Focus on Later-Stage Startup Companies
The Cultivate Capital Accelerator Fund GP LLC has secured $7.75 million from 44 business investors to date, according to the company’s filing with the US Securities and Exchange Commission (SEC). Before starting the VC fund, Genesis Innovation Group raised $10 million in seed funding to back early-stage medical device startup companies.
“We started the seed fund a number of years ago and made a number of very early-stage investments,” said Genesis Innovation Group’s chief executive Rob Ball.
“Many of them have just matured at this point where a majority of the portfolio now has regulatory clearance and will be getting to the stages of commercialization.’’
As a result of that maturity, a need for new business capital has emerged among those startup businesses. Hence, the VC company is focused on later-stage investments and a somewhat different risk-reward profile for business investors, Ball added.
The new VC fund has already backed three startup companies that previously received business investments from the seed fund. These include the porous developing startup company Happe Spine, and Shoulder Innovations, which designed a shoulder replacement system. The startup company secured $21.6 million last fall from 24 business investors.
Shoulder Innovation, in particular, makes implants that consist of fewer components compared to other systems and have a longer lifespan, which helps reduce the duration of surgical procedures and costs. Implants developed by the startup company have been already used in thousands of surgical interventions in the US.
This startup company is also the most mature of Genesis’s investments and has signed a business agreement with the VC fund to use its artificial intelligence (AI) technology to help orthopedic surgeons better plan surgical interventions.
Genesis Innovation has been connecting with a number of industry experts, high net worth individuals, and family offices to help secure business funds for the new VC fund called “Cultivate Capital Accelerator Fund.” Ball added that the company is “doing really well” in a “nice market.”
The group’s first VC seed fund backed 11 startup companies and is close to making its 12th business investment. Startup companies backed by the prior seed fund raised a total of $75 million from individual investors, including debt.
Michigan-based VCs currently have $431 million in hand for further business investments in startups. As many as 165 startup companies from Michigan need a total of $1.2 billion in additional business funds to keep growing in the following two years, as per the recent “2021 Michigan Venture Capital Association Research Report.”
Throughout history, there has always been a big gap between the need for further investments among VC-backed startups and available business funding.
Genesis Innovation Group, a VC company that invests in medical device technology startups, is looking to raise $30 million for a new fund to help portfolio companies continue growing.
About the Author
Mariliana has an MSC in Consumer Analytics and Business Strategy. She has a special interest in fast-moving industries and Big Data.