money moves

Houston venture fund of funds doles out $5 million in Austin firm in its first investment

LiveOak Venture Partners, an Austin-based firm, is the first recipient of Houston Exponential's fund of funds. Courtesy of LiveOak

After closing its initial round of funding last year, Houston Exponential's fund of funds, called the HX Venture Fund, has closed its first investment on March 29. Austin-based LiveOak Venture Partners received a $5 million investment from the fund.

The HX Venture Fund raised $30 million after launching in October of last year. The fund's goal is to invest in out-of-Houston venture funds in the hopes that they reinvest that money into Houston startups.

"We invested in LiveOak Venture II because of the firm's compelling investment track record, expertise and vigor of the general partners, their extensive network of relationships with proven entrepreneurs, and their focus on capital efficient early stage technology companies in Texas," says Guillermo Borda, managing partner at HX Venture Fund, in a release. "LiveOak's team is committed to making a significant impact in the Houston startup ecosystem."

The HX investment is a part of LiveOak's Fund II, which was oversubscribed and closed at $105 million, the company announced today. According to a release from LiveOak, Fund II is a continuation to the firm's dedication to Texas entrepreneurship. The fund will focus on funding within the state's four largest tech hubs — Austin, Houston, Dallas and San Antonio — and have initial investments ranging from $2 million to $4 million, the release states.

The firm's portfolio focuses on seed and series A funding, and most of its investments are Austin-based, with the exception of three Dallas companies. LiveOak invested in Houston-founded CS Disco, an AI-enabled tool for legal business, but the company has since moved to Austin, according to a public relations representative. LiveOak also invested in San Antonio-founded Infocyte, but the company also relocated to Austin.

Houston has been a strategic market for LiveOak, says managing partner, Krishna Srinivasan, in the release, citing the city's recent entrepreneurial activity.

"We are excited to partner with HX Venture Fund and its strategic investment partners, comprising multiple leading Houston based corporations, to catalyze and grow this activity," says Srinivasan, in the release. "Given LiveOak's investment strategy of being the leading source of capital for entrepreneurs across Texas, we view this investment as highly synergistic with our efforts to enable world-class, category dominating companies coming out of Houston."

HX modeled its fund after the Renaissance Venture Capital Fund in Michigan, from which 10 outside venture capital firms benefitted. Renaissance Fund reported positive results from the fund of funds and Chris Rizik, CEO and fund manager of Renaissance, serves as a member of the investment committee.

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Houston-based imaware, which has an at-home COVID-19 testing process, is working with Texas A&M University on researching how the virus affects the human body. Getty Images

An ongoing medical phenomenon is determining how COVID-19 affects people differently — especially in terms of severity. A new partnership between a Houston-based digital health platform and Texas A&M University is looking into differences in individual risk factors for the virus.

Imaware, which launched its at-home coronavirus testing kit in April, is using its data and information collected from the testing process for this new study on how the virus affects patients differently.

"As patient advocates, we want to aid in the search to understand more about why some patients are more vulnerable than others to the deadly complications of COVID-19," says Jani Tuomi, co-founder of imaware, in a press release. "Our current sample collection process is an efficient way to provide longitudinal prospectively driven data for research and to our knowledge, is the only such approach that is collecting, assessing, and biobanking specimens in real time."

Imaware uses a third-party lab to conduct the tests at patients' homes following the Center for Disease Control's guidelines and protocol. During the test, the medical professional takes additional swabs for the study. The test is then conducted by Austin-based Wheel, a telemedicine group.

Should the patient receive positive COVID-19 results, they are contacted by a representative of Wheel with further instructions. They are also called by a member of a team led by Dr. Rebecca Fischer, an infectious disease expert and epidemiologist and laboratory scientist at the Texas A&M University School of Public Health, to grant permission to be a part of the study.

Once a part of the study, the patient remains in contact with Fischer's team, which tracks the spread and conditions of the virus in the patient. One thing the researchers are looking for is the patients' responses to virus complications caused by an overabundance of cytokines, according to the press release. Cytokines are proteins in the body that fight viruses and infections, and, if not working properly, they can "trigger an over-exuberant inflammatory response" that can cause potentially deadly issues with lung and organ failure or worse, per the release.

"We believe strongly in supporting this research, as findings from the field can be implemented to improve clinical processes-- helping even more patients," says Wheel's executive medical director, Dr. Rafid Fadul.

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