Understanding venture capital in the health industry

For health care industry technologies, grants and other nondilutive funding sources are useful to fuel initial translational efforts, but rapid, significant product advancement typically requires larger infusions of capital. One source of such funding is Venture Capital (VC) investment firms. VC investors employ distinct processes for finding, evaluating, and funding investments, with decisions and terms of investment driven by return requirements, a desire to align incentives between VC and company management, and individual fund strategies. By understanding the motivation and context of the VC approach, a scientific or clinical founder can successfully manage his or her side of the relationship to the benefit of all-the investor, the founder, and ultimately patients.

Duke Scholars

Author Barry S. Myers Biomedical Engineering