Late last year, the State of Tennessee changed its Department of Commerce and Insurance’s securities rules to exempt venture capital firms from the requirement of full registration as an investment adviser. As CEO of Launch Tennessee Lindsey Cox penned in The Tennessean newspaper, that rule change and new flexibility will help to bolster the state’s VC ecosystem.
The new rule change has already helped spur the next generations of funds in the state. At the start of 2024, five General Partners (GPs), representing a wide range of experiences across the entrepreneurial ecosystem, launched Knoxville-based Market Square Ventures.
What We Know About The Fund
The GPs of the fund include Brandon Bruce (investor and Managing Director of Techstars Industries of the Future), John Bruck (engineer, entrepreneur, and angel investor), Rosa Mar (former Global Sourcing Manager for Levi Strauss & Co. and CEO of the Hispanic Chamber of Commerce of East Tennessee), Harry Boston Ph.D. (30 year veteran in engineering, technology, and cybersecurity), and Marty Brown (President and CEO of the CPA firm PYA).
The early-stage fund will focus on Southeast and Appalachian-based startups that are tech or tech-enabled. The team hasn’t announced the size of the fund yet, but Bruce told Hypepotamus that they are targeting a “median sized fund.”
But the fund has already started deploying capital, writing checks into three startups since March 2024. To date, its portfolio includes Authentrics.AI (Pre-Seed AI analysis tool from Knoxville), VetVerifi (Seed stage veterinary software in Nashville), and Daily Crunch (a Series A snack company in Nashville).
Knoxville’s Startup Scene
While smaller than other regional players like Atlanta, Charlotte, and Nashville, Knoxville is home to an impressive entrepreneurial scene. The city is most notably home to nearby Oak Ridge National Laboratory, a leading research center for the US Department of Energy.
It is also home to several startup accelerator programs, including the Techstars Industries of the Future Accelerator, the Spark Cleantech Accelerator, and Oak Ridge’s Innovation Crossroads program for Hard-Tech energy startups.
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