A Compelling Early Stage Buyer – Seller Matching Platform

8 Feb

By Cole Bunn, Senior Research Analyst, LSN

cole-wpThe world of early stage biotech/medtech investment is far less than straightforward, and entrepreneurs who have been through the arduous, frustrating process of raising money will second that. Adding to this challenge, other than a personal network, fundraising CEOs have limited resources for learning which investors are in their universe and how to get in touch with them – LSN was founded to address this exact problem.

When raising a seed or series A financing, most people’s mind goes straight to a few brand name VCs and angel groups in their backyard, and mistakenly think this is going to get the job done. The reality is that fundraising is a numbers game, and there are thousands of groups across the world that are not well known and don’t necessarily fall into one of these investor buckets, but may be a great fit for your venture. The problem is that you have no efficient way of identifying who these groups are, if they are a fit and most importantly, a way to reach them.

Over the past 5 years, the LSN research team of Research Analysts has been dedicated to uncovering these groups, building a relationship with the associates and partners of the firm and capturing critical data points on their interests and investment criteria, and most importantly, building out a custom profile that details the firm’s specific interests, how they structure their investments and how much money they put into companies. In the LSN Investor Platform, we have amassed just over 5,000 profiles of investment firms (over 2,000 of which are actively investing), across the globe including angel groups, venture capital firms, corporate VCs, big pharma and other corporate strategics, family offices, venture philanthropy groups, endowments/foundations, hedge funds, private equity firms, government organizations and institutional alternative investors who are investing in the early stage life science space. The functionality of the LSN investor platform allows you to easily apply filters to generate a list of these firms who are a fit for your specific company and financing, which usually leaves about 300-400 firms as initial targets to begin parsing.

The personal connection between the LSN research team and an investment firm allows LSN to capture and utilize a unique flow of information and provides an unmatched tool for fundraising CEOs to understand the players in their space, their nuanced preferences/strategies and a way to begin a dialogue with them. No other service or data provider comes close to the focused, high touch, relationship-oriented nature of data collection and maintenance. It’s clear that no CEO or startup management team would possibly be able to identify 300-400 relevant investor targets, much less capture a detailed understanding of their mandate and a way to contact them, regardless of the amount of time they have to research investors. Additionally, the LSN Investor Platform includes an export function that provides startup CEOs with data that can be imported into a CRM system to manage outreach and track the progress of every investor relationship.

The LSN Investor Platform serves as the core of everything LSN does. The RESI Conference, an early-stage investment/partnering event that allows entrepreneurs to meet face-to-face with up to 16 relevant investors in one day, is powered by the LSN Investor Platform. The RESI conference allows entrepreneurs to meet these investors in person and begin to develop a personal relationship with them. Subscribers of the LSN Investor Platform have a powerful tool that allows them dig into the investors profile prior to the meeting to understand the investor’s interests and preferences, greatly increasing the quality of an intro discussion and making the best use of their facetime with the investor. Using the LSN Investor Platform and RESI conference in parallel creates a tremendous value for any fundraising CEO in the early stage life science space who is looking to find relevant investors, understand their mandate and begin a dialogue in an efficient and cost-effective manner.

An Investor Database That Works

8 Feb

By Lucy Parkinson, Director of Research, LSN

LSN created the LSN Investor Platform, which is the only early stage life science investor platform that goes across the silos of drugs, devices, diagnostics and healthcare IT. Over 600 clients have used this service, raising millions of dollars from investors located all around the globe. We’ve recently updated our video to reflect the latest generation of the cloud-based investor and strategic partnering database – take a look below!

Diagnostic Investors Share their Insights

8 Feb

By Christine A. Wu, Senior Research Analyst, LSN

chrsitine

We see a lot of innovative point-of-care diagnostics out there, but what do these opportunities truly mean to diagnostic investors? How do diagnostic companies climb the reimbursement hurdle and how will the actionable information provided by these new diagnostics change healthcare delivery? Diagnostic investors discussed these questions at LSN’s Redefining Early Stage Investments Conference in San Francisco on January 9th.

