Virginia Innovation Partnership Corporation (CIT>>VIPC) Third FY2022 Quarterly Report
Summary
A letter dated May 1, 2022 from Susan Aitcheson, CFO of the Virginia Innovation Partnership Corporation (VIPC), to Jonathan Howe, Director of the Department of Planning and Budget, enclosing the third FY2022 Quarterly Report. The enclosed report covers the quarter of March 31, 2022 and includes a budget analysis for the nine months ended March 31, 2022, a statement of investments and grants made, and a timeline of the transition to the new Virginia Innovation Partnership Authority. It lists investment in companies of $5,500,113.63 by Virginia Venture Partners (VVP) against a budget of $4,500,000.00, and states that no operating entities were owned during FY22 Q3.
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“Virginia Innovation Partnership Corporation (CIT>>VIPC) Third FY2022 Quarterly Report.”
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May 1, 2022
Mr. Jonathan Howe
Director
Department of Planning and Budget
1111 East Broad Street, Room 5040
Richmond, Virginia 23219
Dear Mr. Howe:
Enclosed please find the third FY2022 Quarterly Report for the Virginia Innovation Partnership
Corporation (CIT>>VIPC). The attached report fulfills the requirements of the Appropriations Act Item
135 D.2 (Special Session I, 2021).
Please feel free to call me at 703-689-3021 if you have any questions.
Sincerely,
Susan Aitcheson
CFO
Virginia Innovation Partnership Corporation
cc: The Honorable Caren Merrick, Secretary of Commerce and Trade
The Honorable Janet D Howell, Chair, Senate Finance & Appropriations Committee
The Honorable Barry Knight, Chair, House Appropriations Committee
Ms. Carla Karnes, Staff Director, House Appropriations Committee
Ms. April Kees, Staff Director, Senate Finance & Appropriations Committee
Ms. Toni Walker, Associate Director, Department of Planning and Budget
Ms. Samantha Martin, Budget and Policy Analyst, Department of Planning and Budget
Dr. Barbara Boyan, VIPC Board of Directors Chair
Mr. Rob Quartel, VIPC Board of Directors Finance Committee Chair
2214 Rock Hill Road
Suite 600
Herndon, VA 20170-4228
Tel.703.689.3000
Item 135.D.2.a
Fiscal Year 2022 Quarter 3
March 31, 2022
Financial Performance
Virginia Innovation Partnership Authority
BUDGET ANALYSIS
For the Nine Months Ended March 31, 2022
(In Thousands) (In Thousands)
ACTUAL -Jul - Mar 2022 FORECASTED -Fiscal Year 2022
Actual Budget Variance Forecast Budget Variance
Revenue
$ 36,420 $ 31,163 $ 5,257 Commonwealth Appropriation - General Fund $ 41,550 $ 41,550 $ -
2 3 (1) Interest & Misc. Income 4 4 -
36,422 31,166 5,256 Total Revenue 41,554 41,554 -
Expenses and Transfers
- 2 (2) VIPA Administrative Expense 3 3 -
12,020 12,075 (55) Transfer to VIPC - FY2022 Appropriation 16,100 16,100 -
24,469 19,088 5,381 Transfer to COEs - FY2022 Appropriation 25,450 25,450 -
36,489 31,165 5,324 Total Expenses & Transfers 41,553 41,553 -
Consolidated Revenue, Expenses and Changes in Net Position
36,422 31,166 5,256 Revenue 41,554 41,554 -
36,489 31,165 5,324 Expenses and Transfers 41,553 41,553 -
(67) 1 (68) Change in Net Position 1 1 -
2,592 2,028 564 Beginning Net Position 2,592 2,028 564
$ 2,525 $ 2,029 $ 496 Ending Net Position $ 2,593 $ 2,029 $ 564
Virginia Innovation Partnership Corporation
Fiscal Year 2022 Q4 Forecast
