Archive | March, 2015

Six Takeaways from Women In Bio Shark Tank

26 Mar

By Lucy Parkinson, Senior Research Manager, LSN

lucy 10*10Last night in Cambridge, LSN joined Women In Bio for a Shark Tank-style pitch event. The audience heard pitches from five life science entrepreneurs. Across the table from them were four experienced early stage life science investors playing the role of “sharks”.

So what did we learn from these life science innovators and from the sharks’ cutting responses to their pitches?

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WIB Shark Tank Event | March 24, 2015

 

  1. Where women’s health meets personalized healthcare, there are significant unmet needs that startups can target.

Personalized medicine was a significant theme of the event, and three of our innovators are targeting major problems in the current standard of care for women’s cancers. By using biomarker diagnostics, personalized monitoring devices, and nanotech drug delivery mechanisms, these entrepreneurs hope to offer earlier detection, personalized treatment options, and targeted treatment to women with ovarian and breast cancer.

  1. Investors want to know how science is guiding a business.

While it’s important to deliver a business pitch, not an academic pitch, investors want explanations of how a company’s plan is backed up by research. How did the scientific research help you choose your lead asset, or your target indication? Has your research been published or patented?

  1. While personalized medicine could revolutionize healthcare, the public first needs to be educated about the technology.

As one entrepreneur explained, a company providing a new personalized health product or service is entering a nascent marketplace, and will have to educate consumers on the benefits of adopting the new technology. Any product in this field requires a marketing plan that includes education and awareness, not just a traditional sales approach, and investors may be wary due to the difficulty of developing this new marketplace.

  1. Data is central to personalized healthcare, so companies must take data science seriously.

The sharks pointed out a number of potential pitfalls for companies that are collecting and using personal health data. A startup has to demonstrate that they have the in-house expertise not only to use this data, but also to provide it to the user and to protect it adequately from unauthorized access. The ability to share data with physicians is another vital element of a data-driven healthcare product. Many startups in personalized healthcare are also considering how best to monetize their data; there is a high level of interest in partnering with pharma companies to provide data for research purposes, but it is vital to obtain full consent from patients before considering this path.

  1. New healthcare technologies have to work with physicians.

As the sharks pointed out, no physician is going to order a biomarker test unless that physician is familiar with the biomarker and believes in the information it provides. Similarly, no physician will pay attention to the data generated by a personal monitoring device unless he or she trusts that the device is producing valid and medically actionable information. In the case of diagnostics that directly affect treatment decisions, such as a test to guide breast cancer treatment, physicians may be very concerned about false positives and false negatives; it’s important that physicians know what companies have done to reduce this possibility, and how a patient may be affected by a false result.

  1. The ask is important. It has to be clear, and it has to be reasonable.

The sharks noted that this can be a difficult part of the pitch to get right, perhaps particularly for women entrepreneurs, who can often receive a negative response in the workplace when they initiate financial negotiations. However, the ask is a vital component of a pitch to investors. Investors need to know how much a company is raising, and where that money is going to take them. A sum that is out of line with expectations will raise a red flag. To help you estimate accurately, look at financing rounds for similar companies, and get a sense of the real costs of advancing an asset; if you plan to advance two lead candidates into the clinic, be realistic about the expense of moving two programs through an IND.

Four Reasons Why It Is Never Too Early to Build Relationships with Investors

26 Mar

By Michael Quigley, Director of Research, LSN

mike-2Entrepreneurs we work with often ask us when they should start contacting investment firms. Almost invariably, our answer is as soon as possible. That doesn’t mean a company should feel rushed into sending out unfinished, sloppy, or overly cumbersome marketing materials. You should take the time to organize your brand, from logo to tagline to pitch deck and executive summary, so that you have a professional and concise package. Any upcoming data or potential partnerships or collaborations can be easily added into the materials as they come into fruition.

