KC Nexus Fund poised to help bring animal, human health care innovations to light

February 1, 2020
Kerry Lengyel

By bridging inevitable funding gaps, the life sciences Proof of Concept fund will offer innovations in the human and veterinary health care sectors a better chance at a successful future.

Animal and veterinary health companies at the proof of concept (POC) stage of their research projects may now have a better chance at gaining the necessary funding to bring their innovations to light.

Historically, the period between the end of academic research funding before commercial funding availability kicks in for a project has spelled doom for many entrepreneurs. But Tony Simpson, managing director of the KC Nexus Fund, powered by BioNexus KC, is coordinating a life sciences POC fund aimed at bridging this gap.

“This [funding gap] period is called ‘the valley of death’ because there is not a lot of capital available to fund the next phase of work,” Simpson said in an article on the BioNexus KC website. “What happens is companies boot strap funding through family or friends, or the company just dies.”

Simpson explained that this new fund was inspired by the 2011 creation of the Center for Animal Health Innovation (CAHI), an initiative led by the Kansas Bioscience Authority to bring animal health technologies to market earlier and more efficiently. He and BioNexus KC collaborated on the formation of CAHI and wanted to reignite this initiative with an even wider scope and goal in mind.

According to the article, the fund aims to raise $6 million to $10 million to invest in a diverse group of veterinary and human health companies at the POC phase, with the companies selected by advisory committees made up of senior executives from leading companies in the Kansas City region. The organizations on the selection committee would provide the chosen companies with guidance to help them take their research and technologies forward.

According to Simpson, BioNexus KC and the KC Nexus Fund is the right place for this type of investment due to the level of access the organization has to early-stage companies, universities, clinical research organization, clinical trial facilities, financial partners and investors.

“[It’s] a full connection to the industry,” Simpson said. “Because of their role at the center of the life sciences ecosystem in Kansas City, BioNexus KC is the right organization to incubate this.”

Right now, the POC fund is only in the groundwork exploratory phase, but Simpson said once that phase is complete, he will start raising capital and putting the fund to work. “We’ll start prioritizing, categorizing, and creating a database of opportunities that fit our investment thesis,” he explained.

This life sciences POC fund will not only shine a light for animal and human health companies faced with “the valley of death,” but will give important, worthy, and innovative projects that may otherwise have never been acknowledged a real chance at a successful future.

“If their technology works, they are going to save lives,” Simpson said. “They are going to give people [and animals] hope that maybe don’t have.”