Operating Funds Designated Funds
COV Other COV
Entrepreneurial Strategic Unmanned
Discretionary Fund Grants & Commercialization Investment Ecosystems Initiatives Systems Building sale
Operating Rent Contracts Division Division Division Fund Fund Proceeds Total
(In Thousands)
Beginning Balance at 7/1/2021 $ 994 $ ‐ $ 665 $ 32,384 $ 16,383 $ 3,296 $ 542 $ 1,384 $ 20,678 $ 76,326
REVENUE
General Fund Appropriation $ 3,196 $ 750 $ 5,000 $ 3,100 $ 2,000 $ 1,000 $ 1,000 $ 16,046
Interest, Sponsorship, Return on Investment $ 43 $ 33 $ 1,660 $ 4 $ 163 $ 158 $ 2,061
Contracts & Grants $ 4,801 $ 4,801
Total Revenue $ 3,239 $ 750 $ 4,801 $ 5,033 $ 4,760 $ 2,004 $ 1,163 $ 1,158 $ ‐ $ 22,908
EXPENSES AND TRANSFERS
Operating and Designated Programs $ 3,600 $ 340 $ 4,761 $ 10,452 $ 1,111 $ 1,644 $ 1,437 $ 23,345
Contracts & Grants $ 4,472 $ 4,472
Transfers and Indirect Application to Designated Programs $ ‐
Total Expenses $ 3,600 $ 340 $ 4,472 $ 4,761 $ 10,452 $ 1,111 $ 1,644 $ 1,437 $ ‐ $ 27,817
Net Change $ (361) $ 410 $ 329 $ 272 $ (5,692) $ 893 $ (481) $ (279) $ ‐ $ (4,909)
Forecasted Ending Balance at 6/30/2022 $ 633 $ 410 $ 994 $ 32,656 $ 10,691 $ 4,189 $ 61 $ 1,105 $ 20,678 $ 71,417
Virginia Innovation Partnership Corporation
BUDGET ANALYSIS
For the Nine Months Ended March 31, 2022
Commonwealth Projects Funded by Appropriation & Other Revenue
(In Thousands) (In Thousands)
ACTUAL -Jul - March 2022 FORECASTED - Fiscal Year 2022
Actual Budget Variance Forecast Budget Variance
Revenue
$ 12,020 $ 12,035 $ (15) Commonwealth Appropriation - General Fund $ 16,046 $ 16,046 $ -
1,731 76 1,655 Interest, Sponsorship, Return on Investments & Misc. Income 2,061 101 1,960
13,751 12,111 1,640 Total Revenue 18,107 16,147 1,960
Expenses
3,555 7,121 (3,566) Commercialization Division 5,839 11,772 (5,933)
8,957 7,851 1,106 Investment Division 12,449 8,691 3,758
663 2,069 (1,406) Entrepreneurial Ecosystems Division 1,391 3,274 (1,883)
1,231 1,295 (64) Strategic Initiatives 2,001 1,685 316
850 1,408 (558) Unmanned Systems 1,766 1,871 (105)
- - - Activities Funded by Building Sale Proceeds - 2,000 (2,000)
699 859 (160) Policy, Communications and Commonwealth Engagement 1,314 1,159 155
(728) (864) 136 Unapplied (over-applied) indirects (1,415) (825) (590)
15,227 19,739 (4,512) Total Expenses 23,345 29,627 (6,282)
(1,476) (7,628) 6,152 (5,238) (13,480) 8,242
Strategic Initiatives and Other Funding Provided by Contracts & Grants
Strategic Initiatives
2,839 1,530 1,309 Program Revenue - DHS Commercial First Innovation ™ 4,442 2,295 2,147
2,628 1,417 1,211 Program Expense 4,113 2,125 1,988
211 113 98 Profit/(Loss) 329 170 159
- - - Program Revenue - VDEM iFLOWS 233 - 233
- - - Program Expense 233 - 233
- - - Profit/(Loss) - - -
Other
88 58 30 Program Revenue - SBA FAST 2022 126 58 68
88 58 30 Program Expense 126 58 68
- - - Profit/(Loss) - - -
2,927 1,588 1,339 Program Revenue 4,801 2,353 2,448
2,716 1,475 1,241 Program Expenses 4,472 2,183 2,289
211 113 98 Net 329 170 159
Consolidated Revenue, Expenses and Changes in Net Position
16,678 13,699 2,979 Revenue 22,908 18,500 4,408
17,943 21,214 (3,271) Expenses 27,817 31,810 (3,993)
(1,265) (7,515) 6,250 Change in Net Position (4,909) (13,310) 8,401
76,326 74,920 1,406 Beginning Net Position 76,326 74,920 1,406
$ 75,061 $ 67,405 $ 7,656 Ending Net Position $ 71,417 $ 61,610 $ 9,807
