In January, The Experiment Fund (Xfund) launched as an early-stage seed fund through backing from storied venture capital firm New Enterprise Associates. Anchored at Harvard, what the Xfund was able to develop was a partnership between two of the longest living institutions in their respective fields. “When anyone designs any institution, they always want it to live beyond the length of the founders,” says Partner and Co-Head of NEA Seed Patrick Chung.
Eight United States presidents. Over 100 Nobel Prize Winners. Bill Gates and Mark Zuckerberg. No one can deny Harvard’s home to innovation. For 375 years, the country’s oldest institution of higher learning has been pushing the envelope and transforming the way we think.
“Cambridge has always been a fountain of new ideas for America,” says Hugo Van Vuuren, which is why he helped found The Experiment Fund — to encourage and support those new ideas so they can grow.
In January, The Experiment Fund (Xfund) launched as an early-stage seed fund through backing from storied venture capital firm New Enterprise Associates. Anchored at Harvard, what the Xfund was able to develop was a partnership between two of the longest living institutions in their respective fields. “When anyone designs any institution, they always want it to live beyond the length of the founders,” says Partner and Co-Head of NEA Seed Patrick Chung.
Van Vuuren agrees, saying “The Experiment Fund is designed to outlive its partners.”
Beyond Van Vuuren and Chung, the team’s also comprised of Jim Breyer, general partner atAccel; Alan Crane, general partner at Polaris Ventures; and Harry Weller, general partner at NEA. “We brought in two of the strongest co-partners to work with us,” Chung says, referring to Accel and Polaris Ventures. Through the move, the Xfund has been able to quadruple the amount of capital they have, as well as expand their network. “We can make investments that have a lot more potential to be truly world-changing.”
In decades passed, entrepreneurs have fled from Cambridge. “You can understand why Gates would have had to leave campus,” Chung says. “He had no where to turn that could support him.” Fast forward 30 years, however, and now it’s harder to find a reason not to stay. Although Mark Zuckerberg left, he did admit if he were starting Facebook now, he would have stayed in Boston. The Xfund wants to keep that feeling fresh.
To Van Vuuren and Chung, it’s never been easier to start a company. “More and more students have learned that,” Van Vuuren says, also admitting they don’t care if their companies decide they want to leave. “We just want to meet them here.” Although anchored in Cambridge, the Xfund has taken a bi-coastal approach, only further enhancing their longevity. To Chung, it’s important they focus on what’s going to help companies thrive and survive in this area.
The Xfund funds four to six companies a year, which raises the bar and makes the process more selective. Current experiments underway include Rock Health, Tivli and Omada Health.
But why “experiments?”
“A big part of the university’s fabric goes back to seeking truth,” Van Vuuren says. Faculty, staff and students come to Cambridge to learn new ideas and experiment with how they can make a life changing difference. “We want to help them seed that experiment,” Van Vuuren claims, also admitting that a lot of the students who are seeking out the Xfund are ones who work in research labs around Cambridge and are experimenting every day.
“What we’re doing in and of itself is an experiment,” Van Vuuren says. “‘The Experiment Fund’ name applies on many levels.”
Chung added on, saying that if you look at other venture firms, they’re typically named after the founders, which puts an impetus on just a couple of people. Or, they’re named after “something bold or declarative that has yet to be fulfilled when they launch.” To Chung, there’s an “inherent humility and humbleness” to what the Xfund is doing. They want entrepreneurs to come to them with uncertainties and insecurities about what is is they’re working on.
“This is an experiment, and sometimes experiments turn out the way you expect, and sometimes experiments don’t turn out the way you expect,” Chung says. “We’re going to find out, and we’re going to get better.”
Considering the powerful team they’ve already formed, the statement is a hard one to question. As Van Vuuren says, “We’re working with the smartest people in the world who are coming to Cambridge to change the world.” And the Xfund is doing their part to help.
Original: BostInno http://bostinno.com/2012/08/09/cambridges-newest-early-stage-seed-fund-invests-in-experiments-that-can-change-the-world/
