Frequently Asked Questions
Who is BioAdvance?
We provide early-stage capital for companies located in the mid-Atlantic region that are developing technologies to improve human health.
What types of technology do you invest in?
We invest exclusively in opportunities that have the potential to improve human health with an emphasis on therapeutic agents including platform technologies, research tools, medical devices, diagnostics and healthcare IT.
How much does BioAdvance invest?
Our initial investment in a company or technology is typically $250,000-$500,000. This commitment is made in two or more tranches, based on value-creating or de-risking milestones. Over the life of a company we may invest up to $1.5M. The goal of our investment is to increase the company’s ability to raise additional capital, attract grant revenue, or partner the technology with a larger company if the milestones are achieved. Before making a seed investment, we often make a small investment of up to approximately $50,000 (sometimes referred to as “pre-seed” or “pilot” funding) to help obtain information that would be important to us in making the larger investment. If successful, these pilot investments may subsequently “graduate” to a larger investment.
What stage of company is appropriate for a BioAdvance investment?
We are not limited to any particular stage of development. Instead, the key question is whether our funding, either alone or with other money available to the company, can achieve a de-risking or value-creating milestone that increases the probability of attracting funding from a larger venture capital investor, a corporate partner, or other funding source such as product sales. Please see article entitled Framing Up Capital Efficiency In Early Stage Biotech for further insight on capital efficiency and value-creating milestones.
Do you have a geographic focus?
Yes, we invest in companies located in the Mid-Atlantic region.
Do you require a match?
No. We frequently serve as the first institutional investor in a company, and we are willing to invest alone.
Are there any activities that are not eligible for BioAdvance funding?
Capital expenditures and leasehold improvements are not eligible. In addition, if a company is funding research at an academic institution, we limit the overhead payable by a company to 20%.
What are your typical investment terms?
If we are the initial investor in a company, we typically invest through a convertible note, which bears interest and converts at a discount (which increases with time) at the time of a significant financing (usually $2M or more). The budget, milestones and responsibilities of the parties will be detailed in a funding agreement between BioAdvance and the recipient. If we are part of a syndicate of investors, we will follow the terms of the lead investor. We also are able to serve as a lead for smaller financings, in which case the terms will be negotiated with the syndicate and the company.
How do I apply for funding?
Companies and investigators may submit materials for funding consideration at any time by emailing a non-confidential executive summary, investor presentation, or business plan to Marnie McCoy, the BioAdvance Program Director at moc.e1488054242cnavd1488054242aoib@1488054242yoccm1488054242m1488054242. We do not sign confidentiality agreements until later in our review process. Materials marked “confidential” are still considered non-confidential. Please do not send us information marked “confidential.” We also are unable to return copies of executive summaries or business plans. If you are an investigator from an academic institution please email a non-confidential summary of the technology, a list of the intellectual property and an outline of intended use of funds. We ask that you notify your technology transfer office that you are submitting materials to us. Please note that the preliminary information should highlight:
- Technical background
- Commercial opportunity
- Intellectual property
- Management team
- What critical milestone will be achieved with BioAdvance funding (or BioAdvance funding in conjunction with other sources of funding – please list those other sources that you are seeking)
- Proposed exit strategy, including potential partners, timing and capital that will be required to achieve that exit
- We encourage all applicants to review the BioAdvance Funding Workshop Slides (currently under revision) which is particularly useful in understanding how we think and the typical pitfalls that we encounter in our review of investment opportunities.
If I have applied for funding from BioAdvance in the past but was turned down, may I reapply?
Yes, you may reapply by submitting an updated executive summary, investor presentation or business plan as discussed under “How do I apply for funding?” We request that you clearly discuss how you have addressed the concerns or questions that we provided at the time of your previous application.
Is there a deadline to apply for funding?
We do not have an application deadline. We consider investment opportunities on a rolling basis throughout the year.
What does your typical review process look like?
We review new materials at our periodic investment meetings (usually three times a month) and issue queries if there are gaps in the submission or if we need clarification. Once we have completed our initial internal review we may ask for a phone call or a meeting. If we decide to proceed to due diligence, we will identify at least one subject matter expert to review the application. These reviewers, who are recognized experts in their fields, such as academic and industry scientists are asked to evaluate the underlying technology for technical merit. Commercial reviewers include representatives of the venture and partnering markets. They validate the technology, and often provide new and useful ideas about markets, methodologies, and milestones. If a positive funding decision is made we will negotiate a term sheet, agree on a final budget & funding milestones, and complete corporate due diligence by reviewing key documents, financial information, and intellectual property. We also require background checks of key managers. If the due diligence is satisfactory, we execute a funding agreement and disburse initial funds.
When will I be given the opportunity to present to the BioAdvance team?
We do not typically invite companies to come in to present to the BioAdvance team until after we have completed our initial triage. An invitation to present either in person or by phone usually is made if we decide to proceed after our initial internal review.
How long does a funding decision take?
We usually get to a “no” decision in four-six weeks but if we decide to proceed, the process can take longer to get to a final decision to invest. We generally require four months to obtain outside business and technical reviews and complete due diligence. Some of the timelines are outside of our control, based on the schedules and availability of external reviewers as well as the responsiveness of the company to our questions.