Category: Hot Mandates

Hot Life Science Investor Mandate 3: CRO’s Corporate Venture Arm Leverages Services for Equity

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The corporate venture capital arm of a global contract research organization (CRO) has the ability to allocate anywhere from $100,000 to $2 million of equity capital to companies. However, the arm only invests in opportunities where it can leverage its CRO services as a piece of the investment, and as such, looks to tailor its CRO services to the needs of its partners, helping them to reach key value-added milestones. The firm will consider opportunities worldwide, and plans to be involved with 6-10 companies over the next 6-9 months.

The corporate VC is willing to consider making investments into companies developing medical devices, diagnostics, and therapeutics that are able to utilize their parent company’s CRO services to advance their product into or through clinical trials. Currently, they are most interested in companies developing therapeutics and biologics with a lead asset anywhere from 6-9 months pre-IND, to Phase III of clinical trials. The arm is completely opportunistic in terms of subsector and indication, and is willing to consider companies targeting orphan indications.

The corporate VC often acts as a co-investor, and generally does not require a board seat. Despite not being active on the board, the firm is a long-term investor and looks to provide market, development, and regulatory insight and strategic advice into selected companies.

Hot Life Science Investor Mandate 1: Multi-Family Office Rapidly Making New Allocations

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Allocation Information

A multi-family office based in the Western US is an active investor in the medical device sector, and is interested in opportunities worldwide.  Initial investments are typically about $50,000 with the potential for follow-on investments totaling $500,000, and may be structured as equity or as debt.  The office does not invest in seed rounds.  In the recent past the office has allocated new investments at a rate of approximately one per month.  The firm offers support and expertise to portfolio companies but does not seek a board seat.

Sectors & Subsectors of Interest

Within the medical device sector, only devices with a basis in mechanical engineering, such as electro-mechanical medical devices, active implantable devices such as pacemaker technologies, and surgical instruments are of interest.  The family office invests only in companies that have already developed a prototype of their product and filed a patent application; the firm prefers that companies that seek an allocation have in-human data but does not require this.

Company & Management Team Requirements

The family office seeks to invest in strong management teams with prior experience in the medical device industry, preferably with previous successful exits and with a strong reputation in their niche.  The firm invests only in privately-held companies and prefers to make investments with the potential to exit within 3-4 years.

Hot Life Science Investor Mandate 2: Corporate Venture Arm Looks for Companies Intersecting Life, Materials Sciences

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Allocation Information

The corporate venture capital arm of a global science-based company active in health, nutrition and materials seeks to make equity investments into seed and venture stage companies generally taking less than 25% ownership. The firm makes allocations ranging from a few hundred thousand dollars to $5 million initially with additional capital held for future financing rounds. The firm is looking make approximately 5-10 investments over the next 6-9 months with +10 being made over the next 2 years. The firm invests in companies located around the globe with a focus on the U.S., Europe and Isreal.

Sector and Subsectors of Interest

The group is looking for companies in the intersection of Life and Materials Sciences. These includes companies developing devices and materials targeting indications of cardiovascular, orthopedics, ophthalmology, dental, drug delivery and next generation cellular therapy. The firm is also interested in companies in the Agbio and nutraceutical spaces. While the firm has invested in companies all the way from seed to 3-month pre-IPO, they generally invest into companies that do not yet have a product on the market.

Company and Management Team Requirements

The group highly values experience in a firms management team and generally looks to take a board seat and play an active role in its portfolio companies. The firm is looking for companies that are in cooperation/alignment with relevant core businesses of the parent company.

Hot Life Science Mandate 3: Opportunistic Institutional Alternative Investor Investing Globally

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Allocation Information

The life science investment subsidiary of a major investment group has assets under management of $400m and is investing from its second fund, which closed at roughly  $300m in 2012. The firm typically makes initial equity investments of $3-7m with the potential to invest up to $20m over the life of an investment.  While most of the firm’s portfolio companies are US-based the firm will consider opportunities worldwide.

Sectors & Subsectors of Interest

The firm invests opportunistically across the life science sector, and is active in the therapeutic, diagnostic and medical device sectors. The firm prefers to invest in companies with products in the late preclinical stage (typically about 12 months from IND; animal data is required).  In the case of medical devices, companies that have developed a prototype and obtained FIM data are of interest. While not all investments are made at this stage, the firm prefers to build relationships with companies at an early stage. The investor will consider investing in any indication.

Company & Management Team Requirements

The firm invests in both experienced management teams, as well as new entrepreneurs and is open to investing in both privately-held and public companies.

Hot Life Science Investor Mandate 1: Private Investment Firm Invests in Wide Range of Assets with Proof of Concept

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A private investment firm based in the Western US invests in seed and early-stage health technology companies. The typical investment size for start-ups ranges from $500K to $750K (usually in equity or convertible notes). For early-stage companies, the firm typically co-invests with other VC firms in Series A and B financing and the investment size will depend on the company’s financial needs. The firm is geographically agnostic but prefers start-ups to be based on the West Coast. The firm is actively seeking new investment opportunities.

The firm invests in novel therapeutics, medical devices, and informatics. Generally, the firm focuses on opportunities that avoid or mitigate FDA regulatory risks. The firm is agnostic in terms of subsectors and indications, but does not consider orphan indications. The firm will only consider technologies with proof of concept. Historically, the firm has invested in therapeutics that address oncology, infectious diseases, cardiovascular, and metabolic disorders; drug delivery; orthopedic devices; genomics.

Hot Life Science Investor Mandate 2: Family Office Allocates Based on Financial Needs of Company

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A group of accredited investors based in the Eastern US is made up of healthcare professionals seeking to invest in technologies that significantly advance the standard of care. The group considers companies from seed to later stage and is geographically agnostic. Since the members are investing their own capital, the investment size and capital structure are highly flexible and will depend on the financial needs of the company. The group is actively seeking new investment opportunities.    

The office is interested in therapeutics, diagnostics, and medical devices. Currently, the group is interested in cell therapy and oncology but is generally agnostic in terms of subsectors and indications. The group is not interested in dermatology. The group will only consider products that have shown clinical efficacy.  Therefore, the group prefers therapeutic products in phase II. The group may consider phase I if it is evidently supported by human efficacy data.

Hot Life Science Investor Mandate 3: VC is Interested in Single Use Devices, Several Indications

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A venture capital company based in the Western US has raised 2 funds to date, and is currently investing out of its 2nd $15 million dollar fund. The firm makes primarily equity investments ranging from $50,000 to $5 million over the lifetime of the investment. The firm is looking for companies located within the United States and plans to make approximately 2 new investments over the next 6-9 months.

The VC is looking for seed and venture stage medical and diagnostic device companies. In these areas the firm is most interested in single use devices capable of delivering a therapy, and in indications such as cancer, cardiovascular and neurological diseases, orthopedic problems, respiratory conditions, and gastrointestinal disorders. While this is the firms primary focus, they remain open minded to other types of devices and indications as well.

The VC looks for professionalism in a firms management teams and is willing to work with firms that do not yet have a complete management team in place.