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Roanoke developer Ed Walker first tried to lure Artspace, a Minnesota-based nonprofit real estate developer for the arts, to Roanoke for an early 2000s redevelopment project, but Artspace essentially ghosted him.
“It’s very, very, very, very difficult to get Artspace’s attention and to get them interested in a community,” Walker says. “It’s like trying to date somebody that just isn’t interested.”
Artspace sure seems to be swiping right on Roanoke these days, however.
On April 18, Walker held a celebration marking the first anniversary of his Riverdale mixed-use development, where, as part of an agreement with Roanoke’s city government, he plans to invest $50 million through 2040 to redevelop the 120-acre former industrial site into residences, offices, retail outlets and eateries.
Appearing at the event were Artspace representatives who had been exploring bringing a residential community for artists to Riverdale, with up to 44 private studio spaces and up to 67 live/work housing units for artists who make up to 80% of the area median income, which is $48,350 for a one-person household. Shared areas, like gallery space, a clay studio and rehearsal spaces, could also be included.
“This potentially could be our very first actual brick-and-mortar project in Virginia,” says Kelli Miles, an Artspace project manager.
Monthly rents would range from $480 for an efficiency to $617 for a two-bedroom apartment, according to Artspace Senior Vice President Wendy Holmes — “so, very affordable for [the Roanoke] market.” Artspace, which will own the property, will likely hire a local property management company to oversee it.
Next, Artspace will identify sources for about $800,000 in pre-development funding for the project, which could cost $12 million to $20 million, coming from a mix of public and private funding, Holmes says. The earliest construction could begin is 2026.
Founded in 1979, Artspace has developed 58 affordable housing and creative spaces for artists in 22 states.
Since last summer, Artspace representatives have held meetings with Roanoke-area cultural leaders, city officials and business leaders, including executives from Carilion and Virginia Tech, to talk about the project and potential financing.
“Ed is true to his word,” Holmes says. “He knows how to bring all these people together.”
Making sure artists can afford housing is a way to keep them in the community, according to Douglas Jackson, Roanoke’s arts and culture coordinator. “I think it is economic development,” he says.
Gen Xers are next in line for retirement, and most are far from being prepared financially for their golden years. They face a substantial shortfall of funds needed for retirement and the largest savings gap of any generation.
“As the first generation to head into retirement largely without the safety net of a defined benefit pension plan, the stakes are higher for Generation X and the margin for error is lower,” according to global asset management company Schroders’ 2023
U.S. Retirement Survey.
Born between 1965 and 1980 (ages 44 to 59), Gen Xers represent 64 million Americans and make up nearly 20% of the population. Their financial fears and challenges are greater in general than the generations immediately preceding (baby boomers) and following (millennials) them, according to the report.
“You are speaking my language,” says Jeff Kelley, principal of Kelley and Co., a Richmond-based public relations and communications firm. Born in 1981, he’s technically a millennial, just outside the Gen X definition, but considers himself on the cusp of both generations.
“I love my job, but I don’t want to be 70 and still having to work,” Kelley says. “My wife and I think we are on track, but there’s a lot to consider. There’s no way to save for everything. We have three kids, ages 10, 8 and 5, and we are putting away whatever
we can for college.”
Gen Xers estimate they will need $1.1 million-plus for a comfortable retirement, but most expect to have about $660,000, a gap of more than $440,000, according to the Schroders report.
More than 60% of Gen Xers are not confident in their abilities to achieve a comfortable retirement. More than 8 in 10 are concerned about the prospect of not receiving regular paychecks.
An average 45% haven’t done any retirement planning. And 66% worry that their workplace retirement plan won’t grow as much as they will need. “The result: The Gen X dream retirement may be slipping away,” the report says.
“My focus has been on growing the family business,” says Matt Dozier, 47, vice president of Dozier Tank & Welding, a tank and trailer repair shop with offices in Chesapeake, Richmond and Selma, North Carolina.
Dozier says he never gave any thought about retirement until he reached his 40s, but even now saving money for later in life is not a high priority. He doesn’t have children, so that’s not a factor. He might want to slow down eventually, he says, but as a blue-collar worker, the prospect of not working is not part of his DNA. “I don’t know how not to work.”
His late grandfather, who started the business in 1966, and his father, now president, never took vacations. Dozier broke that tradition. He enjoys sports car racing and recently spent a week camping in his RV next to a racetrack in Florida.
He and his peers are not as worried about retirement as perhaps they should be, he says. “If we have money, we might as well enjoy it now. We see plenty of people who die five years after they retire.”
Dozier admits he has better financial prospects than many of his friends, since he could become an owner in the family business. But he has no guarantees, nor is he relying on Social Security benefits to supplement his income. “It would be great if Social Security is there, but we’ve been told for 20 years that we won’t see it.”
A more likely scenario for him, he says, would be to pool funds with a few buddies and buy property where they would build tiny houses to live in, sharing a large garage.
