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Sydney Rankin (BBA’20) relied on television to rest her weary brain after studying for her courses in medicinal chemistry at the University of New Brunswick (UNB).

She particularly enjoyed Dragons’ Den and Shark Tank, two shows where hopeful startup founders pitch for funding to a panel of hard-nosed venture capitalists.

Noting her enthusiasm for these shows, a professor suggested she take the MBA/BBA Venture Assessment course at the faculty of management.

“I loved it. It was my favourite course in university,” said Rankin, who went into it not knowing much about venture capitalism except what she had seen on television.

It changed her career path. Rankin switched majors, graduated in 2020 with a BBA and moved on to a career working with startups. She has even returned to the course as a part-time instructor.

The Fraser Student Venture Fund is the foundation of that course. Established in 2019 by alumnus Charles Fraser, the fund provides UNB students with hands-on venture capital skills while providing New Brunswick early-stage startups with money in exchange for an equity investment. It uses philanthropic support to create practical, experiential learning opportunities and support entrepreneurially thinking and startup-stage companies across the region.

“The small companies we invest in could be a big deal at some point,” said Ryan Reid of the faculty of management and manager at UNB’s International Business & Entrepreneurship Centre.

Working with the New Brunswick Innovation Foundation (NBIF), the fund annually identifies promising startups for investment, usually up to $50,000 each.

Drawing on its extensive experience and network within the province’s startup communities, NBIF refers startups not ready for its own investment fund.

“NBIF has its finger on the pulse of everything related to venture investment in the province, and they will think of companies that would fit the fund,” Reid said.

The fund wants scalable early-stage companies with innovative, ambitious founders who aim for the sky.

Students learn the principles of venture capital investment, taught by investment managers and analysts from NBIF, equipping students with practical skills.

Students form teams to evaluate potential investments and hear a 15-minute pitch from the founders. After making selections, they will pitch to the investment committee and defend their choices.

“For the students, there are only so many companies they can pitch,” said Reid. “They may bring in five or six companies and then decide who they want to investigate further.”

The process involves a due diligence phase, during which students assess the startups’ potential before making recommendations to the investment committee.

The veterans in new venture financing review the students’ recommendations and make the final investment decisions.

“It’s like you are in a venture capital firm and going to the investment committee,” said Reid.

“This real-world experience prepares students for venture capital careers and provides invaluable feedback to the startups involved.”

The fund boasts a total value of about $950,000, of which $200,000 is already invested in local startups. (A fresh review of the portfolio’s value should be completed by fall.) It uses a Simple Agreement for Future Equity (SAFE) investment structure, which offers flexibility and simplicity for these new companies.

“What it says is, we’re going to give you money, and when you have a deal with a larger firm that can value your company, our investment will convert into a percentage of the ownership,” said Reid.

The portfolio spans various industries and reflects the fund’s broad scope.

The process is valuable for both students and founders, Reid said.

“It’s comfortable because they are not dealing with a hardcore venture capitalist in Toronto or Boston. They’re dealing with students, and it is a learning experience on both sides.”

Students credit the course for giving them a solid foundation for their careers.

After graduation, Rankin worked for NBIF. She is now at Profitual, a Fredericton company which sells a web-based platform automating financial models for early-stage founders to help them grow and operate their businesses better.

Rankin said the course is more than just an academic exercise. The founders’ need for cash is real, and they must prove why they should get it.

“You’re dipping your toes into the chaos that is working in a startup routine. These companies weren’t pitching to us for fun. They were pitching to us for capital, and what startup doesn’t need that capital as soon as possible,” Rankin said.

“This wasn’t the kind of course where you could sit in your lecture and then go home and have your X hours of homework and you were done. You were spending so much time working with the founders on a schedule that worked for them, which is often odd hours around travel.”

Jacob Van Roeden (BBA’23), who is now working as an investment and insurance analyst, said working with founders was “exhilarating.”

“Their passion and energy were contagious, and it was a unique opportunity to ask probing questions and get a direct understanding of their vision and business strategy.”

Van Roeden found the hands-on experience assessing startups and presenting investment recommendations invaluable.

“Having instructors who had previously worked in venture capital and now work in a venture-backed company added a tremendous depth to the course,” he said.

“I gained essential skills such as financial analysis, due diligence, market research, and effective presentation techniques. These skills are directly applicable to real-world business situations and have boosted my confidence in professional settings.”

Pierre-Luc Savoie (BBA’23) works as a marketing coordinator while running his own marketing and multimedia business. He learned that “team, team and team” was important in deciding which startup to pick.

“Finances and forecasts play a role in this as well, but I quickly realized that a strong team is largely undervalued,” he said.

“The course makes you feel like you’re about to step into the real world of business. The class provided me with valuable real-world entrepreneurial skills.”

Savoie called “the real-world value” of the class “incomparable” and said that he gained confidence in his skills for speaking to entrepreneurs and executives.

“Presenting to the investment committee is also a glimpse into real-world business conferences.”

Reid said the aim is to grow the portfolio to 20 companies, increase individual investment amounts, and reinvest in existing portfolio companies. Further donations from UNB alumni and return on investments will fuel the growth.

“There is a lot of risk in venture capital, but the idea is to diversify,” Reid concludes. “That is why we are trying to grow the fund. The current investments are not enough. We must grow that,” he said.

“We are also trying to broaden the portfolio across New Brunswick. We are the University of New Brunswick, and this is to help develop the New Brunswick economy.”

Photo: Ryan Reid and Sydney Rankin.