FY2022 Annual Report for the Virginia Innovation Partnership Authority (VIPA) and Corporation (VIPC)

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A December 19, 2022 transmittal letter from Susan Aitcheson, CFO of the Virginia Innovation Partnership Corporation, to Michael Maul, Director of the Department of Planning and Budget, enclosing the FY2022 Annual Report for the Virginia Innovation Partnership Authority (VIPA) and the Virginia Innovation Partnership Corporation (VIPC). The letter says the report fulfills Code of Virginia § 2.2-2355 (20) and (17) and the 2022 Appropriations Act Item D requirements. The Annual Report 2022 states that VIPA was launched on July 1, 2020, and that it describes key programs and economic performance.

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“FY2022 Annual Report for the Virginia Innovation Partnership Authority (VIPA) and Corporation (VIPC).” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-rd866-ad63d00ff9/, SHA-256 64110d92c9c616227ca8c51185542e7b4feb817c173710629a8ecf91baa6e303.

Full text

December 19, 2022

Mr. Michael Maul
Director
Department of Planning and Budget
1111 East Broad Street, Room 5040
Richmond, Virginia 23219

Dear Director Maul:

Enclosed please find the FY2022 Annual Report for the Virginia Innovation Partnership Authority
(VIPA) and the Virginia Innovation Partnership Corporation (VIPC). The report fulfills the Code
of Virginia § 2.2-2355 (20) and (17) and the 2022 Appropriations Act Item 127 D requirements.

If any questions, please call me at 703-689-3021.

Sincerely,

Susan Aitcheson
CFO
Virginia Innovation Partnership Corporation

cc: The Honorable Governor Glenn Youngkin
The Honorable Adam Ebbin, Chair, Senate General Laws and Technology
The Honorable Emily Brewer, Chair, House Communications, Technology and Innovation
The Honorable Caren Merrick, Secretary of Commerce and Trade
The Honorable Janet D Howell, Co-Chair, Senate Finance & Appropriations Committee
The Honorable George Barker, Co-Chair, Senate Finance & Appropriations Committee
The Honorable Barry Knight, Chair, House Appropriations Committee
Ms. Anne Oman, 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
www.vipc.org
Annual Report
2022
In accordance with 2022 Appropriation Act Item 127.D and Code of Virginia § 2.2‐2355 (17) and (20),
The Virginia Innovation Partnership Corporation is pleased to submit the following report describing
key programs and economic performance for the Commonwealth of Virginia.
1

ABOUT VIPA
The Virginia Innovation Partnership Authority (VIPA) was launched on July 1, 2020 to support the
life cycle of innovation, from translational research; to entrepreneurship; to pre-seed and seed-stage
funding; as well as acceleration, growth, and commercialization, resulting in the creation of new
jobs and company formation. The Authority provides a collaborative, consistent, and consolidated
approach that will assist the Commonwealth in identifying its entrepreneurial strengths, including
the identification of talents and resources that make the Commonwealth a unique place to grow and
attract technology-based businesses.

The scope of programs the Authority may undertake is broad. It provides for a wide range of powers
and programmatic development. The critical needs and opportunities the Authority can address
include:

• Promote the technology-based economic development of the Commonwealth by building,
attracting, and retaining innovation and high-technology jobs and businesses in Virginia.

• Increase industry competitiveness by supporting the application of innovative
technologies that improve productivity and efficiency.

• Attract and provide additional private and public funding in the Commonwealth to
enhance and expand the scientific and technological research and commercialization
at the state and federal research institutions and facilities, including by supporting and
working with technology transfer offices to advance research from proof-of-concept to
commercialization resulting in new business and job creation.

• Attract and provide additional private and public funding to support and enhance
innovation-led entrepreneurship ecosystems and coordination of existing activities and
programs throughout the Commonwealth to create new job opportunities and diversify
the economy.

• Ensure promotion and marketing of Virginia’s statewide innovation economy and support
and coordinate regional marketing efforts to align local and statewide objectives.

• Close the Commonwealth’s support gap through pre-seed and seed-stage investments,
coordination of private investor networks, and enhanced deal syndication.

The VIPA, with VIPC as its operating arm, brings together components of existing and new program
activities in an approach through which the whole is greater than the sum of the individual programs.
VIPA’s design includes governance and management capabilities to ensure that programs generate
transformative and measurable results.
2

INDEPENDENT NONPROFIT CENTERS OF EXCELLENCE
UNDER A SINGLE STATE AUTHORITY
This new structure allows for greater coordination across these organizations, as well as unified
periodic reporting through VIPC to the Secretary of Commerce and Trade and other Commonwealth
of Virginia stakeholders.

Below is an overview and direct link to each of the Centers of Excellence (COE) annual reports.
VIPC does not approve or include their outcomes in our report metrics. Click logos for annual reports.

