Andreessen Horowitz Launches $200 Million Digital Health Investment Fund


Venture capital firm Andreessen Horowitz announces a new $200 million investment fund that it will direct entirely toward biotechnology startups. The fund will be led by Vijay Pande, a new general partner at Andreessen Horowitz. Pande comes to Andreessen Horowitz from Stanford University, where he was the director of the biophysics program and taught chemistry, computer science, and biology. During his tenure, he oversaw computer science-based research on Alzheimer’s Disease, Huntington’s Disease, and cancer. He also won a Guinness Book of World Records title for building the world’s most powerful supercomputer, hitting processing speeds of up to one petaflop.

Under Pande’s leadership, Andreessen Horowitz will target startups operating at the intersection of biology and machine learning, an area the company is calling “computational biomedicine.”  He explains, “Because the cost of sensors are going to zero, the cost of things like genomic sequencing are going to zero…. It creates an interesting situation where so much is available to us right now. What’s left is the software to put it all together.” Pande cites deep learning-based image analysis applications that support radiology, pathology, dermatology, and ophthalmology as prime examples of startups working at the intersection he is interested in investing.

Andreessen Horowitz trails other more prominent digital health investors like HLM Venture Partners, NEA, and Venrock, who are all on pace to fund more than 10 startups this year. Venrock announced its own $450 million health tech investment fund in July 2014. Andreessen’s most active year in the sector was 2014, when it funded eight startups in digital health. The firm has early investments in several prominent digital health startups, including Proteus Digital Health, Doctor on Demand, Omada Health, and Glow, but has had a limited investment presence thus far in 2015.

Beyond machine learning-based digital health apps, Pande says that the company will find investments in computer-assisted research and digital therapeutics, an umbrella term being used to describe sensor-laden smartpills like those being piloted by Proteus Digital Health, as well as startups building nanotechnology-based drugs designed to precisely attack cancer cells.

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