“Yeah, I might need $1.1 million, but it’s not going to happen,” Dozier says bluntly.
He’s not alone in his thinking. The Schroders survey shows that 47% of Gen Xers believe Social Security will run out of money by the time they reach the full retirement age of 67, compared with 38% of not-yet-retired baby boomers. Only 10% of those who do believe in Social Security’s viability plan to wait until age 70 to receive the maximum benefit payment.
An average 32% of Gen Xers’ retirement plan assets are in cash; 63% fear losing their money, according to the Schroders report, and 24% are not sure how to invest their savings.
Dozier can relate. His maternal grandfather invested poorly, he says, and lost everything before he retired in the late 1980s or early 1990s.
Typically, people don’t get serious about saving for retirement until they get into their 40s or early 50s, experts say. That means Gen Xers still can close the retirement wealth gap, but it won’t be easy.
“Fortunately, even the oldest Gen Xers have some time before reaching their full retirement age,” says Deb Boyden, an author of the Schroders study and head of the company’s U.S. defined contribution division. “Using this time to develop a retirement plan, increase their savings rate and invest more appropriately is crucial to improving their retirement readiness before it’s too late.”
Schroders’ findings are supported by a fall 2023 Bank of America Workplace Benefits Report, which stated that only 17% of Gen Xers feel confident that they’re financially ready for retirement.
“On a more positive note, looking within the 401(k) plans that Bank of America administers for its corporate clients nationwide, 16% of Gen Xers increased their 401(k) contribution rate in the fourth quarter of 2023, compared to just 3% who decreased their contribution rate,” says Matt Card, a Northern Virginia-based media relations executive for Bank of America.
Generation X is the first modern generation to experience the full effect of a societal shift in retirement planning from defined company pension plans to defined contribution plans such as 401(k)s, transferring financial responsibility from employers to individuals.
Defined contribution plans offer tax benefits. Employees choose how much to contribute, subject to annual limits, and some employers match their contributions.
“Corporate-defined pension plans started to decline in the 1980s with the advent of 401(k) plans and are now rare and have been for the past 15 to 20 years,” says Michael Joyce, president of Agili, a financial planning firm in Richmond.
Most government employees still have pension plans, Joyce notes, some with cost-of-living increases but most without. However, only 14% of working Gen Xers have defined benefit pension plans, according to a 2023 report from the National Institute on Retirement Security.
The way that Gen Xers, the original latchkey kids, deal with self-reliance for retirement planning will set the precedent for generations to follow, experts say.
“Clients in the [Gen X] age group are approaching their peak earnings years,” Joyce says. “It is very important to save at least 10% of their earnings and take advantage of company retirement plans — 401(k), 403(b), 457 — as well as maximizing other potential corporate perks, including nonqualified deferred compensations plans [tax-deferred payments made at a future date to allow for certain events], Health Savings Accounts and restricted stock awards.” He recommends they also take advantage of 529 plans for college savings.
Donte Smith, a Richmond-based vice president and financial adviser with Merrill Wealth Management, calls Gen Xers “the sandwich generation,” taking care of children (either in college or with college on the near horizon) while caring for one or two aging parents. “They have significant demands on both sides,” he says, “and barely have time to take care of themselves.”
This generation also weathered three major market corrections — the 2000 dotcom tech bubble, the 2007-2009 Great Recession, and the COVID-19 pandemic in 2020. “All of that has impacted their investments and their confidence and ability to save at the level they should,” Smith says.
Throw in rising health care costs, soaring inflation over the past couple of years, along with high interest rates and lagging wages — and saving money becomes even more difficult.
Gen Xers with access to matching defined contribution plans should at minimum invest the percentage matched by their employers, Smith advises.
A 5% match is common, he says. For example, an employee makes $100,000 a year and puts $5,000 annually into a 401(k). A 100% company match would turn that into a $10,000 investment. Those over age 50 should, if possible, also take advantage of any catch-up provisions, allowing them to sock away even more.
Gen Xers, Smith says, tend to fit into three main groups:
One bunch hasn’t thought much about retiring because they’re too busy rearing their families and paying down debt or saving to buy their first homes.
Others have saved some money but haven’t created retirement plans and don’t know where or how much to invest, he says.
The third group theoretically has done the right thing by saving and investing for retirement since early adulthood. They feel in control of their retirements but don’t have customized plans.
Everyone needs a plan to make sure they’re making the right investment decisions, Smith says. Tactics, whether saving or investing for retirement, should never come before the plan. “You start with a plan,” he says, “and everything you do has to line up with the plan.”
Say, for example, you want to save $1 million and retire in 20 years, Smith notes. How much money should you save each week or month, and how should it be divvied among stocks, bonds and saving accounts? How much risk is the investor willing to take?
“In [your] 40s, all of a sudden you see the end of the track and know you have to get serious about retirement planning,” Smith says, adding that most people in this age group have enough time to realize the benefits of compound interest growth in their investments.
