The corporate venture capital arm of an integrated healthcare system is making investments out of a $150 million dollar fund. The firm can invest as little as $5 million but tends to allocate $7-$10 million initially, and $10-$15 million over the lifetime of an investment. The firm only invests in preferred equity rounds, and is comfortable leading life sciences deals, particularly in healthcare IT. The firm only invests in US-based and incorporated companies. The group is a strategic investor capable of forging relationships with the health system, but is also financially motivated. The firm is involved in approximately 4-5 new investments each year.
The firm is primarily interested in healthcare IT and healthcare services companies with a B2B focus. Physician-facing health IT technologies are also of interest, but given the inherent difficulties with adoption of such technologies, would need significant traction/users to be considered. Diagnostics, medical devices and drug delivery companies will be evaluated secondarily, pending and necessary FDA approval has been received. Companies that are able to benefit the healthcare system’s members are of particular interest. The firm is indication agnostic, however, and is not interested in investing into companies working with novel compounds or therapeutics. The firm is looking for mid to later-stage companies for investment.
The firm looks to invest in companies that have already received institutional funding from highly qualified investors where the investor syndicate has majority stake in the company. The firm will consider companies that are both pre and post-revenue, but is primarily interested in companies with early (single digit millions) commercial traction.
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