“Inveready has liquidated its first fund with a 100 million return and goes ahead with its second and third fund.”

Sara Secall, a chemistry graduate with a master’s degree in environmental science and an MBA, is the current partner and director of investments in Life Sciences at Inveready, a Venture Capital (VC) that invests through 4 verticals, including VC in Digital Technology and VC in Life Sciences. In the Life Sciences area, the fund invests tickets from € 300K to € 2M in early-stage companies, companies with proof of concept results which show in vivo efficacy and initial toxicology, as well as performance companies (companies that have sales traction in medical device products, technology services companies specialized in Biotech, nutrition, digital health, etc).

What attracted you from the world of innovation and Startups so that your career has gone from a degree in Chemistry towards working as an investor at Inveready?

I have spent most of my professional career supporting technology companies as an investor or consultant. What I find most attractive about this world is that it requires constant learning to be able to reinvent itself. It is great to see how cutting-edge technologies advance and change the world. However, this world is not made for people with a desire for stability, since experimentation can often give bad results: a clinical study that fails to demonstrate the hypothesis that was sought to demonstrate is a clear example. In short, the world of innovation and Start-ups seems exciting to me and that is why I keep being part of it.

Inveready has just liquidated its first investment vehicle with a 100 million return. How do you evaluate it and how do you evaluate the investments made in the health field? (multiple of 6.3 on its investors)

The return we have obtained has been excellent, one of the best in Europe and with an excellent asset class. The first fund invested in both IT and Life Sciences sectors, two fields with very different maturation periods, but we can say we have won with this strategy. In the Life Sciences sector we have achieved an extraordinary performance (> 5 multiplier), and in the IT sector it has been even more spectacular, since Másmóvil has become the first Spanish unicorn (companies with a > 1 billion value founded from a 0-stage).

The achieved success lies on our super-diversification strategy, which differs from other VCs, with more than 20 companies per fund, as well as the leverage of capital investment to make capital more efficient in terms of profitability. In fact, we are repeating this same strategy in both second and third funds and they are working very well.

What is your sweet spot in companies in the life sciences sector? What do companies in which you have invested have in common?

Half of the investment is allocated to drug development projects and the other half to performance companies in the life sciences sector with own technology. Invested projects try to solve an unmet need, provide a benefit at the level of cost reduction in industrial processes, new diagnostic products, ehealth, etc.

All invested companies have a high technological and innovative component, an excellent and highly involved team, apart from a solid industrial property and a focus on high growth markets.

What are the implications for investors of investing in an area as regulated as healthcare?

Both negative and positive implications. As negative implications, the requirements are expensive, and in the case of a biotech company it has to meet them more efficiently than a big pharma. As positive implications, technological milestones are clear and coincide to some extent with the regulatory milestones. As these milestones are accomplished, the project is closer to the market and generates more interest, being key in the whole process the external validation promoted by the drug agencies.

Which are the technologies that you think that have most potential to impact the health sector in the coming years?

Gene therapy is a field that raises many expectations, and although we already have strong investments, it still has to grow. A lot is expected from cell therapy as well. There will also be advances in therapies for autoimmune and immune diseases, and second and third generations in immuno-oncology. Anything that changes the course of diseases, beyond facing the symptoms, is of interest.

Why do you think there is still a much smaller number of entrepreneur women and, especially, of Start-ups founded by women that get funding? How do you see the FemTech phenomenon?

It is a common fact in other sectors. There are very good female entrepreneurs and founders who may not be in such a visible place as the CEO but who have a very relevant weight in the advancement of the sector. Under a majority of male CEOs, I would say that 80-90% of biotech companies are made up of a female team.

On a personal level, what would be the investment you would like to make to solve a health problem that you think is important?

There are still many diseases that are sadly not well resolved, such as oncological metastasis. Oncological metastasis and Alzheimer’s would be the problems that I would like to see well focused on in the next 10 years.

How do you see the sector in the midst of the Covid-19 pandemic? How do you think it has affected companies and investors?

Clinical research for other diseases has been stopped or postponed and this means delays in clinical results with a knock-on effect on licensing and M&A transactions. I believe the crisis will promote a change in clinical trials monitoring, and it will tend to telemedicine or remote monitoring. In this sense, investments in this type of technologies will increase.

The arrival of COVID19 has shown that infectious diseases, vaccines and antibiotics, areas that were long forgotten because they generate little return, still require solutions. And that with the right incentives, the industry is able to bring solutions quickly. Compensation mechanisms in infectious diseases must be reviewed to encourage private investment in a stable manner.

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