ANN ARBOR ? A $250,000 investment made by the University of Michigan?s Wolverine Venture Fund turned into a million dollar payday Thursday when a Life Sciences company developed from UM technology went public on Wall Street ? the first portfolio company to do so since the Fund was created in 1998.
The company, called IntraLase, traded under the symbol ILSE, and opened its initial public offering at $13 a share. The Wolverine Venture Fund owned 80,572 shares, creating a total value of $1,047,436 ? a 40 percent annual return on the four-year investment in IntraLase.
“This is a milestone achievement for the Wolverine Venture Fund, the Ross School of Business and the University itself,” said Timothy Faley, Ph.D., Managing Director of the Wolverine Venture Fund and the Samuel Zell & Robert H. Lurie Institute for Entrepreneurial Studies at the University of Michigan.
“This fund is not just a classroom project – it is a real fund with real risk, being managed by first- and second-year MBA candidates as equal partners. Students research all the companies, evaluate the business proposals, and make the final investment decisions. To have a portfolio company go IPO is the ultimate testimonial to the collective venture capital acumen and sound decision-making of the WVF and its student leaders, and is an invaluable real-world venture capital experience.”
Typically investors in an IPO can?t cash in their shares for 180 days after the initial public offering. But since the Fund only owned one-third of 1 percent of the total shares outstanding, it was allowed to redeem the shares at the opening bid of $13.
The $1 million-plus check will swell the Fund?s total value to more than $3 million and allow the Fund to invest in other UM-developed technologies, Faley said.
Another beneficiary of the IntraLase IPO is the UM Tech Transfer Office, Faley said. But Director Ken Nesbit could not be reached for comment.
A third Ann Arbor player in the IntraLase deal was EDF Ventures, a venture capital company. Officials of EDF Ventures also could not be reached for comment.
IntraLase is an ophthalmic medical device company that has developed and markets ultra-fast laser, related software and disposable devices for use in LASIK, the most common vision correction process in use today. Its laser technology offers a blade-free approach for performing the critical first step of the LASIK eye surgery: creating the corneal flap.
“The Wolverine Venture Fund has always been a valuable partner of IntraLase’s,” said Tibor Juhasz, co-founder, vice president and chief technology officer at IntraLase. “The WVF played an important role in the foundation of our company as one of our initial investors, and has been alongside us every step of the way. Now, as we reach this most important corporate milestone, we are proud to see the students of the Wolverine Venture Fund grow with us.”
