In these business-as-unusual-times, the health industry is experiencing a moment of extreme relevance as global leaders call for health technology to battle the pandemic and reduce pressure on the frontlines.
Norway’s health industry has answered the call resoundingly and is contributing crucial solutions to the national and global pandemic response. Norway Health Tech’s online dialogue meeting with the public service provider Sykehuspartner resulted in 1500 (!) papers describing solutions in areas like connected care, disinfection solutions, transportation, pharma, artificial intelligence, tracking equipment, and eHealth.
“As incumbent health companies are killing it on the trading floors and established contenders are flying through their order books, the question Norway Health Tech’s ecosystem has been asking for years is as relevant as ever”, says Jeremy McCrohan, Head of Investor Relations at Norway Health Tech.
“Namely, how do we help Norwegian health companies scale to their potential and become the export-driven industry they should be?”
Untapped growth potential
Lauded by politicians and strengthened by a network of able clusters, the potential of Norway’s NOK57 billion health industry should come as no surprise. Still, while the health industry is the country’s most startup-intensive sector, companies with brilliant new solutions like Decon-X say they’re confined to the waiting room:
«Norwegian entrepreneurs and companies, many of them organized under Norway Health Tech, stand ready with products and services for the national public health sector […] But there’s a lack of will to innovate in the health sector. Norway will be in trouble if we keep meeting tomorrow’s challenges with yesterday’s solutions», wrote Decon-X Founder Bjørn Platou in an opinion article.
Bjørn Arne Skogstad of SIVA followed suit at Norway Health Tech’s recent online seminar on funding opportunities: «Covid-19 is a wake-up call to increase capacity and get the production wheels of the Norwegian health industry churning. We’re presently not doing enough».
At the same webinar, Ivar Slengesol at Kreditteksport explained that, even corrected for the offshore industry, in the past two decades no other country has lost a greater share of its export market: “The health industry must contribute to filling Norway’s export gap».
Another reason is much more basic: A lack of venture funding. A problem Norway Health Tech is determined to solve.
A matchmaking network for investors and ‘investable’ companies
There are plenty of opportunities for funding, loans, and guarantees now being made available. Still, there is a troubling lack of long-term venture capital to speed up development, commercialization, and growth. Global-born Norwegian health companies with lengthy research and development processes – many of them Norway Health Tech members – are spending more time securing funding than developing the company.
“Venture capital is patient capital. It invests continuously through the development cycle and strives to foster an optimal product development path. It’s the kind of investing that is based on hard-core knowledge and understanding the research, technology, and market”, says Jeremy McCrohan. “A specialized health investor can contribute crucial knowledge in a complex and heavily regulated industry. We need more of them, and for the ones we have to tap into that Viking courage and lead rounds more often to create a soft landing for new investors entering the space”.
McCrohan leads The Norwegian Health Investor Network, which under the auspices of Norway Health Tech works to stimulate and facilitate an increase in private capital into Norway’s health industry. The network receives Innovation Norway funding and is developing a stand-alone investor’s hub and a platform for matching VCs, family offices, business angels, private investors, and corporates with investable companies.
«In Norway, many corporate and family offices have been heavily invested in traditional industries like offshore and shipping. But even before Covid19 many were looking to diversify into health. Now, out of necessity, health has emerged as a greater opportunity in bringing products to market», McCrohan says.
“This is why the network’s main pillars are educating the investment community, matching investors with relevant, investable companies, and building collaboration between investors, companies, and the larger health and investor ecosystems”.
Insight through connections
The Norwegian Health Investor Network actively interacts with the investor community as a whole but often meets with investors for one-on-one conversations to really understand their mandates and interests. It also actively leverages key partnerships and long-term relationships to help understand and map out the needs of the latest emerging health-focused companies.The process often leads to curated matchmaking.
«We learn about companies and emerging technology – what incumbents, startups and scaleups are looking for, and what investors want. We expose innovators to other innovators, and mix investors already in the space with those looking to join. We increase the comfort level for everyone interested in entering the field», McCrohan says.
Members gain access to workshops and networking events where new health investors can learn about topics such as company valuations, path and time to market, and risks vs rewards. Seasoned investors can hear from key opinion leaders about the latest industry trends. For instance, The Norwegian Health Investor Network recently co-hosted an event with Carnegie Investment Bank where 120 health-focused investors connected to learn about 5 Covid-19-focused solutions.
“The turnout was incredible, and an example of the present sector interest. Crucially at these events, everyone gets the opportunity to hear about exciting emerging companies in the health sector and to connect with each other to source advice, engage in educated conversation, and connect with co-investors – though the connecting part has been a little hampered by Covid-19 in recent months”, McCrohan says.
A broad-minded investor network
Members are guided to a broad cross-section of the investor community by an Advisory Board headed up by specialized health investor Masha Strømme. With seasoned investors like Kristin Odjfell (Planet 9 Capital), Ann Tove Kongsnes (Investinor), and angel investor Haakon Skar, the board helps engage and attract both the investor and entrepreneurial ecosystems.
The board is complemented by a group of key partners with unique health industry insights, including clusters (Norway Health Tech, Norwegian Smart Care Cluster), TTO’s (NTNU, Valide, Inven2, VIS, NorInnova, 6am), and a health focused incubator (Aleap) who work together to help the network source a constant pipeline of quality deals and companies ready to talk with investors.
“Collectively this unique group has helped develop and scale thousands of companies into investable cases. They now come together under the Norwegian Health Investor Network umbrella to deliver an unrivaled network of national and international companies, investors and experts to provide input to companies on competition, clinical practice, analysis of regulatory context, and price points for future products”, McCrohan says.
McCrohan points out that The Health Investor Network already has a significant number of investors engaged nationally and globally, and is working its way through a list of thousands more:
“One of the few positives about Covid-19 is that it has shed light on the amazing innovations coming from talented entrepreneurs in this sector, and has highlighted the value proposition of investing in health…We are truly energised and excited for the short, medium and long-term future of this sector in Norway».
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To get involved or request additional information on The Health Investor Network, feel free to reach out to Jeremy McCrohan directly at [Jeremy.McCrohan@norwayhealthtech.com]