TechScout Venture Fund helps startups through earliest phase
For startups, the initial phase is often the toughest. Today, Delft Enterprises will launch the TechScout Venture Fund to provide even better support for enterprising researchers and engineers at TU Delft who come up with good business ideas, and to also improve their chance of success. Startups arising from research projects at TU Delft which are less than two years old are eligible for a convertible loan of 50 thousand euros. “Our aim is to accelerate the development of startups in the earliest phase”, says Ronald Gelderblom, Investment Director at Delft Enterprises.
The TechScout Venture Fund was set up after it was found that in a number of situations, existing financing instruments were insufficient. For instance, subsidies aimed at entrepreneurship are often granted periodically which can mean months of delay for startups – and they do not want that. Also, sometimes companies starting up simply need a few extra resources in order for them to be able to successfully apply for funding aimed at startups that are already a bit further along.
Startups are reasonably free to spend the 50 thousand euros on whatever they want, ranging from materials for a prototype to exploring the commercial viability of an innovative technology or service. However, the stipulation is that the appropriation of the funds must take the startup a step further towards obtaining follow-up funding.
Initial investment for MuTech and City Analytics
The first two companies to receive a loan are MuTech and City Analytics. “These are both examples of Delft startups that will be able to get down to business quickly thanks to the loan from the TechScout Venture Fund”, says Gelderblom.
MuTech is developing technology for reducing the noise made by wind turbines. “In the future, this can also be used in the aviation sector”, explains Michiel van Nesselrooij (CTO). “With the support from the TechScout Venture Fund, a full-size prototype of the first product – MuteSkin – will be demonstrated.”
City Analytics has developed an advanced crowd monitoring system that quickly collates, filters, analyses and visualises information relating to crowds of pedestrians. “Due to the coronavirus, the crowd management market has stood still for the past two years”, explains founder and CTO Dorine Duives. “Thanks to the loan from TechScout Venture Fund, we can now get straight down to business.”
Involvement of other startups
The composition of the Investment Committee that decides whether or not to grant the loans is a distinctive feature of the fund. Besides the fund manager and an expert from the field concerned (e.g. AI), there is also an entrepreneur from one of the portfolio companies of Delft Enterprises concerned. Gelderblom: “With this set-up, we not only encourage the startups to learn from each other but also give the entrepreneurs from our portfolio companies the opportunity to be involved in the innovation ecosystem in Delft by taking on a different role”.
The fund is revolving: When money flows back into the fund, it can be reused to support more startups at the beginning of their journey.
Social and economic impact
Delft Enterprises supports startups that want to use the intellectual property of TU Delft for new products or services. These include (deep) tech companies, often built around breakthrough technology which is expected to be able to contribute towards resolving major social challenges relating to energy, climate, digitalization, healthcare and mobility. Recent successful ‘exits’ include Mayht (sold to Sonos), Plotwise (sold to Coolblue) and MILabs (taken over by Rigaku Corporation).
Click here for more information on the TechScout Venture Fund.