If a company is waiting for an event or to receive certain data before formally fundraising, outreach can be framed as an introduction to the company, rather than a direct solicitation for funds. In this case the purpose is simply to begin a relationship. As always when reaching out to investors, it is crucial that you contact people who have interest in your sector and technology, otherwise they are unlikely to be willing to engage in even an introductory conversation or be able to help you when you are formally seeking capital. Building investor relationships early allows companies to:

  1. Establish a Communication Channel

At the very least, this practice gives companies the opportunity to cultivate an investor contact who knows who they are and what they are doing, and who will be significantly more responsive and upfront with feedback when the company formally starts to raise capital. This is the first step in developing any investor relationship, and gives fundraisers a head start on their process no matter where the company is in their development.

  1. Demonstrate Growth/Progress

Reaching out and explaining a plan and future company goals and milestones gives an entrepreneur the opportunity to show potential investors progress and growth over time. This will increase their faith in your ability to manage the product, making the company a more worthy potential investment. Investors aren’t investing in a snapshot of a company at a given date and time; they are investing in the entire lifeline of development. By providing them with a real-time window into that process, you help make the picture more clear and understandable.

  1. Build Trust

Trust is crucial in any relationship, especially when it involves financial capital. By speaking periodically, demonstrating growth, and, perhaps most significantly, explaining any hiccups that led to missed milestones or forecasts and what was learned from them, an entrepreneur can forge a strong bond with an investor. This level of trust can be invaluable, particularly when a company begins looking to secure a lead investor.

  1. Create Pipeline for Future Rounds

Early stage entrepreneurs in the life science field will almost inevitably have to raise multiple rounds of financing, and there is also a good chance that each round will include different investors. By building relationships early with investors allocated at various stages, you can decrease not only the time required to raise your first round of financing, but also that of your future rounds. Having seen a company grow over a few years further strengthens the bond and level of trust an investor feels with that startup.

Waiting until you have limited runway in terms of capital on hand can be a death sentence for an early stage company. Since the average fundraising campaign takes between 9 and 18 months, entrepreneurs must do all they can to streamline and advance the process as early as possible. It is often apparent to investors when a company is running out of cash and time, and that can negatively affect their valuation. Over the years we at LSN have seen a number of companies fall into this trap, and you do not want to join that club. Get your materials together, identify targets, and start reaching out, getting feedback, and building relationships. You will be glad that you did.

RESI @ TMCx Cardiology Investors Panel Announcement

26 Mar

By Nono Hu, Senior Manager, Branding & Messaging, LSN

Nono 2The cardiovascular sector presents unique challenges both to entrepreneurs and investors.  The steep cost of Phase III trials and the strict regulatory standards applied to cardio drugs make investing in cardiovascular products a risky endeavour.  Investors who dare to take on this field are rewarded with access to large markets, including a growing need for new cardio solutions in emerging economies.  In addition to investors who take on cardio for the potential ROI, nonprofit funders see the potential for their dollars to make a significant global impact by backing early-stage companies.

For RESI @ TMCx, LSN has assembled a panel of veteran investors who are focused on meeting these challenges, Moderated by William Kohlbrenner, Consulting Scientist, Boston Innovation Capital & Scientist-in-Residence, Life Science Nation the audience will hear from:

These investors will explain how they assess cardiovascular investment opportunities, what cardio entrepreneurs can do to differentiate themselves when seeking investment, and how to find investors who are interested in working with you in matters of the heart.

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Hot Life Science Investor Mandate 1: US Based Venture Arm of Chinese Family Office Seeking Preclinical Biologic Opportunities

26 Mar

A private investment group that was founded by a single family out of Hong Kong has four operations based in Shanghai, Beijing, Hong Kong and the US. The US-based venture investment arm is actively seeking new investments in the life sciences across the US, and it occasionally invests in companies in Europe. The group focuses on pre-clinical and clinical stage companies. The investment size will vary and typically it ranges from $2 million -$10 million. The group has no set number of allocations over the next 6-9 months.

In the life sciences the firm is looking for new investments primarily in the biotech therapeutics sector. The group will also look at medical devices and diagnostics opportunities; however, they are not their current focuses. For therapeutics, the group is most interested in biologics. The group invests in a variety of therapeutic areas with a focus on oncology. The group generally invests in pre-clinical stage companies without clinical data, and it also syndicates with other investors for clinical-stage investments.

