Terry McGuire, co-founder and managing general partner at Boston-based
Starting next year, McGuire, who focuses on life sciences investments, will add yet another board title when he becomes chair of the National Venture Capital Association (NVCA).
PE Week Senior Editor Joanna Glasner caught up with McGuire, currently an NVCA board member, late last month while he was en route to a weekend getaway in Vermont.
He discussed prospects for investment in life sciences, as well as broader concerns about the venture industry as many firms muddle through what could become a lengthy down cycle for exits.
Q; We just finished up the second quarter in which, for the first time in 30 years, we did not have a VC-backed IPO. Last year, your firm had a few good exits. So how is 2008 shaping up?
I’ve been in the venture business for over 20 years, and I absolutely recognize this is one of the more difficult periods to get liquidity.
At Polaris, we fortunately have had several exits through acquisitions in the last couple years in our life sciences portfolio. But our last portfolio company to go public was in the IT space [TechTarget] and it went IPO in May 2007.
Since public markets have been in some troubled times, it’s not surprising that the IPO markets have been down, too. I don’t think there’s anything unusual about this cycle, but we are definitely in the down part.
Q; Have the market conditions changed the way you have invested lately?
No, I continue to be intrigued by new platform technologies in the biotech end of the medical device space.
One of the latest on the platform side is AdiMAB, which was spun out of technology developed at Dartmouth College and which specializes in the generation of monoclonal antibodies.
Recently, I’ve also been particularly intrigued by the potential for implantable devices that can provide therapeutic treatment. And I’ve been looking at monitoring or communicating information to care providers.
Q: How about outside of life sciences? What is of interest to you?
My investment background is more on the life science side. But at Polaris, overall, the firm has been looking at digital media and we have a growing presence in energy.
Bob Metcalfe [founder of 3Com and Polaris general partner] has been leading the charge on that.
Q: It’s been a few years since a life science investor chaired the NVCA. Does that mean health care and biotech will become a larger focus next year for the trade group?
Life science is obviously becoming a more important part of the venture investment mix.
And it is also important to focus on stories about products that have come out of the venture capital world. For example, look at the pacemaker. Medtronics was backed by venture capital, and that device has saved millions of lives. I expect to see story after story about such medical innovations that might not have existed if it weren’t for venture capital.
Q: What are some other priorities right now?
Recognizing venture capital and how it contributes to the innovation economy is important with the new administration coming into the NVCA. That includes making sure it continues to be supported by the public sector, and that not just venture capitalists, but also entrepreneurs, are treated well for the risks they take.