nurturing early stage HEALTHTECHS: part 2
when technology and healthcare converge
JULY 2021
by Mary Stuart
This is Part 2 of a short series of posts published weekly this summer and reproducing, with permission by The MedTech Strategist, an article written by senior writer Mary Stuart. The MedTech Strategist is the leading sources of global business, regulatory, and reimbursement analysis and intelligence on the medical device industry. Its readers are comprised solely of top-level medical device executives and professionals spanning the entire globe, mostly CEOs and Vice Presidents of the world’s largest medical device manufactures, as well as investors at growth-stage life sciences venture capital firms predominantly based in the United States.
Healthcare is a complicated sector that involves many stakeholders with their own sets of incentives. For new technologies to truly enable change for the better — better treatment outcomes, time-saving processes, more accurate diagnoses, increased access to high quality healthcare for more people — innovators must understand the pain points and reward systems for each stakeholder and how they all fit together. “Understanding all of this for a particular need is not straightforward; it is not an easy space to invest in,” says Subirats.
On the other hand, technology markets have different development curves and drivers. Says Sebastian Anastassiou, Investment Manager, “Traditionally, the healthcare space is all about the clinical need, in the end, the patient need. Now we see the impact of technology in the healthcare space, but there, the engineering, the hardware, the software and getting those to market are quite different from the VC perspective.” It is challenging to merge these two sectors, he says. “That’s where Nina Capital has focused its investment thesis.”
There are plenty of interesting healthtech companies in which to invest. Subirats notes that every quarter the team screens between 250–300 companies. “The question is,” he says, “how to pick the right ones. That is the expertise that Nina Capital wants to bring.”
As a seed-stage investor, Nina Capital’s role is also to help shape start-ups in a hands-on manner, to create more value for the next financing round.
Access to a broad set of skills is necessary to make this happen.
Starting with the core team, which is diverse in terms of expertise and geographic origin.
Zanchi, as noted, is originally from Italy and worked in California for 15 years. With deep experience in the regulation of medical devices, she will often help start-ups with their regulatory strategy and link them to vetted regulatory affairs professionals, epidemiologists, reimbursement, and clinical trial specialists for support with the technical documentation for regulatory filings. She also has experience and a personal interest, she says “in the broader journey from start to market, thanks to Stanford Biodesign and my own work in the Valley.”
Subirats brings the operational experience. He co-founded an early telemedicine company, Advance Medical, which, with more than a thousand employees in eight countries, became the leading virtual care provider outside the US. In 2018, his company was acquired by US-based multinational Teladoc Health Inc. for more than $350 million, in a combination of cash and stock.
Subirats was an initial investor in the Nina Capital fund and subsequently became Partner. “My background is in economics and business, but I try to leverage my experience of starting and operating a health technology company,” says Subirats. He says he helps founders select the right markets, and to design the right go-to-market strategy, noting that his previous business gave him lots of contacts in the health insurance industry. “We try to engage them very early in the process, so there will be an interest five to six years from now, about the time our companies should be exiting.”
Anastassiou had a background in neuroscience before coming to Nina Capital. His growing up years alternated between Norway and Cyprus before he ended up at University College London, where he was responsible for commercializing the university’s biomedical research. “I worked with professors and other academics on their research output from a patenting/intellectual property perspective right through to actual commercialization, licensing the technologies to pharma and medtech companies, or spinning them out of the university as a start-up,” he says. “In the case of spin-outs, I would lay the initial groundwork to set up the company as a vehicle to bring the research and the technology into the market.”
Anastassiou met Nina Capital’s founding team when he entered the MBA program at IESE in Barcelona. He joined the company as an intern, and then became full-time when he finished his MBA. Anastassiou works closely with the management teams of Nina’s portfolio companies “We are very active investors. We spend a lot of time helping the founding teams with whatever they need; advice on anything that our backgrounds can be helpful for, or connections to our network.”
Anastassiou helps companies in several ways, including executing IP strategies, and preparing them for the next round of fundraising. When founders come in, they typically have a runway of 12–18 months, so very soon after Nina Capital invests, they need to begin preparing for the next funding round — the seed round, or the Series A — which can take six months to complete. “We have our own network of investors that we share with our portfolio companies, and we’ll make warm introductions to various investors to try and gauge their interest in the next fundraise.” Or the team will help start-ups determine what types of investors they should be targeting and prioritizing, he says. A lot of work goes into understanding value-generating milestones for the upcoming round and the use of capital raised thereafter. As noted, Nina Capital’s team is very hands-on. “We’ll help them with the actual pitch deck, and critique them during dry run-throughs to guide them through the process,” Anastassiou says.
Ferran Marti, associate, got his Bachelor’s degree in biotechnology at IQS Barcelona, graduating with a thesis in the field of applied bioinformatics before joining a consultancy firm serving the finance and banking industry. Yahel Halamish, head of investor relations, began with a Bachelor of Law and a BA in economics from The Hebrew University of Jerusalem followed by years working in alternative assets management in Israel. She began interning for Nina Capital while she was completing her MBA at IESE in Barcelona. Head of finance Jordi Pedrol did his undergraduate work at UAB, going on to get his master’s in finance at Carnegie Mellon University. Since then, he has served as CFO for several high-tech companies.
In short, within six international people, the team has operational, financial, clinical, regulatory, and IP expertise. But for relevant experience that the team lacks, Nina Capital has enlisted 16 venture partners and advisors who are part of the process. In addition to that, notes Subirats, “We have built a large network of clinical key opinion leaders for the different clinical needs, and we have built relationships with the industry. When we are screening potential investments, we try to get their opinion to see if this is a company that five to ten years down the road, if they deliver on their promise, they would be interested in acquiring.” Nina Capital also has a network of co-investors in Europe and the US. “We invest at an early stage, so we want to accompany the founders all the way to follow-on Series A, where we try to bring on the right investors.”
To read Part 3: how to make the cut, click here
