MUSC to Launch First Venture Fund, 1824 Health Ventures

The Medical University of South Carolina (MUSC) is betting big on its own innovative culture, announcing the launch of the academic medical center’s first venture fund, 1824 Health Ventures Fund I, LP. By and through the MUSC Foundation: the 1824 Health Ventures represents a significant milestone moment for a university with 200 years of history as an innovation champion, so much so that its first venture fund is named in honor of its founding year.

Around the country, universities are increasingly stepping into the startup game, spinning out new companies, patents and technologies with higher education embracing entrepreneurship like never before. Now, MUSC is joining the movement with the commitment of a $20 million fund designed to provide a dedicated source of seed capital to exclusively grow MUSC-affiliated companies and its robust innovation ecosystem.

Backed by limited partners who support the broader MUSC enterprise, the fund will focus on early-stage investments that help to bridge the gap between academic research and commercial viability.

“If you look at the ingredients needed for successful spinout companies, it starts with great science and great people,” said Nathan Dolloff, Ph.D., director of entrepreneurship at the MUSC Hollings Cancer Center. “But you also need financial power. Nothing gets done without those three major elements, and I think it’s a great example of MUSC leadership recognizing the need and stepping up to fill it.”

Dolloff’s own startup, Leukogene Therapeutics Inc., an MUSC biotech startup focused on developing new therapeutics for patients with advanced-stage cancer, has been announced as the first company joining the fund’s portfolio. The investment will look to help Leukogene and other companies cross the aptly named “Valley of Death,” a phase often referred to when many promising discoveries fail to reach fruition due to a lack of funding.

“We are thrilled to secure funding from 1824 Health Ventures,” said Leukogene CEO Sandeep Gupta, Ph.D. “It is a strong endorsement of Leukogene’s platform and its potential to treat immunologically cold tumors. This funding will be instrumental in enabling Leukogene to advance its lead candidates further into preclinical development, he added, referring to studies conducted to assess the safety profiles of potential new drugs before they can be tested in human clinical trials.

For MUSC startups like Leukogene, 1824 Health Ventures hopes to nurture an entrepreneurial ecosystem that can grow over time, reinvesting only in MUSC startups, and develop a sustainable network for entrepreneurial activity across the enterprise. MUSC also hopes the bold move catapults South Carolina into the eyes of other groups looking to invest in the state’s talent and ecosystem. South Carolina currently ranks 44th in the nation in venture capital rankings, according to the U.S. Bureau of Economic Analysis. However, from 2012 to 2022, the state has seen the tenth-highest growth rate in venture capital funding relative to the gross domestic product (GDP).

“We know that Charleston in particular has grown tremendously as an innovation hotspot over the last 10 years – fourth best in the nation in terms of patents per population,” said Jesse Goodwin, Ph.D., chief innovation officer at MUSC. “Now it’s time for us to take that next step and show how attractive our state can be in terms of attracting funding and retaining our talent.”

The fund will be managed by Bob Crutchfield, a senior executive with over 30 years of leadership experience with major international companies, entrepreneurial startups and venture capital firms. In alignment with the OneMUSC strategic goal of stimulating the state’s economy through innovation, the fund is expected to support the creation of contracts and higher-wage science, technology, engineering and mathematics (STEM) jobs in the state with its investment over the next five years.

“MUSC has been one of the state’s leaders in innovation and life-science development throughout its history,” said Stuart Ames, CEO of the MUSC Foundation. “This venture capital funding is crucial in allowing MUSC to foster groundbreaking innovation, support our own entrepreneurs and attract more to our enterprise and state.”

While the fund will be another example of financial backing and a symbol of support for MUSC innovators, for companies like Leukogene, Dolloff sees the fund as a true example of MUSC working toward its aspirational 20-year goal of stimulating South Carolina’s economy through innovation – something critically needed by a state that’s seeing regional oversight.

“Life science investments have historically been limited to just a few geographical pockets across the country. It would be a major win for South Carolina to capture even a fraction of that outside capital, but it needs to start with local sources first. It’s exciting to see MUSC leading the way, and it is a testament to the University’s commitment and vision for innovation.”