Commonwealth Center for Advanced Virginia Catalyst Commonwealth Center for Advanced Commonwealth Cyber Initiative Virginia Academy of Science,
Logistics Systems 501(c)(3) Manufacturing Multi-University Program Engineering and Medicine
501(c)(3) 501(c)(3) 501(c)(3)

Board of Directors Board of Directors Board of Directors •Advisory Board Board of Directors
(10 Members) (16 Members) (12 Members) •Leadership Council (12 Members
Chair: Dawit Haile Chair: David X. Cifu Chair: Nezih Yaramanoglu Exec. Dir.: Luiz DaSilva President: James Aylor
Vice Chair: Vince Barnett CEO: Michael Grisham CEO: John Milton-Benoit
President & Exec. Dir.:
Mark Manasco

Commonwealth Center for Non-stock corporation research Commonwealth Center for Commonwealth Cyber Initiative VASEM is a Virginia nonprofit
Advanced Logistics Systems consortium comprised of the Advanced Manufacturing funds Hub and Node sites corporation established to: Inform,
administers and deploys University of Virginia, Virginia administers private sector to provide resources for the Advocate, and Serve.
seed money for collaborative Commonwealth University, incentive and university research establishment of research faculty/
public sector projects with Virginia Tech, George Mason grants. recruiting, entrepreneurship
Commonwealth partners. University and the Eastern Virginia programs, student internships and
Medical School that contracts to educational programming, and
perform research and develop operations.
infrastructure tools in biosciences
to facilitate research activities.
3

The Virginia Innovation Partnership Corporation (VIPC), Connecting Innovators with
opportunities. The nonprofit operations arm of the Virginia Innovation Partnership Authority (VIPA),
VIPC is the commercialization and seed stage economic development driver in the Commonwealth
that leads funding, infrastructure, and policy initiatives to support Virginia’s innovators,
entrepreneurs, startups, and market development strategies. VIPC collaborates with local, regional,
state, and federal partners to support the expansion and diversification of Virginia’s economy.

Programs include: Virginia Venture Partners (VVP) | Virginia Founders Fund (VFF) |Commonwealth
Commercialization Fund (CCF) | Smart Communities | Unmanned Systems | Entrepreneurial
Ecosystems | Regional Innovation Fund (RIF) | Federal Funding Assistance Program (FFAP) for
SBIR & STTR | University Partnerships | Startup Company Mentoring & Engagement. For more
information, please visit www.virginiaipc.org. Follow VIPC on Twitter, LinkedIn, and Facebook.

VIPA & VIPC are Guided by Four Governing Principles:

INCLUSION ACCOUNTABILITY
Prioritize outreach to historically Openness on all issues among the
underrepresented groups in the Board, the Administration, the General
Commonwealth such as people of Assembly; enhanced Board Committees
color, women, and rural communities for oversight across all VIPA activities.
while ensuring that all parts of the
Commonwealth are touched by VIPC.

TRANSPARENCY LEADERSHIP
Board approved operating plans & balanced Board and management policy
scorecards; management accountability; engagement with COV government,
Board and Commonwealth reporting. operational execution, and measurable
results.
Anticipated Changes in FY2023
During FY23, VIPC will provide leadership for funding, infrastructure, and policy initiatives that support
the success of Virginia’s innovators, entrepreneurs, startups, and market development strategies that
create jobs, new startups, and well-trained entrepreneurs and innovators.

Our anticipated changes surround the growth and development of existing, new programs, and
opportunities which will include:

The generation of measurable economic development benefits.
• Expanded investment strategies that support more investment while generating ROI.
• Broaden the funnel of entrepreneurs and commercialization ideas.
• Track consistent set of growth metrics.

Be a catalyst for the Commonwealth’s entrepreneurial ecosystem.
• Collaborate with Centers of Excellence (COE) on programs and funding to ensure
synergy.
• Deploy Regional Innovation Fund (RIF) grants to ensure stable ecosystem support.
• Collaborate with accelerators, incubators, university-based entrepreneurial
programs.
• Develop a continuum of support services and investment tools.

Support full innovation life cycle, from research to commercialization.
• Expanded partnership with feds (DHS, NIH, EDA) for innovation.
• Commercial-first innovation.
• Expand path-to-market partnerships with companies, early adopters & communities.
• Pilot projects to prove & validate product/functionality.
• Living laboratory facilities and operational adoption partners to reduce “valley of
death”.

Define and prioritize strategic technology domains for investment.
• Launch Virginia Innovation Index.
• Collaborate with technology-focused entities such as VASEM, CCI, MITRE, VEDP.
• Incorporate emerging Federal priorities such as resiliency.
• Incorporate commercial market trends such as autonomy, AR/VR, personalized
medicine.
• Focus on industries and research with potential for Virginia leadership.
• Continuous evolution of technology baseline & focus.

Innovation outreach, including marketing and policy development.
• Policy development & advocacy supporting industry-permissive approaches.
• Regional/Statewide marketing.
• Citizen engagement & outreach for awareness and support.
• National/international visibility and publicity in leadership areas.
5

Regional Innovation Fund (RIF)
• Beginning in FY23, the RIF program’s eligibility has been expanded to include
entrepreneur support organizations (ESOs) based outside of Virginia but that
have a significant operating presence in Virginia with a track record of supporting
Virginia-based startups. It has also been expanded beyond only co-funding eligible
GO Virginia projects to support state and regional ESOs in all regions of the
Commonwealth that have actively collaborated with the VIPC Commercialization,
Entrepreneurial Ecosystems, Investment, and/or Strategic Initiatives divisions.

