The role of the family office in life science investment

We have been sensing a growing trend of family office interest for getting involved in investing in the healthcare sector, and had significant feedback from our life science executives about exploring family offices as investment partners and as route to capital.

On July 14th we spoke exclusively to a panel of family office experts, for the next in our webinar series, with this topic proving our most popular yet; the webinar broadcast to over 270 registered participants.

The principle objective of the panel was to understand more about the role of family office investment in life sciences, the best ways to connect and develop relationships with the family office community, and uncover some advice, insight and expertise for biotechs about working with family offices, and for family office executives about getting involved in the sector.

The panelists were:

John Elder
- Founding Partner of Family Office Advisors LLP, a consulting company which advises on, establishes or restructures investment and reporting solutions for family offices, HNWs and wealth managers. John has 30 years of broadly based financial services experience encompassing consulting, investment management and financial planning.

Dr. Chris Donegan - Founding Partner of Azure Wealth, a private wealth management firm co-founded by a European family office headquartered in London. Chris specializes in illiquid investments - most specifically intellectual property backed businesses and is ranked as one of the world’s top intellectual property strategists advising on the investment of over $450m into the asset class over the last 5 years.

Matthew Norman
- Deputy Chairman of the Family Office Council, a membership group for Single Family Offices with leadership and agenda set by Single Family Offices. Matthew works for several UK based resident non-domiciled principals and previously spent eight years with a London based Brazilian single family office as head of investments.

John kicked off the discussion, explaining the key differences between Single Family Offices (SFOs), Private Multi-Family Offices (PMFOs) and Asset Gathering Multi-Family Offices, with Matthew explaining that the main difference in their investment strategy being that SFOs are not under pressure from multiple clients to produce quick returns so often can take a much longer-term view on any investment than multi family ffice.

Chris explained that life sciences can diversify a family office’s portfolio, but that a lack of in-house expertise to properly understand the science and business case is a reason why many choose to neglect life sciences. He adds that a lot of family offices who invest in biotech may instead invest in a VC-run fund, in order to spread risk.

The audience were asked to vote on what they felt was the biggest barrier to greater investment from family offices into life science and healthcare. A large majority of 70% felt that access (the ability for companies to connect and meet with FOs) was the greatest barrier, with a further 17% feeling that volume (the number of FOs who understand and are interested in the sector) was the major issue.

For life science execs, our panellists also discussed what family and private wealth investors offer on top of capital, the most effective ways for biotechs to connect with and access capital from family offices and whether direct investments into life science companies, as part of a diversified portfolio, is considered an attractive investment proposition.

For family office execs, our experts also provided their views on the trends family offices should look for, the key evaluation criteria for investments in the sector and advice on how FOs can connect with the most attractive and appropriate investment opportunities.

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