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60 | DOING BUSINESS IN CONNECTICUT | 2019 The state's venture capital arm just turned 30. And it's showing no signs of slowing down. Connecticut Innovations is celebrating 30 years in business. Founded in 1989, the organization has helped launch hundreds of successful companies, including Achillion Pharmaceuticals (NASDAQ: ACHN), Alexion Pharmaceuticals (NASDAQ: ALXN), Arvinas (NASDAQ: ARVN), BioHaven (NASDAQ: BHVN) and Aventri, to name just a few. CI has invested in 500 startups over its three decades. About one- fifth of those investments were pre-seed—meaning the companies had no customers, revenue or outside funding—by far the most difficult point for a founder to raise capital. "CI leads about 70 percent of the first investments in Connecticut startups, supporting these nascent companies as they build their proof of concept," said David Wurzer, CI's chief investment officer. "What CI does is critical. If we don't invest early, some of these companies might go to a different state. Far worse, some life-changing innovations might never make it to market." Connecticut Innovations has a dual mandate to generate returns and create economic value for the state. Keeping these goals in mind, the venture team deeply scrutinizes every potential investment, voting yes on fewer than 5 percent of the companies coming in the door. As a result, an investment from CI signals to other investors that a company is worth consideration. CI's reputation for strict due diligence has enabled the group to leverage more than $2 billion in private capital in just the past 10 years, investment dollars that flow directly into the state's ecosystem. EVOLVING ALONG WITH THE INDUSTRY CI grew out of a predecessor organization the state created in the early 1970s to help Connecticut companies lessen their reliance on the defense industry. This early organization funded product development efforts within established companies, receiving a royalty for products that took off. In the late 1980s, the state legislature, deciding it needed a way to help promising young companies get off the ground, formed Connecticut Innovations. Peter Longo, CI's senior managing director of investments, joined the organization 24 years ago and has witnessed its evolution. "In the early days, we were doing venture capital investing when there wasn't a lot of venture capital around. We operated on a much smaller scale than we do today, investing only in a small number of companies that were founded by Connecticut entrepreneurs and were growing up here in Connecticut." Throughout its history, CI has been on the forefront of numerous industries, notably personalized medicine, fintech—"We were investing in fintech before it even had a name," said Longo— insurtech and e-commerce. "We invested in Cyberian Outpost in the mid-1990s, and it became one of the most successful early e-commerce companies in the world," said Longo. "The company sold hard-to-find Macintosh products and at its peak had customers in more than 100 countries." Longo attributes a large part of CI's success to its partnership with local universities. "Yale is extremely adept at spinning out the technologies developed there into successful companies, and UConn is an emerging powerhouse," he said. SPONSORED CONTENT