“Don’t stop believin’….
Hold on to that feelin’….”- Journey
This is a post I envisaged writing 3 months ago when I first ran into Darren Hite, (principal at Aberdare Ventures), at the Rock Health launch party. Today our company, goBalto, announced a Series A round of financing to advance cloud-based technologies in clinical research. From first contact to wiring the funds, the process took less than 3 months. Is this fast? I dunno. What I do know is that the moment I met the folks from Aberdare, I knew they were special.
I’d recommend that any entrepreneur with the next big idea in healthcare technology take a deep look at the folks at Aberdare Ventures and the newly-formed West Health Investment Fund (WHIF).
Here are 7 reasons why…
#1 Seasoned veterans
If you’re going to do something as crazy as disrupt healthcare, you better be working with folks who “get” healthcare:
- Aberdare’s founding partner, Paul Klingenstein was a key partner at Accel. He helped build their healthcare practice.
- Darren Hite, was a medical student and Stanford MBA.
- Don Casey, was the worldwide chairman of Johnson & Johnson’s Comprehensive Care Group and now the Managing Partner at the West Health Investment Fund.
- Dr. Mohit Kaushal is a surgeon, VC, Stanford MBA, and healthcare evangelist at the FCC.
- Dr. Joe Smith, is a PhD in medical engineering and medical physics from MIT, Harvard-trained physician, and served in executive leadership roles at Guidant, Boston Scientific and J&J.
This is a real group of “underachievers.”
#2 Committed to healthcare + tech
Two weeks ago in San Francisco there was a convergence of a “who’s-who” in healthcare. Seed accelerators, venture capitalists, startups, companies, and government – including Todd Park, CTO of HHS, and Aman, assistant to the CTO. (These guys inspired me to consider a career in government post goBalto.)
Given the dismal performance of investing in biotech therapeutics, it’s not surprising that VCs are repositioning themselves to be the next generation of thought leaders in healthcare + tech. It remains to be seen who’ll be around after the fashionistas disappear, but I believe Aberdare and West Health will be.
Darren is what I’d characterize as a hustler — he’s everywhere. Talking, mentoring, meeting, and screening healthcare tech deals. While most VCs simply point out weaknesses, from day one he worked with me to brainstorm issues whereas other VCs simply mentally checked out.
Despite not being guaranteed a seat in the Series-A round, Darren persisted in creating value. Now the cynics may say it’s because he wanted to close the deal, but he’s still hustling. That’s Darren. As for WHIF, they just announced they’re investing $100 million in technologies that reduce healthcare costs. Plenty of dry powder in the keg.
#3 Re-defining connected
Executives at Fortune 100 Pharmaceutical and biotech companies, other VCs, startups, scientists, and folks in the upper echelons of government. In the past 3 months, I’ve personally seen there’s no door that these folks can’t open.
#4 Knowing what they don’t know
When was the last time a VC told you they didn’t know the answer?
With these guys, they admit they don’t have a crystal ball. However, what they do well is brainstorm and figure sh$t out. If there’s a problem I need some help with, they’re just a phone call away. (Caveat: as a founder, you better have more than 95% of stuff figured out — they don’t invest in you to spend hours on end trying to figure stuff out for you.)
#5 Consistent
I spent a great deal of time speaking with founders from their current and past portfolios companies (both successes and failures), other VCs, friends, and even family. Throughout the process I was sensing a consistent message. Aberdare and WHIF deal from a position of integrity and fairness.
#6 Cloudy days, but always a ray of sunshine
The “honeymoon period” starts when you’re starting off and the future is bright and sunny. It’s only when you don’t hit milestones and things aren’t working out according to plan, do the investor true colors show.
Well, those “colors” started to show during the final phases of the agreement-drafting process. Small details requiring both VC and founder attention, started to test everyone’s patience. It gave me a first glimpse into how things could be when we’re all not seeing eye-to-eye. In the end, we focused on the goal and worked stuff out.
#7 Scotch. Candor. Patience.
Life is short. You’d better make sure that when you select an investor, you actually enjoy being around them. While it won’t always be fun and games, ask yourself whether you’d enjoy spending time chatting with the partner over some coffee or in my case an 18 year old Macallan scotch at Michael Mina. If not, I suggest you keep looking.
In closing
I want to share a story that solidified my decision to go with Aberdare and WHIF. It was August and I’d been in due diligence with Darren from Aberdare for roughly 30 days. We were both considering syndicate partners and he set up a meeting to introduce me to Dr. Mohit Kaushal (“Mo” from WHIF). We were dining on sushi at Ozumo in SOMA and Darren was running late. Mo suggested we play a prank on Darren where I would ask Aberdare step aside from the deal and let WHIF take the whole round.
In the venture community this just isn’t done — WHIF would essentially be hijacking the deal. Long story short, Darren arrived. Mo excused himself and I proceeded to explain how I was going to go with WHIF and suggested Darren play an advisory role. Darren tried his best to stay patient, but in the end I saw him getting extremely pissed. Mo returned to the table and we exploded in laughter. I knew then that these were the guys I wanted on my side to transform the clinical trial landscape. Smart, fun, and passionate with a sense of humor.
VCs don’t get better than that.
