Valency Fund: reimagining early-stage finance in Wisconsin

After 25 years in the state’s startup scene, Laura Strong says she’s watched too many revenue-producing businesses contort themselves into “10x or bust” stories just to fit a venture capital template that was never really built for them. Now, with Valency Fund, she’s trying to design something that actually meets that gap in the market.

“I think that there are successful companies in Wisconsin that lack growth capital to get to the next stage and limiting their growth impacts their founders, their management team, their employees and their communities.”

That’s the problem she’s solving. And she’s very clear that the solution had to be rooted in Wisconsin.

Strong isn’t originally from the Midwest. “I came to Wisconsin for grad school in 1995… thinking I was going to come here for grad school and get the heck out because I don't like winter.”

She stayed. Earned a PhD in organic chemistry at UW–Madison and quickly crossed from academia into company-building.

Strong helped start a drug development company, Quintessence Biosciences, that took a new cancer therapy “from… early stage benchtop to end of a phase one clinical trial.” They couldn’t raise the capital to keep going and had to shut the company down, and that experience stuck with her. From there, she moved through a series of health-tech and science-driven startups, usually as an early employee or on a founder-adjacent team. The focus being less on pure science and more on what actually makes a product and a business work. “I never did science after I left the university,” she said. “I really got more into how do you build products, how do you figure out what a customer wants, all those kinds of things.”

When every company gets pushed into the VC box

What bothered Strong wasn’t just that capital was scarce in specific sectors (like drug development) in Wisconsin. It was that the dominant shape of capital — equity, angels, and VC — was becoming the only story founders were allowed to tell.

“We really fixate on venture capital and equity investing, angels and all of that to fund these young companies,” she said. “I feel like those are not the companies that we're always trying to build and we try and put them into this box because that's the box we have, right? And shouldn't we have something else for the companies that don't fit there?”

She’d sit through pitches where founders dutifully walked through their TAM slides and promised venture-scale growth.

“Listening to their pitches around, … our TAM is this. Oh, we're going to go after this market. We're going to 10x this. And you're just looking at it and you're thinking, that's not a 10x business. And it's okay,” she said. “Like it should be okay to just build a business that's $10 million in annual revenue or $30 million. Why are we just forcing them to tell us that it's a 10x…?”

Her critique extends to how investors think about the product.

“If any company came to a venture capitalist and said, 'I have my product, I already know what my product is, everybody sells this product, everybody wants this product, and I'm going to keep selling it,” the VC would be like, well, what in the world? No, we're not investing in that, right?” Strong said. “So, why do we as investors sit on the other side and say, well, we've always sold equity. We've always sold it in this way with these terms and we're just going to 

keep doing it.”

Valency Fund is her attempt to treat capital itself like a product that can and should be redesigned.

Designing an evergreen, nonprofit fund

When Strong decided to build something of her own, she made two structural choices to set Valency Fund apart: it’s a nonprofit and evergreen. “As long as we make money with our investments, which we 100% aim to do, we are able to reinvest the profits into the next generation of companies,” she explained.

Without the clock of a 10-year fund life ticking in the background, Strong isn’t promising LPs a specific distribution schedule.

“We have not said we're going to give you X dollars in X years. We are able to tailor investments to fit what companies need as long as we make money,” she said.

The first deal out of the fund is deliberately familiar to anyone who’s looked at non-dilutive capital: revenue-based financing. Strong describes it as “a more well understood structure… where it's kind of standard revenue based financing. You agree to a multiple, a term and you get repaid from growth on revenue.”

For founders and CFOs used to picking between a bank loan and a priced equity round, that “unconstrained” language is the point: Valency wants to start with the revenue model and design the capital around it.

Built specifically for Wisconsin’s “longlasting, profitable private companies”

Strong’s decision to base the fund in — and focus it on — Wisconsin is neither incidental nor temporary.

“We've got a great tradition in the state of Wisconsin, building private, long-lasting companies,” she said. “You look at our public companies, not so much. But our private companies, we've got a really solid group of longlasting, profitable private companies.”

Valency Fund’s mission, as she wrote it into the nonprofit, is explicitly Wisconsin-focused. 

That also shapes the companies the fund backs. She describes Valency as Wisconsin-based and oriented toward “ag[ri] business, advanced manufacturing [and] technology,” with a clear traction bar: “you have to have 200,000ish of revenue or more, which is our signal for traction because all of the ways that we think about funding growth relate to growing revenue so that we can get paid back.”

For a region where many businesses are built on physical products, services, and steady growth rather than blitzscaling, that’s a feature, not a bug. It’s also a different narrative to pitch to local capital holders who may not see themselves in the typical “hot SaaS round” story.

A Wisconsin-only, nonprofit, evergreen vehicle focused on durable, revenue-producing local companies conveys a distinct story, one likely to resonate more with manufacturing families and privately held business owners than a standard VC pitch deck.

A chemist’s view of capital: making new bonds

The name itself is a nod to her academic training. “It's a nod to the chemistry nerd in me,” Strong said. “So valency is chemical bonds and so … part of our mission is to create bonds to help facilitate bonding and creation of connections.”

Those “bonds” are not just between investor and company, but between generations of Wisconsin businesses: today’s returns recycling into tomorrow’s growth companies through an evergreen, region-locked pool.

For Midwest founders who feel stuck between taking venture money they don’t really want or bootstrapping forever. For institutional and individual investors seeking ways to back their home-state economy without signing up for a traditional VC model, Valency Fund may offer a third option: capital that starts with the company’s reality, not an asset-class playbook.

Or as Strong puts it, her way of solving the problem is simple to say, even if it’s complex to execute: “My way … is to figure out what a company needs to grow and provide it in the way that is going to help them grow.” 

Simple, right?