Smith suggests Gen Xers modify their spending habits — cutting back on streaming subscription services or dining out — to increase their retirement savings.
The typical Generation X household (with half saving more and half less) has only $40,000 in retirement savings, according to the National Institute on Retirement Security report.
More than half of Gen Xers (55%) participate in employer-sponsored retirement savings plans, according to the 2023 NIRS report, which analyzed 2020 data from the federal Survey of Income and Program Participation and found large discrepancies between average and median amounts of retirement savings.
The average account balance in private retirement accounts (individual retirement accounts, Keogh plans for the self-employed, defined contribution plans) among working Gen Xers was $129,994. However, the median account balance, with half saving more and half less, was only $10,000. Also, 40% had accounts with zero balances.
“Most Gen Xers, regardless of race, gender, marital status or income, are failing to meet retirement savings targets,” according to the NRIS report.
“Shoring up the Social Security trust fund is critical for assuring Generation X of its retirement security,” the report adds, noting that policy actions such as increasing plan access for part-time workers and reforming a saver’s credit (a federal income tax credit) also would help.
Unlike many of his peers, Kelley has mapped out a savings plan. He and his wife, Cristin, rolled over their 401(k) accounts from previous employers into IRAs, preserving their tax-deferred status with no early withdrawal penalties.
They have a Simplified Employee Pension (SEP) IRA, which allows contributions up to 25% of compensation. And they have Virginia 529 college savings plans for their three children.
Their cash savings is invested in a high-yield bank account. Plus, they have a taxable brokerage account or “robo-adviser,” an online platform that automatically manages and allocates investments based on risk tolerance and targeted returns. “This could be retirement someday but is really a place to park accessible funds if ever needed,” Kelley says. “I try not to touch it.”
Social Security doesn’t figure into their strategy at all.
“We try to save as much as we can, but we also want to live our lives,” Kelley says. “My goal is A) Be with my kids as much as possible, and B) Make as much money as possible.”
The family likes to go on a vacation once a year. They go out to eat but only occasionally. They don’t go to Starbucks. Nor does Kelley go out to lunch during workdays.
“Our cars are paid off. Our house is within our means,” Kelley says. “Am I rich? No. Smart with money? Hopefully.”
In philanthropy as in business, Dwight Schar sees the wisdom in doubling down when the stakes — and the impact — of an investment are high.
In May 2023, three decades after their initial donation to the organization, Schar and his wife, Martha, made a $75 million matching gift to Falls Church-based Inova Health System. It was the largest donation the 68-year-old nonprofit health system had ever received, and the largest donation the Schars had ever made. The Schars have donated more than $126 million to Inova since 1993, including $50 million in 2015 to establish the Inova Schar Cancer Institute, the hospital system’s Fairfax County hub for cancer treatment and clinical trials, which opened in 2019.
“Health care is No. 1 in my books; there’s nothing more important you can offer the community,” Schar says. “The metropolitan Washington area has been very good to me and my business, so this is where I feel I can do the greatest good for the greatest number of people.”
The Northern Virginia philanthropist founded Reston-based Fortune 500 company NVR, one of the nation’s largest mortgage bankers and homebuilders, which operates under the Ryan Homes, NVHomes and Heartland Homes brands.
Schar, 82, retired as NVR’s chair in 2022, after having previously served also as CEO. Since its founding in 1980, NVR has grown to employ more than 6,000 people, and for the fiscal year ending Sept. 30, 2023, it reported $9.79 billion in revenue. As of 2024, it has built homes in 36 metropolitan areas across 16 states, mainly on the East Coast.
“There are two issues in health care that affect every family: cancer, and heart and vascular health,” says Schar, whose mother died of cancer at age 58. “My mother raised six children by herself, and health care was not very accessible to us at that point in time.” Martha Schar herself recently had a heart valve replacement surgery, but for her husband, it’s just coincidence and not a surprising one, given that heart disease affects more Americans than any other condition.
“Despite enormous progress in diagnostic techniques and innovative drug, device and procedure treatment options, heart disease remains the No. 1 cause of death in the U.S.,” says Dr. Christopher O’Connor, president of Inova Schar Heart and Vascular. “Because of disparities in care related to the disparities in income and other social drivers of health in Northern Virginia, there is a significant variation in cardiovascular mortality rates that we hope to address with this gift.”
He adds, “It is critical that we transform cardiovascular care to address disparities and strengthen our ability to prevent and combat this deadly disease.”
The Schars’ record 2023 donation helps check a lot of boxes on Inova’s long wish list, including financial support for research, outreach, prevention and early diagnosis of cardiovascular ailments, hiring more health care professionals, and expanding specialty services.
“This gift is not about doing big shiny things, but to help us focus on providing the very best patient-centered care and attracting the very best talent to provide that care,” says Sage Bolte, chief philanthropy officer and president of the Inova Health Foundation, the organization’s fundraising arm.
