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REGISTER NOW for the first-ever University POC and Startup Gap Funding Web Summit

From our analysis of over 50 University-affiliated Proof of Concept programs, we have observed their strength in moving technology to a point of commercialization, while acting as an effective means to leverage and attract outside capital and expertise.

Proof of Concept (POC) gap funds evaluate commercial potential, demonstrate the value, and generally de-risk (or perception of risk) the project to commercial partners or investors. Achievements like prototypes and commercial assessment help to identify and secure a route to commercialization, if one exists. POC funds also identify weakness in the technology for further development, or help avoid costs by deciding not pursue the technology

These funds are often administered centrally through the technology transfer office, research foundation, central research administration, or the equivalent at the college-level. Externally-partnered public funds, accelerators, and corporate funds run independently or in close collaboration with the research institution.

In this session, we will hear from leading fund managers regarding their strategies for:

  • Raising and sustaining POC funds
  • Communicating the fund and sourcing projects
  • Working with faculty/student inventors throughout the process
  • Evaluating projects for funding
  • External collaboration with industry, entrepreneurs, and investors as funding sources and advisory support
  • Oversight and management of funded projects

Visit Events Page and Register for Single Event or Full Six Session Summit:

Startup Formation gap funds assist in the formational steps of spin-outs — even prior to becoming a legal entity. This gap fund type could be seen as a startup-focused extension of proof of concept funding that further develops the business application of the technology through market research, product development, business development, management, space, and equipment to attract third party interest and capital

These funds are primarily administered by the technology transfer office and associated venture centers. External public-private arrangements to support business creation are administered by sponsoring agency or through close collaboration with the research institution

Startup Growth gap funds invest in scaling and growing established spin-outs. Research institutions have created, spun out, or partnered with seed funds and accelerators, both public and private, to fill this void in early stage startup capital and to directly invest in their own startups. Some institutions are even beginning to invest in non-institution startups.

Centrally managed Startup Growth gap funds are limited based on the required capital. To overcome this challenge and mitigate risk, research institutions may partner with existing early stage venture firms or corporate investor groups

In this session, we will hear from leading fund managers regarding their strategies for:

  • Raising and sustaining startup funds
  • Communicating the fund and sourcing startups
  • Working with faculty/student inventors throughout the process
  • Evaluating startups for funding
  • External collaboration with industry, entrepreneurs, and investors as funding sources and advisory support
  • Oversight and management of funded startups

Visit Events Page and Register for Single Event or Full Six Session Summit:

Gap funding programs have a much broader impact than financial return alone, and are more appropriately assessed on their ability to improve the innovation capability and landscape surrounding research institutions and affiliated stakeholders.

In fact, most of their immediate and near-term returns are better represented in their ability to catalyze the commercialization process, to build support communities that can assist in the development of funded projects, and to convert those projects into commercial entities that create jobs and enrich local and regional economies; but, perhaps the most exciting observation is that gap funding programs are playing a direct role in attracting outside capital and expertise.

In this session, we will suggest a structure for measuring gap funding impact, both financial and programmatic, that gap fund programs and managers can use to better demonstrate the impact of their program. These measures align gap funding practices with the mission of the research university, and other public and private sources of early stage capital, while demonstrating how the practice supports innovation and commercialization on a larger scale, including:

  • Catalyzing the Commercialization Process
  • Growing a Community of Innovation
  • Building Businesses and Creating Jobs
  • Attracting Capital and Expertise
  • Returning Capital to the Gap Funding Program

Visit Events Page and Register for Single Event or Full Six Session Summit:

Access Report


The Mind the Gap Report is a first-of-its-kind, all-in-one program development guide for current and aspiring gap fund managers that investigates 82 active translational research, proof of concept, and start-up investment funds at 51 universities and affiliated organizations.
Access Report
The Mind the Gap Report is a program development guide for current and aspiring technology and start-up gap fund managers that:

  • investigates 82 active translational research, proof of concept, and seed investment funds from 51 universities and affiliated organizations
  • establishes the need for gap funding and its positioning in the new early-stage capital continuum
  • demonstrates the impact of this funding approach for ROI, capital attraction, economic development, job creation, and innovation community development
Fund managers, stakeholders, and partners at:

