Panel Announcement: Big Data in Healthcare

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By Christine A. Wu, Senior Research Analyst, LSN

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LSN is pleased to publish its first panel announcement for RESI SF 2017: Big Data in Healthcare. On January 10th, a panel of five expert healthcare investors will speak regarding why they’re looking for big data investment opportunities, how they identify technologies that will have an impact on the healthcare system landscape, and what early-stage fundraising companies in this exciting new vertical can do to get a foot in their doors.

The Big Data in Healthcare panel will comprise of the following panelists:

The big data space has increasingly become exciting with its potential to transform healthcare through its cross-correlation of a number of broad applications – computer vision, machine learning, patient medical records, disease diagnoses, mental health trends and proposed therapies, as well as many other spaces in healthcare. If you haven’t yet, be sure to register now for this tremendous educational opportunity in this booming space, while also having the chance to meet valuable investors in-person.

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Hot Investor Mandate 1: Crossborder Firm Raises New Fund for Clinical-Stage Biotech, Medical Devices and Diagnostics

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A strategic consulting firm has formed a new venture capital arm with offices based in Minneapolis and Shanghai, China. Alongside investments, the firm advises life science companies on strategic partnerships (manufacturers, distributors) in the China market by providing resources in the network. The firm’s first fund is predicted to close end of 2016. The firm is seeking five new investments within the next year, and typically makes $1M – $5M dollar investments per company in Series B and C rounds, but also considers Series A. The firm acts as co-investors while also helping companies seek additional investors for the round. The firm focuses on US and Canada based companies, though is open to companies on a global-level.

The firm is indication agnostic and open to technology in all sectors of life science – medical devices, therapeutics, diagnostics, and healthcare IT – while having the most experience in biotech/medtech. In terms of phase of development, the firm requires the company to at least have a prototype, and for therapeutics to be in clinical trials, preferably in Series B. The firm will also look at on-the-market products as well as lab equipment and drug development enabling technology.

The firm requires the company to be in Series A, B, or C. The firm prefers the company to have or seek to have their technology in the China market.

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: Oncology Fund Looks Globally for Early Stage Therapeutic Opportunities

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A specialized investment firm is currently investing from its third oncology fund of USD 64 million. The firm generally makes investments in Series A, B or C equity rounds; the firm is not interested in seed rounds. The firm typically makes allocations of $3-8 million, and may either lead investments or act as a co-investor alongside a syndicate. The firm is open to oncology opportunities globally but has recently invested primarily in the USA.

The firm is currently focused on cancer therapeutics. The firm will consider any form of therapeutic molecule in oncology, including small molecules, antibodies or new technologies such as cell therapies. The firm generally invests at the late preclinical stage, from 6-12 months pre-IND, but is also interested in companies with Phase I or Phase II assets.

The firm places high importance on the management team’s scientific rigor and industry experience; the firm prefers to work with entrepreneurs who have led biotech companies previously. NThe firm also considers the strength of the investor syndicate and their alignment of interests.

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: Corporate VC of Health Insurer Invests Strategically in Healthcare IT

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A wholly owned venture arm subsidiary of a regional health insurance firm seeks to invest in technologies that are a strategic fit with members of the insurer’s network. The firm is flexible in terms of investment sizes and considers an array of capital structures including equity, convertible note, debt, and others. The firm typically co-invests with other investors but is open to leading a financing round. The firm is currently seeking new opportunities from across the US, while non-US opportunities may also be considered.

The firm is focused on opportunities in the following areas: Accountable Care Organizations, Consumer Solutions; Health Information Technology; and Behavioral Health. Potential examples may include consumer-facing patient engagement software, behavioral health technology, telemedicine, and B2B solutions that help healthcare organizations with decision making and financial planning. The firm is stage agnostic and would consider from pre-revenue to commercial-stage companies. Historically the firm has invested in patient monitoring system, EHR aggregation and analytics, and mobile health information platform.

The firm is seeking experienced, competent teams with disruptive innovations that are a strategic fit with its parent company’s network members. After investment, the firm typically requests a board seat or at least an observer position.