NEW Activity: Petersburg Founders Fund (PFF)
• The Petersburg Founders Fund (PFF) is a new competitive direct grant program,
and VIPC will not take an equity stake in the companies. However, via the PFF,
the Commonwealth will invest in the future growth of Petersburg’s economy and
entrepreneurial ecosystem. Services for founders will also include mentoring, access
to markets, business acceleration and incubation, introduction to potential lenders
and investors, and other important benefits. The PFF will connect to and build on
existing entrepreneurship programs in the City and surrounding communities.

NEW Activity: Virginia’s State Small Business Credit Initiative (SSBCI)
• The U.S. Department of the Treasury will be approving Virginia’s application for
funding to support the state’s small businesses and entrepreneurs. The federal
program will provide resources for Governor Youngkin’s vision of an innovation
economy in the Commonwealth by enabling increased access to capital, especially
in traditionally underserved communities. The Virginia Innovation Partnership
Corporation (VIPC) will allocate the funding through Virginia Venture Partners
(VVP) to place equity investments in Virginia’s leading seed stage start-ups, explore
investment opportunities in emerging sectors vital to Virginia’s future and support
other funds aligned with that mission.
6

FY2022 PROGRAM OVERVIEW
Click Division to Skip to Section

Division of Division of
Commercialization Entrepreneurial
Ecosystems

Division of Division of
Investment Strategic Initiatives
7

DIVISION of
COMMERCIALIZATION

Strategic Investments in
Research Commercialization
The Division of Commercialization supports and advances technology
commercialization throughout Virginia, with particular emphasis on
higher education and the private sector. It plays a crucial role in
promoting research and development (R&D) excellence in Virginia
and in guiding, coordinating, and funding efforts to support research
with commercial potential. The Division manages the Commonwealth
Commercialization Fund (CCF), a Commonwealth-funded grant vehicle
with programs that support seed-stage privately-held technology
companies and promising technology commercialization projects within
Virginia’s colleges, universities, and other nonprofit research institutes.

Commonwealth Commercialization Fund (CCF)
Private Sector Grant Program (PS): PS provides competitive grants of
up to $75,000 for seed-stage privately-held Virginia-based technology
startups.

Higher Education Grant Program (HE): HE provides competitive grants
of up to $300,000 for promising early-stage research commercialization
projects within Virginia’s public and private research universities and
other nonprofit research institutes.
8

Eminent Researcher Recruitment & Retention Grant Program (ERR): ERR provides up to $250,000
per year to each of Virginia’s public research universities to help recruit and retain eminent
researchers and faculty who will be leaders in commercializing and productizing promising research
and development.

Laboratory & Equipment Grant Program (L&E): L&E provides up to $1M per year to each of
Virginia’s public research universities to support the development of next-generation research
laboratories. L&E grants can be paired with ERR grants to support the recruitment of new faculty or
the retention of existing faculty.

Entrepreneur-in-Residence Grant Program (EIR): EIR provides up to $250,000 per year to each
of Virginia’s public research universities to hire entrepreneurial mentors who work with faculty and
researchers to orchestrate commercial “spin-outs” that leverage university-owned IP.

Beginning in FY22, the Commercialization Division transitioned CCF to rolling submissions, allowing
the team to support more grant applications and consistent momentum for this process into FY23.
As a result, the Commercialization team was reorganized in FY22 to support dedicated business
development and grant management functions. The Division has seasoned directors overseeing
each of the private-sectors and higher education CCF programs, with an experienced director
overseeing grant administration, including awardee outcomes reporting. The Commercialization
Division team provides customized guidance and support for each of our applicants and awardees.
Click Here to Learn More

Primary objectives for the Commercialization Division in FY23 include:

• Attract and review at least 150 CCF private sector grant applications.
• Attract and review at least 80 CCF higher ed grant applications.
• Launch ERR program through Virginia colleges and universities.
• Launch EIR program through Virginia colleges and universities.
• Launch L&E program through Virginia colleges and universities.
• Support the portfolio of CCF, CRCF, and VRIF award recipients.
• Prepare and submit the FY23 CCF annual report and provide other reports as required,
including the VIPA report for Legislative Audit and Review Commission (JLARC)’s annual
economic development incentive review.
• Encourage founder-friendly IP licensing policies and startup access to facilities at
Virginia’s colleges and universities.
• Convene and consult with the Advisory Committee on Commercialization.
• Convene VIPC’s Eminent Researchers, with the objective to build community and
collaboration across Virginia’s research universities.
9

Commercialization at a Glance
Lega
FY2021-Current
The Commonwealth Commercialization CR
Fund (CCF) provides grant funding for FY201

CCF Virginia-based technology startups and
commercialization projects with a high
potential for economic development and
job creation and that position the
Commonwealth as a national leader in
science- and technology-based research,
development, and commercialization.

