1:03 PM
Jan 19, 2017
 |  BC Innovations  |  Finance

Kurma chameleon

How French VC Kurma is bringing industry into tech transfer before creating newcos

French life science VC Kurma Partners S.A. is experimenting with a new investment model to accelerate the transfer of European academic research into the commercial setting with less risk than standard seed investments. The firm is balancing the new model with its traditional one, allowing it to continue investing in later-stage companies while also competing with the bigger players for highly innovative discoveries.

Kurma was formed in 2009. Its first fund, Kurma Biofund I, created newcos using a traditional route that invests money and other resources into translating an academic discovery.

In November 2016, it announced it is incorporating a new strategy into its latest fund, Kurma Biofund II, after rethinking the best way to access disruptive technologies while balancing the risk.

The idea is to syndicate with industry partners from the get-go, bringing them in at a pre-seed stage -- prior to forming the company -- to provide expertise that matches the newco’s technology. Working alongside the academics to ripen the technology with low financial commitment de-risks the program.

Moreover, it should allow Kurma to compete for seed or series A stage assets with the bigger players.

According to managing partner Vanessa Malier, the new approach is unique among French life science investors and makes it possible for a small firm like Kurma to create new companies without tying up a large percentage of its capital in seed investments.

The firm’s industry partners for these investments include Boehringer Ingelheim GmbH and Ionis Pharmaceuticals Inc.

Having an industry player on board “gives a lot of credibility to the newco and facilitates the recruitment of an experienced management team and the syndication with other VCs,” said Malier.

The VC landscape in France is dominated by two major funds -- Sofinnova Partners and Edmond de Rothschild -- and smaller players like Kurma. In addition, BPIFrance, the investment arm of the French state, provides venture investments and grants and loans to new companies within the country.

Edmond de Rothschild partner Gilles Nobecourt said his firm is not heavily focused on early stage innovations, and he isn’t aware of any other French funds that use a model similar to Kurma’s. While most VCs, including his firm, provide access...

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