Item 135.D.2.b
Fiscal Year 2022 Quarter 3
March 31, 2022
Investments & Grants
Virginia Innovation Partnership Corporation
Investments & Grants Made and Return on Prior Investments
For the nine months ended March 31, 2022
Actual Budget Variance
Investments made Virginia Venture Partners (VVP):
Investment in 37 companies $ 5,500,113.63 $ 4,500,000.00 $ 1,000,113.63
Return on Prior Investments, including gains and losses:
Returns from 8 companies $ 1,498,762.00
Grants made Commercialization Division:
Commonwealth Commercialization Fund (CCF): 39 companies $ 2,279,432.00 $ 4,901,000.00 $ (2,621,568.00)
Item 135.D.2.c
Fiscal Year 2022 Quarter 3
March 31, 2022
Financial & Programmatic
Performance of Operating
Entities Owned by VIPC
No Operating Entities Owned
during FY22 Q3
Item 135.D.2.d
Fiscal Year 2022 Quarter 3
March 31, 2022
Transition to new Authority
Timeline and Associated Activities for transition into the new Authority
CIT began the transition from its management of the Innovation and
Entrepreneurship Investment Authority (IEIA) to management of the new Virginia
Innovation Partnership Authority (VIPA) after passage of HB1017 and SB756 in
the 2020 Session of Virginia's General Assembly. That new role - as the VIPA
managing non-profit - became official on July 1, 2020.
To ensure a smooth transition and sustained program operation, CIT’s existing Board
remained in place until future governance could be established. In preparation for the
first VIPA Board meeting, CIT’s Board met for the final time on December 3, 2020 to
approve changes in CIT’s bylaws and articles of incorporation that would allow the
newly formed VIPA Board to also serve as the Board for CIT.
Six of the eleven VIPA Board of Directors were appointed in July 2020 by Governor
Northam and a seventh, Virginia's Secretary of Commerce & Trade serving as the VIPA
Vice Chairman, was also in place. As of December 31, 2020, the Board positions
allocated for appointment by the General Assembly's Joint Rules Committee in the
authorizing language were yet to be made. However, the current seven
appointees constituted a quorum for the VIPA and the inaugural Board meeting was
held on December 17, 2020.
The following Board Members were present at the meeting:
Vice Chairman - Secretary Brian Ball
Member - Ms. Monique Adams
Member - Dr. Barbara Boyan
Member - Mr. Richard Hall
Member - Mr. Chiedo John
Member - Mr. Kurt John
Member - Ms. Paula Sorrell
At the December 17, 2020, Board meeting, several critical actions were taken by the
Board to ensure that CIT was authorized to provide administrative and operational
support to the VIPA and ensure uninterrupted services from programs that required
VIPA oversight. These actions were unanimously approved through a governance
resolution and separate motions that included:
Designating CIT as the managing non-profit and operating arm of the VIPA
Appointing the President of CIT to serve as the President of the VIPA and carry
out the duties outlined in the resolution
Designating the Board of Directors for the VIPA to also serve as the Board of
Directors for CIT
Approving Advisory Boards for the Investment, Commercialization, and
Entrepreneurial Ecosystems Divisions at CIT
Approving Guidelines for the first solicitation of the Commonwealth
Commercialization Fund (CCF) to be announced in January 2021.
