New Orleans BioFund injects $3 million into startups _lowres

Associated Press file photo by GERALD HERBERT -- Robyn Thompson, an associate scientist with InnoGenomics Technologies, works with DNA samples in their laboratory at the New Orleans BioInnovation Center in New Orleans in a September 2011 file photo. InnoGenomics, a genetic testing firm that is developing a blood test to detect and monitor cancer, is one of the success stories from the New Orleans BioFund. The BioFund has invested its initial $3 million funding pool into 15 emerging companies in the New Orleans area, and the fund is now shifting to a model that will offer startups equity to support their growth.

The New Orleans BioFund has invested its initial $3 million funding pool into 15 emerging companies in the Greater New Orleans area.

A program of the New Orleans BioInnovation Center, the BioFund has a special focus on biotechnology and life sciences startups. The fund has also supported companies across numerous industries including food service, consumer goods, and manufacturing.

Organizers said the fund is now transitioning to a micro-venture capital model in which startups can receive either equity or debt funding to support business growth. These new capital offerings will include equity investments, convertible debt instruments, and short-term loans.

“Our fund helps local early stage companies overcome a critical funding gap,” said BioFund Managing Director Kris Khalil. “The capital we provide helps businesses achieve milestones, hire new team members, and position themselves not only for growth but for additional follow-on investments.”

The BioFund was created to support local small businesses and began by offering low-interest loans of up to $250,000 to fund equipment and sales inventory purchases for startups. Those companies are normally considered too risky to borrow from traditional lenders.

Some of the fund’s successes include Propeller, a social entrepreneurship accelerator and business incubator that is home to more than 80 companies; and Tulane University spin-out company Advanced Polymer Monitoring Technologies, whose products improve efficiency in industrial polymer production and pharmaceutical drug development.