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Initiate Ventures Gets $45 Million to Fund, Co-Found Startups
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By Brian Gormley, WSJ Pro
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Good day. Some venture investors such as Flagship Pioneering are known for launching biotechnology companies. New venture firm Initiate Ventures is bringing that company-creation model to other areas of healthcare.
Initiate, which is looking for startups operating at the intersection of healthcare, life sciences and technology, said this week it secured $45 million for its first venture fund. The firm expects to help about half of the 10 to 12 companies it funds through this pool launch through a studio where it teams with entrepreneurs to hatch companies.
The strategy mirrors the experience of co-founders and General Partners Iana Dimkova and Jessica Owens. Dimkova previously worked for radiation-therapy company ProCure Treatment Centers and spent four years with GE Ventures, where she invested in healthtech startups. Owens is a former partner with venture investor Kleiner Perkins and co-founded cancer-detection company Grail.
Venture investors can reap giant rewards by launching successful healthcare companies, as Flagship did with Covid-19 vaccine developer Moderna, by owning significant stakes in them. San Francisco-based Initiate formed in 2022 and already has six portfolio companies.
Portfolio companies Initiate has co-founded include Cornerstone AI, whose AI software is used to rapidly prepare healthcare data for analysis, and Macro Trials, a precision-research clinical platform company.
And now on to the news...
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Workers preparing FarmboxRx food boxes. PHOTO: AMORE FILMS
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Food-as-medicine. Despite its success, FarmboxRx could never convince venture capitalists it had a winning business model. Then Robert F. Kennedy Jr. was tapped to lead the Department of Health and Human Services.
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“I woke up and had two VC emails in my inbox before 6 a.m.,” said FarmboxRx founder and Chief Executive Ashley Tyrner-Dolce. Other investors also have since expressed interest, she said.
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FarmboxRx is among the companies that have launched services that use healthful foods to fight disease. These food-as-medicine startups could soon have a champion in Kennedy and Mehmet Oz, the celebrity surgeon widely known as Dr. Oz. who is President-elect Donald Trump’s choice to lead the Centers for Medicare and Medicaid Services.
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The medical system, however, is geared more toward paying for medication than food. Food-as-medicine proponents hope Kennedy and Oz will propel the sector through programs that help Medicare and Medicaid pay for it.
More:
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“There’s a lot of opportunity for the food system and the agriculture system to take market share from healthcare."
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—Carter Williams, CEO and managing principal of venture investor iSelect Fund
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Frazier Healthcare Partners Hits Fundraising Limit for Latest Vehicle
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Frazier Healthcare Partners has closed its latest fund at its $2.3 billion hard cap, giving the veteran firm its largest pool of capital ever to deploy in growth-buyout deals, WSJ Pro reports. The vehicle, Frazier Healthcare Growth Buyout Fund XI, was oversubscribed and exceeded its $2 billion target, said Ben Magnano, a managing partner at the Seattle-based firm. The prior vehicle closed in 2021 with $1.4 billion. The fund will aim for a concentrated portfolio of 10 to 12 investments, Magnano said. Its areas of focus will include pharmaceutical and biopharmaceutical services, women’s and newborn’s healthcare, pharmacy technology and healthcare information technology.
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PHOTO: GABBY JONES/BLOOMBERG NEWS
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xAI valued at $50 billion in funding round. Elon Musk’s artificial-intelligence startup, xAI, has told investors it raised $5 billion in a funding round valuing it at $50 billion—more than twice what it was valued at several months ago, The Wall Street Journal reports. Qatar’s sovereign-wealth fund, Qatar Investment Authority, and investment firms Valor Equity Partners, Sequoia Capital and Andreessen Horowitz are expected to participate in the round, according to people familiar with the matter. The financing
brings the total amount xAI has raised to $11 billion this year.
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U.S. Military Selects Little-Known Utah Supplier for Drone Program
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The U.S. Army is bypassing some of venture capital’s best-funded drone makers to buy technology from a little-known Utah manufacturer. Salt Lake City-based Teal Drones has been selected as the winner of a military program to provide thousands of small surveillance drones, according to a regulatory filing and an Army document viewed by The Wall Street Journal.
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People
B Capital, which focuses on seed to late-stage venture growth investments primarily in the technology, healthcare and climate sectors, appointed Timur Akazhanov as general partner. He was previously a managing director at H.I.G. Capital.
Angela Hwang will join Metaphore Biotechnologies as chief executive officer and Flagship Pioneering as CEO-Partner. She most recently served as chief commercial officer and president of the global biopharmaceuticals business at Pfizer.
Schizophrenia treatment developer LB Pharmaceuticals appointed Heather Turner as chief executive officer. She was most recently president and CEO of Carmot Therapeutics.
Mental health startup Two Chairs appointed Frank Keim as chief financial officer. He was previously CFO at the Center for Autism and Related Disorders.
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Zarminali Health, a Chicago-based pediatric-care startup, was seeded with a $40 million investment led by General Catalyst. Brandon Kerns joined the board as an independent member.
Minu, a Mexico-based employee wellness platform, raised $30 million in Series B funding led by QED Investors.
Synapticure, a Chicago-based virtual care provider for patients and caregivers living with neurodegenerative diseases, closed a $25 million Series A round led by B Capital.
Seen Health, a senior-care provider, picked up a $22 million investment led by 8VC.
New Lantern, a San Francisco-based provider of an AI copilot for radiologists, emerged from stealth with $19 million in Series A funding. Benchmark led the round, with General Partner Eric Vishria joining the board.
OneCell Diagnostics, a Mumbai-headquartered genomics-based precision oncology startup, secured $16 million in Series A financing. Celesta Capital led the round, with Michael Marks and James Rothman joining the board.
Jimini Health, a New York-based digital mental healthcare startup, launched with $8 million in pre-seed funding from investors including Zetta Venture Partners, Arkitekt Ventures and BoxGroup.
World Class Health, a New York-based provider of healthcare services to employees, was seeded with an $8 million investment led by AlleyCorp.
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The U.S. Food and Drug Administration indicates that seafood is at a higher risk for PFAS contamination compared to other foods, according to its previous samples and tests. PHOTO: SEONGJOON CHO/BLOOMBERG NEWS
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