Key Takeaways
- • Proximal Ventures, led by former SignalFire principal Sahir Raoof, closed a $27.5 million debut venture fund targeting AI-driven tools, infrastructure, and services for drug development, according to TechCrunch.
- • The fund writes pre-seed and seed checks of $500,000 to $1.5 million and has already backed six startups, including ChronicleBio, which uses AI to analyze biological and medical data.
- • Raoof's thesis is that pharma buys services rather than software, and that AI could automate outsourced drug development work, opening a market of billions of dollars in pharmaceutical services spending.
- • Backers include SignalFire, Kleiner Perkins, Bertelsmann Healthcare Investments, Dimension Capital co-founders Nan Li and Zavain Dar, and Amy Abernethy, co-founder of Highlander Health and former FDA principal deputy commissioner.
Summary
Proximal Ventures has raised $27.5 million for its first fund, a notable outcome given the difficult fundraising environment facing first-time fund managers, according to TechCrunch reporting. The firm was founded by Sahir Raoof, a former SignalFire investor who spent two years as a principal there. Earlier in his career, Raoof led business development at clinical trial recruitment startup Iterative Health and oversaw partnerships at Flatiron Health, the oncology data company Roche acquired for $1.9 billion in 2018.
The fund's investment thesis centers on AI's potential to transform the tools, infrastructure, and services that pharmaceutical companies have traditionally outsourced, including compound synthesis, scale manufacturing, and clinical trial data analysis. Raoof argued that pharma has historically been a strong buyer of services but a weak buyer of software, and that AI could allow startups to deliver those services at lower cost and in significantly less time. He cited law and finance as sectors where AI has already delivered value in service-oriented work and sees similar opportunity in pharmaceutical services, which he said could capture billions of dollars in industry spending.
Proximal plans to invest in pre-seed and seed-stage companies with checks of $500,000 to $1.5 million. Its six portfolio companies include ChronicleBio, co-founded by former OpenAI executive Fidji Simo, which applies AI to biological and medical data to better understand chronic diseases and identify potential treatments.
Proximal's limited partners include SignalFire, Kleiner Perkins, Bertelsmann Healthcare Investments, and individual investors Nan Li and Zavain Dar, co-founders of Dimension Capital. Amy Abernethy, co-founder of Highlander Health and former principal deputy commissioner of the FDA, is also an investor and a former colleague of Raoof from Flatiron Health, where she was chief medical officer. She told TechCrunch that Raoof's relationship-building and ability to identify industry bottlenecks have helped Proximal co-invest alongside larger, better-known funds.
The fund's investment thesis centers on AI's potential to transform the tools, infrastructure, and services that pharmaceutical companies have traditionally outsourced, including compound synthesis, scale manufacturing, and clinical trial data analysis. Raoof argued that pharma has historically been a strong buyer of services but a weak buyer of software, and that AI could allow startups to deliver those services at lower cost and in significantly less time. He cited law and finance as sectors where AI has already delivered value in service-oriented work and sees similar opportunity in pharmaceutical services, which he said could capture billions of dollars in industry spending.
Proximal plans to invest in pre-seed and seed-stage companies with checks of $500,000 to $1.5 million. Its six portfolio companies include ChronicleBio, co-founded by former OpenAI executive Fidji Simo, which applies AI to biological and medical data to better understand chronic diseases and identify potential treatments.
Proximal's limited partners include SignalFire, Kleiner Perkins, Bertelsmann Healthcare Investments, and individual investors Nan Li and Zavain Dar, co-founders of Dimension Capital. Amy Abernethy, co-founder of Highlander Health and former principal deputy commissioner of the FDA, is also an investor and a former colleague of Raoof from Flatiron Health, where she was chief medical officer. She told TechCrunch that Raoof's relationship-building and ability to identify industry bottlenecks have helped Proximal co-invest alongside larger, better-known funds.
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