The firm’s second fund closed last October at €150m, one of the largest venture funds raised to invest in European healthcare opportunities. Gilde Healthcare II (GHII) was backed by current investors, as well as a small group of new LPs. The largest group among LPs was banks, but there were also pension funds, fund-of-funds and family offices.
The original target for the fund was €125m but high demand from LPs led to this being increased, says general partner Pieter van der Meer, who adds that it was important to create a balanced mix of investors.
Gilde Healthcare was not fund raising in the most favourable market conditions, concedes van der Meer: “We really benefited from the fact that one of the new fund’s early investments was listed at a significant multiple after five months. That showed a lot of investors how successful we could be.”
Fund raising was also helped by the fact that there had been several successful exits from the first fund. All in all, there were six exits in the two-year period to October 2007. “That meant people had faith in our ability to execute our strategy and get positive returns in an appropriate time period,” says van der Meer.
Gilde Healthcare Partners aims to build healthcare businesses across Europe, by investing in companies with well thought-out business models. It invests in companies developing therapeutics, diagnostics, medical devices and technologies. The fund will invest in all stages of a company’s development, from seed stage to pre-IPO rounds. Investment size will range from €1m to €15m per investment.
Of the 12 investments in the first fund, which was raised in 2000, seven have been exited. Seven investments have been made in the second fund and one exited.
Van der Meer said at the time of the fund raising close: “We believe this successful fund raising reflects our high quality portfolio, which contains many of the most successful emerging healthcare companies in Europe. Our investment approach, which is not biased towards any particular country, means that we can invest in the best healthcare opportunities being created across the whole of Europe.”
He added that the quality of the investment portfolio, which the firm has built and moved to liquidity within five years, had enabled it to generate attractive returns for investors.