Delaying the first report on the VIPA Centers of Excellence until December 1,
2021
Delaying the election of VIPA officers until the full Board has been appointed.
The VIPA held its second Board meeting on March 4, 2021, however, the four Joint
Rules Committee appointments had still not been announced. The Board received an
update on CIT’s FY21 goals and objectives and strategies for FY22 planning.
Additionally, the VIPA Board approved the criteria for the Regional Innovation Fund.
Overviews of VIPA’s four centers of excellence (CCAM, CCALS, CCI, VBHRC) were
presented by the directors of each organization.
Significantly, the first solicitation of the new Commonwealth Commercialization Fund
was launched in January 2021, and the first solicitation of the new Regional Innovation
Fund was launched in March 2021. Both programs made awards before the end of
FY21.
In May 2021, the General Assembly’s Joint Rules Committee made the remaining four
appointments to the VIPA. Those members were:
Member – Andrew Ko
Member – Chris Long
Member – Rob Quartel
Member – Angela Reddix
The full Board met for the first time on June 10, 2021, virtually. Key items on the
agenda for the 4th Qtr. meeting included: Approval of CIT’s Operations Plan for FY22,
approval of CIT’s budget for FY22, approval of the recommended name change from
the Center for Innovative Technology (CIT) to the Virginia Innovative Partnership
Corporation (VIPC). The Board was provided a timeline for the rebranding effort that
included SCC approval for the corporate name change.
CIT's Entrepreneurial Ecosystems Division was working with stakeholders in all nine GO
Virginia Regions to establish criteria for the second solicitation of the Regional
Investment Fund (RIF). The criteria were presented to, and approved by, the VIPA
Board at the March 4, 2021, meeting. The first awards from the RIF were made in June
FY21.
Since July 1, 2020, operational funding for CIT and the newly consolidated COEs has
been provided to CIT and then distributed accordingly. Portions of the overall Item#135
appropriation initially required VIPA Board approval but, since an initial meeting of that
Board was delayed pending appointment the full Board, a budget amendment (Item 135
#2.c) was submitted and passed during the 2021 Special Session of the General
Assembly that authorized CIT's President and CEO to approve and release related
funding. Appropriated funds have been provided to the COEs in accordance with
requirements outlined in the budget language.
The Virginia Innovation Partnership Authority (VIPA) held its first in-person Board
meeting on September 9, 2021, in Richmond. In addition to offering the first chance for
most Board members to meet each other in-person, the meeting was significant for
many important actions taken by the Board.
Dr. Barbara Boyan, the Dean of VCU’s College of Engineering, was elected as
the VIPA’s first Board Chairperson.
The Board established five new standing committees and Chairpersons for each:
o Executive Committee – Barbara Boyan
o Finance Committee – Rob Quartel
o Strategy Committee – Kurt John
o Entrepreneurial Ecosystems Committee – Paula Sorrell
o Diversity, Equity, and Inclusion Committee – Angela Reddix
The Auditor of Public Accounts provided a very positive report on CIT’s FY21
audit results.
The Board approved changes to CIT’s Bylaws and Articles of Incorporation to
facilitate SCC approval of the name change to the Virginia Innovation Partnership
Corporation (VIPC).
The President’s Report included a review of CIT finance, operational highlights,
and corporate performance for FY21. This included an assessment of goals and
metrics established in the FY21 operating plan.
The Board reviewed and accepted the Investment Division’s Indirect Investment
policy recommendations
CIT’s marketing consultant, ACG, provided an update on the rebranding process.
.
In the quarter ended December 2021, the formal announcement to the public of the
name change from Center for Innovative Technology (CIT) to Virginia Innovation
Partnership Corporation (VIPC) was made, including press releases, website and other
social media updates.
To recap the major transition activities that have been completed,
The Board and Board Committees have been established and meet regularly.
The division and program guidelines and policies have been created and funding
is being deployed accordingly.
The managing nonprofit has undergone the name change and rebranding.
At this point, the new Authority has moved into the post-transition phase of operations.
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