NEW YORK, May 31 - Venture capital firms RHO Ventures and Forward Ventures have raised new funds worth $435 and $256 million, respectively, for investments in information technology and life science companies, the firms said Thursday.
Forward Ventures will focus specifically on funding biopharmaceutical, medical devices, and biotechnology companies, with an emphasis on oncology, said Ivor Royston, a general partner at Forward Ventures and former oncologist. RHO Ventures will invest in healthcare-related businesses as well as in telecommunications and information technology. For both companies, these funds represent the fourth round of capital raised so far.
Forward said that it would invest two-thirds of its capital in seed and early-stage companies located in the San Diego area and on the West Coast, and the other third in late-stage companies located in the US and internationally. The fund has already invested in 12 startup life sciences companies, including eight in the San Diego area. Most recently, the fund invested in Sagres Discovery, a Davis, Calif.-based company that identifies genes associated with cancer, and Genicon Sciences, which has developed a light scattering technique for detecting biological interactions.
Royston said Forward targets both platform and pharmaceutical-development companies for investment, but that in recent months the trend has been to invest in companies selling products as opposed to services. "We like [companies that sell] products," he said, "especially companies that generate products sooner rather than later."
While RHO is a diversified fund overall, said Mark Leschly, a general partner at RHO, the fund has "historically been a heavy investor in biotech, and we continue to be active." Leschly added that while "inevitably most [genomics] companies are now focused on products," revenue from research services can allow a business to survive until its products reach the market.
Most recently, RHO invested in Archemix, a company developing protein microarrays that eventually plans to build an internal drug discovery program. "We spent a lot of time looking at companies in proteomics" over the past few years, said Leschly. "[Archemix is involved in] not just a incremental advance, but a paradigm shift," Leschly said. "We got excited about it."In the past, RHO has invested in life science companies such as Diversa, Human Genome Sciences, and MedImmune.