Innovation Works (IW) is one of the most active early-stage investors in the country and the most active early-stage investor in the State of Pennsylvania. So far, IW has financially supported over 761 companies that have gone on to raise $3.3 billion in follow-on funding, and IW portfolio companies have generated and retained over 20,000 jobs in the State of Pennsylvania. Pulse 2.0 interviewed Innovation Works President and CEO Ven Raju to learn more about the company.
Ven Raju’s Background
What is Ven Raju’s background? Raju said:
“My professional experience has primarily been in investment, specifically in venture capital and private equity. This includes identifying promising opportunities, conducting due diligence, structuring transactions, managing portfolios, and operational oversight through participation on portfolio boards of directors.”
“In my previous role as managing director at Northwell Ventures, the corporate venture arm of Northwell Health, I led a team in deploying capital to early and growth-stage companies across various healthcare sectors. Before that, as a partner at Chestnut Ventures, I had the opportunity to invest in a wide array of industries, including health tech, IoT, SaaS, AI/ML, robotics, and life sciences.”
“Before transitioning to the investment side, I began my career as a strategy consultant advising Fortune 100 clients on mergers and acquisitions. Currently, I serve as an adjunct faculty member at the Lebow School of Business, Drexel University, and as a guest lecturer at The Wharton School, University of Pennsylvania.”
Formation Of Innovation Works
How did the idea for IW come about? Raju shared:
“Innovation Works is the Southwestern PA partner of the Ben Franklin Technology Partner (BFTP) network, a network since 1983 that has been dedicated to growing Pennsylvania’s entrepreneurial economy.”
“In partnership with the Pennsylvania Department of Community and Economic Development, the BFTP serves as a catalyst for economic growth by providing access to capital, knowledge, and networks that foster innovation, commercial traction, and success for early-stage companies. The organization is the country’s gold standard for state and regional technology-based economic development with 40+ states now implementing technology-based economic development efforts.”
Favorite Memory
What has been your favorite memory at IW so far? Raju reflected:
“Founders demonstrate remarkable tenacity as they seek every available resource to overcome the challenges of building and scaling their companies. Engaging with these visionaries as their ventures transition from conceptualization to thriving enterprises is both an honor and a privilege. Playing a direct role and being a small part of their growth journey has been a defining highlight of my experience.”
Key Focus Areas
What are key areas of focus for IW? Raju explained:
“Innovation Works is one of the most active early-stage investors in the country and the most active early-stage investor in the state of Pennsylvania, with nationally ranked programs in software, hardware, life sciences, and robotics. We provide a range of support services for early-stage companies including assistance with product development, customer discovery, go-to-market strategy. We also provide entrepreneurs access to customers, mentors, and investors. Our vertical agnostic seed fund handles anywhere from 40-60 transactions annually and our growth fund invests in companies as they look to scale.”
Challenges Faced
What challenges have Raju faced in building the company? Raju acknowledged:
“The macro venture environment and the venture asset class specifically are facing some headwinds. As a result, early-stage companies have had to recalibrate fundraising expectations and goals. We have bolstered our level of support to help offset funding needs for our portfolio companies and beyond. In the last 18 months, we have doubled our investment capacity to better serve early-stage companies in our region.”
Evolution Of The Firm’s Mission
How has the mission evolved since launching? Raju noted:
“Our mission has remained the same since our founding in 1999: investing in the people and businesses that drive innovation and propel Southwestern PA’s economic growth. Innovation Works exists to support the region and foster tech-based economic development through job growth, investments, and programs for entrepreneurs that help them scale their businesses.”
Success Stories
When asking Raju about success stories, he highlighted:
“We’ve expanded our programmatic scope to support additional verticals, such as robotics. Recently, we launched a Life Sciences revolving fund in partnership with Highmark – AHN, which we anticipate will be the most active and largest source of early-stage capital for life sciences companies in the region.”
Differentiation From Others
What differentiates IW from other funds? Raju affirmed:
“While I covered our investment programs earlier, our manufacturing programs help founders understand how to build better products, simplify their supply chains, and leverage access to a network of over 3,000 manufacturers in the region. Our experienced manufacturing team assists with product development, helping founders design and test their products with a state-of-the-art prototyping lab at our Robotics Factory location. The program also helps founders with access capital to support product iteration and supports local manufacturers with internship development and funding opportunities as well.”
Emerging Trends
What trends are emerging in the Pittsburgh startup ecosystem? Raju concluded:
“The past year has been significant for Pittsburgh’s tech economy. The region secured approximately $3.12 billion in funding in 2023, the second-highest year on record. Despite a national decline in fundraising volume, Pittsburgh experienced a surge in investment activity, with a staggering 203.2% increase over 2022. The autonomous vehicle industry, robotics, and artificial intelligence played significant roles in achieving this milestone, further cementing Pittsburgh as a global hub for technological innovation and investment.”
