Mid-Year Check-in: What 2025’s Uncertainty Has Meant for InnoVenture Iowa (So Far)
It has been an unpredictable first half of the year for early-stage founders, both nationally and here in Iowa. According to Pitchbook, median early-stage valuations have continued to soften, and capital deployment remains cautious. We’ve seen a similar story unfold locally resulting in founders navigating longer fundraising cycles, feeling an increasing pressure to demonstrate traction and capital efficiency. For many startups in our portfolio, that’s meant tightening burn, adjusting timelines, and turning toward non-dilutive resources whenever possible.
Still, uncertainty creates space for opportunity. In Q2 InnoVenture Iowa secured the next tranche of funding through the State Small Business Credit Initiative (SSBCI) and the Iowa Economic Development Authority. With the U.S. Treasury’s renewed commitment to Iowa, this second round unlocks an additional $13 million in capital to be deployed over the coming 24-36 months, fueling even more investment into the state’s growing startup ecosystem.

But the truth is, we’re still far from where we need to be. This latest funding is just a small drop in the bucket compared to what’s truly required to help Iowa’s most promising founders launch, scale, and stay rooted in the state. As Liz Keehner of Next Level Ventures recently pointed out on the Iowa Podcast, Iowa continues to rank near the bottom for venture funding in the Midwest. If we want to lead, we need more strategic, long-term public and private capital, including from local high-net-worth individuals who recognize that transformative technologies are being built right here in our state.
At InnoVenture Iowa, we’re taking a measured approach, prioritizing the allocation of capital across more startups instead of fewer. In the first half of this year, we committed nearly $2 million toward six companies: Bound, Build Factory, Entac Medical, MedDefend, Repaint Studios, and SourceEazy. The InnoVenture Challenge has also been paused.
It was a tough call, but it opened up capacity for our small-but-mighty team to engage elsewhere. This past spring, we delivered a second semester of venture capital workshops for high school students; continued production of our weekly Iowa Tech Podcast episodes; and celebrated the graduation of our third InnoVenture Iowa Fellow.
This Fall, we’ll be continuing to tour Iowa with VentureNet and IEDA to provide information on the variety of funding options currently available; and we’re ramping up the planning process for the next Angel Investor Summit, presented by DSM Partnership.
These efforts reflect our long-game approach: deploy capital wisely, nurture relationships, and grow the ecosystem from the ground up. We’re determined to continue momentum-building —and we’re focused on making every dollar go further.
Onwards.
Safiya Lee-Evans
Program Manager