Editor’s note: Este artículo está traducido al español.
Former UNLV President Len Jessup has made a significant return to Las Vegas with an ambitious new initiative: the launch of Desert Forge Ventures. This venture capital fund is designed not only to support local startups but also to attract innovative companies to the region, marking a key shift from his academic career to the realm of private investment. The aim? To diversify the economy of Southern Nevada beyond its traditional ties to tourism and gaming.
An Overview of Desert Forge Ventures
Upon arriving at UNLV over a decade ago, Jessup recognized a forthcoming need for a venture capital fund tailored to the university and its burgeoning startup ecosystem. Although the timing wasn’t right in the past, he believes the moment has now arrived. UNLV, designated as a Carnegie R1 research institution, is producing impressive research outputs from its faculty and students. Recent studies have indicated that Las Vegas’ startup ecosystem is among the top five in the U.S. in terms of rapid growth, creating a fertile ground for entrepreneurial activity.
Drawing inspiration from successful models at universities such as the University of Arizona and the University of Utah, Jessup has crafted a fund that engages with the local ecosystem. He has spent time studying how other universities have effectively developed their venture funds and is now implementing similar strategies in Las Vegas.
Investment Focus: Target Sectors and Companies
Desert Forge Ventures prioritizes companies aimed at diversifying Nevada’s economy. Jessup emphasizes the need to create a more resilient economy that is less vulnerable to economic downturns. With the entertainment and tourism sectors thriving, and professional sports making headway in the city, Jessup is keen on investing in a broad spectrum of tech companies.
The fund’s sourcing strategy is threefold: first, it will focus on innovative projects emerging from UNLV, facilitating a direct connection to the university’s research and development findings. Second, Jessup will engage with existing startups within the local ecosystem of Las Vegas. Finally, he aims to attract founders from outside the region to establish their companies in Southern Nevada. The city’s appealing economics, including no state income tax and relatively low operational costs, bolster this recruitment effort.
Among the first investments made is WAVR, a company specializing in atmospheric water harvesting. Jessup’s commitment of $500,000 is further supported by a matching agreement with the Governor’s Office of Economic Development, which aims to enhance local investment opportunities. Another investment involves Vena Vitals, a medical device firm that spawned from UC Irvine, showcasing the fund’s strategy to engage both local and external startups.
The Importance of Localized Venture Capital
Jessup underscores the critical need for a locally-based venture fund like Desert Forge Ventures. While there is plenty of capital entering the state, there remains a lack of organized local venture capital at a level that meets the demands of burgeoning startups. Although there are angel funds operating in the area, they are insufficient to satisfy the financial requirements of companies seeking substantial investment.
Founders who frequently exhaust personal and angel funding sources find themselves at a crossroads when seeking larger financing rounds. If local funding is unavailable, they often look to relocate elsewhere, typically to areas with existing capital networks. Jessup’s initiative targets not just the capitalization of companies, but also their retention within Nevada. He envisions a community-centric approach to venture capital, where familiarity and personal investment in the success of local founders and their businesses foster a sustainable ecosystem.
Long-Term Vision for Growth
Regarding future growth, Jessup has a clear roadmap. His immediate focus is on reaching the $10 million threshold for the fund and maximizing the matching commitments from the state. This endeavor marks the first phase of investment – or Fund I – where the emphasis will be on deploying capital effectively to the selected companies.
Once Fund I reaches its limit, Jessup is keen to pivot to Fund II, based on the outcomes and learning from the initial fund. Drawing on his experiences at the University of Arizona, where he witnessed a dramatic transformation of the local job market thanks to homegrown companies, he harbors an aspiration to replicate that success in Las Vegas. His goal is to cultivate a vibrant ecosystem that can produce multiple high-value enterprises similar to Ventana Medical Systems, a testament to successful university spinouts.
The Significance Behind “Desert Forge Ventures”
The name “Desert Forge Ventures” encapsulates a strong sense of place and purpose. Jessup highlights how the name reflects not only the geographical attributes of the region but also the forging of new companies and ideas within the desert landscape. The metaphor of a forge evokes a sense of craftsmanship and resilience—attributes that are essential for nurturing startups that will thrive in the unique economic climate of Southern Nevada.
As Desert Forge Ventures embarks on its journey, its implications for the local economy and community are profound. With a focus on supportive investment, geographical groundedness, and a commitment to local founders, this initiative seeks not just to ignite the startup landscape in Las Vegas but to sustain and elevate it for years to come.