Venture capital firm Aberdare is evolving with the times. In response to technology, policy and demographic trends that are reshaping the healthcare industry, the group on Tuesday said it is refining its investment thesis.
To support its growing emphasis on “transformational health investing,” the firm also said it had hired a new partner Mohit Kaushal, an MD and MBA, who previously led investments at West Health and served as director of connected health at the Federal Communications Commission.
“The old mantra was very much around improved outcomes as a thesis and then premium pricing on top of that, whether it’s a drug or a device. Aberdare came to the conclusion, from a very bottoms up approach, that the world is changing and that this was not a viable thesis any more,” said Kaushal. “The efficiency angle is just way more important these days.”
Given the rising cost of healthcare and the growing elderly population, as well as shifts in the technology and policy landscape, big changes in the way health care is delivered and regulated are on the horizon. While outcomes are still critical, Kaushal says it’s become increasingly important to encourage cost-effective health care systems.
With an investment portfolio that includes wearable electronics startup MC10, online diabetes prevention program Omada Health and health startup accelerator Rock Health, Aberdare is already a leader in the emerging world of digital health. But Kaushal said the firm will focus even more closely on three areas in healthcare: personalized medicine (including diagnostics and genomics), smart sensors and health care IT.
As various reports have shown, venture capital interest in life sciences companies is on the decline. Some firms like Aberdare and Venrock, which historically invested in more traditional pharmaceutical and device companies, were early supporters of startups that bring newer digital technologies to healthcare. But others have been slower to shift their focus. Going forward, it will be interesting to see how the rest of the industry shakes out.