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Investing in life science companies is both challenging and rewarding. The sector is constantly evolving and comes with a lot of unknowns and risks, especially at the commercialisation stage. However, with the potential to help create a positive impact to society and simultaneously receive financial gains, it can be an incredibly worthwhile venture.
Launched in May 2022 by thriving life science community Discovery Park, Discovery Park Ventures (DPV) is an investment fund that invests in ambitious and growing life sciences companies, driving disruptive innovation and catalysing economic growth. Initially a £1m fund, DPV has now expanded to £3m.
Following the fund’s first 10 investments, Emma Palmer Foster, Director of Discovery Park Ventures, and Martino Picardo, Director of DPV and Chairman of Discovery Park, share their learnings and insights into life science investing.
What were your goals when you set up DPV?
Emma: We wanted to invest in outstanding, innovative life science businesses looking to create an impact on human and plant health. Setting up DPV would allow us to grow the innovation ecosystem at Discovery Park and expand our network of innovative companies.
Martino: Our goal was to establish DPV as a key player in the investment community, with an aspiration to grow the fund to support a wide range of companies at the cutting edge of life science.
What have you learned throughout the process of this first round of investments?
Emma: We’ve been amazed by the range of different life science companies in the UK and what has been produced by accelerators, incubators, universities and other mechanisms. Martino and I have a background in science, so have thoroughly enjoyed hearing the incredible ideas from founders with a drive to make a difference. We’ve been really impressed with the volume of quality opportunities that have come our way.
Martino: It’s tough out there for life science companies seeking investment, particularly at an early stage where there is so much risk and uncertainty. We’ve learned that companies often need support in understanding how they can de-risk their proposition. Having a balanced team of investors for due diligence and a broad network of experts to tap into is key. However, we can’t always say yes to potential investees, so having integrity and an honest approach goes a long way in supporting their journey.
Tell us a bit about the companies you’ve invested in and why.
Emma: Our portfolio of companies is very varied, and we are pleased with the progress that they have made so far. An important part of how we select companies to invest in is assessing the team. Building a good relationship with the team really matters to the success of the investment, as we need to work together closely. We look for founders who are really putting in effort and turning over every stone to build their company.
Martino: From cataracts and the microbiome to cancer and agri-tech, the companies we’ve invested in are innovating in a range of fields. All of the companies in our portfolio are based on cutting edge science and talented teams, and many of them have female founders.
How will your learnings and experiences so far impact your investments going forward?
Emma: We’ve learned that everything takes longer than you expect and won’t likely go according to planned timelines. Going forward, we’ll be very realistic about company forecasts and be prepared to help investees out more than we originally thought. We’ve learned that you almost become part of your investee’s team, so utilising our extensive network and ability to open doors will continue to be an important aspect of the support we provide.
Martino: Our learnings so far will certainly continue to help improve our process of triage and due diligence. I’d like to think it will help to pinpoint where there might be gaps in our portfolio as we continue to look for pioneering science and brilliant people.
What are the benefits of a fund linked to a science park?
Emma: It has been brilliant to build an innovation environment with DPV and Discovery Park. It has provided us with the opportunity to invest in the region and help grow businesses within Kent, as well as the whole of the UK. DPV demonstrates Discovery Park’s desire to fund and support the exciting businesses of the future.
Martino: Having DPV linked to Discovery Park means we can offer investees access to state-of-the-art infrastructure and a vibrant ecosystem of people to collaborate with.
How do you see the fund growing/changing in the future?
Emma: Our goal is to grow the fund to 25 million by working with angel investors and other investor firms to become one of the most significant life sciences funds in the South East, and indeed the UK. We want to provide not only early-stage funding but follow on funding also. We’re linking up with as many angel groups as possible at the moment to work towards that goal.
Martino: We want to build on our success so far and strive for some larger investment opportunities. Also, we’d like to place a greater focus on engaging our investees with Discovery Park and its ecosystem.
What sets DPV apart from other investors?
Emma: We’re very hands-on and have extremely extensive networks. Even for companies we don’t invest in, we strive to be helpful with feedback and signposting.
Martino: We invest at an early stage and try to move quickly to accelerate the growth of our investee companies. This is aided by the doors we can open for investees because of our extensive network.
The companies to date have several female founders, what challenges remain for female founders seeking investment in the biotech space?
Emma: Any founder with any kind of difference will find challenges that are above and beyond the typical difficulty of fundraising. A lot of things are different compared to 20-30 years ago, but a lot of things are the same. I hope that as the next generations of investors and company founders move into place that things will become easier and easier in terms of appreciation of the value of diversity – to the point that diversity is routine and unremarkable.
Martino: Female founders face unique challenges in an already tough market; but things are changing, albeit too slowly. I believe there is now a greater recognition of the value and benefit of diverse teams with strong leadership.