A small VC group expands its hunt for inspired biotech founders in need of seed cash
Civilization Ventures, a California-based VC fund that successfully bet on biotechs Rocket Pharmaceuticals and Singular Bio a few years ago, is bringing forth its next round of investments.
Founded by entrepreneur Shahram Seyedin-Noor, the company has closed a $35 million fundraise and announced Tuesday morning it plans to invest in three areas: diagnostics, synthetic biology and AI-related digital health. The new life sciences capital comes three years after Civilization’s first fund, an $8 million pool that saw Rocket go public through reverse merger and Singular be acquired by medical-genetics company Invitae.
Civilization touts its 70% “graduation rate” from that fund, with several companies successfully raising subsequent financing rounds on their own. It was Seyedin-Noor’s first foray into the VC universe, though he had previous experience as an angel investor, and he recounted how the most impactful aspect of that new foray came on a personal level.
One of his companies provided a close relative with a potentially life-saving bladder cancer diagnosis just a few weeks ago that doctors had found elusive.
“[They] had been going in and out of the doctor’s office for six months now, something’s going on,” Seyedin-Noor said. “We have a company in our portfolio that specializes in next-gen sequencing of urine to detect early-stage bladder cancer. So I asked the doctors if they could enroll [them] in our trial, they said yes, and our tests showed 90-plus percent specificity and sensitivity, this is bladder cancer…the doctor did a biopsy and confirmed it. That is the future.”
Seyedin-Noor said he learned many important lessons from that first fund, with the most important being to not always follow the lead of bigger investors. While those companies may have their own internal analyses for the best investment opportunities, Seyedin-Noor says this can often ignore the people in charge of those looking for funding.
It’s all part of Seyedin-Noor’s own “founder-centric” investment model. Though hardly reinventing the wheel, Seyedin-Noor essentially hopes to pick up what he claims bigger VC funds lose through the cracks. By emphasizing the human aspect and relationship-building, Civilization can set itself apart from the major VC players, even though it’s not strictly a black and white choice.
“If you’re the chief of a $500 million firm, you’re not going to mentor a founder when you invest $250,000 or $500,000, it’s not economically feasible,” he said. “So among micro-VCs, the founders can look at us and say ‘Shahram’s started multiple companies, exited multiple companies, has a pretty well-known portfolio in my industry,’ versus the other guy who used to write code at Facebook or whatever, he has no clue about health care…when that becomes the comparison it’s kind of no contest.”
In addition, Seyedin-Noor says he uses his past experiences as an entrepreneur as an asset to sell to prospective companies, focusing on the mentorship of the individuals launching new biotechs. That can range from simply being an extra ear for advice to taking a board seat on the company.
But all that doesn’t mean Civilization ignores metrics and market analysis. The VC has its own proprietary ranking system that determines how and where the company spends its money. These rankings can run the gamut, with Seyedin-Noor providing an example that nepotism is a massive red flag.
Ultimately, the venture capitalist combines such data with what he feels in his gut.
“If your gut tells you ‘This guy is kind of a jerk, I don’t like the way he treats his employees,’ that might not fit into a traditional VC matrix,” Seyedin-Noor said. “But I will say where I think a lot of investors go wrong is by ignoring the founders. It’s not just about the IP, about whether this company has the next secret sauce, it’s who’s running the company.”