- The Kairos Fund is making $25 million available to seed and scale start-ups with social missions that are being ignored by Silicon Valley's venture investing elites.
- Student debt, affordable housing, child care, and worker retraining are among the trends that the new fund wants to help young entrepreneurs tackle.
- The fund's board includes Mehmet Oz of ABC's The Dr. Oz show; Vicente Fox and Marta Fox, former President and First Lady of Mexico; Roger Goodell, Commissioner of the NFL; and Bobbi Brown, founder of Bobbi Brown Cosmetics.
While many in Silicon Valley focus on futuristic technology — ranging from cryptocurrency to drone delivery — a quiet movement is afoot among young entrepreneurs that have audacious ideas to change the world and help society.
To help these start-ups take flight, the $25 million Kairos Fund was launched Thursday. It will provide $250,000 to $1 million in seed financing to fledglings, as well as management guidance to help scale up their business.
"The idea is to focus on key areas in need of disruption in the life cycle of all consumers: Student debt; affordable housing; child care; worker retraining and post-retirement living," said Ankur Jain, founder of Kairos, a global organization that is a peer-to-peer community of some 1,000 student entrepreneurs from 50 countries. It runs a fellowship program for top-flight entrepreneurs selected to address global issues. The new fund will help these aspiring innovators finance their big ideas.
"We kept hearing from entrepreneurs in Kairos that they were getting frustrated with investors in Silicon Valley who were not interested in solving problems for people who need it most. That's why we decided to launch this fund," Jain said. He added, "We are in a critical juncture. If Silicon Valley ignores the challenges squeezing our youth and middle class there will be a backlash. A lot of the tech ventures being funded will actually hurt the workforce and people's livelihoods. We want to back founders that can rethink business models that leave everyday people financially strapped."
The Kairos fund has an impressive board of directors that includes: Mark Thompson, CEO of The New York Times; Mehmet Oz of ABC's The Dr. Oz show; Ronan Dunne, president of Verizon Wireless; President Vicente Fox and Marta Fox, former President and First Lady of Mexico; Roger Goodell, Commissioner of the NFL; Bobbi Brown, founder of Bobbi Brown Cosmetics; Michael Dubin, founder of Dollar Shave Club and David Carey, president of Hearst Magazines.
"What caught my attention was how these 25 year-olds are not fearful to swing for the fences on shockingly big ideas," said Dr. Oz, a Wharton business school graduate and a surgeon who co-founded Sharecare, a health and wellness platform. "They are focusing on many of the big challenges not being addressed and left behind by major venture capitalists. It is exhilarating to mentor the next generation of leaders."
Oz said he will be focused on mentoring entrepreneurs tackling health care, elder and child care, all areas in need of new business models. "There are huge demographic shifts taking place in America that will radically determine our future. We need to focus on these really big challenges we face," he said.
One of the first companies the Kairos Fund is investing in is Little Spoon, an organic local baby food delivery company that is launching its nationwide service Thursday. The start-up is only two years-old but has attracted heavyweight angel investors such as Kyle O'Brien, Chobani's executive VP of sales, and Sean Rad, co-founder and former CEO of Tinder, the popular dating app.
According to co-founder and CMO Lisa Barnett, a former brand strategist at Estee Lauder and venture capital investor at Sherpa Foundry, Little Spoon is targeting a lucrative niche in the $55 billion global baby food market: Affordable organic food for infants that is not processed with harmful chemicals and preservatives.
Right now, that business is dominated by huge corporations such as Nestle's Gerber, Campbell Soup Company's Plum Organics and Beechnut. Recent studies have found detectable levels of lead in baby food samples, a serious health concern since lead can cause problems with attention and cognitive development in a baby's formative first two years of life.
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While other organic baby food companies are springing up, Little Spoon says it has an edge because it owns the facility where it produces the baby food and can control the process in California. It also uses a technique called high-pressure processing (HPP), which is basically what happens with cold-pressed juices and is used to lock in the nutrients and neutralize bad bacteria instead of using additives, preservatives or simply flash-freezing like some other brands.
The company has set up a nationwide shipping network so products can ship anywhere in a day. Little Spoon will ship you up to two weeks worth of 4 oz.-sized meals for babies at $2.99 per meal for three meals a day (if you buy in bulk), or up to $4.99. The team behind Little Spoon also consists of co-founder Michelle Muller as the "chief mom," co-founder and CEO Ben Lewis, and co-founder and chief product officer Angela Vranich.