Initially called the Fairfax Hospital Association, Inova was founded in the 1950s to meet a pressing need for local hospital services for Fairfax County residents. Today, it provides more than 4 million patient visits a year and employs more than 24,000 people across five hospitals and dozens of other facilities, including 37 primary care clinics and Northern Virginia’s only state-designated and nationally verified Level 1 trauma center.
“Dwight and Martha’s commitment to ensuring that all individuals in the Northern Virginia region have access to world-class health care shows up in everything they do, even in their partnerships with some of the other organizations around. Their generosity is accelerating our ability to attract world-class physicians, nurses and researchers,” Bolte says.
The Schars’ latest donation will deepen resources for women’s cardiovascular health, Bolte adds. “Women have different symptoms. They show up differently with heart disease or heart failure, and we’ve now hired some experts to create a comprehensive women’s cardiac program that is going to be transformational for the way in which we’re able to care for women, especially premenopausal, menopausal and pregnant women.” Early detection and prevention of heart and vascular disease will also be a top priority, as well as reaching higher-risk communities lacking access to health care, according to Bolte.
Programmatic priorities, O’Connor says, also include advanced heart failure and lung disease care, minimally invasive cardiac surgery and interventions to reduce recovery time and improve quality of life, as well as development of vascular medicine and surgery innovations to reduce the risk of heart attack, stroke, critical blockages of arteries in the lower limbs, and limb amputations. “These novel diagnostic and treatment techniques are having an immediate impact and will continue to be built out in the coming years,” says the physician.
The gift from the Schars has also enabled O’Connor’s team to pursue innovative platforms to predict and prevent disease progression through artificial intelligence and data analytics. “We are continuing to grow our use and understanding of telemedicine, remote monitoring, wearables and other technologies as they continue to evolve. These platforms are improving patient outcomes and resulting in better quality of life,” O’Connor says.
Finally, the donation will help Inova to make important capital investments in new labs, patient rooms and equipment, as the health system’s heart and vascular group expands its footprint at multiple locations, including Inova Alexandria Hospital’s new Landmark Mall location, Inova Fairfax Hospital and ambulatory care locations. “More surgical suites and rooms mean that more patients can be seen in a timely manner,” Bolte says.
The Schars’ May 2023 donation had another important effect for Inova — a seismic increase in gifts large and small. “The Schars’ pledge came with a community challenge to match their gift to ‘anywhere your heart beats,’” explains Bolte. “The Schars said, ‘Our heart has beaten for cancer and for heart and vascular. Your heart might beat for behavioral health. Give where your heart beats and meet that $75 million challenge by next May.’ As of the end of April [2024], we are just $7 million away, nearly double what we would normally raise in a year.”
As with many business relationships, the Schars’ connection to Inova began with a personal one. Dwight Schar admired the community engagement of J. Knox Singleton, who was then president and CEO of Inova Health System and also was involved in organizations like United Way.
“At that point in my career, I was really broke, but I was drawn to help Inova,” says Schar. In 1990, NVR lost $261 million after interest rates skyrocketed and home sales dropped, and in 1992, the company filed for Chapter 11 bankruptcy protection, which it emerged from in 1993, the year the Schars made their first major donation to Inova.
In 2015, Schar was there to back Singleton — and Inova — at a critical moment. When rumors began to circulate that oil giant ExxonMobil was contemplating a move from its 117-acre Merrifield campus, Singleton took the opportunity to shop around the concept for a new multidisciplinary cancer and research center, reaching out to Schar and his friend and fellow real estate mogul Milt Peterson for help.
Schar and Peterson’s combined real estate acumen, political connections and financial backing proved critical in Inova’s $182.5 million purchase of the land from ExxonMobil in 2020, after leasing it in 2015.
Sage Bolte was executive director of Inova’s Life with Cancer and Patient Experience when the Schars made their $50 million gift in 2015. “It was exhilarating that someone saw the value in what we were doing and helped us make it that much better. It really energized staff and put a spotlight on how Inova was doing something different related to cancer care,” says Bolte.
That gift to Inova’s cancer program has paid substantial dividends, she adds. “It helped us build a comprehensive cancer program, where patients are seen by an entire multidisciplinary team, including psychosocial care, and get all their treatment in the same building. That is a very rare experience in community-based cancer care, which is usually very fragmented.”
The endowment also enabled Inova to create a fellowship program, grow its rosters of residents and oncology-certified nurses, and create an arts and healing program within the cancer program, among other outcomes. Another initiative supported by the Schars’ 2015 gift was standing up a molecular tumor board, a team of multi-disciplinary experts who make individualized cancer treatment recommendations for patients not responding to typical treatment regimens.
The eight-figure donation also ushered in an era of larger-than-ever individual donations to Inova’s cancer program, including a $20 million donation in 2019 from Virginia philanthropists Tina and Gary Mather; a $20 million donation in 2022 from Paul and Linda Saville; and, this April, a $20 million donation from the Peterson family.
