Cure Ventures has closed an inaugural $350 million fund to provide another financial lifeline to biotech startups, with a seasoned leadership team that plans to wield smaller seed rounds to elevate larger breakthroughs.
The haul was backed by the likes of city and state pension funds, a U.S.-based sovereign fund, foundations, endowments and hospital systems, according to Tuesday's announcement. The founding trio of Richard Lim, David Fallace and Lou Tartaglia, Ph.D., is equipped with dozens of years of combined biopharma investment experience, including at Third Rock Ventures and Omega Funds. Lim told Fierce Biotech in an interview that Cure’s leadership received ample guidance from its founding limited partners in the year and a half it took to raise the fund, including what sum to strive for.
“The LPs who have come into the fund are very sophisticated, perennial biotech venture investors,” he said. “And they told us very clearly about where we should be.”
Now, the firm is ready to make its first bets, with a three-pronged strategy that Lim and his co-founders believe can distinguish itself from competitors. The first, and possibly most distinct, quality of Cure will be a focus on smaller seed rounds. Lim says this fund will be used to invest in roughly 20 seed rounds ranging from a few hundred thousand to a couple million dollars. Around 12 to 15 companies will receive series A funding.
“Seeding is really utilized by us to de-risk science,” said Lim. “By making financial risk low, we actually then have the incentive to push the limits of the technology on those dollars.”
De-risking, of course, has different definitions for different people. Lim acknowledged this, using science coming out of academic institutions as an example where the investors may look for a new standard before moving on to more advanced preclinical or IND-enabling work.
The other benefit to lower seed rounds, Lim says, is staying low-profile while early-stage companies lock up intellectual property. Large seed rounds, he added, result in a “massive” amount of eyeballs.
Beyond the seed strategy, Lim says the company will embed Cure management as early C-suite members, a strategy seen at other VCs like Flagship Pioneering and Third Rock Ventures. Cure will also prioritize genetic validation as a means of increasing clinical success.
So far, the team has kept any and all investments under wraps. But Lim was clear that target identification-focused platform companies are not on the immediate radar, with Lim calling that tech “too early for prime time.” Cure is not discounting platform companies as a whole, however, and may ask companies to use seed funding to build “exemplar assays” that can pair with new candidates.
“And if that holds water, then I think we'd be more than happy to back the platform itself,” Lim said. “They’re not all created equal.”