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‘Utah Innovation Lab’ would be a state-sponsored angel investor for university startups

college funding Tribune 2-23.jpg
Francisco Kjolseth
/
The Salt Lake Tribune
Lassonde Studios on the University of Utah campus in Salt Lake City on Thursday, Oct. 27, 2022. The Utah Legislature is considering a bill to create a Utah Innovation Lab that would fund startup businesses coming out of university entrepreneurs at Lassonde and elsewhere.

Utah Legislature considers creating a nonprofit "Utah Innovation Lab" that would enter the risky world of pre-seed investment for startups from the state's universities.

This story is part of The Salt Lake Tribune’s ongoing commitment to identify solutions to Utah’s biggest challenges through the work of the Innovation Lab.

They call it “the valley of death.”

In the technology startup world, it’s the gap in funding between the federal grants that fuel research at universities and the venture capital that funds startups when they’re starting to scale up.

Can a state-created nonprofit be the angel investor that walks the state’s tech entrepreneurs through the valley of death?

That’s the intent of Rep. Jeff Stenquist’s HB42, a bill to create the Utah Innovation Lab. The Draper Republican proposes an independent nonprofit organization that would invest in startups at the “pre-seed” phase before venture capitalists are willing to jump in.

The lab would start with $15 million, but it wouldn’t just be giving it away. It would be buying equity in the startups, becoming part-owners of the ventures.

Read full report here.