Though patriarch Milt Peterson passed away in 2021, the Peterson family continues with its legacy of giving to Inova, which has totaled $50 million. Jon Peterson is now CEO and chairman of Peterson Cos., the company founded by his father, Milt, in 1965. Peterson Cos. is responsible for notable developments such as Fairfax Corner, Fair Lakes, National Harbor, Burke Centre and Tysons McLean Office Park, in addition to other major projects in Northern Virginia and Maryland.
The Petersons’ 2024 donation earmarked $15 million to the Inova Life with Cancer program, which provides support for people with cancer and their families, and $5 million to support the $161 million expansion of Inova Fairfax Hospital’s emergency room to include more beds and a unit for acute behavioral health care, as well as a dedicated entrance for pediatric emergencies.
While the Petersons say the Schars’ landmark $75 million donation and challenge to match it inspired their recent gift, Dwight Schar says that it was Milt Peterson’s own early philanthropy that led him down the path of giving.
“The Petersons are really my idols in philanthropy. Milt was a very good friend and a real leader in the D.C. metropolitan area, and his children are carrying on with the same kind of leadership,” Schar says.
While Schar doesn’t micromanage his donations, he does pay attention to the finer details of the care Inova provides through his funding.
“One thing near and dear to my heart is that when you pull up to the cancer center and to the heart and vascular center, there’s free valet parking for everybody, so no one has to walk three or four blocks or hunt for a parking spot,” Schar says.
“The treatment is obviously the most important thing — you wouldn’t survive without it — but all these other little things make the experience that much more positive for patients. Being delivered to the front door, having ambassadors greet them with smiling faces and direct them where they need to go, it gives them a positive view of treatment.”
If health care is Schar’s top philanthropic priority, education runs a close second. Schar majored in education at Ashland University in Ohio, and started out as a junior high school teacher, stumbling into his real estate career via a side job selling homes in the mid-1960s, and then joined Ryan Homes to become a homebuilder. In 1980, he started NVR.
In 2006, the Schars donated $5 million to his home-state alma mater to help fund the construction of a new education building. In 2014, the couple went on to make the largest single gift in Elon University history, pledging $12 million to the private North Carolina university attended by their sons, Spencer and Stuart. Two years later, the Schars donated $10 million to what is now George Mason University’s Schar School of Policy and Government.
“The cost of higher education is ridiculous now; only the affluent can afford to make that kind of an investment,” Schar says. “We have to figure out alternative ways to provide quality, affordable education.”
That also was a motivating force for other philanthropists who made significant donations to higher education institutions across the state over the past year. The University of Virginia, George Mason University and William & Mary all received significant gifts to boost the state institutions’ offerings and fund expansions and scholarships.
In September 2023, The Breeden Co.’s founder and chairman, Ramon W. Breeden Jr., gave U.Va. $50 million to be split between the university’s renovation and expansion of its McIntire School of Commerce and construction of a new athletics complex.
A 1956 McIntire graduate, Breeden almost had to drop out of U.Va. due to family financial hardships. The future Virginia Beach real estate magnate took on three part-time jobs to get through, though it meant the student-athlete had to leave the baseball team.
“The McIntire School broadened my education and gave me confidence in myself. I have many friends who attended Ivy League schools, and I can stand toe to toe with them in business, as I got just as good an education and, in some cases, better,” says Breeden, whose father worked his way up from sweeping floors to operating machines in an envelope factory. “McIntire taught me not to give up and to keep pushing on in life.”
Meanwhile, married U.Va. alums Kathleen and David LaCross added $50 million to their earlier gift of $44 million to the Darden School of Business in October 2023. With matching funds from the university, the total donation is more than $107 million, which will be used to pay for AI tech programming and a residential college at Darden. David LaCross, who founded a small California tech company that he sold in 1997, earned an MBA from Darden in 1978, and Kathleen LaCross graduated in 1976 from U.Va.’s College of Arts and Sciences.
In May 2023, the late Loudoun County businessman Donald G. Costello left George Mason $50 million, its largest individual gift. The donation established the Costello School of Business and created an endowment for undergraduate and graduate scholarships for business students.
In March, an anonymous William & Mary alumna donated $30 million to renovate and rename an out-of-use campus building in honor of former U.S. Secretary of Defense Robert M. Gates, the university’s chancellor. Gates Hall will house the Global Research Institute, the Institute for Integrative Conservation and the Whole of Government Center of Excellence.
Also, Inova wasn’t the only health care organization to receive a windfall in the past year. In September 2023, the Red Gates Foundation committed $50 million, to be disbursed over five years, to the Roanoke-based Fralin Biomedical Research Institute at VTC in support of cancer and neuroscience research.