  • Research universities and labs
  • Tech-based economic development initiatives
  • Incubators, accelerators, and research parks
  • Corporate venture and acquisition groups
  • Angel and venture investors
  • Policy-makers and international governments

that seek a detailed program roadmap to guide, develop, and benchmark gap funding programs

Focus Areas
Emerging model for early stage capital
  • Detailed assessment traditional and emerging forms of early stage capital (VC, angel, public/private funds, accelerators, and crowdfunding)
  • Introduction of an updated capital model that positions gap funding within this landscape and it’s vital role in commercializing technology
Modeling the Gap Funding Process
  • Segmentation and evaluation of the gap funds into four distinct fund types: translational research, proof of concept, business formation, and business growth
Fund Source and Sustainability Strategies
  • Actionable strategies for raising/initiating funds and future plans for sustainability
Fund Management
  • Detailed fund management structures based on type of organization and fund
  • Sample budgets and resource allocation based on funding objectives
Fund Process
  • Evaluation, selection, and decision-making criteria
  • Advisory board composition
  • Promotion and marketing strategies
Support Programs
  • Highlight support programs that are associated with gap funds that build an innovative community of students, faculty, and mentors
Fund Impact
  • Demonstrate specific impact and results of gap funding, including financial returns (ROI, leveraged capital), process indicators, economic development measures, and community engagement metrics
Success Stories
  • 4000 archived stories that showcase specific fund processes and impacts

What’s In the News

Clemson University Research Foundation awards funds for technology development 

The Clemson University Research Foundation (CURF) has announced six recipients of fiscal year 2017 Technology Maturation Fund awards. The CURF Technology Maturation Fund provides grants to faculty to support the last critical development step needed to [...]

Montana State University business accelerator receives $50,000 from U.S. Small Business Administration

An entrepreneurship support center for Montana State University students, alumni and faculty has won a $50,000 award from the U.S. Small Business Administration to help enhance its business accelerator program, 406 Labs. The Blackstone LaunchPad [...]

University Investment-A New Model Of Venture Capital

In the alternative investments space, attorneys have long been able to play an important role. Whether the investment in question is senior bank loans, non-recourse litigation finance liabilities, venture capital investments, or hedge fund vehicles, [...]

3 initiatives, $3M for startups: MEDC seeks to boost access to early-stage capital

A trio of initiatives from the Michigan Economic Development Corp. aims to increase the flow of capital to startups and early-stage companies in the state. By the end of the year, two separate but similar funds [...]

GO-EDC launches fund for start-up companies

The Greater Oshkosh Economic Development Corporation has launched a fund to help entrepreneurs get their business ideas off the ground in the Oshkosh area. GO-EDC this week announced its recently minted Greater Oshkosh Capital Catalyst [...]

Innovation in the Western Cape is set to get another healthy boost

Designers, inventors, entrepreneurs and product developers  can apply for grants of up to half a million Rands each from the second round of theDesign Innovation Seed Fund. The DISF is a project of the Cape Craft [...]

Birmingham’s Health Tech Kaido secures £50,000 funding from Mercia Fund Management SME Innovation Fund

The SME Innovation Fund is a joint initiative set up by Mercia Fund Management, leading investment business in UK innovation and a wholly-owned subsidiary of Mercia Technologies PLC and the West Midlands Academic Health Science [...]

Group seeks to guide  philanthropists to supplement crunch in federal funding of research

Poring over a list of the top 50 US philanthropists in 2014, physicist Marc Kastner noticed that 16 were based in California, compared with just 6 in New York, Connecticut and New Jersey combined. “That [...]

Enterprise Ireland gets a new €200k start-up Competitive Feasibility Fund

A new €200,000 Enterprise Ireland Competitive Feasibility Fund for entrepreneurs and early-stage start-up companies in the Cork region has been launched. The fund, which is a key measure of the Government’s Action Plan for Jobs, [...]

Spin-out company from Queens University receives £500k investment for cancer-detecting sensors

It was announced today that Kernel Capital has invested £500k in Causeway Sensors, a spin-out from Queens University Belfast (QUB). Founded by fellow QUB Academics Dr. Robert Pollard, Prof. Robert Bowman and Dr. John Nelson, [...]

Is it time for a new model to fund science research in higher education?

