IAB provides an environment that facilitates interactions between interesting start-up projects and its members. Our goal is to identify and nurture top talent entrepreneurs in the Life Sciences sector. We lead equity investments to help ideas and start-ups to reach key objectives. Our value is beyond financing, we do not provide just angel money. We bring mentoring and expertise to great ideas by becoming entrepreneur partners. Our added value is in networking: we connect start-ups with international venture capitals, Life Sciences experts, strategic partners, industry veterans as well as service providers such as law firms, as well as other advisors or service companies. We usually take board seats and work closely with entrepreneurs to maximize the chances of success.
Lead equity investments
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The new millennium finds us in the midst of a biological revolution driven by the explosive advances of modern biology of the last half-century. The benefits of this knowledge and understanding is especially evident in medicine, where the genetic basis of many diseases is becoming clear and where new therapies for old and new maladies are bringing relief to millions of sufferers. Progress in pharmacogenomics will allow the design of drugs tailor-made for the genetic characteristics of each patient. The knowledge of the genetic health risk factors of individuals at birth should result in careful monitoring and more efficient medical treatments.
Significant advances in science has been and will be required if the new knowledge of biology is to fulfill its promise. The molecular aspects of aging are being studied with the hope of improving the quality of life for people’s late years. Diagnostic techniques for inherited diseases and cancers are steadily increasing and being improved. Vaccines and therapeutics obtained through genetic engineering are already available and many others are on their way. Current progress in the application of gene therapies and/or other genomic approaches may provide further promising avenues for the future.
Biotechnology, in particular, is helping our life by changing the odds of serious, life-threatening conditions, reducing rates of infectious disease, tailoring treatments to individuals and creating more precise tools for disease detection.
Since 1982, millions of people worldwide have been helped by more than 230 biotechnology drugs and vaccines. The pipeline of biotech and pharma companies is enriched by more than 400 biotech drug products and vaccines currently in clinical trials. These new potential treatments target more than 200 diseases, including Alzheimer’s disease, diabetes, multiple sclerosis, cancer, heart disease, AIDS and arthritis. Biotechnology is also responsible for hundreds of medical diagnostic tests that keep the blood supply safe from the AIDS virus and detect other conditions early enough to be successfully treated.
Just to mention a few:
- From 1993 to 2003, the death rate from coronary heart disease dropped 30%, due in part to the introduction in 1987, of new biotechnology-based drugs, which allow emergency room doctors to dissolve blockages causing heart attacks.
- Before 1982, there were few options for insulin-dependent diabetics who were allergic to animal-derived insulin. That year, a human version of the drug entered the market: the first ever biotechnology medicine to be commercialized. Recombinant insulin is still saving lives today.
- Rheumatoid arthritis disease afflicts several million people, mostly women. Today, biotechnology drugs that slow the progression of the disease are helping thousands of women worldwide.
- A growing percentage of cancer patients are surviving and returning to good health thanks to biotechnological breakthroughs.
These improvements in health care are just a small sample of the benefits biotechnology has brought, and will continue to bring, in the future. New products in advanced testing or under consideration for approval include medications for cancer, hepatitis, psoriasis, diabetes, AIDS, macular degeneration and many rare genetic diseases.
Apart from the great improvements in the diagnosis and therapy of many diseases, biotech is bringing significant contributions in the creation of innovative enterprises and qualified employment, high financial return on the investments and contribution to the economic growth (biotech GDP around 1.1 worldwide, expected to raise to around 2.5 within the next 10-20 years).
Why become a business angel?
Being a business angel offers the opportunity of a high return of your investment, however the main scope for the involvement in a Company (usually as non-executive or part-time) is to use your experience to help the company to develop its business. Personal involvement is not mandatory and has to be negotiated with the founders, but being active as a non executive director can be very stimulating and help the company achieve its potential.
A member of the IAB must have worked in a biotech startup company?
No, members have a range of experiences in the Life Science sector, including executive and non executive roles in mature or early stage companies, venture capital funds, R&D positions both in companies as well as in academia, legal or financial advisors for transactions in the life science sector.