The Red Gates Foundation was established by the estate of Richmond philanthropist Bill Goodwin’s late son, Hunter, who died of cancer in 2020 at age 51. Hunter Goodwin’s parents and estate made a $250 million endowment in 2021 to kickstart a national cancer research foundation bringing together five leading cancer research institutes.
Progress continues on the Wise County Industrial Development Authority’s 200-acre Elam Farm industrial site in Wise County, which will expand an existing technology park. With help from various sources, including a total of $1 million from the Virginia Coalfield Economic Development Authority, the project so far has received $4.8 million in investments, with plans to add future manufacturing and data centers.
Brian Falin, the IDA’s executive director, says the project dates back to 2013 when the IDA acquired the property, but development didn’t begin until 2019.
“We started taking a hard look at bringing this property up to the standard that the rest of the Lonesome Pine [Regional] Business and Technology Park is,” he says. Existing tenants include Foundever, DP Facilities’ Mineral Gap Data Center, and Ronald Blue Trust.
Jonathan Belcher, VCEDA’s executive director, says as the technology park evolved, attracting new tenants, the need for expansion was clear, and the adjacent Elam Farm was the logical choice.
By the time it’s developed, he says, the property will have a 65-acre industrial site ready to be marketed.
The project’s development encompasses multiple phases. The first phase focuses on fundamental groundwork and includes developing an access road and extending utilities like water, sewer and natural gas. Construction began in December 2023 and is on track for completion by September, Falin says.
The VCEDA funding — a $700,000 grant for Phase 1 and a $300,000 loan for Phase 2 — is coupled with a $1.8 million grant from Virginia Energy’s Abandoned Mine Land Economic Revitalization Program to pay for the first phase.
The second phase, bolstered by additional funding from other sources, will include earthwork, site clearing and grading, and Falin says it’s pivotal in delineating a 65-acre plot primed for development. Construction was slated to begin in May, targeting a December completion.
The property was a surface mining site in the early 1990s, Falin says, and over the years has transitioned into agricultural use.
Belcher says Southwest Virginia’s mountainous topography creates challenges for site development.
“Having that 65-acre site will be of tremendous value as we try to attract prospects that need a larger footprint like that,” he says. “We’re pretty well-situated as far as greenfield sites for companies that might need a smaller amount of acreage, but having a larger acreage is something we have less often.”
Google is expanding its Virginia data center campuses this year and is launching a $75 million Google.org AI opportunity fund. (April 26)
After nine years and through three U.S. presidents, attorneys David DePippo and Tim McHugh and their client, a Richmond FBI agent, won a case focused on GI Bill education funding. (April 16)
Five Petersburg casino contenders shared their plans, but the city later picked a partnership between The Cordish Cos. and former NFL star athlete Bruce Smith
to move forward. (April 15)
Gov. Glenn Youngkin announced three new hires in his administration. (See related interview with new Virginia Lottery Executive Director Khalid Jones, Page 46.) (April 12)
The payment and invoice automation company signed an agreement to be acquired by Atlanta-based Corpay. (May 9)
Gov. Glenn Youngkin made headlines last December when he announced a $90 million-plus pitch to launch “Virginia’s Research Triangle.”
Initially envisioned as a cooperative initiative among Virginia Commonwealth University, Virginia Tech and the University of Virginia, the triangle was expanded into more of a rhombus following the addition of Old Dominion University to the research network during the 2024 General Assembly session.
If approved by the legislature and Youngkin, a total of $96.4 million would be divided among the four public research universities: $46.5 million for U.Va.’s Paul and Diane Manning Institute of Biotechnology; $31 million for Virginia Tech’s Roanoke-based Fralin Biomedical Research Institute at VTC; $14.9 million for VCU’s Medicines for All Institute; and $4 million for ODU, which a university spokesperson says plans to develop its “digital patient model,” a “simulation-based environment” for virtually testing treatments and therapies. (As of this story’s press deadline, the budget was still in negotiations.)
This would help establish a biotechnology, life sciences and pharmaceutical manufacturing network in Virginia, partnering research universities with the Virginia Innovation Partnership Authority to collaborate on commercialization and startup support.
It’s also hoped that the statewide research network will help spur the creation and expansion of Virginia businesses as well as attract outside companies to locate here. This endeavor comes on the heels of several developments at each hub of the proposed research network.
In December 2023, U.Va. broke ground on the $350 million Manning biotech institute. Expected to open in late 2026, it received a $100 million gift in January 2023 from its namesakes, Charlottesville-based PBM Capital Chairman and CEO Paul Manning and his wife, Diane.
In October 2023, the Richmond-Petersburg region was selected as one of 31 federally designated tech hubs, allowing the region to compete for up to $70 million in federal grants as it focuses on strengthening advanced pharmaceutical manufacturing.
And in September 2023, Roanoke’s Fralin Institute announced it had received a $50 million commitment to support cancer and neuroscience research from a foundation established by the estate of Richmond philanthropist Bill Goodwin’s late son, Hunter.
