News releases

August 20, 2024

New independent venture capital fund accelerates and enhances innovation ecosystem at the UW

Pack Ventures, a new venture capital fund that is collaborating with the University of Washington, aims to help entrepreneurs launch new innovations and grow startups that emerge across the UW, while also giving Husky alumni access to investment opportunities.Dennis Wise/University of Washington

Pack Ventures, a new venture capital fund that is collaborating with the University of Washington, aims to help entrepreneurs launch new innovations and grow startups that emerge across the UW, while also giving Husky alumni access to investment opportunities.

Pack VC is independently run and is building affinity to the UW, lowering the threshold to investing and leveraging the deep relationships with innovators who have a UW affiliation — spinouts from campus and alumni-founded companies. The UW and Pack Ventures signed a memorandum of understanding earlier this year, formalizing the relationship.

Pack Ventures is now a preferred venture partner of the UW and CoMotion, the UW’s collaborative innovation hub. On the back of this agreement, Pack Ventures launched their second venture fund and is raising $30 million to invest in more Husky founders. The second fund already has more than 50 investors.

Ken Horenstein is Pack Venture’s founder.Pack Ventures

Ken Horenstein, Pack Ventures’ founder, said the fund also will help attract faculty and students to the UW, increase philanthropy to the UW and help the UW engage alumni who are looking to invest in emerging companies.  Horenstein has committed to donating up to 2% of his personal proceeds to the UW and is encouraging all fund investors to make a similar pledge.

“I’m kind of a marketplace. I’m trying to pair people who have investment dollars to good investment opportunities,” Horenstein said, emphasizing companies that will succeed and are likely to have a positive social impact on a global scale.

“Part of my calculus to focus on the UW is: I think the talent is world class. I think the resources are world class. And there’s not enough attention here, which has created what we call in finance, ‘alpha,’ which is an overlooked opportunity that will perform better than the rest of the market,” he said.

Horenstein said over the past decade the UW had more than $30 billion in exit valuations, a broad measure of the worth of companies, intellectual property and other assets. With additional nurturing, Horenstein said, that number will grow.

The UW is one of the top institutions nationwide receiving federal funds for research — more than $1.5 billion in fiscal year 2023, according to the UW Office of Research. That figure is an indicator of the quality and creativity of UW faculty and staff — and quite often these faculty go on to start spinoffs to amplify and scale the impact of their research.

Pack Ventures was an idea that germinated at CoMotion’s first Innovation Roundtable in 2020, part of former Provost Mark Richards’ agenda to help take UW research and discoveries to a higher level of excellence and impact. The Roundtable brings together some of the top names in venture capital and industry from the Pacific Northwest. Participants in the first Roundtable suggested the creation of an Innovation Imperative website that aggregates all things entrepreneurial across UW’s three campuses, helped bring Creative Destruction Lab to the Foster School of Business, had a vision for Pack Ventures and contributed to the diversification of the UW innovation ecosystem.

Chris DeVore, creator of Founders’ Co-op, a Seattle based venture fund, participated in that first Innovation Roundtable. He noticed that similar universities with UW’s research funding had venture capital funds within their ecosystem. While state law prohibits the UW from investing directly in startups, there was an opportunity to bring more early seed funding to companies emerging from the school. Entrepreneurial success leads to entrepreneurial wealth, DeVore said, and fostering that cycle can lead to a number of positive outcomes.

“If we’re better at supporting entrepreneurs, it will, in the long run, support our advancement goals as an institution,” he said. “That’s the capsule.”

The UW has many cornerstones in place to support an innovation culture, but Pack Ventures taking on this work helps supplement and complete the landscape, said Mike Halperin, a member of the Innovation Roundtable, a life sciences investor and an enthusiastic UW supporter.

“There’s a different role to be played by a venture fund, and in particular one which has its DNA, its roots and its goals 100% in supporting the vision and mission of the University of Washington, in support of the population of the state of Washington,” Halperin said.