107 Projects, $8M
Legacy Programs
nt The Commonwealth
VR
Cumulative Outcomes Since Commercialization
2012 Fund, or CRCF,
FY201

e Commonwealth Commercialization CRCF
provided grant funding for
Virginia-based technology startups
nd (CCF) provides grant funding for $970 $167
FY2012-2020
1371 400
and commercialization projects in
rginia-based technology startups and
MILLION MILLION support of the Commonwealth’s
mmercialization projects with a high overall plan to enhance economic
tential for economic development and
Follow-on Commercial Direct Products/ through
development
Revenue* Jobs Services
b creation and that position the Funding entrepreneurship.
Commercialized
mmonwealth as a national leader in
ence- and technology-based research, 356 Projects, $28.4M
velopment, and commercialization.
Legacy Programs
07 Projects, The
$8M Commonwealth The Virginia Research Investment
Commercialization Fund, or CRCF,
CRCF VRIF
Fund, or VRIF, was established in
provided grant funding for 2016 as part of the GO Virginia
Virginia-based technology startups initiative to fostered economic
tive Outcomes
FY2012-2020 Since 2012
and commercialization projects in
FY2016-2020
development and job creation through
support of the Commonwealth’s competitive grants that supported
overall plan to enhance economic
$167 1371 400
development through
innovative and collaborative research,
development, and commercialization
MILLION entrepreneurship. efforts among and between public
ommercial Direct Products/ institutions of higher education and
Revenue* Jobs 356Commercialized
Projects, $28.4M
Services the private sector.

5 Projects, $5.5M
The Virginia Research Investment

VRIF
Fund, or VRIF, was established in
2016 as part of the GO Virginia
FY2016-2020 initiative to fostered economic
development and job creation through
competitive grants that supported
10

DIVISION of
ENTREPRENEURIAL
ECOSYSTEMS

Strengthening Communities
The Division of Entrepreneurial Ecosystems was established in
July 2020 to support and promote technology-focused entrepreneurial
ecosystems throughout the Commonwealth. Regional entrepreneurial
ecosystems in Virginia have grown significantly over the last several
years as communities have recognized that successful technology
and innovation-led startups are important to economic growth and
development. Regional ecosystem-building initiatives and entrepreneurial
support organizations (ESOs) have been established to meet the needs
of Virginia’s diverse and dynamic regional economies.

The Division acts as a supporter, connector, and convener for
entrepreneurial ecosystems and stakeholders throughout Virginia. These
stakeholders include startup incubators business accelerators, venture
development organizations, regional technology councils, chambers
of commerce, and other Virginia-based organizations that assist
entrepreneurs through the early stages of business formation and growth.

Regional Innovation Fund (RIF) Click Here to Learn More
The RIF is a VIPC-administered state-funded program that provides
competitive grants to leading Virginia-based entrepreneurial support
organizations (ESOs) and ecosystem builders (EB). RIF grants provide
operational and sustained funding for these partners and RIF grants can
11

be renewed on an annual basis as grantees continue to make progress toward projected outcomes
and metrics.

The Division of Entrepreneurial Ecosystems launched the RIF in March 2021 and has made four
awards through June 2022.

Primary objectives for the Division of Entrepreneurial Ecosystems in FY23 include:
• Support innovation ecosystems across the Commonwealth, including organizing, co-
hosting and sponsoring regional and statewide events.
• Provide up to $2.0M in RIF funding to entrepreneurial support organizations and regional
ecosystem builders.
• Map technology-based entrepreneurial ecosystem resources to determine gaps in services
available at the regional and statewide levels.
• Establish and execute the Petersburg Founders Fund (PFF) a grant program to assist
entrepreneurs and companies in one of Virginia’s most economically-challenged
communities.
• Establish a multi-tiered customer development pilot program to assist entrepreneurs in
gaining access to commercial, and governmental.

For activities associated with the Division of Entrepreneurial Ecosystems, 4 capacity-building/
organizational support grants totaling $800,000 were awarded for FY22 activities (including 2 awarded
at the end of FY21) using RIF to enable regional entrepreneurial support and ecosystem building
services. These grants supported organizations located in GO Virginia regions 2, 4, 5, and 9.

Additionally, EED awarded $360,000 to support the Innovation Commercialization Assistance
Program (ICAP) and 8 sponsorships to Entrepreneur Development Programs (EDPs) participating
in the Virginia Accelerator Network initiative during FY22. In addition to awarding funds, the
Division provided technical assistance to ICAP and the Virginia Accelerator Network participating
organizations. These projects increased the geographic impact of EED to 7 out of 9 GOVA Regions
served with 1 additional statewide resource supported.

