Pitango, a venture capital firm based in Herzilya, Israel, recently celebrated the successful first closing of its second healthcare-focused fund, Pitango HealthTech II, with a significant $175 million in commitments. This fund is dedicated to advancing health tech startups at various stages of development, from seed to commercial, encompassing diverse sectors such as digital health, medical devices, techbio, diagnostics, foodtech, ag-tech, biotech, and life sciences.
New Investments in Healthcare Pioneers
Among its initial investments, Pitango HealthTech II has backed two promising companies:
- QuantHealth.ai: An artificial intelligence (AI) company specializing in clinical trial simulations aimed at accelerating and de-risking drug development.
- Nevia Bio: A FemTech company focused on creating an AI-based biomarker platform for early detection of women’s health diseases.
These investments join a roster that includes previous investments in companies like Protai, Laguna Health, Vertos, Visby, Clew, and Magenta.
Building a Healthcare Portfolio
Pitango HealthTech II builds upon the success of Pitango’s first dedicated healthcare fund, which launched in 2019 and ceased new investments at the end of the previous year. However, it continues to support its existing portfolio companies. The new fund aims to assemble a portfolio of approximately 15 innovative companies over a span of three to four years, as stated by Managing Partner Ittai Harel.
Focused on Healthcare Innovation
Pitango HealthTech II primarily targets health tech startups in the seed and Series A stages, though it remains open to considering investments in Series B and commercial-stage companies. The fund has a broad perspective on healthcare and focuses on the integration of AI in healthcare, especially in areas where data science converges with life sciences, including proteomics, genomics, immunology, and more. Additionally, the fund is keen on supporting innovation in medical devices, a field it believes has room for growth.
The founding team of Pitango HealthTech comprises accomplished individuals who bring a wealth of expertise to the field. Hila Karah, as the Managing Partner of HealthTech, leads the charge with her strategic insights and vision. Alongside her is Ittai Harel, another Managing Partner in HealthTech, known for his deep understanding of healthcare innovation. Jonathan Glazer, a Partner in HealthTech, contributes his experience to drive the fund’s success, while Joel Schoppig, as Senior Principal in HealthTech, adds a valuable perspective to the team’s endeavors in the healthcare sector. Together, they form a dynamic and capable team dedicated to fostering innovation in healthcare.
Key Criteria for Investment
When evaluating startups, Pitango places significant emphasis on several key factors:
- The quality and commitment of the founding team.
- The uniqueness and defensibility of the technology.
- The startup’s ability to demonstrate its potential value to customers.
- The efficiency of the business model.
Additionally, Pitango considers a startup’s path to regulatory approval, with around 40% of its healthcare investments requiring regulatory clearances of the 510k type, while the remaining 60% do not. The fund takes a case-by-case approach, balancing risk and opportunity in its portfolio.
A Global Perspective
While rooted in Israel, Pitango HealthTech II is open to investing in startups from around the world, building on the experience of its first healthcare fund, which allocated a significant portion of its capital to non-Israeli startups. This openness reflects Pitango’s commitment to fostering healthcare innovation on a global scale.
Seizing Healthcare Opportunities
According to Ittai Harel, the current healthcare landscape is brimming with opportunities for investors. He attributes this largely to the transformative effects of pandemic-induced trends, including the consumerization of healthcare, the decentralization of care sites, and the ascent of personalized medicine. Harel emphasizes that there is a palpable shift towards recognizing the fundamental need for change in 2023, a sentiment he believes is stronger than anything he has witnessed over the past two decades. Furthermore, he notes that this momentum is not slowing down; rather, it is accelerating, especially with the widespread adoption of digitization and the integration of AI and generative AI. This newfound flexibility among providers, payers, and regulators is driving a willingness to explore and embrace innovative technologies and business models within the healthcare sector, as Harel aptly explains.
In conclusion, Pitango HealthTech II’s $175 million investment underscores the firm’s commitment to nurturing healthcare innovation worldwide, with a keen focus on pioneering startups and groundbreaking technologies.
Pitango HealthTech II, a venture capital fund based in Israel, has secured $175 million for its second healthcare-focused fund. This fund is dedicated to supporting startups in various healthcare sectors, including digital health, medical devices, and biotech. It has already invested in promising companies like QuantHealth.ai and Nevia Bio. Pitango prioritizes factors such as the quality of the founding team, technology uniqueness, and regulatory approval when making investments. While rooted in Israel, the fund is open to global investments. The current healthcare landscape offers ample opportunities for innovation, driven by digitization, AI adoption, and changing healthcare paradigms.
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