Nordic life science companies are generally of good quality, but can often be better at pitching compared to US-based companies and entrepreneurs.
Effective pitching is a skill, and is centered on good storytelling to get an investor’s full attention and buy-in. Since I work for the life science VC, HealthCap, I thought I would share a few thoughts on what we like to see. This might not apply to all investors and exactly to your pitch, but hopefully you will find some of the advice below useful.
Effective pitching is a skill, and is centered on good storytelling to get an investor’s full attention and buy-in.”
First of all, we recognize that in today’s market it is difficult to get funding anywhere, and we all hope this will improve in the not-too-distant future. Like most VCs, at HealthCap we get bombarded with proposals from companies looking for funding, and just to set expectations, we end up rejecting most things we see. When considering VC financing it is important to be mindful of how your pitch fits what the VC is focusing on. A good piece of advice is to do a little research on who to approach, and how to approach them. The best way to get an investor’s attention is to reach out with a relevant proposal and use a personal connection in your network who can refer you to someone at the fund.
Getting both European and US investors on board early on is usually a good thing, as it opens up the investor universe and increases the chances of finding additional investors either in the EU or US for future financings.”
HealthCap invests primarily in private companies and earlier stage companies, and ideally in assets that are validated and address high unmet medical needs. We like to help shape the companies we back and help to build them. At HealthCap we like collaborating, both with entrepreneurs and with other investors. Typically, VCs invest alongside other VCs in syndicates, recognizing that investors bring different expertise, networks and resources to the table. Getting both European and US investors on board early on is usually a good thing, as it opens up the investor universe and increases the chances of finding additional investors either in the EU or US for future financings.
Below are a few things that HealthCap is looking for in new deals. The starting point is that we look for great ideas and solutions addressing high unmet medical need. We are very patient-centric in our approach and want to see that patient outcomes can be improved. At HealthCap we like our companies to be able to control their destiny, meaning that we like niche products and precision medicine and tend to shy away from investing in large phase 3 outcome studies that require a lot of capital. We like when it is possible to develop assets in a capital-efficient way and if there is a possibility to leverage non-dilutive sources of capital.
Generally, it is better to focus on data in the pitch and less on market estimations.”
Like most life science VCs, we like to get into the science; we really want to see and understand data and look for the key data and science that validates the approach. Generally, it is better to focus on data in the pitch and less on market estimations. We like to see real data and substance and when too much focus is spent on market estimations we tend to zoom out.
When pitching it is important to highlight the strength of the team, but not to spend too much time on backgrounds and advisors. Investors typically know a great team when they see one. Lean and adaptive organizations are often the right approach for early companies and a team should be scaled appropriately for the strategy and for the stage of the company.
For Nordic companies it is important to point out that the life science industry is a global industry, meaning that world-class expertise is not always found locally. This means that you need to have an international mindset when looking for expertise and be open to working with people on a virtual basis.
Another important section that investors like to see is a robust development plan that includes the use of proceeds. Be realistic and highlight what the financing will be used for, and what the plan and cost look like to get there. It is also good to include exit scenarios in the pitch, outline who the big industrial companies are and what they are looking for to get really interested, and how the company needs to be developed to be ready for a sale.
Be realistic and highlight what the financing will be used for, and what the plan and cost look like to get there.”
Finally, time and agenda management is crucial for a strong pitch; a good meeting typically does not last longer than an hour, so aim to talk for 30 minutes and leave enough time for discussion and questions during the meeting.
I recognize that the advice above is quite generic, and it is of course up to you to apply it to your pitch as you deem fit. I wish you all the best with your pitch and look forward to hearing about your company and your ideas if you believe that you have something that is in line with what we are looking for.
This Commentary was originally written by Mårten Steen, Partner, HealthCap, for NLS magazine No 04 2023, out November 2023
Featured photo of Mårten Steen: Dan Coleman
