There’s a narrow focus, and then there’s a narrow focus. Viscogliosi Brothers LLC would be among those in private equity that can truly say it’s a niche investor. The firm, which bills itself as a venture capital firm, private equity shop and merchant bank, dedicates itself to investments in a specific portion of the health care industry – the musculoskeletal and orthopedics area.
Viscogliosi, which was founded by brothers Marc, John and Anthony in 1999, has launched a fund-raising effort for its latest vehicle, according to regulatory filings with the Securities & Exchange Commission. The firm has already raised more than $6 million of a targeted $20 million, according to an SEC filing in May.
The firm indicated it will use the fund to “invest in, finance, operate and manage companies” in its chosen space and a portion of the capital will go toward the purchase of patents.
Anthony Viscogliosi was introduced to the orthopedics industry in 1987 when he was a sell-side investment research analyst following publicly traded companies.
Brother Marc Viscogliosi also comes from a research background, while John has a broad investment-banking history with experience in institutional and retail sales, institutional listed trading and money management.
The firm’s website says that the musculoskeletal and orthopedics space has grown from a $1 billion industry in 1988 to a market that accounts for more than $22 billion in annual sales today.
Viscogliosi, strangely enough, isn’t the only private equity firm that targets this area. HealthPoint Partners, the private equity affiliate of HealthPoint Capital, also focuses exclusively on orthopedic device companies. HealthPoint raised a $125 million fund two years ago, according to Thomson Venture Economics (publisher of PE Week).
Viscogliosi Brothers has either led or participated in more than 40 transactions in the industry. Much of Viscogliosi’s deal activity leans toward the venture side, but the firm has been active in buyouts as well. Since February, Viscogliosi has acquired three companies, Xtremi-T, Envision Manufacturing Inc. and Avanta Orthopaedics Inc.
Meanwhile, like some of its larger investment peers, Viscogliosi has also crossed the line into hedge funds, and last year funded Orthopedic Investment Partners LP with $2 million. The hedge fund is the first of its kind in that it exclusively targets publicly held musculoskeletal companies.
Viscogliosi also says on its website that its investors consist of more than 140 health care industry pros, including orthopedic doctors, neurosurgeons, product distributors and other musculoskeletal industry personnel.