The ZLCF team is actively looking for entrepreneurs seeking pre-seed funds to turn big ideas into exceptional companies.
The team adopts a hands-on approach to investing that leverages the talents and resources available at the Stephen M. Ross School of Business at the University of Michigan to make a real impact for the entrepreneur and the University.
We look to provide pre-seed funding to start-ups looking to make a huge difference
Where we Invest
Consumer | Healthcare | Cleantech | Technology
The Value of a ZL Fund Investment
Accelerate towards a Series A | Critical feedback from Fellow + Advisory Board | Access to University Network
To be considered for an investment by the Fund, projects will need to meet the Fund's criteria for investment. Primarily, projects must:
Be driven by founders who are committed to building a successful enterprise and recruiting managers with the skills to do so.
Support technologies or products that are advanced, proprietary (if applicable), and meet a large unmet market need or provide at least an order of magnitude performance improvement compared to existing solutions.
Have an U-M or local Ann Arbor connection. Founders seeking to commercialize technology or products owned by the University should contact the University's Office of Technology Transfer prior to submitting an application.
Commercialization Business Plans
You may submit a short application that includes your business plan to the ZL Fund at any time. The Fund reviews submissions on an ongoing basis, with priority given in the order of applications received. We are currently sourcing deals for the 2014-2015 academic year.
Benefits for University Inventors
ZL Fund teams will seek opportunities where they can work closely with inventors to help identify the key milestones necessary to demonstrate the idea’s utility and market potential and position the idea to receive investment capital in the future. With the advice and counsel of the ZL Fund Advisory Board, the Zell Lurie Fellows will apply their skills and wealth of experience to analyzing the commercialization potential of each project. Inventors and founders with high-potential ideas will receive assistance from the Fellows in the development of their plan for commercialization. Finalists (one or two per sector) will, in addition to being considered for an investment, receive the benefit of the ZL Fund team's recommendation of the optimal path to commercialization and have the opportunity to present their business plan to the ZL Fund team and its advisory board, which includes a number of successful angel investors and venture capitalists.
Frequently Asked Questions
1. What is the size of the typical ZL Fund investment?
The fund typically initially invests $25,000-$35,000, with the possibility for a follow on investment for a total of $100,000 in funding. Each investment opportunity will be evaluated individually to determine the appropriate investment amount. Sometimes however, the ZL Fund investment would draw other Ann Arbor area VCs, resulting in a larger syndicated investment round led by the Fund.
2. What is the ZL Fund Application Process?
The ZL Fund application process is outlined below:
Review: Applications are received and reviewed. Applicants will be contacted to set up a meeting to clarify details on the application form.
Evaluation ZL Fund initiates the due diligence process to evaluate the firm's commercial viability. The Fund will conduct 2-3 more meetings with each company.
Selection ZL Fund select a number of prominent firms and consults with its board of advisors as a final screening measure.
Investment ZL Fund presents each investment opportunity to the Board and makes a final decision.
Due to limited resources, we are unable to fund all ZL Fund applicants. Nonetheless, companies in which we choose not to invest are encouraged to reapply next year.
3. Is the information shared with the ZL Fund kept confidential?
All Zell Lurie Fellows have signed umbrella non-disclosure agreements with the University of Michigan that prevents transfer of university information to outsides side sources. For entrepreneurs with ideas not under the university umbrella, the Zell Lurie Fellows will make our best effort to keep confidential all information shared during evaluation.
4. What value does the ZL Fund student team bring to the company?
The ZL Fund team will be actively involved in due diligence, which will include assessing business risks and the IP landscape, conducting a market size assessment, speaking to customers, etc. The goal of the analysis is to determine the feasibility for commercialization and the key success factors for raising capital for the proposed venture in the future. The fund will provide the company their findings and feedback which will be very useful for making decisions about how to position the company for success.
The ZL Fund Fellows will reserve the option to attend company board meetings for up to one year after investment. If needed, Zell Lurie Fellows will be available to provide strategic business expertise.
5. What is the role of the ZL Fund Advisory Board?
The ZL Fund Advisory board consists of successful local entrepreneurs, venture capitalists and business consultants. The board serves as advisors, providing the Fellows with guidance and feedback during the due-diligence and firm evaluation process. Finalists in the ZL Fund investment process will have an opportunity to present to the board and hear their feedback.
6. How is the ZL Fund different from the Wolverine Fund?
While both the ZL Fund and the Wolverine Venture Fund are student-run, the ZL Fund differs in a few important ways:
The ZL Fund is focused on commercializing technologies and supporting business opportunities in and around with the University of Michigan whereas the Wolverine Venture Fund will invest in companies from around the country.
The ZL Fund invests in earlier stage companies.
The ZL Fund invests alone most of the time whereas the Wolverine Venture Fund almost always invests in a syndicate with other venture funds.
7. What are the terms of the ZL Fund investment? Does the ZL Fund take an equity stake in the company?
The ZL Fund makes investments in exchange for equity in the opportunity. The preferred investment instrument is convertible debt. Convertible debt (A loan that entitles the lender (or the holder of loan debenture) to convert the loan to common or preferred stock (ordinary or preference shares) at a specified conversion rate and within a specified timeframe) is commonly used in early stage investments when the value of the idea is not easily determined. Simply put, the dollar amount invested will convert to equity on the next round of funding.
We would be happy to discuss the nature and specifics of convertible debt with any prospective investment.
8. How can I learn more about the ZL Fund?
The ZL Fund is available to speak to inventors/entrepreneurs through out the year. At any time, please feel free to contact us at firstname.lastname@example.org.
Please send questions to email@example.com and submit an application here. The ZL Fund investment teams will review and respond to submissions within three weeks of receipt of the application.