These programs anticipated $25 million of initial and follow-on capital with 30 companies accelerated
and 675 entrepreneurs to receive pre-acceleration support. Supported programs reported the
following successes for FY22:

• $61 million in capital raised
• 410 pre-acceleration entrepreneurs supported
• 29 companies accelerated
• 36 post-acceleration companies supported
• 153 jobs created
• 5,937 mentoring hours supported
• 24 events held with 1,138 attendees
• 500 entrepreneurs engaged
• 11 new companies formed
12

Entrepreneurial Ecosystems at a Glance

NNOVATION
HIP CORPORATION
urial Ecosystems
445
businesses
Federal Funding
Assistance Program
The Federal Funding Assistance Program
(FFAP) has provided Small Business
Innovation Research (SBIR) and Small
$200k
Reg
Inn
The Re
launch
first fo
supported Business Technology Transfer (STTR)
support to over 400 businesses annually via
each in
ecosys
and inn
annually workshops, consultations, and mini-grants.
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Charlo
Richm
Commercialization division on July 1, 2022.

ral Funding Regional State
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ral Funding Assistance Program The Regional Innovation Fund was The Entr
s provided Small Business launched in March 2021 and has made its provided
n Research (SBIR) and Small
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pre-acce
o over 400 businesses annually via
each in and innovation hub projects in mini grants entrepre
ps, consultations, and mini-grants.
transferred to the grants
Charlottesville, Hampton Roads,
Richmond, and Roanoke-Blacksburg.
& other It provid
to accele
ialization division on July 1, 2022. opportunities as part o
initiative
Regiona
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innovati
and regi

nal State & Regional
ation Fund Ecosystem Support
al Innovation Fund was The Entrepreneurial Ecosystems Division
March 2021 and has made its provided $200K to the Virginia SBDC
ants of $200K apiece to
builders, startup accelerators $360k Network ICAP program to expand
pre-acceleration services for tech
tion hub projects in mini grants entrepreneurs across all regions of Virginia.
ville, Hampton Roads,
and Roanoke-Blacksburg.
& other It provided $160K in strategic mini-grants
to accelerators, incubators and other ESOs
opportunities as part of the Virginia Accelerator Network
initiative. EED also engaged and support
Regional Technology Councils and Minority
Business Organizations to advance inclusive
innovation-led entrepreneurship at the local
and regional levels.
13

DIVISION of
INVESTMENT

Investing in Virginia Companies
The Division of Investment was established to support VIPC Virginia
Venture Partners and any new investment vehicles approved by the
VIPA and VIPC Boards. The purpose of this Division is to give Virginia
a competitive advantage with an array of funding mechanisms provided
under section § 2.2-2355 related to direct and indirect investments.
Historically, Virginia Venture Partner has focused on direct investment,
placing equity financing in early-stage science and technology-based
companies through a family of funds spanning multiple generations of
tech, life science, and clean energy theses.

Launched in 2018, the Virginia Founders Fund joined these sector-
oriented funds, placing investments in Virginia communities traditionally
underserved by risk capital. In FY22, Virginia Venture Partners added
the Virginia Partners Fund, providing a specific focus on Virginia’s
traditionally underserved geographies.

VIPC management oversees VVP and is advised by the Virginia Venture
Partners Investment Advisory Board (IAB). Click Here to Learn More

The Division of Investment is also advised by the Division Advisory
Committee on Investment, which offers guidance on new investment
programs and policies.
14

Primary objectives for the Investment Division in FY23 include:
• Continued development of Virginia Venture Partners three-stage model to support
companies through their seed-stage progression:
• Seed-Stage I Pre-GAP Funds
• Seed-Stage II VVP GAP Funds
• Seed-Stage III VVP GAP Funds Spin-Out Fund

• Continued focus on Seed Stage I, pre-GAP investments through the Virginia Founders
Fund, Virginia Partners Fund, and Innovation Fund program offerings and on Seed-Stage
II investments through flagship GAP Tech, GAP Life Science, and GAP Clean Tech funds.

• Implementation of the Department of Treasury State Small Business Credit Initiative
(SSBCI) Venture Capital Program to enhance investment capacity, both the number of
investments and dollars deployed through Virginia Venture Partners’ existing Stage I and
II direct investment channels, and the extension of external investment capacity through
indirect investment in external fund managers.

• Exploration of the Seed-Stage III Opportunity Fund launch, to invest pooled private
capital under the management of the VIPC Virginia Venture Partners Team into selected
Seed Stage II portfolio companies and other late seed-stage Virginia start-ups. VIPC will
pilot the fund with initial draw-down of building proceeds for designated investments.

• Design and implement other indirect investment programs. These may encompass the
creation of sidecar funds, additional intermediary investment, or co-investment vehicles
aligned with VIPC’s investment mission or intra-VIPC fund transfer to support other
divisional initiatives.

• Work with the Advisory Committee on Investment to advise and assist the Investment
Division and VIPA Board on making biennial recommendations to the Governor regarding
investment strategy.

Investment at a Glance
15

DIVISION of
STRATEGIC INITIATIVES

Embracing Innovation in the Commonwealth
The Division of Strategic Initiatives will “provide leadership for strategic
initiatives that explore and shape programs designed to attract and
grow innovation in the Commonwealth” (§ 2.2-2355). FY23 will continue
the division’s efforts on the execution of three primary activities: Smart
Communities, Unmanned Systems, and the DHS SCITI Labs program.
In addition to these primary activities, Strategic Initiatives will deliver the
Virginia Innovation Index. Strategic Initiatives Division will also continue
to develop the following new areas initiated in FY22:

• A Maritime Center of Excellence centered around Hampton
Roads, conducting activity under the FY22 Announcement of
Opportunity solicitation with VISA.
• The Public Safety Innovation Center, now initiated and being
developed in conjunction with the Public Safety and Homeland
Security Secretariat of Virginia.
• Augmented Reality/Virtual Reality (AR/VR), as initially embodied
in the AccessVR Lab at GCubed in Stafford County.
• Quantum computing, focused specifically on the development of
quantum computing-based software solutions for areas such as
Advanced Logistics.
• Other potential initiatives and external funding opportunities
under § 2.2-2355 will be pursued during FY23 as opportunities
provide possible mission support and available staff time allows.
16

Primary objectives for the Strategic Initiatives Division in FY23 include:

Public Safety Innovation Center at VIPC Click Here to Learn More
Assist with the development and implementation of new and/or improved technology for use by
public safety emergency responders at the local, state, and federal level.

