Device VCs Find New Hope in Old Exit Path
An analysis of acquisitions of privately held venture-backed medical device companies delivers some signs of hope as well as important warnings for medical device VCs hoping to find a lucrative exit in this difficult market.
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At Elsevier Business Intelligence's February IN3 West conference, a panel of leading device venture investors, who remain committed to and are actively doing deals in medtech, discussed how the recent recession has affected device investing and how much, if at all, that world has changed as a result.
A five-year review of returns from medical device mergers and acquisitions,
A year and a half after the September 2008 collapse of Lehman Brothers and the official start of the economic recession, a panel of venture capitalists and other financiers in the medical device industry came together at the IN3 meeting in Boston. We asked them if they've had to change the way they look at deals. What is the trade-off between expensive, de-risked later stage deals and the kinds of returns that can be achieved by backing a winning company from start to finish? Where would they place their bets: cost-effective technologies for tried-and-true markets or novel products for unmet clinical needs, the "evolutionary vs. revolutionary" debate? And what can one do about tired syndicates? Our panel lets us in on the kinds of discussions they've been having around the table at weekly partners' meetings.