The group invests in privately held life science companies. The group is generally not interested in commercial-stage companies.

If you are interested in more information about this investor and other investors tracked by LSN, please email mandates@lifesciencenation.com

Hot Life Science Investor Mandate 2: Healthcare Angel Group Seeking Therapeutics, Devices and Diagnostics Across the United States

26 Mar

An angel group that is made up entirely of healthcare professionals is seeking to invest in technologies that significantly advance the standard of care. The group considers companies at a range of stages and is geographically agnostic. Since the members are investing their own capital, the investment size and capital structure are highly flexible. The group is actively seeking new investment opportunities, and is open to leading financing rounds.

The group is interested in therapeutics, diagnostics, and medical devices. While the group will consider almost any indication and technology type, the group currently has a particular interest in cell therapy and in the oncology sector. In general, the group is not interested in dermatology. The group will only consider products that have shown human clinical efficacy; in the case of therapeutics, the group generally looks at phase II companies but if a company has obtained human efficacy data in phase I, the group would consider the opportunity. 

The group invests in both private and public companies. The group performs deep scientific due diligence on all the opportunities that the group takes part in, often conducted by the group’s members.

If you are interested in more information about this investor and other investors tracked by LSN, please email mandates@lifesciencenation.com

Hot Life Science Investor Mandate 3: European VC Firm with New Fund Seeking Broad Range of Medical Devices Throughout the US and EU

26 Mar

A European VC firm with over €700 million in total assets under management, and has raised a total of five funds; the most recent fund closed in 2014. The firm typically invests €1-5 million in venture-stage opportunities, or up to €15 million in growth-stage opportunities.  The firm is open to opportunities globally and has invested in Western and Eastern Europe, the Middle East and the USA.

Within the life science sector the firm is currently focused on medical technology, diagnostics, life science tools, and digital health. The firm is open to all classes of devices and molecules, is open to opportunities in any indication area and at any phase of development.  Previous investments include diagnostics for stroke, nano coatings for implants, and cardiovascular catheters.

The firm is open to investing in pre-revenue companies, companies at the early commercialization stage, as well companies generating steady revenues.

If you are interested in more information about this investor and other investors tracked by LSN, please email mandates@lifesciencenation.com

Hot Life Science Investor Mandate 4: Global VC Looking for Early Stage Therapeutics, Devices and Tools

26 Mar

A Venture Capital company with offices in the US and Europe is currently looking to make investments out of its fourth fund. The firm is looking to make venture stage investment generally falling in the range of $2-$6 million though investments may fall outside of this range depending upon the opportunity. The firm also reserves additional capital for follow on rounds. The firm is most interested in companies based in the US although they are also open to investing in Eastern and Northern Europe, East Asia and Australia. The firm could make as many as 5-10 investments over the next year.

The firm is primarily interested in companies developing therapeutics and to a lesser extent medical devices and research tools. Within the Therapeutics space the firm has a slight preference for companies working with platform technologies although they are open to single asset companies as well. The firm is willing to invest in small molecules, biologics, and cell and gene therapy. The firm is willing to consider opportunities from preclinical through phase III of clinical trials though most of their investments will likely be allocated to later stage companies. The firm generally only considers pre-clinical stage companies if there is a clear path to exit in a shortened timeframe. The firm is highly interested in area of RNA therapeutics, Oncology, Structural Heart and Gene Therapy and is generally less interested in CNS disorders.  For medical device companies the firms looks for technologies that are into clinical trials with a working prototype and is agnostic in terms of technology type and indication.

The firm is looking for private or publically held companies, and has special interest in companies considering going public as well as secondary’s investments. The firm prefers to invest as a member of a syndicate and does not always require a board seat following investment. The firm looks to act as a value add investor helping companies expand their networks and filling in holes in existing management.

If you are interested in more information about this investor and other investors tracked by LSN, please email mandates@lifesciencenation.com