The fund will engage with agricultural entrepreneurs to provide startup investments.
The Texas Tech Research Park Inc. Board of Directors chairman and president John Esparza has announced the launch of a collaboration with Seraph and the Lubbock Angel Network (LAN) to launch the research park's first venture capital fund, the Seraph Hub Fuel Fund. The focus of the collaboration is to accelerate business success of high-tech startups and emerging companies in the agriculture sector that can scale and provide return to investors.
The region's first $10 million seed fund will leverage Seraph Group's private expert network of 330-plus global investors to develop the capabilities in a critical funding gap in the region. The managing director, David Miller, will work closely with Texas Tech University's Innovation Hub at Research Park, Seraph and LAN to create opportunity for the local startup community over the coming months.
There are nine partner organizations, including the Lubbock Chamber of Commerce, Plains Cotton Growers, the Lubbock Economic Development Alliance, the City of Lubbock, the U.S. Department of Commerce Economic Development Administration and the Plains Cotton Cooperative Association as well as Seraph, the Innovation Hub and the LAN.
“The DOC EDA saw an opportunity to support rural West Texas and funded our grant. The grant helped to establish the Seraph Hub Fuel Fund,” said Kimberly Gramm, chief operating officer of the Texas Tech Research Park Inc. “We knew this was an exciting time to be a part of the growth in Texas, and we wanted to create ways our citizens could benefit. Our visionary Texas Tech leaders and community along with the Texas Tech Research Park board took the time to determine the ideal approach. I believe this initiative will pay dividends to the people of West Texas, creating jobs and financial support for new ventures. I am so thankful for the support of the team that brought it all together.”
The minimum fund goal is to invest in 25-35 agricultural technology startups with investments ranging from $100,000 to $250,000 focused on the following technology areas:
- Water and environment technology
- Emerging contaminants and nano-materials
- Satellite and atmospheric predictability
- Sensor and chip internet of things
- Supply chain technologies
- Smart electronics
- Wind engineering and mitigation
- Plant and animal breeding
- Imaging or mapping
- Big data analytics
When evaluating an investment opportunity, the Seraph Hub Fuel Fund considers myriad factors. Among those are:
- Experienced leadership and teams that are passionate, curious, coachable, collaborative and motivated;
- Product-market fit and early revenue traction;
- Sustainable competitive advantages from patents, trade secrets, differentiated business models, etc.;
- Large addressable markets (ideally $100 million-plus) that are experiencing rapid growth;
- Capital-efficient business models that require limited capital to commercialize solutions and achieve an exit and return on investment; and
- A deep understanding and a defendable clear path to exit.
“The Lubbock Angel Network has been a source of capital for entrepreneurs in Lubbock and surrounding areas since 2015,” said Ryan Reber, executive director of the LAN. “We have invested in 32 companies and have seen very exciting innovations and jobs being created from our portfolio of investments. We believe entrepreneurs are one of the most effective ways to impact lives and we are very excited to partner with the Seraph Hub Fuel Fund as an investor in the fund and collaborator to accelerate investments in entrepreneurs within our region.”
The Texas Tech Research Park Inc. Board of Directors was established in 2020 to support future strategies in development of research and innovation, economic development and industry engaged initiatives. The board's first initiative was to support agricultural innovation in the West Texas region.
“The Seraph Hub Fuel Fund launch is an important step for the innovation and entrepreneurship ecosystem in Lubbock,” Mayor Dan Pope said. “Good ideas create good jobs for our citizens and college graduates. I am very excited about this fund, and I value the support provided by the Texas Tech Innovation Hub to West Texas business owners and entrepreneurs. Good work, like this, fuels the American Dream.”