Frank Gupton, CEO of the Medicines for All Institute at VCU, and a co-founder of Richmond-based pharmaceutical company Phlow, compares Youngkin’s proposal to North Carolina’s Research Triangle — “except we’re doing more translational work, as opposed to basic science.
“If U.Va., Virginia Tech or VCU comes up with a new innovative drug, we’ll have a platform that we’ll be able to scale up and do the clinical trials for. It’s going to be an end-to-end capability,” Gupton says. “My hope is that we’ll be working together and leveraging our collective resources to be able to do some really meaningful research and development that will benefit all the universities.”
Joe Benevento, CEO and president of Virginia Innovation Partnership Corp., VIPA’s nonprofit operations arm, and formerly Virginia’s deputy secretary of commerce and trade, says the commonwealth’s proposed research network will attract startups seeking access to research facilities, wet labs, testing space and equipment.
“Startups really can have the opportunity to collaborate and partner with world-class university researcher talent [and] build off and leverage that IP and know-how to accelerate commercial development, attract growth investment and enhance market delivery,” Benevento says.
Erin Burcham, president of Verge, an umbrella organization for the Roanoke-Blacksburg Technology Council and Roanoke’s Regional Accelerator and Mentoring Program (RAMP), says that additional biotech research funding will increase opportunities for biotech companies, growing the state’s economy.
“Biotech in our region is transforming the economy in a really impactful way,” says Burcham. “We’re going from a very industrial town that was really focused on Norfolk Southern and trains to more of an innovation economy where we’re focused on high-wage, high-tech, advanced science-type companies.”
Paul Manning sees the capacity for collaboration between the research network’s hubs. While VCU will continue focusing on large-scale pharma manufacturing, U.Va. and Virginia Tech will use the new state funding to move research from labs to patient treatments. Charlottesville Economic Development Director Chris Engel has said that the Manning institute alone could support a bioscience cluster of about 75 companies and 3,000 employees.
“There’s so much to be done, and we are in a revolution in biotechnology right now. There won’t be much overlap [between hubs], and I think the research that’s going to be done at every institution will help all,” says Manning, adding that the quality of research facilities will motivate “people and companies … [to] start moving here to set up their operations in Virginia because we have such a deep bench of scientists that will be able to provide support.”
Dr. K. Craig Kent, CEO of UVA Health and executive vice president for health affairs at U.Va., also thinks startups will be drawn to the research network.
“Biomanufacturing is really expensive. It costs a lot of money to develop these facilities,” Kent says. “Part of the draw is that smaller companies trying to get into phase 1 drug trials don’t have the money to build their own facilities. The research triangle could partner with these companies and grant access to their facilities.”
Kent says this initiative will attract companies outside Virginia while retaining existing biotech startups.
“As long as we have the ability to help those companies translate and run clinical trials, they’ll stay here in Virginia,” Kent says. “If we have a critical mass of intellect, researchers that do this kind of work, companies want to associate with those individuals. They want to be around them. They want to partner with them in their own research.”
He compares the draw that Virginia’s research network will have to that of Boston, which attracts startups and researchers to its large number of top-level universities and biotech companies with an associated talent pool. But Virginia, he says, can offer researchers a much lower cost of living and higher quality of life.
Marc Nelson, Roanoke’s economic development director, says he’s already seen a transformational change in his city from the Fralin Biomedical Research Institute at VTC, which was founded in 2010 by Virginia Tech and Carilion Clinic.
The institute “really helps from an economic development standpoint … [to] create really lucrative and innovative jobs,” Nelson says. “We’re just getting started, and Fralin Biomedical and Carilion have really led the way. Now you’re seeing the partners come up behind them and give them the support structure they need.”
And the research network isn’t the only new proposed state initiative that could help spur the creation of biotech startups. In collaboration with Richmond-based innovation incubator Activation Capital and CvilleBioHub, a nonprofit that works to boost Charlottesville-area biotech businesses, Verge has applied for a GO Virginia grant that would total roughly $15 million. The funding would support health care innovations at an earlier stage in the creation process.
“These three organizations are very passionate about identifying additional capital through grants and public-private funding to support the growing, commercialized biotech side of the state, and doing it hand-in-hand with the universities so we can nurture intellectual property,” says Burcham of Verge. “Entrepreneurial organizations are responding to the money coming in for biotech research and really trying to build out a holistic ecosystem for those startups to thrive in Virginia.”
On an early morning in summer 2021, a small group of engineers and drone operators gathered at Lake Elsinore in California to see if their machines would fly as designed. With newly incorporated sensor technology, it was the first time the founders of Leesburg-based Flying Ship Co. attempted to fly one of their autonomous vehicles over a lake.
“When we first got it off the ground … that was a nail-biter,’ recalls Flying Ship co-founder and CEO Bill Peterson. Founded in 2020, Flying Ship makes unmanned cargo aircraft.