The United States is at a crossroads with respect to many societal issues – think about the challenges of improving human health, eradicating hunger, protecting human rights. At the same time, federal support for higher [...]

University at Buffalo Seed Fund for Innovative Research Supports Faculty in 6 Departments 

Eight faculty members from the Jacobs School of Medicine and Biomedical Sciences are conducting research supported by the Innovative Micro-Programs Accelerating Collaboration in Themes (IMPACT) program. “The IMPACT program supports cutting-edge research throughout the university, not [...]

Crowdfunder CEO talks about using gap funding to fix the University Research System’s “Valley of Death”

For decades, America’s economic success has been driven by an engine of innovation that periodically creates new industries and companies that change the world. The JOBS (Jumpstart Our Business Startups) Act was passed to make [...]

Rhode Island is boosting innovation grants to $1.5M

Gov. Gina M. Raimondo opened the second round of the state’s Innovation Voucher Program last week, soliciting applications from Rhode Island companies with fewer than 500 employees to apply for grants of up to $50,000 [...]

UAE Venture fund helps Mena region tap into expertise of veteran investors

Most technology investors are hunting future "unicorns", as start-up ventures valued at US$1 billion or more are known. But with millions of businesses launching each year, these are proving ever elusive. Step in one new [...]

Enable Injections to triple Cincinnati workforce after landing $30 million in Series A funding 

Enable Injections plans to triple its workforce as a result of $30 million in funding lined up by the Cincinnati health care company. The firm was founded in 2010 and now employs about 50, but [...]

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Our Partners are Our Users.

All of the information covered in this resource comes from close collaboration with active gap fund managers. We play a supportive roll by collecting and reporting up-to-date knowledge to assist the development of the technology and start-up gap funding community of practice

Who We Serve

  • Research Universities, Hospitals, and Institutions

  • Accelerators and Incubators

  • State and Federal Economic Development and Innovation Agencies

  • Angel Investors and Venture Capital

  • Corporate Innovation and Venture Groups

What We Cover

  • Translational Research Gap Funds

  • Proof of Concept Gap Funds

  • Start-up and Venture Gap Funds

  • Government-supported Innovation Initiatives and Funds

  • Angel Investors and Angel Networks

  • Corporate and Venture Capital

  • Crowdfunding

  • Student Venture Funds and Competitions

The Mind the Gap initiative has helped the technology transfer community focus on emerging practices in university-affiliated gap funding. The Mind the Gap initiative is the primary, comprehensive source for POC and early stage funding information and resources that the community, including my operations, turns to for understanding and insight.
David Allen, University of Arizona Tech Launch Arizona
As a Fund Manager, designing and implementing an organically grown technology development fund, these reports were invaluable in understanding metrics and what other institutions are accomplishing
Michael Rusnak, Medical University of Southern Carolina
Mind the Gap is the premier source for aggregated information regarding university-affiliated gap funding practices. It has been invaluable to us in our ongoing efforts to evaluate creative approaches for structuring seed and early-stage investment collaborations with universities and federal labs. Mind the Gap represents a valuable connection point to universities with leading edge commercialization programs, and as a result, a source of market-leading technology opportunities.
John Banta, Blue Cross Blue Shield Ventures

Why Gap Funding?

University Gap Funding: Mind the Gap

With all eyes on the economy, policymakers are quick to invoke the buzzwords of the day, such as “innovation”, “economic development”, and “job creation”, to describe the beneficial impact of commercializing early stage technology, often from research universities. Recently though, it seems that special interests, void of workable solutions, are grabbing headlines and helping to craft policy based on the suggestion that research universities are doing little to support this opportunity.

If you have accepted this information as fact, you would understandably think the system has neglected its duty, has failed, and is need of a revolutionary fix; however, with minimal investigation, you will see that universities have lead in the development of tactics and programs that address critical barriers to early stage commercialization, often ahead of other public and private entities.

One such example, is their development of gap funding programs to address the capital shortage that exists for early-stage technologies and start-ups.

So what is gap funding? How does gap funding relate to other forms of innovation capital?  And what is the impact of gap funding (why should you care)?


What is Gap Funding (A Better Definition)?