Key goals of this strategic vision include:
• Establish relationships for the exchange of concepts and best practices between the
PSIC and other public safety organizations such as local responders, state agencies,
commercial or non-profit groups, the Department of Homeland Security, and other
federal government agencies/entities.
• Seek out and assess new innovative technologies that could potentially aid and
benefit public safety practitioners.
• Assist in the development, testing, and validation of new technologies and
equipment.
• Identify, facilitate, and support new initiatives and pilot projects that will further the
transition to practice and use of innovative technologies for public safety.
• Identify and help implement and deliver public safety training, primarily around new
technologies and capabilities.
• Provide and/or coordinate provision of public safety Subject Matter Expertise (SME)
to local and state public safety and other government entities in the Commonwealth.
• Continue to build upon the relationship with the Commonwealth Virginia Department
of Public Safety and Homeland Security Secretariat and the federal Department of
Homeland Security to advance public safety across various areas to include use of
drones, specialized training activities, operational experimentation, IoT, and related
technologies, emerging activities relating to Port security and safety, and other public
safety centric technology advancement.

SCITI Labs Click Here to Learn More
The SCITI Labs Commercial First Innovation program will continue with the U.S. Department
of Homeland Security (DHS) in FY23. In May 2021, DHS issued a contract modification to add
funding to our current multi-year contract, and a second option is expected to be exercised in
May, 2022. Management has set a conservative realized revenue target of $2M for SCITI Labs in
FY23. The primary focus of this program will be continued strong execution against the defined
Program Plan and customer technology interests.

Key priorities in support of this strategic vision include:
• Detection of environmental threats such as flood and wildfire ignition using networked
IoT sensors.
• Smart buildings and communities.
• UAS/C-UAS and other Public Safety-related technologies.
17

Smart Communities Click Here to Learn More

Key priorities in support of this strategic vision include:
• Activities will continue to focus on pilot projects across Commonwealth, with the
intent being “Community-Driven Innovation.”
• Continued support of early stages of initiatives that develop capabilities identified and
desired by the communities involved, including pilot projects with a diverse set of
communities Project selection will seek to achieve geographic diversity across
Commonwealth, in addition to technology and vendor diversity, with a preference for
smaller, innovative Virginia companies.
• Initial areas of focus include: IoT security and privacy, indoor public building
and environmental sensors, and continued integration of various pilot activities with the
Commonwealth Data Trust model. Click Here to Learn More

The Virginia Unmanned Systems Center at VIPC Click Here to Learn More
The nexus of Virginia’s activity in UxS – Land, Air, Sea, Space.

Key priorities in support of this strategic vision include:
• Maintain collaboration between businesses, investors, universities, entrepreneurs,
and government organizations.
• Continue to support rapid growth of the UxS industries in Virginia, pivoting towards
infrastructure to support growth of heavy cargo transport and eventually people
transport (Advanced Air Mobility, AAM).
• Create new pilot projects with Virginia state agencies and private companies to
demonstrate value proposition of UxS technology.
• Develop partnerships for Virginia companies with major service providers (package
delivery, public safety, and infrastructure).

Budget and Resources
Appropriated Strategic Initiatives budget for FY22/23 biennium budget is $1M per year for each
of the two years and for each of the two areas – Smart Communities and Unmanned Systems.
Management expects the federal government to authorize additional funding to its existing DHS
SCITI Labs Commercial First contract during the current federal FY ending September 30, 2022.
Management projects the need to add one to two new hires for adequate program support. The
remaining funds will provide direct program support, including pilot project initiatives under Smart
Communities and Unmanned Systems and subcontracts under the SCITI Labs program.
18 T
VIRGINIA INNOVATION
PARTNERSHIP
Strategic Initiatives
VIRGINIA CORPORATION
at a Glance
INNOVATION
PARTNERSHIP
Division of CORPORATION
Strategic Initiatives Federal DHS Fun
Division of Strategic Initiatives Federal
VIPC DHS Fundingini
Strategic De
VIPC Strategic initiatives
Total S&T Funding
Total S&T Funding
To
Total Private
to 15 to 15 InvestmentIn
Technologies/Companies
Technologies/Companies Attracted A

