Medtech has seen phenomenal growth in the last few years, and, with COVID shining an unprecedented spotlight on healthcare, angel networks supporting these innovative companies are adapting to the new normal themselves.
2020 has shaken the economy to the core. The early-stage investment market has been rocked more than others, with over 50% of UK angel investors reporting being negatively affected by the pandemic.
As angels suffered through a recession, so did the startups that rely on them for survival.
However, according to a report by Beauhurst, half of all life sciences companies tracked this year have received innovation grants, and 64% have taken on investors to grow their companies.
The industry has been able to grow during a year riddled with economic uncertainty, and it did so by moving away from lab-based discoveries and pharmaceutical innovation alone, and focusing on technology.
The biggest trends in medtech and digital health? The large scale adoption of big data and AI.
As the industry looks to the future, so do the investment networks that help fuel growth.
Digital investment platforms are the new normal in medtech angel investment
While medtech looks towards digital, the angel investment market has been lagging behind in terms of digitization. That being said, as 2021 made in-person events impossible, all of that changed.
Online platforms actively fight the biggest barriers to investment in the sector – the lack of specialized knowledge by angels and the volume of work required in due diligence.
Most investors will want to understand the entrepreneurs’ path to to commercialization. They will want to know if the company owns its IP, has gone through regulatory approval and has a stellar team.
Digital platforms allow for unencumbered communication and document exchange between potential investors and companies.
With an online platform, angel investment networks can publish investment opportunities and start promoting deals to investors in days.
After the deal has been published, investors can track companies, review business plans and ask the founding team questions, all from the comfort of their own home.
A digital platform makes it easier for investors to conduct due diligence at their leisure. Sensitive documents are kept in a secure data room, and are easily shared upon request.
The process gives companies a mechanism to find the ‘right’ investor, by taking the pressure off of pitching events and allowing them to court investors for longer.
They might not be on board during a pitch day, but a big contract, unexpected publicity or a key hire are likely to change their minds.
The right digital platform will help you keep investors engaged
Operating our own investment network in the UK for the last 15 years, we know that investor engagement is key to successful raises.
The right digital investment platform will improve communication with investors and make admins life easier.
The best products on the market include a built-in portal to allow for investors to be kept up to speed with company updates and be able to freely communicate with founders.
With an online platform, investors can track companies and ask for business plans and key documents at their leisure.
In order to keep investors engaged, you can make use of custom messaging, email updates, filtered search and investor pledging and payment.
A built in investor relations feature also enhances the chance for backers to become repeat investors.
Deal syndication helps your cohorts succeed
With a digital investment platform, networks can choose which deals to promote. When they need a final push to close a round, they can rely on other networks for help.
A connected digital platform will allow networks the ability to extend their exposure to other partner networks to top up funding for their companies. That translates to a network in Manchester, for example, being able to share deals with one in London.
Many platforms, like Envestors’ own Envestry for Networks, offer the option of deal syndication in which networks can discreetly share deals. You get more eyes on your deals, but still control who can see them.
“Without platforms such as Envestors we would not have been able to raise the £15m required to expand our business. The 51 private investors who invested under the EIS through Envestors shared a profit of £48m when we sold the company to BP – proof the model works,” David Martell, Founder of Chargemaster says.
Choosing the right digital platform
We know that choosing the right partner is key to the success of your platform. Your best bet is choosing a partner that not only provides the technology you need, but can offer guidance and support throughout.
With more than 15 years of experience, the team at Envestors has built a constantly evolving platform that shares learning from all its partners.
Envestry is a user friendly, branded marketplace that allows you to host opportunities, engage with investors and share deals.
We host regular training, networking and pitching events, and allow our partners access to a larger connected network.
Our network product’s built in features take the hard work out of updating investors on companies’ progress. We know that piqueing investors’ interest in your companies is a difficult job, so we’ve built a tool that does the job for you.