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VCs forecast: Doom and gloom for next two years
The venture crowd gathered for a wake of sorts at this week's BIO-Europe meeting, mourning the toll in store over the next two years of small biotechs with limited funding opportunities.
Simon Turton, managing director for Warburg Pincus, said he had only "doom and gloom" to offer the biotech community. Cited in a story for BioWorld International, he said that biotechs "need to be looking at ways to use the cash that they have to get to 2011." And his thoughts on the chances of a biotech IPO: "There will be nothing next year and only a few, perhaps even rash offerings, in 2010."
James Watson, managing director and head of merchant banking for Burrill & Co., noted that financing is already down, and all signs point to a steady worsening. Added Watson: "It will be hard to raise any new money."
- read the report from BioWorld
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Comments
By Patrick Bols | Posted 4:33pm | November 19, 2008
Doom and Gloom? Clearly VC's are relating to their own prospects of making megabucks. Indeed those prospects are not so good. I believe it is mistake for VC's to pretend that they are the only source of capital for Biotechs. There are simply too many excellent research activities right now for those not being funded one way or another.
The challenge is to the VC's to come up with more innovative ways for funding or other means will inevitable emerge and short circuit them. It pays to adapt to a changing environment and the VC model is maybe outdated?
Patrick Bols
CEO BioNimbus