“We didn’t know if it was going to work. We didn’t know what kind of conditions it would work under, but seeing it work over a body of water was incredible, nerve-wracking and exhilarating all at the same time,” Peterson says.
For startups and founders, feelings like those can extend to navigating the various funding rounds for securing capital to grow a business and keep it afloat. In pre-seed, seed and early-stage funding rounds, companies take shape, often relying on angel investors, family and friends to cover initial costs. In Series A rounds, growing companies share performance metrics and may rely on funding from one major investor or stock sales. In Series B rounds, proven companies continue to develop their market shares past initial development stages. And in Series C, often already profitable companies look to expand.
When it comes to reporting capital, all startups have to report what they have raised to the U.S. Securities and Exchange Commission, and there are specific rules guiding general solicitation and from whom companies can solicit funding. Founders should seek advice from support organizations or lawyers with specific knowledge about raising capital.
In pre-seed and seed funding rounds, successful funding comes from helping others see your vision, says Scott Janney, co-founder and CEO of Norfolk-based Magazine Jukebox, which provides digital magazines, games and trivia to businesses like doctors’ offices to offer in waiting rooms. Magazine Jukebox had raised $2.7 million in seed funding as of May and plans to raise another $1.6 million, transitioning to Series A in 2025 or 2026. Janney likens navigating the funding stages to traversing mountains and valleys, with the “easy part of fundraising” being the mountain. “When everyone can see what you’re doing, it’s easy,” he says. “The valleys, where you’re making it stretch and working to improve, are what no one sees.”
Seed rounds are often about the comfort level between investors and entrepreneurs, says Robert Gourdie, founder of Roanoke-based The Tiny Cargo Co. Founded out of lab research at Virginia Tech in 2018, Tiny Cargo extracts exosomes — extracellular biological particles — from cow’s milk for therapeutic and nutraceutical uses on an industrial scale. The company raised $940,000 in a 2023 seed round, and also has secured venture capital backers and grant funding, all of which require different approaches, Gourdie says.
“When you’re raising capital in a seed round, you meet face-to-face with an investor, and it’s an interesting and important difference [from applying for grants] because you have to look investors in the eye and feel comfortable with the story you’re telling, and they have to feel comfortable with you,” he says.
Flying Ship’s Peterson calls it “betting on jockeys, not horses. … If you have an awesome team in place, boast about the phenomenal people you have,” he says, sharing lessons he learned during the 2022 pre-seed round in which the company raised $500,000.
Jen Finn is co-founder and CEO of Richmond-based HIO, which provides an artificial intelligence customer service texting chatbot to property management companies. She has sat on both sides of the table — as an angel investor and as a founder seeking funds, she says. Her advice to founders: Find your niche, show investors the scalability of your product and balance accessibility, all while understanding how much of the company shareholders and investors should have.
HIO raised $95,000 in grants in 2022 from the Virginia Innovation Partnership Corp.’s Commonwealth Commercialization Fund, $20,000 from Lighthouse Labs and another $450,000 in convertible notes from friends and family. She has not had to give up any equity in her business yet, she says, but that could change in the future because of the convertible notes.
Each funding stage has its own challenges, and there’s no set time for how long a round can last or how many times a company can repeat a stage.
Many companies are receiving less funding than they may have two to four years ago, with companies not progressing through the series or going through multiple seed rounds, says Paul Nolde, managing director of 757 Collab and executive director of 757 Angels powered by VentureSouth.
“Three years ago, we were in a founder-friendly cycle, valuations were high, and terms were founder-favorable, but now it has largely switched to an investor-friendly cycle,” says Nolde. “Capital is a little more constrained, but I believe the best companies will always find capital.” Rising interest rates and pushback against overvalued companies earlier in the 2020s have resulted in large investors and firms keeping their money close.
In the past, Nolde has counseled fledgling companies to raise only what they need at the time, but with private funding less available, companies should build in a cushion, Nolde says.
Many venture capital groups are pulling back and focusing inwardly on their existing portfolios, leaving companies in early-stage funding rounds for longer periods, says Rich Diemer, managing director of Charlottesville-based CAV Angels, a nonprofit investor network of University of Virginia alumni, faculty, parents, students and friends. There’s no one perfect formula for funding, he says.
“My advice is to avoid short-term people who are trying to take advantage [of your business],” he says. “That’s the importance of relationships. … Stick with the people who will stick with you.”
Even for mature companies, successful later series funding rounds are still “a grind,” says Ed Rogers, CEO and co-founder of Charlottesville-based Bonumose, which is commercializing the production of tagatose, a natural sugar with a low-glycemic index. Bonumose completed a Series B funding round in early 2021, raising $34.68 million, according to SEC filings, and is currently in a Series C round.
Rogers encourages entrepreneurs to find investors who have skills and resources that can help their businesses in the long run.
“Raising money and running a business are not the same,” he says. “If you can find somebody who writes a check but also has connections and expertise, that makes your organization more valuable.”
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