When Set Your Sites was raising its pre-seed round in early 2025, it needed a funding match to secure money from Invest Nebraska, the state-contracted venture capital nonprofit. One of the first stops for co-founder and CEO Stacy Dam: the Nebraska Angels.

One angel investor who pitched in was Nelnet, the Lincoln company that services federal student loans. They contributed a significant part of the total $500,000 round, helping Set Your Sites get the Invest Nebraska match.

Fundraising rounds sometimes take up to six months, Dam said, which can hold up a startup’s growth. This one took just six weeks with Nelnet’s help. “We wouldn’t have been able to close the round (quickly) without their major investment,” she said.

At the time, Set Your Sites’ campground management software was running on just four campgrounds. Now, it serves 2,000 campsites across six states and 30 campgrounds. “If it wasn’t for this pre-seed round, we would not be where we are right now,” Dam said.

In many ways, Nelnet is a cornerstone of the Nebraska innovation ecosystem. The company is unique in the state’s corporate world, heavily involved in supporting startups and using its own balance sheet to make early investments. In turn, it is shaping the future of Nebraska’s business community.

Since 2006, Nelnet has invested roughly $190 million across 171 investments, with 80% of those dollars going to Nebraska-based companies. Those include sportstech giant Hudl and CompanyCam, Nebraska’s first unicorn — both of which are fixtures of the revitalized downtown in Lincoln, where Nelnet is based. Typical investments start at $100,000.

“Beyond their investment in Hudl, Nelnet’s long-term partnership and strategic support have been instrumental in helping many companies like ours scale right here in Nebraska,” said David Graff, CEO of Hudl, in an emailed statement to Silicon Prairie News.

For Nelnet, supporting Nebraska innovation and helping to keep talent in the state is meaningful work. “We’ve always enjoyed investing, and it’s fun to watch new companies grow,” said Mike Dunlap, the executive chairman and co-founder of Nelnet.

But “it’s not a charity,” he said. Nelnet, like any investor, is in it for the financial returns. There is a sense of pride, though, in also bolstering economic development. “We believe you can do both at the same time.”

Two decades of experimentation

Nelnet’s history of venture capital is also the history of Nebraska Angels. In 2006, Dunlap and Chuck Norris, now the managing director of Nelnet’s venture arm, went to a founding meeting with about 20 attendees.

Dunlap was already thinking about how the effort could benefit the state’s workforce — and Nelnet. “One of our goals was, if we can help seed the tech ecosystem in Lincoln and Nebraska, then as that ecosystem grows … we can potentially hire more people in the state to do our technical (work),” he said.

With the Nebraska Angels, Nelnet got a crash course in startup investing. Dunlap and Norris “really didn’t know that much about angel investing when we started, and neither did the angels,” Norris said. “So we all learned together and have been learning since.”

Among the lessons: accepting that not every startup is going to succeed. Many investments will fail, others will break even, but the few that make it can bring an outsized financial return. 

It takes patience to invest in a portfolio of startups and hunker down for the decade or so needed to see returns. Not every company can hang on the way Nelnet has.

“I’ve worked and seen a lot of corporate innovation efforts out there, and typically what happens is, 18 months in, three years in, it’s like, ‘Well, this isn’t working, so we’re gonna give up … it’s not worth our time to invest in startups because we’re not getting immediate impact,’” said Brian Ardinger, Nelnet’s director of innovation.

Nelnet’s mindset is different. “We don’t wake up in the middle of the night because we have an investment that didn’t work,” Norris said.

“We wake up in the middle of the night if we didn’t make an investment that did work,” he said. “We’re going to be biased towards doing an investment … because you don’t want to miss the winner. That’s a bad night. It’s a bad day. Bad week. Bad year.”

An advocate and guide for startups

For Ben Jackson, the CEO of Guardify, the Omaha-based startup providing secure data management services for child advocacy centers, Nelnet is “sort of like a lighthouse in Nebraska — they’re just looking after everybody.”

Funding is critical for early companies. So is guidance and a sense of support, something Nelnet makes sure to provide. Otherwise, running a startup can feel like lonely, disorienting work.

Jackson and Guardify know that personally. Nelnet is a lead investor alongside Invest Nebraska, and has put over $1 million into Guardify since the company’s founding in 2019.

But Norris is also a board observer for Guardify, helping to maintain transparency and good financial stewardship. A confidant for Jackson. And a “huge cheerleader,” Jackson said.

“When other investors have had questions and said, ‘Hey, we’re thinking about putting some money in with Guardify,’ (Norris) is very fast to be like, ‘Have them call me and I’ll tell them that they should do it, and I’ll tell them why,’” Jackson said.

Outside the venture capital arm, Nelnet’s other resources are also a benefit. Having another technology company to spitball ideas with — one with which Guardify isn’t in competition — helps Jackson find new ways to grow the startup.

The two companies have compared notes on how best to approach government contracts, and Nelnet also freely shares requests for proposals it sees from different agencies that Guardify might want to submit for.

Nelnet’s willingness to invest and support startups is uncommon in Nebraska, Jackson said. He previously worked at LinkedIn, Flywheel and WP Engine. In his experience, Nebraska companies and investors tend not to know what’s happening with local startups and are hesitant to get involved.

Nelnet is “uniquely not risk-averse,” Jackson said. In Nebraska, there is a “Midwest conservatism that, ‘You don’t want to go try this whole crazy tech startup thing.’ 

“Nelnet has been that one that’s like, ‘No, you can do this methodically and strategically, and you can help lots of people, but at the same time, have good shareholder returns,’” Jackson said. “We need more corporate innovators like Nelnet.”

A culture of innovation

By investing in startups, Nelnet gets another kind of positive return. Corporations can get stuck on the status quo, too busy oiling the gears of current business to be flexible and innovative. That can be risky as the tech and business world evolves at light speed.

But working with startups on the cutting edge of technology helps Nelnet stay fresh. Norris attributes an internal culture change to its investment work and to Ardinger, who joined the venture team about seven years ago.

“It’s taken those six or seven years to get people to think about how you create new things in the organization that is more like a startup than it is like the old, traditional, ‘Put together a 50-page business plan and ask for $5 million bucks’ (approach),” Norris said.

“We’re getting people to start thinking about, ‘Put together one or two pages, and let’s go spend 50 grand on doing some research,’” he said. “OK, that looked promising. Let’s go spend 200 grand more on building a small, easy prototype.”

Nelnet has also supported that kind of culture of innovation, and the infrastructure needed for it, in the broader Lincoln community. The company is a major investor and board member for the Lincoln Chamber of Commerce and the Lincoln Partnership for Economic Development.

Just like with startups, Nelnet pushes those nonprofits to take big swings, said Jason Ball, CEO of both the chamber and LPED. As a result, the city has benefited.

“Lincoln’s in so much of a better place economically than it was going back 25 or 30 years,” Ball said. “And it’s the engagement of Nelnet, along with a lot of other great corporate leaders in this community that have really made that possible.”

Lev Gringauz is a Report for America corps member who writes about corporate innovation and workforce development for Silicon Prairie News.