W Health Ventures Launches $70 Mn Fund To Back 8-10 Healthtech Startups

Healthtech-focussed VC firm W Health Ventures has launched its second fund with a target corpus of $70 Mn (INR 609 Cr). The fund will also have a greenshoe option of $30 Mn (INR 261 Cr).

With Fund II, the VC firm will look to back eight to 10 early stage healthtech startups over the span of next four years, with an average cheque size of $3 Mn to $5 Mn.

Speaking with Inc42, W Health Ventures managing partner Pankaj Jethwani said that the firm is eyeing the first close of the fund in the next couple of months.

He added that the investment firm will offer R&D avenues to the selected startups for developing their early minimum viable product (MVP).

Launched in 2019 by Sunil Wadhwani, W Health Ventures backs early stage healthtech ventures. It claims to help its portfolio companies in conducting research trials, offering R&D, building a go-to-market (GTM) strategy and opportunities for networking with its partner healthcare stakeholders in India and the US.

The VC firm typically makes three to four investments a year in India. It has so far backed mental health-focussed Wysa, chronic disease management platform BeatO, sexual wellness-focussed virtual clinic Mars by GHC, and community-based parenting startup MYLO among others.

Oncology, Psychiatry In Focus With Fund II

W Health, via Fund II, plans to especially focus on segments such as oncology (cancer care), psychiatry and geriatric care (or ageing) for the second fund.

“Other spaces of interest include geriatric care or aging, and the plethora of health challenges that geriatric patients or seniors above the age of 65-70 face,” Jethwani said.

The firm also plans to back platforms that focus on areas such as longevity and preventive health. “It’s very hard to make a business in preventive health anywhere in the world. In India, it’s harder because insurance, most of the time, doesn’t cover preventive health solutions and services,” he added.

In addition, primary care continues to be an area of interest for the VC firm.

The VC firm has already made two investments from the second fund in startups operating in its core focus domains – oncology and psychiatry.

“The first one is an oncology platform called Everhope Oncology that we are building along with Narayana Health. We invested about $10 Mn there together with Narayana Health (hospital chain),” said Jethwani.

Notably, Narayana and W Health Ventures, earlier this year, banded together to launch Everhope to standardise, improve quality of care, and streamline cancer patients’ hospital experience. As per Jethwani, Everhope Oncology is building “innovations” in chemotherapy, surgical oncology, cancer diagnostics, and ongoing supportive care for oncology.

The Fund II’s second investment is in a psychiatry startup, which is still in stealth mode. Its official announcement is likely to be made next month. W Health, along with another strategic partner, has invested nearly $6.8 Mn in the platform so far.

“It’s a US-India corridor company (Indian companies with some semblance of a GTM strategy in the US) that serves the clinics, small or group clinics within the US market in the psychiatry space. So, it’s an investment that we’ve been working on for the last 18 months or so,” said Jethwani.

The yet-to-be named startup also helps independent psychiatry establishments launch their operations, streamline patient outcomes, and improve the total revenue and EBITDA margin of the clinic.

How Has W Health’s Investment Thesis Evolved?

The firm, via its maiden fund, invested in startups like Nivaan, Mylo, BeatO, and BabyMD in India. W Health claims that its portfolio startups serve over 25 Mn patients globally. The average ticket size for the first fund was $1 Mn to $5 Mn.

Citing a two-pronged approach, Jethwani said that the VC firm understands the market capabilities and talent ecosystem in India. Besides, it is also adept at comprehending the go-to-market opportunities and white spaces in the US. It aims to leverage the two aspects to create a bigger market impact.

Jethwani noted that W Health, under Fund II, will focus on companies that can create patient impact and solve major pain points. Additionally, W Health intends to focus more on building and incubating companies from scratch under Fund II as against mere investments under the first fund.

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