reinvestment.

What is a typical check size?

The IU Philanthropic Venture Fund has $11M to invest with plans to have up to $50M from donations and equity realizations. Investments range from $100k to $1M depending on the stage of company, size of the round and the investment case.

At what stage does the IU Philanthropic Venture Fund invest?

We invest at the seed, series A, and B stages and pro rata in subsequent rounds.

What sectors does the IU Philanthropic Venture Fund invest in?

The IU Philanthropic Venture Fund is industry agnostic, but we focus in technology and science-based sectors.

What is the source of deal flow?

  • IU technology transfer and business development
  • IU thought leaders, sector experts and investors who refer opportunities that are too early for them but would invest if criteria are met that we can facilitate with our funding
  • Co-investors, especially those who are sector specific
  • Facilitating organizations internal and external to IU
  • Faculty, alumni and friends of IU

What is the process like for a founder interested in funding from the IU Philanthropic Venture Fund?

  1. Indicate interest by filling out this form or through an introduction to the IU Philanthropic Venture Fund team by other investors and interested parties.
  2. Initial review and introductory meeting between the company and one or more members of the IU Ventures.
  3. Potential for additional review and formal due diligence by the IU Philanthropic Venture Fund team and further meetings with the company.
  4. With a successful due diligence process, the IU Philanthropic Venture Fund will develop an investment case internally, with advisors and with input from the company.
  5. Presentation to the IU Philanthropic Venture Fund investment committee who will make the final investment decision. 

How are investment decisions made?

  • Recommendations to invest are based on an investment case put forward by the IU Philanthropic Venture Fund team.  If a company is not selected for investment, the IU Ventures team works with the founders to identify other resources or make recommendations for next steps.
  • The IU Philanthropic Venture Fund team works closely with an investment committee of serial entrepreneurs and experienced investors to evaluate and provide feedback to candidate companies and invest funds.
  • Up to two opportunities will be formally presented to the investment committee each month.

Given the IU Philanthropic Venture Fund is a donated fund, what is in it for donors?

  • Tax deduction
  • Bicentennial Campaign credit
  • Entrepreneur engagement and mentor opportunities 
  • Regular updates on the fund, investment pipeline and its portfolio companies
  • Annual gathering to meet portfolio companies, other donors and the IU Ventures team
  • Long term multiplying impact of their donation through the evergreen structure of the fund

How does the IU Philanthropic Venture Fund help the State of Indiana?

  • Enhanced venture community resources 
  • Support for new companies in the State
  • Encourage investment in Indiana companies through syndication with external funds
  • Creation of new products, services, companies, and jobs leading to economic growth
  • Benefit from IU innovations to the State, the nation and the world

How does the IU Philanthropic Venture Fund help Indiana University?

  • Support the mission of ensuring the results of IU research and scholarly endeavors reach the public
  • Increased ability to move IU innovations from lab to market for the benefit of society
  • Engagement and reengagement of venture savvy alumni
  • Support to entrepreneurial faculty, staff and students
  • Enhanced reputation as a tech commercialization leader
  • Improved returns from new venture licensees of IU

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