New Zealand needs three things to continue the growth momentum for our health-tech sector and Molly Yang, an experienced health-tech investment manager, shares her view with us.
“To set a healthy and sustainable environment, we need investment & support from different stakeholders, to implement financial incentives, and to be in a position to attract and retain talent.” she says. “We have a strong science foundation and brilliant ideas, but we’re still not investing enough into start-ups and new companies.”
She says that whilst we have the talent and the ideas, at times we lack the investment to help realise the growth potential of these start-up companies.
“Firstly, we need more funding from diversified investors, including government, corporates, institutional funds, PE & VC, etc. Given the complexity, intensive capital, high risk, technical expertise required, and the long investment cycle, many investors shy away from the health-tech sector. Setting up a dedicated health-tech fund could be considered to further stimulate private investment which is very common in other parts of the world. In New Zealand we see some Angels and incubators provide limited capital at pre-seed and seed stage for health-tech companies”.
She says we ideally need more corporate involvement in this space, corporate VCs are very popular in other developed countries with pharma and MedTech companies setting up their own inhouse investment arm or incubation programmes. Capital is critical to commercialise a business while strategic input, which corporates can bring, is also valuable.
“Secondly, we need to introduce a series of incentives to encourage more investors in this space to help support entrepreneurs. We could look to how countries such as China take a multi-stakeholder approach versus our often-single focus, and how they support start-ups with funding options, rent, lab & GMP facility and tax breaks.”
“Thirdly, we need to build a consolidated talent pool. This includes highly qualified scientific teams, experienced med-tech executives, committed investors, board members and advisors to help upskill New Zealand and help us enter the world stage more frequently.”
She says that whilst money chases great ideas, health-tech is still not as popular as other sectors, such as agri-tech. “In health-tech, we are competing against the likes of US, China, Japan and Israel. What is our strength in terms of technology, commercialisation, getting to market? We need to be clear about our position and how to get there effectively.”
Covid-19 pandemic continues to spur innovation and attract large amount of capital globally. “According to CB Insights, there was a 33 percent jump in investment globally which hit a new record with $80.6 billion, particularly in digital health. The Asian market grew by an astonishing 70 percent. These are the opportunities we face.”
New Zealand’s opportunities include the likes of AI, mental health, women’s health, medicinal cannabis, wearables, medical devices and diagnostic tools. Over 50 projects received funding from MBIE’s Covid-19 Innovation Acceleration program last year. However, Molly Yang says they may struggle to get to market and deliver much-needed social gains unless we can increase our monetary investment, time and expertise.
Molly Yang has over 10 years’ investment and portfolio management experience in the venture capital industry, mostly focused on the health-tech and bio-tech sectors. She has worked with a large number of start-up companies on fundraising, international market expansion, strategic partnership, and corporate governance.
Molly is an investment manager with New Zealand Growth Capital Partners Limited (NZGCP).
Disclaimer: The views expressed in this article are Molly’s personal views and do not represent the views of NZGCP.