At the University of North Dakota, students are completely running their own venture capital fund through the Dakota Venture Group (DVG) program. It’s the only one of its kind currently in the U.S. where students get direct experiential learning in the field of venture capital and angel investing without having to report to an advisory board.
Students from many different academic backgrounds, anything from law, marketing, engineering, finance, accounting or entrepreneurship are given the opportunity to conduct due diligence, make investment decisions and negotiate deal terms. Five students are appointed as managing directors.
The DVG program started in 2006 thanks to an $300,000 innovation fund donation, as chairman Emily O’Brien, who is expected to graduate with a masters in entrepreneurship in 2018, shared in an interview. The only way that the program is affiliated with the University at all is just in the fact the participating students also attend the University of North Dakota.
The students also have raised $1.4 million on their own and currently invested in 21 different companies. Companies either pitch to the students directly, or they will come about from referrals and reaching out on their own to find promising investment opportunities.
O’Brien explained they invest in a variety of startups in different sectors, whether it be medical technology, energy, social marketing companies, even a drone company. In the healthcare sector specifically, they have invested in Embomedics, Stemonix and Corvida Medical.
One thing to be clear on is that the students are not getting returns for their investments financially, they don’t even get university credit. It is strictly a unique educational opportunity that gives them the experience of actually investing, as opposed to simulated example in an average classroom of things would work in the real world.
“People are here because they want to be – they want to have that professional experience,” O’Brien explained. “And it’s interesting because the ones who you think this might not really be for them, they are the ones that work the hardest because they don’t understand everything naturally like some of the others, even with no [financial] compensation. And I was in that situation as well.”
As far as alumni go who have left the project, O’Brien said some go the corporate route, some have focused on investing in startups and some have gone on to create their own startups.