A new venture capital fund hopes to tap into Tulane University’s nationwide brand and active alumni network across the country to find both investors and startup companies worthy of a cash infusion.
New Orleans-based 1834 Ventures on Monday announced the launch of its inaugural $20 million startup fund and its first two investments.
Co-managing partners Patrick Hernandez and Evan Nicoll said they plan to leverage the alumni network of Nicoll’s alma mater, Tulane, to invest in and grow scalable ventures while encouraging them to bring their business to Louisiana.
“Tulane graduates and entrepreneurs who have participated in Tulane programming have received a top-tier education,” said Hernandez. “We consider that a competitive advantage. Plus, we know that Tulane grads around the country have an affinity for New Orleans and Louisiana.”
“We are hoping to capitalize on that to bring more business to the state,” he added.
Hernandez said the fund has raised $4.4 million in commitments from 30 investors nationwide. One of those investors is the Louisiana Economic Development Corporation, which spends federal dollars dedicated to economic development by the Biden Administration. The State Small Business Credit Initiative will match private dollars raised for investment.
The fund’s first two investments are in Cabana Mental Health Solutions, a health care platform; and Orion Longevity, maker of a smart mattress cover designed to improve sleep.
The fund, named in honor of Tulane’s founding year, is not affiliated with the university. Instead, it was created to “support and invest in innovation emerging from its extended community,” said Hernandez, who spent more than four years as director of capital access at the New Orleans-based startup incubator Propeller.
The new fund got SSBCI approval in February and kicked off fundraising shortly after.
“We focused a lot on hitting some bigger out-of-state markets, where people know that Louisiana has this influx of capital,” Hernandez said. “We wanted to build momentum outside of the state first and then come back.”
The fund will invest both in new companies and in established ones that need capital to continue growing.
Attraction strategy
The first two bets from 1834 Ventures are on out-of-state startups with Tulane ties.
Cabana is a digital mental health platform serving U.S. military veterans. Founded by Tulane alum David Black, the company is based in Annapolis, Maryland, but is planning an imminent move to New Orleans.
Cabana, which said it has secured seven-figures in annual recurring revenue through federal contracts, is partnering with Ochsner to strengthen wellness and support initiatives for employees.
The company provides online, on-demand therapy with individual counselors or small groups, as well as workplace “pods,” physical booths where users can take tailored, short mental health breaks during the workday.
1834’s other announced investment is in Orion Longevity, maker of mattress covers that use biometric sensors to monitor and optimize sleep. The company, led by Tulane alum Harry Gestetner, aims to begin full production this fall. Its prototypes use high-tech methods to regulate users’ body temperatures.
The company will remain headquartered in California but plans to find ways for its supply chain to run through Louisiana.
“We have an attraction strategy, focusing not just on companies based locally but also ones willing to set up operations here or move back here,” Hernandez said.
1834 Ventures is working closely with the Tulane Innovation Institute and the Tulane Venture Fund on co-investment, programming, and founder readiness.
“With 1834 Ventures now part of Louisiana’s investment scene, we’re opening more doors for ventures ready to launch and grow here,” said Kimberly Gramm, managing partner at Tulane Ventures.
In late August, the fund will co-lead a two-part webinar series with the university’s Innovation Institute on venture capital fundamentals. It will be open to founders and startup teams.
1834 Ventures encourages applications from startups founded by Tulane alumni, students, faculty, staff and community, a group that could include any business that participated in Tulane entrepreneurial support programming. But it is not limited to them.
It plans to invest in many different types of businesses and at different stages of development, including the pre-seed, seed and Series A stages. Check sizes will range from $50,000 to $1 million.
Rushing to invest federal dollars
1834 Ventures is the ninth fund in the state approved to participate in the State Small Business Credit Initiative administered by Louisiana Economic Development. The program, launched in 2023, could potentially provide up to $113 million in capital for the state’s entrepreneurs with an emphasis on supporting historically underserved communities. There are deadlines that have to be met to unlock all the money.
The state’s program, recently rebranded “Louisiana Opportunity Capital,” has committed more than $25 million to nine participating funds, according to LED, which said 150 Louisiana small businesses have received investment or loans through the state program. The state added a direct investment program, the Louisiana Growth Fund, earlier this year in an effort to get dollars into the hands of entrepreneurs more quickly.
The program supplies public matching funds for private investment dollars up to a set amount. The state has committed $5 million in matching funds so far to 1834 Ventures.
Ochsner Health and Tulane are among those operating SSBCI-backed funds. Boot64 Ventures has been among the most active, investing $5.8 million in 26 companies to date.
After the program’s slow launch, funds investing SSBCI money have picked up the pace, in the hopes of unlocking all the potential federal matching dollars in the time allotted.
