What made you decide to found Forty51 ventures?
We are setting up Forty51 ventures, a Biotech venture fund, to fill an important gap that we see in the Central-Western region in Europe. While we see a high density of scientific and medical innovation, yet we do not see many true venture builders that can help translate such innovation.
There is a great need in this area for investors who have the know-how, the network and a long experience accumulated over the years to maximize their value to entrepreneurs and help them build their companies during the early days.
Forty51 ventures is an emerging fund composed of four Partners who together bring almost 100 years of operational experience in the industry. In our view, this is the most important differentiation that sets us apart from other venture funds in Europe.
We bring skills to the table that entrepreneurs need and care about – deep industry expertise that includes research, pre-clinical and clinical drug development, M&A/transactions and most importantly, a high-quality global network.
I love medicine, science, making a difference for patients and providing a good return for investors.
What has been some of the biggest challenges so far starting the fund and what is it like especially now in this environment?
Sascha Bucher and I (both co-founders of Forty51 ventures) started to think conceptually about a new-gen Biotech fund many months ago. Back then, the brainstorming efforts were intensely focused on defining a differentiated fund that entrepreneurs would trust and be drawn to, a venture fund that would help develop therapies that address high unmet medical needs in a more efficient and ambitious way than it is done today in Europe.
Our two other Partners are both seasoned drug developers that substantiate the value and differentiation of our fund. Each brings 25+ years of drug development experience in Pharma and Biotech across several therapeutic areas.
Building a relationship with potential fund investors takes time and it requires resilience. More importantly, it demands a fine understanding of who the audience is, a mutual fit based on the type of product you are marketing, differentiation with other funds, as well as good timing and a bit of luck, which is something that you cannot control.
We decided to kick-start our efforts in the middle of the COVID-19 pandemic. We felt that the team and the strategy that we had put together is unique and could be successful – even in such challenging times. What made it easier for us was the fact that most investors we are discussing with were either pre-existing relationships (some dating back 20 years) or they were a direct introduction from a trusted colleague. Those are the discussions that have been the most prolific for us thus far.
Having drug development expertise and being able to share that with entrepreneurs has been extremely valuable when working with management teams and board directors.
Can you share more about your emerging fund?
The common denominator is venture formation and venture building. This could for example start with a clinical-stage asset from Big Pharma or an early-stage technology from University. Another type of company in the sweet spot for our emerging fund can also be existing Biotech companies in their early days where we can be the first institutional investor.
In all these examples, these opportunities need to be actively built. We aim to build and lead investments with capital but also with a strong strategic input and deep network that is much needed in the early stages of company formation. We strongly rely on our network to help us found, mature and exit our prospective portfolio companies.
Further, we are disease and modality area agnostic. Having said that, we may deprioritize therapeutic areas that would take too much time or capital to Phase 2 completion. We will also deprioritize therapeutic indications where there is no appetite from the ecosystem as we cannot fully mature companies by ourselves. Lastly, we stay close to Big Pharma and Biotech to anticipate which areas are of interest to future acquirers.
Have you always known you would start a venture fund?
No. I had never thought of myself as an entrepreneur and I did not actively think of creating a company during the early stages of my career. It was later in life when I started to hear an echo from friends and mentors… “Sara, you should try to raise a venture fund”.
At first, I thought that it was not something that I could attempt to do, but then the timing was perfect when I met my co-founding Partner Sascha Bucher with whom I started this journey.
what makes you a good investor and ANY success stories you can share?
Building a track-record in Biotech takes over a decade. My strengths as an investor lie on having spent more than a decade in R&D before switching to the investment side. Having drug development expertise and being able to share that with entrepreneurs has been extremely valuable when working with management teams and board directors.
Delinia is one of my biggest successes; it was an investment I did at Sofinnova and it was acquired by Celgene for $300M upfront and up to $785M in milestones. That was an investment that we did together with Atlas Venture, a pretty quick exit and great return for Sofinnova Partners. This is a great example of venture building in Biotech.
People usually talk about the successes, but I like to talk about the failures. An example is Auris Medical in the otology space which is severely underventured. It is a Swiss company that was not successful from a drug development perspective; however, given the big unmet need and the strength of the biology, I believe it was worth the commitment. My view is that there are many learnings from failures over successes.
Having a network that is strong and sharp that we can then offer to our companies is key.
What made you switch from a career in R&D to Biotech investments?
After more than a decade developing compounds, I wanted to see the industry from another angle. Following my instinct, I decided to venture into the business side through an MBA. I was past my mid-30s when I decided to go to business school. At the time, people in my immediate network (all scientists) could not advise me on whether it was a good career move for me, but I was determined to give it a try. Through hard work I was able to make a successful transition to the business side of the industry.
Another example is Forty51 ventures. I decided to leave Roivant Sciences, a very prolific firm mostly focused on late-stage opportunities, to raise a Biotech venture fund together with a fantastic team to fill a large unmet need in Biotech in Central-Western Europe. Considering that most people who try to raise a fund fail, explaining my decision to leave Roivant to my family was not easy, but they see that I am passionate about drug development and helping entrepreneurs build their companies.
Is there a division between professional and personal life? What does a typical day look like for you?
For me, there is not a division between personal and professional life. The hours are long but you try to make it all work the best you can. I could not have done this without my family’s support, I am grateful for them.
There are various things that I/we do in a day. For example, most of our time is spent today talking to people in the industry, building relationships and ensuring they get to know and appreciate our strategy, the team and the ambition of Forty51 Ventures. We are also reviewing business plans and discussing with many Biotech companies on a weekly basis. It takes a number of months to prepare an investment, and so we are actively working on prospective investments at the moment.
We also spend a considerable amount of time talking to an important part of the ecosystem that includes universities, hospitals, private/public investors and Big pharma. An important value that our team brings to the table is our high-quality network; we have worked in >10 pharmaceutical and biotech companies during our careers. Having a network that is strong and sharp that we can then offer to our companies is key.
Tell me more about this passion you talk about.
I like to do things well, learn and share my experiences with entrepreneurs. I enjoy meeting Biotech teams, helping them strategically, and ultimately investing in them and helping them mature. The passion to learn is something that fuels that passion. I love medicine, science, making a difference for patients and obviously providing a good return for investors.
Any advice for those who started in R&D etc. and want to switch to investments?
Try to build a solid and credible career in development, finance, operations, etc. before you move to the venture side. There is always time to make that switch to the investment space. I think the early formative years are very important. Don’t be in a rush to become an investor – think deeply about what value you could bring to entrepreneurs.
Becoming an investor takes many years, and not all of those need to be in venture, if you know what I mean. Experience, perseverance and a passion to help entrepreneurs build their companies are good traits to have before going into venture. It is a truly rewarding journey.