Harvard Experiment Fund, Backed by NEA, Joins Crowded Investor Field

1/31/12Follow @gthuang

There’s a new player in the seed-stage investment game in Boston. As of this week, the Experiment Fund is open for business at Harvard University, backed by the Silicon Valley venture firm New Enterprise Associates (NEA). The startup investment fund is being hosted by Harvard’s School of Engineering and Applied Sciences in Cambridge, MA.

The new fund is led by Hugo Van Vuuren (see photo above), a Harvard graduate student and entrepreneur, and two venture capitalists from NEA, Patrick Chung and Harry Weller (both Harvard alums). David Edwards, a Harvard professor of biomedical engineering, serves as an advisor to the fund. Van Vuuren and NEA did not respond to requests for comment in time for this article.

The basic structure of the Experiment Fund is that selected startups—mostly student-led teams from Cambridge—will receive up to $250,000 in seed funding over the next two years, presumably in exchange for a sizable equity stake in the companies. The fund is based out of Harvard but says it will operate independently of the university and will look at teams from other local schools—and, more broadly, from the East Coast. The sectors targeted are pretty broad as well; they include information technology, healthcare, and energy.

No word yet on the size of the fund or how many companies it will invest in. But Van Vuuren, a recent fellow at Harvard’s Berkman Center for Internet and Society, said in a press release that he and his partners are looking for “smart and resourceful people, zealous full-time teams, and experiments in need of seed funding and hands-on help to get off the ground.”

Not to beat a dead Zuckerberg, but the overarching goal here is to keep the next Facebook in Boston—and, preferably, affiliated with Harvard. “It’s continued growth of the ecosystem for Harvard and beyond,” says Gordon Jones, director of the Harvard Innovation Lab, which is collaborating with the Experiment Fund to provide office space and resources, but is separate from the new fund. Jones calls the Experiment Fund “extremely complementary” to the i-Lab.

One of the first Harvard teams to receive an investment from the fund is Tivli, a TV-in-the-cloud startup led by Harvard students Nick Krasney and Tuan Ho. The company has grown from two guys to a team of about eight people since September, Jones says.

Despite a fair amount of initial press coverage, several Boston-area angel investors and VCs I talked to had not heard much about the Experiment Fund. That raises questions of whether the program is seen as insular to Harvard or NEA, and how much impact it will really have on the overall startup ecosystem around Boston.

The Wall Street Journal reports that the fund (and Harvard) is looking to work with other VC firms—in particular, a Boston-based firm—to be a strong partner in mentoring local startups. The program is a bit unusual in that it is affiliated with a particular university, and its main backing is from a venture firm outside the area. Of course, plenty of universities have programs to support student entrepreneurs and connect them with early-stage investors; and VCs and angel investors are increasingly trying to build relationships with young entrepreneurs.

Local seed-stage accelerator programs like TechStars and MassChallenge, and incubators like Dogpatch Labs, have a base of support from local and national venture firms, but are not tied to a specific university. Nor are micro-VC and angel funds like NextView Ventures, Founder Collective, Project 11, Boston Seed Capital, or CommonAngels affiliated with particular schools.

“Overall I think the more seed funding in Boston, the better,” says Jeff Glass, a managing director at Bain Capital Ventures, which is not involved with the Experiment Fund. For its part, BCV just raised a new $600 million venture fund, its largest to date.

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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