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: Evergreen Fund Invests in Software-Driven Devices, Diagnostics and Healthcare Services

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A US-based firm is investing from a multi-million dollar evergreen fund and is interested in a variety of sectors including the life science field. For life science investments, the firm typically allocates $2-15 million, and prefers to invest in Series B-C rounds. The firm invests primarily in the USA and Canada.

The firm is presently focused on technologies that involve an IT/software component, across digital health, healthcare services, medtech, and diagnostics. The firm is open to opportunities in any clinical indication, especially ocular. The firm is only interested in devices and diagnostics that have in-human data, have received marketing approval and are in the commercialization stage.

In the life science sector, the firm is not interested in early-stage R&D opportunities; howeverthe firm is open to both companies with an approved product on the market, and companies with a product in late-stage clinical trials. The firm takes the strength of the management team into consideration.

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

Short-Term Investors in Long-Term Development: Matching an Investor’s Time Horizon

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By Lucy Parkinson, Director of Research, LSN

One of the greatest difficulties in raising early stage financing in the life sciences is that many investors balk at the development timelines involved in biotech and medtech opportunities.  VC investors in particular are driven by short term fund lifecycles; particularly if you are receiving an investment late into a fund’s investment period (which may extend 2-3 years after the fund is closed), the VC will be often looking for the possibility of an exit in under 3 years. Angel investors and evergreen funds may also operate under similar horizons, as they rely on successful exits to generate capital to make further investments. Beyond structural constraints, from an investor’s perspective, time is money; their rate of return is directly governed by how long their capital is tied up in your company.

Everyone knows that it takes a long time to develop and commercialize a new drug, medical device or diagnostic. It’s estimated that it takes 11-14 years to move a drug from preclinical testing to the marketplace. Yet many investors step into this marketplace with a 2- or 3-year investment horizon. Early stage companies must therefore learn how to get in step with investors when it comes to timelines.

It’s important to understand that early stage investors most often don’t intend to remain invested in a company all the way to commercialization; rather, they want to deploy capital to enable a company to reach an important milestone that can be used to generate an exit opportunity.  If your company has a long development path ahead, it’s therefore vital to identify these milestones and provide investors with a map that will demonstrate your near term opportunities for value inflection.  A company can also look for potential ways to accelerate their development path.  Recently one LSN client created a new clinical development plan that would provide significant results much sooner than their original plan; this has improved their investor traction tremendously.  In the biotech world, many companies look for potential applications of their products in orphan diseases so that they can pursue an accelerated plan.

Alternatively, a company can focus on investors who are looking for longer term opportunities. This may include family offices or strategic investors; however, it’s important to reach out to every possible category of investors, and having a timeline that can provide value to both short-term and long-term investors is important for increasing your potential to receive investment.

AgBio Spotlight

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By Caitlin Kramer, Research Analyst, LSN

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Agriculture is the base of modern society, and makes up nearly a third of the global carbon footprint. Many current sociopolitical conversations revolve around GMOs, use of pesticides and antibiotics, and the future of sustainable food in the face of an ever-growing population. Biotechnology has increasingly sought to step up to these challenges of sustainability, though not always as successfully as anticipated (biofuels) or without controversy (GMOs), and in the back seat compared to biotech’s role in therapeutics. Yet, innovation in this space still sees strong interest from investors – 152 investors mention an interest in agbio in their mandates on the LSN Investor Platform. A majority of the investors LSN tracks that are interested in Agbio are open to investing as early as the seed stage.

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Figure 1. Data taken from LSN Investor Database on 13 Oct 16.

The LSN Company Platform contains 951 agbio companies, broken down by country below. China and India, the world’s two most populous nations, comprise 30% of the agbio companies tracked in the platform. Italy, the world’s largest producer of wines and a lead producer of olive oil and various fruits, comes in third.

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Figure 2. Data taken from LSN Company Database on 13 Oct 16.

LSN tracks a wide variety of investor interests and company sectors globally. Agriculture biotechnology is an important area of investment and innovation for countries around the world that has not escaped our notice.  We’ve found a wealth of early stage financing available for agbio companies, with interest from every investor category.