Moderated by Akhil Saklecha, Partner of Artiman Ventures, we heard from:

  • Jenny Rooke, Venture Partner, F-Prime Capital
  • Alessio Beverina, Founder & Managing Partner, Panakès Partners
  • Eric Hargarten, Investment Associate, Sandbox Industries
  • Wouter Meuleman, Director of Investments, Illumina Ventures

Last week, we summarized what we heard from the Big Pharma panel. Now what about the diagnostics side? Below are the main takeaway points.

Consider how the diagnostic would effectively disrupt the current healthcare delivery system to solve the problem. Investors are looking at the rest of the diagnostic system, how solutions are currently being delivered, and how your solution solves the workflow of delivery. Areas these investors noted as “uncapped and wide open” are concussions and head injuries, genomics, proteomics, and oncology.

“Point-of-Care” diagnostics is too crowded an area, especially when the company does not know at what point or for what care. There are many barriers to entry for point-of-care diagnostics to demonstrate usefulness in the healthcare system. How does the point-of-care diagnostic affect a clinical decision? Other oversaturated diagnostic areas are liquid biopsies, such as blood-based oncology tests, and NGS software tools.

Focus on payor-relations by continually publishing clinical evidence, especially if aiming for reimbursement. One of the large concerns for diagnostics is reimbursement. If the company can solve a significant problem for patients, but cannot demonstrate a business case for the key players in the healthcare system, adoption will be a huge issue. Particularly in the U.S. where the expectation is for third-party insurance companies to pay, it becomes imperative for diagnostic companies to perform trials and demonstrate clinical utility in practice. Investors suggest having a person on the team dedicated to publishing studies aimed at winning over payors. How many studies should you complete before getting reimbursement, you ask? “One more than you have,” quotes Eric Hargarten from Sandbox Industries.

Think more broadly than classic venture money—VCs are not your only source of capital, especially for diagnostics. Apply for non-dilutive grant money—SBIRs are a great way to progress early-stage development. Other equity, dilutive funding sources that are not exactly the classic healthcare investors also exist. These can be tech investors that are interested in the data-side of diagnostics, as well as corporate and strategic partners. Companies should also seek foundations and family offices that are perhaps more mission-driven around the problem at hand. Incubators are also a source to gain early proof-of-concept.

Final Advice for Entrepreneurs:

  1. Have a high level of clarity. This demonstrates proprietary insight of the clinical problem and will get the investors’ attention to drive further conversation. Be sure the issue you are trying to solve is explained as clear as possible.
  2. Consider the strategic alignment with the investor. Also consider the market size, particularly for payor or provider-backed venture funds.
  3. Be prepared for technical conversations. Investors are excited by great science and great technology that solves problems others are not able to solve (think diagnosing Alzheimer’s disease before any symptoms appear!). Have your technical material on hand and be prepared to go deep. That said, be sure to also know your business model and plans for regulatory reimbursement.
  4. Carefully pick your advisors, board of directors, and KOLs. Be sure they understand what you are doing and truly champion your company.
  5. Think about what your company will look like in five years, and know what it takes to get there.

 

Hot Investor Mandate 1: Large Bay Area Based VC Seeking Global Opportunities with Focus in Therapeutics and Digital Health in Life Sciences

8 Feb

A venture capital firm with offices in the Bay area invests in a wide variety of industries and is currently making investments from two separate funds that total to $700M: one being a venture fund investing primarily in Series A and B rounds, and a fund investing in growth stage opportunities. The firm is flexible in investment structure, with typical Series A investments of $5M – $10M upfront with capital reserved for subsequent rounds. The firm usually leads investments and seeks a board seat, but may also invest as part of larger syndicates. The firm is active in their portfolio companies and seeks to add value through network, recruiting, and experience in startup strategy and operations. The firm will invest globally.