The “gap” in gap funding refers to a vast shortage in capital and other commercialization support to transition early-stage technology to the marketplace.  To address this need, many research universities either directly manage or partner with government agencies, early stage investors, or corporations to create translational research, proof of concept, and pre/seed-stage gap funds that assist in evaluating, de-risking, or commercializing technologies and start-ups.

Defining this “gap” too broadly (e.g. “Valley of Death” or “between basic research and the market”) oversimplifies the complexities of the situation and clouds the path to resolution. Frankly, it may be a reason why this sort of funding is less covered in mainstream press, and less understood by the general public. To relieve this tension, I propose and can demonstrate a more actionable, segmented system based on fund observations.

The approach to the larger “gap” can be broken down into a system of four gap fund types, each with individual characteristics, structures, and commercialization priorities:



Translational Research
Translational Research gap funds enter after traditional sources of investment in basic research cease, and support the promising projects that require additional applied development. The ultimate goal is to get the technology to a point where it can be assessed for commercial potential, or aligned with the priorities of an external partner willing to develop the technology further

Proof of Concept
Proof of Concept (POC) gap funds evaluate commercial potential, demonstrate the value of the technology, and generally de-risk it (or perception of risk) for commercial partners or investors. By developing the commercial groundwork, including prototypes, IP/competitive landscaping, and application evaluation, these funds aim to identify and secure a route to commercialization (license to existing company or spin-out). POC gap funds also act as a process filter by identifying weakness in the technology for further development, or by deciding not to pursue the technology which saves often larger resource requirements later in the process (a common recommendation in most new product development literature). From my research, this is the most widely-utilized, and necessary gap fund type

Start-up Formation
This emerging gap fund type assists in the early formational steps of new company creation – often prior to it becoming a legal entity. Business Formation funds can be seen as a start-up-focused extension of proof of concept funding (post route-to-market decision) that develops the business application of the technology through market research, product development, business development, management, space, and equipment

Start-up Growth
As scalability and growth become major objectives, some research universities have created, spun out, or partnered with seed funds and accelerators, both public (government) and private (corporations, investors), to fill a void in early stage capital. The main goal of Business Growth funds is to scale an attractive business that creates jobs, produces a risk-worthy return on investment, and attracts capital by leveraging other external investors

In summary, adopting this segmented approach to gap funding creates a model that is actionable, relatable, and customizable in that it:

  • Aligns with well known technology product development processes
  • Allows for an individual approach that is based on the specific resource needs and existing culture of the funding institution
  • Creates a system that is identifiable by stakeholders of early-stage innovation (public and private), and provides them an opportunity to identify their role as a partner in the process


How does gap funding relate to other forms of innovation capital?

The common model of early stage technology and start-up funding — prevalent in business books and policy reports — depicts government-funded research magically transitioning to application through a license to an existing company or start-up. The start-ups are then supported in their early development by government grants, bootstrapping, and through angel or venture capital investment as they work towards profit, growth and liquidity.

This view is clean and places and emphasis on more traditional forms of early stage capital; however, it is also misleading and shifts the focus downstream. It ignores a major portion of the realities of early stage technology development—especially those which are realized by those involved in commercializing university research (longer to-market timelines, resource intensive).

In this view, gap funding and other emerging and disruptive sources of early stage capital are often overlooked and under resourced because they are literally not even in the picture; therefore, I offer an updated version of the early stage funding landscape—one that positions gap funding and also includes the current status of other forms of traditional, emerging, and disruptive sources of early stage capital and support


Innovation Capital Landscape


Each of these sources of early stage capital are vital to transitioning university and other early-stage technology to the marketplace; but, there are some inherent conflicts that inhibit their ability to provide reliable and well-positioned assistance in the early stages of technology and start-up development. Some of these weaknesses include:

  • Aversion or inability to fund translational research, proof of concept, and other early stages of start-up development
  • Structured to make larger investments in fewer deals
  • Focus on investment sectors that may not address technology with longer development timelines, resource intensity, and IP/regulatory hurdles
  • Motivations (incentives towards near term returns) and constraints that may limit their ability to accept the risk of early stage innovation

A good strategy to address this capital shortage is to either a) attract retreating forms of early stage capital and commercial partners back into the “gap”, or b) invest directly into models that are better positioned to fund the “gap”. The best strategy is to support a solution, like gap funding, that accomplishes both.