Horenstein earned his bachelor’s and master’s degrees at the UW and he already was mentoring participants at CoMotion, the innovation center that provides UW researchers with the tools, connections and acumen to transform ideas into economic and societal impact. François Baneyx, the CoMotion director and UW vice provost for innovation, said Horenstein has experience working for M12, Microsoft’s venture fund, and is a community builder who is equipped to deal with the complexity of running a fund.

“Ken has quickly become an integral part of the fabric of our innovation enterprise,” Baneyx said. “He talks to our alumni. He talks to our students. He’s really keen on helping build up the UW entrepreneurial ecosystem.”

Now entering its second fund and its third year, Pack VC has raised more than $10 million from more than 100 investors and invested in 29 companies run by people that have connections to the UW, including faculty, students and alumni. These companies have raised more than $130 million in additional venture capital funding or grants.

Pack Ventures helps those organizations with mentorship and critical early funding. Investments can take years to realize gain — many companies fail early on — but some will breakthrough and deliver returns of up to 50 times the original investment. Unlike other venture funds that have high-dollar investment minimums for limited partners to get access to the fund returns, Pack Ventures lowered the initial threshold, actively embracing people who have been historically excluded from the venture marketplace.

The fund also hires UW graduate students to serve as fellows. Lucy Maynard, a bioengineering doctoral student and current Pack Ventures fellow, said the experience has demonstrated the fundamentals of meeting founders, doing due diligence, understanding the financials and writing investment memos. In the lab, Maynard is working on therapeutics that rewire biology, but she wanted to round out her experience.

“VC has always been an avenue that’s been of interest to me,” Maynard said. “I’ve seen science from the academic lens, I’ve seen it from the industry lens and I’ve had a few opportunities to sort of explore it from a startup lens. And so, VC was that final lens.”

Pack Ventures checked the boxes, she said, especially the goal of cultivating entrepreneurship at UW and in the Pacific Northwest.

Rainfall Health CEO Ahmed ‘Eddie’ Qureshi was an UW undergraduate when he first developed a technology platform for better diagnostics. Since then, Qureshi has been building a digital health platform at Rainfall Health that leverages artificial intelligence to improve healthcare delivery to rural and underserved communities. He built the company as part of the Creative Destruction Lab program in the Foster School, and that’s when he met Horenstein and the team at Pack Ventures.

The meeting led to early seed funding — and today Rainfall Health has 11 employees and has received more than $3 million in two funding rounds from multiple investors, including prominent healthcare executives. They’re hoping to do for healthcare what Airbnb did for hospitality and Uber did for transportation — make healthcare accessible to the 70 million Americans who live two hours or more from a hospital. Building the business with mentors from Pack Ventures, the UW and the talent in the Pacific Northwest has helped Qureshi’s business flourish.

“It makes such a big difference when people are ready and willing to believe that the system can change and improve,” Qureshi said. “That’s half the work right there.”

Another startup to receive Pack Ventures investment dollars is Monod Bio, a spinout from UW Medicine’s Institute for Protein Design. GeekWire reported that Monod Bio and other spinouts from IPD now are valued at more than $1 billion. Monod Bio used technology built at the UW and optimized it for scientists to use in a laboratory, a multibillion-dollar industry. They’re also developing new clinical diagnostics. Founded in 2021, the company set up shop at CoMotion Labs and utilized facilities at Fluke Hall, said David Shoultz, a cofounder, chief operating officer and an affiliate professor of epidemiology in the School of Public Health.

“The first day, thanks to CoMotion and their incubation services, we were able to already have office and lab space,” Shoultz said.

Pack Ventures injected capital in two rounds of funding and today Monod Bio has raised $25 million and has 26 employees operating in office and lab space in Seattle’s South Lake Union neighborhood. Despite the relatively small investment amount from Pack VC, the relationship has “outsized” value thanks to Horenstein’s strategic guidance and his ability to tap into a vast professional network.

Horenstein said he hopes to see innovations impact the world and not be limited to a laboratory.

“We’re progressing science,” he said. “I want to see it actually have an impact on patients or customers or industries.”