Venture Capital

NVNG looks to help companies innovate through venture capital


Whether or not the $100 million venture capital fund Gov. Tony Evers proposed in his budget actually becomes reality, it appears there will be a new set of venture funds taking a closer look at…

Whether or not the $100 million venture capital fund Gov. Tony Evers proposed in his budget actually becomes reality, it appears there will be a new set of venture funds taking a closer look at Wisconsin startups in the near future.

Madison-based NVNG Investment Advisors plans to close on $40 million to $50 million in funding from Wisconsin corporations and other entities in the state in June. Once it closes on the fund, NVNG, which stands for “nothing ventured, nothing gained,” will in turn invest in venture capital funds from around the country in a fund of funds model.

“This is about helping to develop the Wisconsin ecosystem, this is about helping drive economic growth,” said Carrie Thome, chief executive officer and managing director of NVNG. “Innovation is the lifeblood of growth and we have to find a way to support innovation here.”

NVNG is targeting $100 million in total funds to disburse and hopes to have a second closing before the end of the year. After the first closing it will begin investing with a range of funds, from seed to later stages and across industries; however, the funds will not be required to invest in Wisconsin. 

“The venture firms that we target have an interest in better connecting into Wisconsin’s startup ecosystem,” said Grady Buchanan, managing director of NVNG. “We intend to highlight our state’s startups and innovators for these outside firms, offering that initial point of contact, drawing their capital to us.”

Thome, formerly the chief investment officer at the Wisconsin Alumni Research Foundation, said that even if the goal is to help the state, venture capital is ultimately an investment and the best way to make the approach work is if the focus is on the investment return. 

With Wisconsin entities and companies as limited partners, the returns will ultimately end up benefiting the state, but financial benefits aren’t the only benefits to the approach NVNG is taking. 

It is a model based on what Renaissance Venture Capital has done in Michigan for more than a decade. 

Total venture capital in Wisconsin (in millions)


When Chris Rizik started Renaissance in 2008, Michigan was a state with great university research and a high concentration of engineers and talent, but it fell short in terms of entrepreneurship, including a lack of access to capital. 

“If this is an area that has all this great research and there’s not enough capital, there’s real opportunity for successful investing,” Rizik said. 

Renaissance uses a fund of funds model to help the investor money go further. Rizik said the original $45 million fund could have perhaps invested in 10 companies. Investing in 10 funds that each invest in 15 to 20 companies extends the reach. 

“You just have a lot more shots on goal to make an impact,” Rizik said.

The first Renaissance fund ultimately attracted $1 billion to the state, Rizik said, far outpacing its $300 million goal. Three additional funds have since been raised. 

Beyond bringing in investment, Renaissance also sought to address a problem that was just emerging when Rizik was raising the first fund: Major corporations increasingly needed to look externally for innovation. 

The idea is that corporations invest in the fund, which then distributes the money to other venture capital funds that in turn invest in Michigan’s startups. The startups are then able to grow and scale. The corporations then have access to the new companies as suppliers, partners or windows into the future vision of technology. 

Rizik said the willingness of corporations to be customers to the startups was one very useful element in attracting outside venture funds. So far, there have been at least 140 pilot programs or contracts between corporate partners and startups in the Renaissance portfolio. 

“Even in situations where it didn’t lead to that, the knowledge base that comes from one of our corporations meeting with eight cybersecurity companies in the portfolio just gives them a sense of what’s going on in the market that’s valuable to them,” Rizik said. 

As NVNG is planning to do, Renaissance hasn’t forced the venture funds it invests in to invest in Michigan companies. 

“We just really require them to engage,” Rizik said, noting Renaissance does a lot of leg work to help the funds meet with startups. “We’re pretty comfortable that if funds engage here, on the merits, they’re going to find things.”

Forcing funds to invest in a particular state comes with two problems, Rizik said. For starters, adding strings may make it more difficult to distribute the money. 

“Great venture funds, especially now, have no problems raising money, so they don’t need money that comes with strings,” Rizik said. 

The other issue is that limiting where the money can be invested could harm the financial returns of the fund, which hurts the original corporate investors and other partners. 

Rizik said those corporate partners originally invested “almost exclusively” because they wanted to help the region. As time has gone on, Renaissance has been able to lean on its track record of financial returns and strategic benefit to help raise funds. 

Attracting venture capital funds to look at the state required a reliance on its reputation for great research institutions like the University of Michigan, Rizik said. He noted those institutions across the Midwest give the region an advantage, along with a more loyal workforce, a strong existing customer base of major corporations and a generally less expensive environment to start and grow a company compared to the coasts. 

“Capital around the country is more willing to look in the Midwest than it was 13 years ago,” Rizik said. “If anything, I guess the value proposition of the model is just clearer now.”

So, can the same model work in Wisconsin?

“The basic elements that we had here, you have there, almost identically,” Rizik said. 

He said that on a relative basis, Wisconsin is probably about at the same place it was when Renaissance started its work in Michigan. 

From 2006 to 2010, Wisconsin averaged $88.8 million in venture capital deals annually, a figure that increased to $161.2 million from 2011 to 2015 and to $257.9 million from 2016 to 2020. However, the state’s average rank in each of those three periods was essentially 27th, according to Pitchbook data. It’s ranking in annual deal volume slid two spots to 26th from the late 2000s to the second half of the 2010s. 

“A place like Wisconsin is still tremendously underserved for venture capital,” Rizik said.

While NVNG is hoping to bring more venture capital to Wisconsin, its focus is on the state’s startups. 

“We’re not about developing the venture industry,” Thome said. “We focus on how do we get capital to the state’s startups.”

Wisconsin’s challenges in the startup world have generally been on two fronts, the availability of capital and the availability of companies to invest the capital in. 

Efforts like NVNG’s, the proposed $100 million state fund, the Badger Fund of Funds, which has nearly $66.7 million across five funds, and others are changing the state’s status for the availability of capital. 

Meanwhile, companies like Fetch Rewards, Eat Street, Frontdesk and Fiveable and programs like gener8tor and Titletown Tech are changing the narrative around the state’s entrepreneurs. 

“We have a very long runway,” said Buchanan, a former investment analyst at WARF. “We’re certainly on a good path here.”

He said there still is a challenge as investors look to areas like Chicago, Minneapolis, St. Louis or Iowa, but also pointed to the state’s universities as a potential pool of future entrepreneurs. 

“By definition, we have an insane amount of entrepreneurial talent. It’s like, how do we grow it and how do we keep it here long enough where they actually establish a presence?”
Buchanan said. 

Budding entrepreneurs need to see more examples of companies that grow and scale in the state to see that path as a possibility for themselves, he said. 

“It’s not so much that companies get started and moved out of here,” Thome said. “It’s that people have chosen to just go elsewhere to start their company instead of being here.”

She added the state needs a greater density of capital that knows how to grow and scale companies.

“It’s a fair question,” Thome said of whether the state has enough startups. “I’d have to say we’ve been on the bubble of that for a really long time, but I think we’re about ready to go down the other side.”

When it comes to innovation and venture capital, Wisconsin corporations are at a variety of different stages. Some have their own venture funds, some have executives with a little experience in venture investing and others are just getting started. 

Just like the Renaissance fund in Michigan, NVNG could bring companies financial returns, the strategic ability to see potential disruptions to their industry and an opportunity to build the startup ecosystem in the state. 

“If we do this, this will impact the state and improve its visibility, it will improve visibility to attract talent,” Thome said.


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