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 / private equity shop and merchant bank, dedicates itself to investments in the healthcare industry, or more specifically the musculoskeletal and orthopedics area of the sector.
Viscogliosi, which was founded by brothers Marc, John and Anthony in 1999, has launched its latest fund, according to Form D filings with the Securities & Exchange Commission. The firm has already raised $6.04 million of a targeted $20 million, with 24 accredited investors having committed to the vehicle. Viscogliosi is accepting a minimum of $100,000 as an investment, and no placement agent was named in the documents. The filing was dated May 9, 2005.
The firm indicated it will use the fund to “invest in, finance, operate and manage companies” in its chosen space, and Viscogliosi identified that a portion of the capital will go toward the purchase of patents.
Anthony Viscogliosi originally was introduced to the orthopedics industry in 1987 as a sell-side investment research analyst following publicly traded companies. 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 Web site describes that the musculoskeletal/orthopedics space has grown from a $1 billion industry in 1988 to a niche that accounts for more than $22 billion in annual revenues 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.
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 of this year, Viscogliosi has acquired three companies, Xtremi-T, LLC, Envision Manufacturing Inc. and Avanta Orthopaedics Inc.
Meanwhile, like some of its larger PE 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 indicated on its Web site that its investors consist of more than 140 healthcare industry pros, including orthopedic doctors, neurosurgeons, product distributors and other musculoskeletal industry personnel.