Hatteras raises $94M to invest in early-stage biotechs

Clay Thorp, co-founder and general partner of Hatteras (Hatteras Venture Partners)

Hatteras Venture Partners has raised $94 million for its sixth venture fund. The first close of the targeted $200 million fund tees Hatteras up to make a fresh batch of seed and early-stage biotech investments.  

North Carolina-based Hatteras will use some of the money to continue helping entrepreneurs found and build startups underpinned by science from academic centers in the southeastern U.S. Across its first five funds, which have $450 million under management, Hatteras has applied that model to help biotechs such as gene therapy startup StrideBio and the RNA-targeting Ribometrix get started.

Another slice of the money will support Hatteras’ activities outside of the southeastern U.S. In recent years, Hatteras has leveraged relationships with groups outside of the area to sniff out co-investment opportunities. 

Hatteras expects to have more money to commit to both sets of opportunities than it did in the past. The VC shop raised $125 million for its fourth fund in 2013 and came in over the $150 million target when it closed the fifth vehicle in 2017. Hatteras thinks changes to the early-stage biotech scene will ensure it can put the additional money to good use.  

“The pace and quality of our deal flow has grown tremendously during the past several years,” Clay Thorp, co-founder and general partner of Hatteras, said in a statement.

Hatteras has laid the groundwork for the assessment of the accelerating deal flow by making some personnel changes. Mike Dial and Jeff Terrell, who joined Hatteras as analysts, have stepped up to partners. And Ben Scruggs and Kseniya Simpson have come on board as associate and analyst, respectively, boosting Hatteras’ capacity to analyze and support companies. 

Many of the companies assessed and supported by Hatteras are drug developers, but the fund’s focus extends beyond therapeutics to medical devices, digital health and diagnostics.