Amber Tong, Senior Editor at Endpoints, chaired a fantastic panel of Europe’s leading VC investors at the Anglonordic conference. The panel included: Hakan Goker – M Ventures; Debbie Harland – SR One; Nanna Lüneborg – Novo Ventures: and Stephan Christgau – EIR Ventures. We have summarised the top takeaways below.
How has the pandemic impacted your business and what is the new normal?
- Despite the pandemic, venture firms have successfully closed funds, exited investments (both through IPOs and M&A) and invested in new and exciting companies.
- For investors who spend a significant time travelling, it has been very efficient and productive to have meetings online. Additionally, it has been tricky, but not impossible, to hire people remotely into a team or a portfolio company.
- Venture Capital is a people driven business relying heavily on relationship building. However, you can witness other, more personal aspects of a colleague’s life with the sudden appearance of a child or a pet to liven up an online meeting – and these instances can help forge close relationships.
- Investors miss face to face meetings, dinners and spontaneous discussions, and for future expect a hybrid of virtual and in-person encounters.
What are some essential components to building a successful biotech? What are the challenges?
- You need an IP defensible technology, a great team, a compelling value proposition and be building a smart asset pipeline that addresses key unmet medical needs. Demonstrating clinical validation of targets makes the vision more compelling.
- Understanding the market, your positioning in the clinical landscape and having a clear go-to-market strategy is key.
- Speaking to clinicians and other key opinion leaders will help companies gain an end-to-end understanding of the problem they are trying to solve.
- Experienced management is very important. Having the experience of bringing assets to market is an unmatched skill.
- It is possible to build successful companies around academic founders, but this requires a lot of hard work. Syndicating with investors who are ready to do the ‘heavy lifting’ around this is important.
- There is a lot of money flowing into the sector, a lot of funds that are turning to building companies from scratch and building them better by investing in experienced management teams and providing more money at an earlier stage.
Where is Europe leading?
- Europe is renowned for its fantastic science. We have seen high potential technologies for drug development that have first emerged in Europe
- RNA modulating therapeutics company STORM therapeutics is an example with similar companies now founded in the US hoping to drug RNA modulating targets.
- Drug development around the DNA Damage Response is another breakthrough that started in Europe and encouraged financing of similar companies around the globe.
- European start-ups tend to be less “blue sky” visionaries and are more focused on tangible targets compared to the US.
- Company valuations are also lower. This can be seen as an advantage as it can be attributed to EU companies being more cost-efficient and achieving targets with less funds.
What are the hot markets for investment?
- Oncology will always have new developments including cell therapies however the area is getting too crowded. Immuno-oncology is expected to deliver the next breakthroughs addressing existing and new targets.
- Neurobiology has the potential to be a hot area provided biomarker discovery progresses to aid the development of new therapeutics.
- The first approvals in Alzheimer’s disease will be the key milestone that will transform the space.
- Looking beyond biologics, small molecule therapeutics and RNA technologies are exciting areas with great potential.