The Florida Funders team. Senior investment associate Zach Brodsky, far left, and managing partner Saxon Baum, fifth from the left, participated in interviews for this story. Photo provided.
Tampa-based venture capital firm and investor network Florida Funders and the Institute for Commercialization of Florida Technology (The Florida Institute) Wednesday officially unveiled Florida First Check. The initiative is an evergreen pre-seed investment strategy.
Florida Funders will serve as the investment manager for the effort. It will provide $75,000 to $100,000 first checks, on behalf of The Florida Institute, to early-stage technology founders statewide.
Formed by the Florida Legislature, the Florida Institute “supports and funds innovation companies that create clean jobs in new industries driving the global economy,” according to the organization’s website.
The strategy’s first investment is Tampa-basedStello AI,which is developing an agentic artificial intelligence-powered human resource platform. This system helps automate compensation, payroll and core HR workflows. Prior to launching the organization, founder Amee Parekh was a HR director for Uber Eats US and Canada and senior vice president of HR at telehealth company Hims & Hers.
“We have been managing the Florida Institute now as the private fund manager since 2019 and we’ve had a very similar structure and strategy in terms of when and how we’re going to be making investments,” said Florida Funders senior investment associate Zach Brodsky. “We started to see a bit of a trend of where some of the best investments in the Institute portfolio lied and that was the extremely early deals that we were investing in.”
He added that there are not a lot of funding options for pre-seed founders. It is “probably one of the most difficult checks to actually raise at the institutional level.”
The goal is to provide Florida-based pre-seed founders with access to capital without requiring them to seek out-of-state resources, Florida Funders managing partner Saxon Baum explained.
“Sometimes, that is enough to jump-start a company to keep them here in the state,” he said. “We know that our job is capital. So, we believe that this is definitely going to move the needle with that.”
Prior to launching Stello AI, founder Amee Parekh was a HR director for Uber Eats US and Canada and senior vice president of HR at telehealth company Hims & Hers. Stello AI is Florida First Check’s inaugural investment. Photo: Hims & Hers/Business Wire
Brodsky added that “the strategy has been kind of developing since 2019.” Within the past six months, Baum and Brodsky began to actively create the initiative. They hope to initially work with about 15 companies over the next three years.
The effort was designed to be self-sustaining.
“The Institute operates on an evergreen model,” Brodsky explained. “What that means is basically every time that we do make an investment and then we get returns on that investment, it gets replenished into the fund to then be funded into another company.”
Baum and Brodsky believe that Stello AI was an ideal fit.
“We always look for founders that really can understand multiple aspects of a business,” Brodsky said. “This is a company, at this stage, that actually does have great traction. It has pilots that are ready to convert and has been able to show that momentum. That’s exactly what we want to be investing in in these pre-seed opportunities.”
He added that startups and founders will be selected based on a variety of factors including discussions with customers and subject matter experts. Additionally, Florida Funders will review a wide selection of data. This allows the team to determine “where this market is headed” and what companies “are well equipped to grow.”
“We want to work with accelerators, universities and incubators around the state,” Baum emphasized. “We want them to know there is a home for their best companies to get a check instead of having to wrangle up a bunch of angel investors.”
He explained that the strategy will enable Florida Funders to invest in early-stage companies it otherwise might not. This can strengthen the organization’s “proprietary deal flow.” More so, it can help the Florida economy thrive.
“Florida has no shortage of brilliant founders — what’s been missing is a reliable first check that keeps them building here instead of relocating for capital,” said Florida Institute executive director Rafael Lohner in a prepared statement.“Partnering with Florida Funders to manage Florida First Check gives our state’s earliest-stage companies an institutional partner from day one. And when a company builds here, the high-wage jobs and economic impact it creates stay here — that’s the Institute’s mission at work.”