Investing in early-stage companies is risky. How is the IAB managing the risk?
The IAB as a group is not offering any advice. More than half of angel investments lose money and you should be willing also to accept losing money. You should learn as much about early stage investing as you can before thinking to apply to become a member. Angel investments should be made in companies in which you understand the product, the market and the industry.
What are the benefits of being a member of IAB?
Networking with talented people, high quality investment opportunities in the life science sector, diversification of investments, share due diligence with industry experts and a chance to promote growth in our Country, among others.
What type of companies do angels invest in?
Angels look for innovative startups that can grow quickly in value, creating jobs and soon attracting deep pocket investors to help maturing the business. Members of the IAB like to invest in companies located in their communities and in the life science sectors in which they have experience or understanding.
If I join IAB, what time commitment is required?
Members are asked to attend our elevator pitch events approximately every three months, to help with the selection process by contributing with their own specific expertise when matching with specifics of the submitted proposal. If a member decides to invest in a company introduced by IAB he or she is expected to provide mentoring support to the company.
How much total money should an angel investor put in this type of investment?
It depends on the person, but thinking through your risk tolerance up front is important. Because more than half of angel investments lose money, you should be willing to lose the money you set aside for angel investment. For many experienced angels, this amounts to 5 to 10 percent of their overall investment portfolio. The most sophisticated angels make at least ten investments over several years for a better chance to make a return on their investment, counting on one or two to provide nearly all of their return.
Can I be a member of the IAB and a member of other Business Angels organizations?
At the moment there is no limitation. The IAB is the first and only Business Angel club in Italy focused in Life Sciences, therefore it is unlikely that other clubs may offer as many opportunities in the sector as we do. However the IAB is assessing on a case by case the curriculum and backgrounds of each member prior to authorizing him/her to join.
What is an angel group?
Individual angels are joining together with other angels to evaluate and invest in startups. The angels can pool their capital to make larger investments.
How much money do individual angels invest in a company?
There is no limit in principle. The amount depends on stage of the proposal and on how many angels are investing together. Most investments by individuals are between $5,000 and $100,000 per company round.
What are the key steps for angel investments?
The process may vary on a case-by-case basis. Usually includes: screening of an executive summary of a business plan, meeting with the entrepreneur and submission of a business plan, presentation by the entrepreneur of the plan with a Q&A period, due diligence on the company and its management team, negotiation of a term sheet and legal documents, and post-investment support, including service on the company’s board of directors, monitoring reports, and providing mentoring and advice.
What is the difference between venture capitalists and angels?
Venture Capitalists provide capital they have raised from other investors to later-stage businesses for growth while Angels generally invest their own money in start-ups and very early stage companies.
How often do I have to invest?
By joining the IAB there is the expectation that you will invest at least 100,000 euro in startup opportunities over a period of 5 years. You will have the opportunity to attend IAB group meetings, where apart from actually seeing the companies pitch and having the opportunity to meet them afterwards with other investors, the IAB will ask, subject to always seeing the right opportunity, your investment intentions, expectations and level of activity.
Why do people make angel investments?
We have heard many different answers to this question, ranging from “I can make money”; I love working with other entrepreneurs”, “it’s fun” to “I get to help create great new companies in my country” among others.
What are typical considerations in selecting the right investment opportunities?
Basic requirements are: management team expertise, level of innovation, growth stage, industry sector expertise, growth potential, competitive advantages, and high return on investment.
How many opportunities will I see as a member of the IAB?
We are planning to organize 3-4 pitch events per year. At each event 3 companies will be invited to present. The selection of companies to present is made by the Board who may consult with other members of the IAB in case they have specific expertise to help with the review of one or more of the proposal received. This process will allow the screen of all the applications to guarantee the best investment opportunities will be invited for the pitch event to the angel community. The Board cannot guarantee that the selected opportunities are investible but that they represent the best out of the applications. However, each member is expected to be capable of making independent investment decision.