$16.5
$16.5 $131.3
$1
VIRGINIA INNOVATION
PARTNERSHIP CORPORATION
MILLION MILLION
MILLION
SMART COMMUNITIES M
*Final FYE22 impact data will be available in November 1 an
Department of Homeland Securi
ION Department
Science of Homeland
and Technology Director
Federal DHS Funding Deployed via
Science and Technology D
VIPC Strategic initiatives since 2015.
VIRGINIA INNOVATION
Total Total Private
S&T Funding CORPORATION
PARTNERSHIP Funding Leverage Factor
to 15 Investment
SMART COMMUNITIES
VIRGINIA INNOVATION
Technologies/Companies Attracted
PARTNERSHIP CORPORATION 8x
SMART
*Final FYE22 impactCOMMUNITIES
data will be available in November 1 annual report
$16.5 $131.3 Additional Revenue
Generated by Funded
MILLION
*Final FYE22 impact data will be available inMILLION
November 1 annual report
Companies Since 2015

Department of Homeland Security $9.5M
Science and Technology Directorate
Total New Jobs (EST)

ATION 1000
Direct & Indirect Jobs

November 1 annual report
19

Appendices
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Division of Investment
Virginia Venture Partners (VVP) Growth Acceleration Programs (GAP)

Division of Entrepreneurial Ecosystems
Regional Innovation Fund (RIF)

Division of Commercialization
Commonwealth Commercialization Fund (CCF)
20

Virginia Venture Partners (VVP)
The FY2022 activity below is provided in response to Section 127.D.2A of the Appropriations Act.

Since VVP investments are, by design, pre-seed and seed stage focused and intended to leverage
private investment and stimulate the next generation of new technology companies, job creation and
tax revenue impact are longer term objectives.

I. The number of companies receiving investment from the VVP:
a. FY22: 43 companies
b. Inception-to-date: 275 companies1

II. The state investment and amount of privately leveraged investments per company:
a. FY22: VVP invested $7.2M and leveraged $98.6M in angel and venture dollars
on FY22 investments. During FY22, VVP’s investments leveraged $241.6M.
b. Inception-to-date: VVP has invested $41.8M and has leveraged $1.6B in angel
and venture dollars, $241.6M of which was leveraged during FY22.

III. The estimated number of jobs created or preserved during FY22:
a. FY22: 505 jobs in companies invested in by VVP in FY22.
b. Inception-to-date: In FY22, companies reported that 3,943 jobs were created or
preserved by companies invested in by VVP in FY22 or before.

IV. The estimated tax revenue generated during FY222:
a. FY22 investments: $2,479,515
b. Inception-to-date: $18,440,671

V. The number of companies who have received investments from VVP fund still operating
in Virginia*
a. FY22 investments: 42 out of 43
i. One (1) company ceased operations after their lead venture investor lost
interest and advocacy in them and their investment partner (who advocated
for the deal) left the firm.
b. Inception‐to‐date: 134 out of 275i2
21

Of the 141 companies no longer operating in Virginia:
I. Nine (9) are active VVP portfolio companies that have moved from the
Commonwealth:
1. Five (5) moved from Virginia to other states after the three year
requirement to be headquartered in Virginia timed out.
2. One (1) moved from Virginia to Connecticut. This company had received
a $100K convertible note from VVP - $50K from Commonwealth-
appropriated funds and $50K resulting from a grant to VVP by Johnson
& Johnson. In June of 2009, VVP elected to be paid back the $50,000
Commonwealth-appropriated funds plus interest and to convert Johnson
& Johnson grant-sourced $50,000 principal and interest at a 50%
discount.
3. Three (3) were part of MACH37
a. Two (2) are winding down operations and pending a write-off
and/or collection efforts.
b. One (1) was acquired by a company not headquartered in the
Commonwealth of Virginia. VVP notified the company of its
request to formally abandon its security interest during FY22
but VVP’s stock certificate has not yet been canceled.
II. 132 are Inactive companies
1. 60 have failed
2. 72 have been acquired or paid back VIPC
a. The above total of 72 includes one company for which VVP
received shares of an acquiring company in lieu of a cash
payout. While this acquiring company was itself acquired
prior to the 6/30/22 date of this report, VVP did not have the
opportunity to redeem its shares prior to that date. For this
reason, the acquiring company in which VVP holds shares
is not included in the total of 72, above, or elsewhere as an
independent investment.

*Data only includes companies in which VVP has placed a direct investment. Therefore, it excludes
four companies, for which VVP was granted ownership in a newly formed entity as a result of a
merger or acquisition without making any additional investments.