The firm is open to investing in multiple sectors, but has a strategic focus in life sciences and digital health. The firm has special interest in therapeutics (especially platform technologies), digital health (especially digital therapeutics and chronic care management) genomics, and synthetic biology.

The firm believes passionately that their role is to support and serve great management teams and entrepreneurs.

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

Hot Investor Mandate 2: Newly Launched USA Investment Firm Focused on Diagnostics Investments

8 Feb

A recently formed venture capital firm is focusing on the big-data aspect of personalized diagnostics. The firm is seeking early-stage companies raising seed to Series B rounds. The firm has a $200M target fund and seeks to make 15 –20 new investments within the year. The firm seeks to make $2M – $4M initial investments per company, but will make smaller initial seed investments as well. The firm prefers to be actively involved in their portfolio companies, and therefore prefers companies based near the west coast, though is open to other U.S.-based companies.

The firm is focused on early-detection diagnostics, such as discovering cancer when it is still monogenetic versus heterogeneous and already invaded in other parts of the body or detecting Alzheimer’s 8-10 years before dementia symptoms are present. The firm is interested in point-of-care diagnostics (for influenza A/B/bacterial, etc.) that can diagnose specifically and efficiently. The firm is especially interested in technology with a big-data component, and involved in genomics and personalized medicine to provide the right treatment as early as possible. The firm seeks preclinical to clinical-stage technology, though will also look later-stage depending on the opportunity.

The firm requires a smart management team that is diverse in knowledge, and a company with good IP that may come from a leading institution. The firm will usually seek early-stage companies with less than half a dozen people.

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

Hot Investor Mandate 3: VC with Strong Ties to Asia Invests in Early-Stage Therapeutics, Molecular Diagnostics, and Digital Health

8 Feb

An early stage investment firm with offices in North America and Asia focuses on facilitating the development and commercialization of high-potential, high-impact life science innovations arising from the U.S., Canada, South Korea, China and other markets that represent a significant source of opportunities for outsized value creation. The firm makes initial seed investments of US$100K – 1M and can bring in strategic capital from Asia to facilitate global development and market entry. The firm expects to make 2-3 new investments in the coming year.

Within life sciences, the firm is mostly interested in therapeutics, molecular diagnostics and digital health. The firm takes an opportunistic approach when it comes to disease areas and targets early stage innovation on the cusp of preclinical proof-of-concept or validation.

The firm is looking for capable teams developing innovative technologies. The firm works actively with entrepreneurs to devise and implement development and commercialization strategies, help assemble management personnel, and secure additional capital. For more mature opportunities, the firm will add value by using its fundraising, monetization, business development and licensing expertise to help secure investments and partnerships that will fund and expedite eventual commercialization.

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

Hot Investor Mandate 4: Bay Area Venture Capital Looks to Invest in Mobility and Data-Driven Technologies in Life Sciences and Healthcare

8 Feb

A Silicon Valley-based venture capital firm founded in 2012 currently has $300M AUM and investing from its third, $100M fund. The firm focuses on early-stage investments from Seed to Series A, and initial size of investment can range from $500K to up to $3M. The firm reserves a significant part of the fund as follow-on investment. With the current fund, the firm seeks to invest in a total of 6-8 companies, with a preference for companies that are within proximity to their office in the Bay area.

The firm is interested in technologies that incorporate mobility and data. In terms of life sciences and healthcare, this includes digital health, AI and big data in discovery, precision medicine, etc. The firm has made several investments in digital health companies – examples include a mobile coaching app that promotes smarter decisions and better outcomes, a digital health platform for chronic disease management, etc.

The firm looks for driven management teams – relevant industry experience is a definite plus, but not an absolute requirement. The firm works closely with portfolio companies, providing companies with the needed resources and expertise to achieve scalability. The firm prefers to act as the lead investor, typically taking a board seat in such cases.

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