The Big Red Venture Fund, a venture capital group operated entirely by students of Cornell University's S.C. Johnson Graduate School of Management, has made its first investment in a biotechnology company founded by a student and an alumna.

The company is Gene Network Sciences, based in Ithaca and founded and owned by Colin Hill, a Cornell doctoral candidate in biophysics, and Iya Khalil, Ph.D. '01. It received a $125,000 investment from the fund. The company pioneers research into in silico biology, the creation of computer models of the genetic and biochemical networks of living, human cells. Using mathematics, proprietary computer programs and experiments, the company claims it can make drug discovery more predictable. With this focus, the company is moving quickly toward completing the most comprehensive computer simulation of colon cancer cells created to date.

"Our investment is the culmination of several months of working closely with the Gene Network Sciences team to help them bring their vital technology to the world of drug discovery," says Thomas A. Neyarapally, a Big Red Venture Fund partner and a Cornell student in both the law school and the Johnson School.

The Big Red Venture Fund has helped Gene Network Sciences in many ways. "From polishing our business plan to providing seed funding, their services have significantly helped propel our company forward," says Hill.

Like Gene Network Sciences, the Big Red Venture Fund is in its infancy. Founded last year, the fund is unique among business school venture groups in that the students -- rather than faculty advisers -- make all investment decisions. "We do, however, try to capitalize on our advisers' expertise and insight as much as possible," says MBA and law student Jesse R. Goichman, a fund partner. Unlike traditional venture capital funds, the limited partners are donors to the university and do not receive any returns from the fund. The investments can range from $50,000 to $200,000.

The current partners include: Robert W. Chesley, MBA '02; Brian M. Culley, MBA '02; Kerry L. Dolan, MBA '02; Goichman, MBA '02, J.D. '02; Geoffrey A. Goodman, MBA '02 ; Neyarapally, MBA '02, J.D. '02; Justin R. O'Keeffe, MBA '02. The fund's advisers include Rob Ryan, former chief executive, Ascend Technology; Rich Marin, chief executive officer of VC Fund B2B-Hive; and David BenDaniel, the Berens Professor of Entrepreneurship at Cornell.

In November, Gene Network Sciences introduced BioMine, a software that analyzes gene expression data generated from DNA microarrays. The software is being evaluated by more than 100 pharmaceutical and biotechnology companies and institutions.

Creating new pharmaceuticals can take companies as long as 15 years and can cost as much as $500 million in current dollars, with about 75 percent of the cost paying for failures. However, Gene Network Sciences says, by using in silico modeling to organize the vast, raw volume of genome data, companies can prioritize and narrow drug targets, resulting in cost savings and a faster time to market.