Seattle-based venture capital firm Biomatics Capital, which focuses on companies innovating around healthcare and technology, has closed its initiatory fund of $200 million. This exceeds the firm’s target of $150 million and spans a range of investors including individuals, family offices and institutions.

Biomatics is particularly interested in genomics and digital health, and will use this fund to dedicate early stage investments to about 15 to 20 companies over the next few years, with investments ranging from $5 million to $10 million (and up to $20 million over the life of the investment). The firm has two core investment theses: data will change healthcare, and breakthrough technologies will enable translation into diagnostics or tech-enabled healthcare delivery systems.

The firm, which launched in November 2016, was founded by people with strong roots in academic and entrepreneurial networks: Julie Sunderland, who previously worked as was the director of Program Related Investments for the Bill & Melinda Gates Foundation, and Dr. Boris Nikolic, who served as chief advisor for science and technology to Bill Gates.

With the recent explosion of genomic data and development of platforms to organize that data, Biomatics is more heavily focused on genomics than anything else, but Sunderland told MobiHealthNews that the company is dedicating a significant amount of attention on digital health innovation.

“We’re about 70 percent genomics and 30 percent digital health, and we’re looking at that from a couple of different perspectives,” Sunderland said. “We are looking for companies that are using data and technology in interesting ways, but also those that are very nuanced about understanding the reimbursement environment. You need to get paid in healthcare, and getting paid in healthcare is really hard, with a really complicated set of issues, so we need to see companies that are aware of that.”

Along with reimbursement awareness and an understanding of how technology and data can enable clinical change, Sunderland said Biomatics wants to see companies that are also cognizant of another key aspect of healthcare.

“They need to show they are very mindful about the regulatory environment, and that they are not trying to develop in ways that bypass that but are actually being very mindful,” said Sunderland. “Knowing how technology is enabling that to happen, how that can create value for patients, and also understand how it creates financial value is important. That’s hard enough, but they also have to work with regulation.”

That starts with who makes up the team, Sunderland said, so they keep their eyes out for companies who are made up of people with the range of expertise needed to innovate in health.

“Teams that are integrated with the healthcare perspective and the technology perspective are going to be successful,” she said, noting that while Biomatics is looking all over for investment opportunities, a lot of funding goes to companies in San Francisco, which lead in creating technology as a disruptor, and deep science-focused Boston.  

“You bring those two cultures together and you get the right mix,” Sunderland said. “If you only have technology, you may be too aggressive about your perspective and you will miss a lot of the nuance and complexity of healthcare, but if you only have a healthcare perspective, you may be too timid or cautious about getting ideas out. We like to see more of those teams come together.”

Basically, they are looking for outliers, Sunderland said. Eight companies have already received investments from Biomatics The pre-seeded portfolio includes genomics-based cancer screening company Grail, AI-powered medication adherence company AiCure, and Aledade, which offers data-driven business models for accountable healthcare organizations. Once Biomatics makes an investment, they then take on an active role in the company by supporting them as they hire, protecting intellectual property, and guiding them through regulatory issues and exit strategies.

"Our health care ecosystem is at a tipping point," Nikolic said in a statement. "In the next decade, breakthrough science and technology will fundamentally transform the practice of medicine and delivery of health care. Data will drive this transformation."