The New Brunswick Innovation Foundation revealed today that it earned $9.2 million from its Radian6 investment, but the really interesting news was in the final paragraph of the media release.

The not-for-profit organization that finances research and early stage companies said all – every last nickel – of the proceeds will go back into the fund and be used for further funding of academic research and startups.

``As a non-profit corporation, all of the investment return will be used to further the Foundation’s mandate through by replenishing its Venture Capital Fund,’’ said the statement.`` This will allow NBIF to start up more innovation-based companies for years to come.’’

It’s the second indication this week that proceeds of Radian6’s $371 million sale to Salesforce.com will be reinvested in the New Brunswick economy. On Monday, Mariner Partners Chairman Gerry Pond, a Radian6 investor, said at Invest Atlantic he would have an announcement in mid-October, hinting it had something to do with reinvesting his Radian6 proceeds.

Last week, the venture capital funds backing Radian6 -- Summerhill Venture Partners, Brightspark Ventures and BDC Venture Capital – said they had made $205 million off the investment.

NBIF helped launch the company in August 2006 with a seed investment of $50,000, which it topped up in December 2008 with a $276,973 VC investment.

After the sale, NBIF’s two investments generated a combined internal rate of return of 170 percent—28 times the value of its original investment. That’s an even better performance than the three VC backers recorded.

The announcement highlights the benefits of exits to the whole startup ecosystems. At Invest Atlantic, Randy Thompson, CEO of the Venture Alberta Angel Forum, bemoaned the fact that his group has made 62 investments and has not yet had a single exit. Someone has to sell out soon, he said, if the network is going to get funds to reinvest in the next generation of young companies.