Update on T1D Fund Overhaul

June 10, 2026

This report provides an update on the recent changes at the T1D Fund.

We now have official confirmation of the changes, which we will review below.

We have also received a statement from Breakthrough T1D responding to JDCA questions. While some of our questions were addressed, others were not. The official response in full from Breakthrough T1D is available in Appendix A.

Breakthrough T1D is one of the most powerful T1D nonprofit organizations in the world. With that power comes the responsibility, we believe, to operate at the highest levels of good governance and transparency.

Up to this point, Breakthrough T1D’s approach to addressing these changes has been, in our opinion, to keep quiet and stay out of the public eye rather than be open, direct, and transparent. This report and the Breakthrough T1D reply are a good start toward greater transparency, but there are still many open questions and concerns that could have giant implications for the future operation of the T1D Fund.

Overall, the changes noted below give Breakthrough T1D greater power in its relationship with the T1D Fund and clarify how it sees the T1D Fund’s role going forward. Our view is that Breakthrough T1D leadership was concerned that the T1D Fund was becoming too independent and took action to curtail its scope of authority. Many large organizations struggle to strike a balance between parent and subsidiary, creating inherent tension that requires continual evaluation and calibration. In this case, Breakthrough T1D decided to make sweeping leadership and key operational changes. Was this the right decision? We do not know. The proof will be in the pudding—whether the T1D Fund flourishes or falters under the new leadership and operating structure.
 
That said, the way the changes have been implemented has created far more backlash than expected and, in our view, has caught Breakthrough T1D leadership by surprise (though it should not have been).

We have learned from sources that these changes were authorized by a unanimous vote of the Breakthrough T1D International Board members. We understand a PowerPoint was presented to board members to inform the decision, but we have not seen the content, nor do we know to what degree the International Board engaged in a pro/con discussion about the changes. We do not know whether they were warned by Breakthrough T1D leadership that these unilateral changes might sour relationships with longtime influential donors and supporters.

This development is regrettable for T1D. We all want a Practical Cure, and such infighting helps no one.

These implications will take some time to digest, and we will follow up in the weeks ahead with a strong point of view on risks and opportunities.

The report will address:

• Chain of events since last Friday
• Confirmed changes
• Unchanged operating activities
• Open questions

 
Chain of Events Since Last Friday

Last Friday at 4:45 PM, JDCA published a report titled “Power Grab at the T1D Fund.” The report detailed a leadership purge of the T1D Fund by its parent organization, Breakthrough T1D, and a revision to the operating agreement between the two organizations, allegedly giving the latter greater control. According to sources, many of the T1D Fund board and investment committee members were terminated without advance notice or warning.

At 7:01 PM last Friday, Aaron Kowalski released a letter to Breakthrough T1D donors acknowledging that major leadership changes did indeed occur at the T1D Fund. At the same time, the letter attempted to assure donors that the T1D Fund remained unchanged and business was proceeding as usual. Notably, the letter did not explain why these changes occurred.

The Kowalski letter also sought to discredit the JDCA report, stating that it contained “numerous inaccurate and false statements” and, in threatening language, demanded a “full recant.” However, the main developments reported by JDCA have indeed occurred and been confirmed.

The JDCA report also noted that both organizations' websites had removed references to the T1D Fund board members and investment committee members. Over the past weekend, these references have been restored to show the new T1D Fund board investment committee members.
 

Confirmed Changes

Changes to the T1D Fund Board

• Six of the eight prior T1D Fund board members were removed. Independent sources tell us that three of the six were forcibly removed, and the others resigned in protest (see chart A). Four new T1D Fund board members have been named. Only Aaron Kowalski and Karen Jordan, the incoming Breakthrough T1D International Chairperson, remain unchanged.
   
• All new T1D Fund board members are deeply connected to Breakthrough T1D as current or prior international board members and/or major program donors. None are independent/exclusive to the T1D Fund.
   
• The prior T1D Fund chairperson, who helped found the fund, has not been retained in an advisory or emeritus role. The new T1D Fund chair is Joe Lacher, who is also on the Breakthrough T1D International Board.

Changes to the LLC (the operating agreement between the T1D Fund and Breakthrough T1D)

• Updates were indeed made to the LLC. Breakthrough T1D says this is the 6^th time since inception that changes have been made to the agreement. (We have heard that all other times the agreement has been changed have been done collaboratively with the T1D Fund Board; this is the first time, according to sources, it was done unilaterally by the Breakthrough T1D Board.)
   
• The official reason for the update is stated: “to ensure better alignment between the Foundation [Breakthrough T1D] and the Fund and to provide for a sounder governance structure.”
   
• Breakthrough T1D would not provide JDCA with the LLC agreement or the changed clauses. However, we are told that the major change to the agreement was expressed in “Amendment #6.” While we have not seen it ourselves, sources say that the amendment moves the explicit authority to hire and fire the T1D Fund CEO, Executives, and Investment Committee Members from the T1D board to the Breakthrough T1D Board. It also requires that a Breakthrough T1D staff member be a signatory on all T1D Fund bank and investment accounts. If accurate, this is a major control shift resulting in a markedly weaker T1D Fund Board.
   
• Breakthrough T1D’s official response highlights three key changes to the LLC. The first change, shared below, clearly articulates an increase in Breakthrough T1D executive control. The next two seem to be related to ensuring the T1D Fund remains on mission, a good thing.

 Unchanged Operating Activities

• “The Fund is a wholly owned subsidiary of Breakthrough T1D.” In legal terms, Breakthrough T1D is the sole member of the LLC. In practical terms, this means Breakthrough T1D has the legal right to amend the T1D Fund LLC agreement at any time (and has always had that right).
   
• The T1D Fund will remain a not-for-profit, a point that the response letter emphasizes several times. “It [non-profit model] has been a core principle of the Fund since inception, remains unchanged today, and will continue into the future.”
   
• “The T1D Fund and Breakthrough T1D teams work closely together to support portfolio company success.” We have understood that, in the past, this was often not the case; that the two entities, for reasons of deal-making security, were required to remain at arm’s length.