VI. Return on investment
a. FY22 investments: $0
b. Inception-to-date: $25,665,706

VII.The number of investments that failed:
a. FY22 investments: 1
b. Inception‐to‐date: 60 failures, $6,238,600 invested

2
VVP has invested in 275 companies from inception through FY2022. This is a downward adjustment from 278 total companies in the
portfolio inception-to-date due to the following reasons (278 + 1 (item #1 below) – 4 (item #2 below) = 275:
1. Two of the invested companies merged into one company.
2. 2. Four of the invested companies were acquired and, as part of the acquisition, VVP was granted ownership in the
four respective new entities without additional cash investment.
22

VIII. Number of companies created or expanded and the number of patents filed during FY22:

a. FY22:
i. Companies created or expanded: 43 companies
ii. Number of Patents filed: 36

b. Inception‐to‐date:
i. Companies created or expanded: 2752
ii. Number of Patents filed during FY22: 171

IX. Geographic distribution of investments (based on GO Virginia regions)
a. FY22 investments: 42 of 43 in Virginia (one company failure)
i. Region 1: 1
ii. Region 2: 2
iii. Region 3: 0
iv. Region 4: 9
v. Region 5: 6
vi. Region 6: 0
vii. Region 7: 21
viii. Region 8: 0
ix. Region 9: 3

b. Inception to Date: 134 out of 143 active companies are based in Virginia
i. Region 1: 2
ii. Region 2: 7
iii. Region 3: 2
iv. Region 4: 18
v. Region 5: 11
vi. Region 6: 0
vii. Region 7: 80
viii. Region 8: 1
ix. Region 9: 13

3
Corporate and personal income tax revenue estimated. Corporate tax revenue based on company’s actual revenue in CY2021 Q3 and Q4
(assumes 50% of total reported CY2021 revenues) and CY2022 Q1 and Q2. Personal tax revenue assumes an average salary of $125k per Virginia
employee.
23

Regional Innovation Fund (RIF)
The FY2022 activity below is provided in response to Section 127.D.2B of the Appropriations Act.

B(i) and B(ii) Projects Supported to Date
The Regional Innovation Fund (RIF) provides competitive grants to leading Virginia-based
entrepreneurial support organizations (ESOs). In FY22, the RIF capacity building grants were
awarded to two (2) entities, bringing the number of projects funded since inception to total four
(4). The grants of $200,000 each for a total of $800,000 since program inception were awarded to
organizations to perform regional entrepreneurial support services.

B(iii) - (v) Anticipated and Realized Program Impacts
From the four projects awarded to date, anticipated results as projected by awardees included the
following information.
I. $18.25 million in capital to be raised over 5 years
II. 210 jobs to be created over 5 years
III. 80 companies to be served during the grant period
IV. 2 new companies to be formed during the grant period
V. 175 entrepreneurs engaged during the grant period
VI. 1250 mentor hours facilitated during the grant period
VII.18 events held during the grant period
The two RIF grants awarded in FY21 had their initial Year 1 impact reports due in FY22. The
awardees did not report any new company formations during the initial period of this award. The
two grantees who completed their first-year projects reported that 30 jobs were created and 23
companies were accelerated with the support of this award in the first year.

B(iv) Sources of Investment
Additional sources of investment for the four projects funded under this program to date include
$450,000 in total funding from the US Navy Mid-Atlantic Tech Bridge, Radford University
Foundation, Roanoke City, Valleys Innovation Council, Activation Capital, Kaleo Legal, Albemarle
County EDA, Charlottesville City EDA, and the Quantitative Foundation.

B(vii) Geography Served
To date, the program has supported projects in GO Virginia Regions 2 (Roanoke-Blacksburg-
Lynchburg), 4 (Richmond-Petersburg), 5 (Hampton Roads), and 9 (Charlottesville).
24

ECONOMIC PERFORMANCE
OF KEY AREAS

Commonwealth Commercialization
Fund (CCF)
The FY2022 activity below is provided in response to Section 127.D.2C
of the Appropriations Act.

The CCF program will continue to reflect the importance of and value
the Commonwealth has placed on supporting early-stage innovations to
catalyze economic outcomes in FY2023 and beyond. Development of
the higher education Entrepreneur-in-Residence Program is underway
and the Commercialization Division continues to assess and refine the
current funding opportunities to best meet the needs of the entrepreneur
and university research community.

For activities associated with the Commonwealth Commercialization
Fund:

i. Number of research grants awarded by domain area
a. Private Sector: 36
b. Higher Education Tier 1 (TRL 2-4): 3
c. Scholarships to accelerators and incubators: 3

ii. State investment by CCF program
a. Private Sector: $2,648,410
25

b. Higher Education Tier 1 (TRL 2-4): $224,979
c. Scholarships to accelerators and incubators: $60,000

iii. Number of eminent researchers attracted and retained
a. FY22: none

iv. Additional research dollars leveraged as a result of the state investment
a. FY22: $165,913,367

v. Number of new products completed/released to production
a. FY22 Revenue: 84

vi. Sales and/or revenue
a. FY22: $38,264,957

vii. Start-ups created from the research investment
a. FY22: 8

viii. New licenses granted to companies within Virginia
a. FY22: 4

ix. New licenses granted to companies outside Virginia
a. FY22: 28

x. The geographic distribution of the grants (by GO Virginia region)
a. FY22: 57
i. Region 1: 1
ii. Region 2: 12
iii. Region 3: 0
iv. Region 4: 10
v. Region 5: 8
vi. Region 6: 0
vii. Region 7: 23
viii. Region 8: 0
ix. Region 9: 3

b. Inception: 468
i. Region 1: 3
ii. Region 2: 84
iii. Region 3: 3
iv. Region 4: 69
v. Region 5: 65
vi. Region 6: 9
vii. Region 7: 117
viii. Region 8: 12
ix. Region 9: 106

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