ChicagoInno: Why Isn’t Chicago the Silicon Valley of Life Science?
By Will Flanagan05/27/14
That was the key question to emerge during ‘Health Care Matters,’ Friday night’s panel part of U Chicago’s ‘Innovation Week.’
The discussion, featuring Mike Yang, partner at Baird Capital, and Pat Flavin, Executive Director at MATTER, was built around the “state of venture capital in the healthcare sector.” Both speakers were aware of the impending three day weekend – probably more so than the audience – and kept it casual.
The panel’s main thesis was answered quickly and abruptly. “The state of Chicago VC in healthcare? Uh, not great.”
As Yang pointed out, Baird is one of the only VC firms in Chicago focused primary on healthcare and life sciences and Chicago Growth Partners, one of the others, just bailed on its efforts to raise a third fund.
“Pintrest was just valued at 1 billion dollars and they’re not generating any meaningful revenue,” said Yang. It’s tough for healthcare startups with that kind of activity going on in the digital space.
Because of this lack of competition, Baird has the luxury to wait on investments, perhaps to the detriment of promising startups. Flavin, in turn, told multiple stories about innovators in the sector needing to go out west or to Cambridge, MA for funding. And when innovators leave, they rarely come back.
But the panel obviously didn’t end in 10 minutes. (“Landscape stinks. Later nerds”). Though the immediate state isn’t positive, the future is extremely promising.
And this optimism led the discussion to MATTER, the 4 million new “BioHub” that’s opening later this year in the Merchandise Mart. MATTER, like 1871, will serve as an incubator and collaborative space for innovators, but will focus only on healthcare tech and life science entrepreneurship.