Research universities and partners have created gap funding as a capital and innovation support mechanism that is ideally positioned to address the critical elements of transitioning university technology and start-ups, while also attracting additional capital and third-party interest.

While it may not yet have the prestige of other forms of early stage capital, gap funding is emerging as a disruptive approach that is better aligned with and has the capability to support technology and start-up development in the early stages through:

  • Focus on translational research, proof of concept, and start-up development
  • Targeted smaller grants and investments per project, that enable to technology or start-up to be more adaptive to development “pivots”
  • Directed to fund university projects, often in many technology areas with varying to-market requirements
  • Positioned at a nexus of faculty, students, and business networks
  • Mission-driven to innovate, educate, and job create


What is the impact of gap funding (why should you care)?

The complexity of the answer lies in the fact that these funds do not just measure themselves in purely financial terms. The funding vehicle (often grants), the stage of technology (early), and the organizational missions inhibit this narrow focus. Instead, many refreshingly take a comprehensive approach and identify gap funding with its ability to catalyze the entire innovation ecosystem.

To capture these outcomes, I suggest four major groupings of impact measures, each with corresponding success metrics, and expected realization timelines, demonstrated below:


Impact Horizons


Process indicators: Measures to track and forecast the process of gap funding and eventual commercial outcomes. Some that I track include:

  • Yield rates, or projects proposed vs funded, were observed at up to 41% depending on fund type. This of course is much higher than the traditional investment sources typically 10% (angel) or .1% (VC)and demonstrates the ability of these funds to give more technologies an opportunity and capability to develop.
  • Commercialization rates, or those funded projects that were ultimately licensed to existing companies or start-ups, were observed at 76-81% depending on fund type

Building a Community of Innovation: An overlooked benefit of the funds is the associated gap support programs that engage members of the innovation community in the evaluation, commercialization, and funding process.  These tactics enlist thousands of faculty, students, and community members (business, investment, technical) in the entire process, which benefits the credibility and development of the projects, but also builds an expertise-, education-, and relationship-platform for future opportunities

Business Formation and Job Creation: Impact of these gap funds in tech-based economic development, including:

  • 395 new start-up companies (44 reporting funds)
  • 188 gap funded technologies licensed to existing companies
  • 7,732 confirmed jobs (27 funds), at an average gap investment of $16,300/job
  • 70% survival rate of reporting start-ups over five years old compared to 51% of SBA all new firms

Returns to the Gap Funding Organization and Capital Attraction: Direct repayment (repayments, royalty returns, equity payouts) and capital attraction (government grants, corporate, angel, venture)

  • Direct Repayment
    • While still early to capture complete outcomes, reporting funds experiences up to a 5x return of proof of concept type funding through, with an average of 2x for seven reporting funds
    • In addition to returns through direct repayment and equity, early results indicate that these funds (especially proof of concept) may increase the likelihood, speed, and negotiation position in licensing deals with existing commercial partners
    • Attracted Capital Leverage
      • $2.8B reported attracted third-party capital on $162M vested gap fund projects, 30 funds reporting
      • Up to $9:4:11:148 of attracted capital per $1 of gap funding in government, corporate, angel, and venture follow-on, respectively


In summary, gap funding is an effective approach, led by research universities, to address the capital shortage for early stage technology and start-ups. As a mechanism it is well positioned in the updated capital continuum, and is ideally structured to fund early stage innovation. Finally, it has demonstrated an ability to positively affect commercialization rates, support new businesses, develop communities of innovation, and attract capital to regions and new opportunities.

There is a story to be told, and this is just the beginning.

About the Effort:

Mind the Gap ( is a conversation-building initiative of innovosource that 1)increases awareness of the early stage capital shortage and advocates for solutions, like gap funding, 2)expands knowledge and best-practices for current/aspiring gap fund managers and stakeholders, 3)connects university technology and startups to sources of early-stage capital (venture, angel, crowdfunding),talent, and other support.

This information is backed by over a decade of experience tracking gap funds, and specifically from the Mind the Gap Report  that now covers 82 translational research, proof of concept, and seed gap funds associated with 51 research institutions. The roadmap is constructed to assist current/aspiring fund managers and stakeholders in starting, developing, or measuring successes of their own gap funding programs.