Lisa Suennen, one of the leading venture investors in the San Francisco Bay Area life sciences and digital health scene, says she’s leaving Psilos Group, the life sciences-focused venture firm where she’s long been a managing member, to work as an independent consultant.
Suennen co-founded the New York- and Santa Fe, NM-based firm with her father Albert Waxman, a serial healthcare entrepreneur, and Stephen Krupa, a former investment banker, in 1998. Her departure is effective Feb. 1.
Suennen announced the change to Psilos’s limited partners yesterday and confirmed it in a telephone conversation with Xconomy today. She says she’ll remain on the board of one Psilos portfolio company, Fremont, CA-based AngioScore.
After 15 years at the firm, “I felt like it was time to have a new adventure, to try some new stuff,” Suennen says. “We’ve had an amicable parting and I will remain an advisor for a while to Psilos.”
The investments Suennen oversaw at Psilos, which has $580 million under management, ranged from healthcare services companies to medical devices, healthcare IT, and digital health. She says she plans to stay engaged in all of those areas as a consultant for large and small companies and other venture firms.
Suennen leaves her venture post at a time of rising tides for healthcare companies and their investors. After years of drought, 2013 saw a near-record number of IPOs for biotech, healthcare, and pharmaceutical companies. Funding for digital health startups hit $1.9 billion, a 39 percent increase over 2012 levels, according to data gathered by Rock Health, the San Francisco-based startup accelerator and seed fund. (Overall venture funding for life sciences companies in 2013 was $6.6 billion, down slightly from prior year.)
“I think the prospects for Psilos’s companies and LPs are great,” says Suennen, who lives in Tiburon, CA, and works in nearby Mill Valley. “Never has there been a time that is so ripe for new businesses and innovation in our field, never in my lifetime anyway. Is the old VC model ‘broken’? I don’t know, but we are seeing all sorts of new methodologies and fund styles and corporate investors and angels.”
I asked Suennen to share a few valedictory thoughts about the most interesting and promising areas for healthtech entrepreneurship and investing. She named three.
“One is the whole area of how consumers are becoming more engaged in healthcare, whether on purpose or by accident,” she says. “That extends from the health insurance exchanges, all the way down through the digital health stuff. It’s really about how you make healthcare meaningful, accessible, understandable, and useful to people. That is a place where a lot of energy is being spent for the first time in a long time, maybe the first time ever.”
The convergence of healthcare IT, healthcare services, and medical devices is the second area Suennen says she’ll continue to follow closely. “You see IT and services companies utilizing devices for the first time, and device companies thinking about how to add IT and services to their offerings,” Suennen says. As an example she points to companies like Madison, WI-based Propeller Health, which has developed a data-collecting device that snaps on to asthma patient’s inhaler and sends dosage data to a smartphone or base station.
“Lastly, there is this whole longevity economy,” Suennen says. “How do you take care of people as they age? Not just when they’re sick, but keeping them healthy. No just in the hospital, but at home. The whole health-and-wealth socioeconomic concept of aging is changing.” She cites efforts by the American Asssociation of Retired Persons to push startups to build products and services for the next generation of older Americans. (Suennen will emcee the AARP’s Health Innovation@50+ LivePitch event at the Boston Convention & Exhibition Center on May 9.)
Overall, Suennen says she thinks innovation is in the air across the healthcare economy, largely in response to the financial, regulatory, and insurance reforms wrought by President Obama’s Patient Protection and Affordable Care Act.
“Organizations that people had thought of as being bureaucratic and staid are really trying to change,” Suennen says. “They are trying to think differently about how their business evolves and embrace some new ways of doing things. They won’t all succeed. Some will succeed massively. But it seems to me there is some effort on the part of the healthcare industry to embrace the change they are stuck with, and figure out how to take advantage of it in a positive way.”
Suennen is an active writer, posting frequent observations about technology and the healthcare economy at her blog Venture Valkyrie. With co-author David Shaywitz, she recently published a collection of essays called Tech Tonics: Can Passionate Entrepreneurs Heal Healthcare with Technology? Since 2010 she has been an Xconomist, and has frequently cross-posted her Venture Valkyrie essays at Xconomy. This month, Rock Health, Goldman Sachs, and Fenwick & West named Suennen to their list of the “Top 50 Digital Health Entrepreneurs” of 2013.