“If it’s not broken, let’s not try to fix it.”
That’s the motto behind biotech VC firm Westlake Village BioPartners, which said Monday that most of its existing investors returned for a $450 million third fund. The firm plans to incubate more hometown Los Angeles startups, follow the same CEO-first model that worked for its IPO star Acelyrin and breathe new life into clinical-stage assets developed by biopharmas.
Behind the fund are founding managing director Beth Seidenberg, the ex-Kleiner Perkins investor who has brought many of her former LPs along to Westlake, and managing directors Mira Chaurushiya and David Allison, a jovial duo that had worked together at 5AM Ventures.
“When I started Westlake — now almost five years ago — the vision was to create a top-tier, world-class biotech investing firm, and we’re well on our way to accomplishing that now with Mira and David on board,” Seidenberg told Endpoints News. The fund mainly brings together university endowments and foundations “that have missions that are aligned with ours,” she added.
They’ve deployed most of the $430 million from their second fund, with capital reserved to further bankroll the existing portfolio, Chaurushiya said. No formal investments have been made out of the new fund just yet, but Westlake has identified three CEOs that it’d like to lead new biotechs and in-license assets, whether that’s from academic labs or biopharmas, Chaurushiya and Allison explained in an interview.
“We also really like what we call internally the ‘Tiger team model’ of one parent company [sprouting] out multiple assets and multiple subsidiaries,” Allison said, referring to the work they’ve done with the constellation of Star Therapeutics, which includes Electra and Vega.
Westlake will likely bring aboard three or four more CEOs, who the VC plans to pluck from drug developers big and small. Ideally, those individuals can build great teams, Chaurushiya said. It’s a model they’d like to replicate over and over again, much like what they did with Shao-Lee Lin, a former Horizon Therapeutics scientific executive who now leads Acelyrin, an immunology biotech that quickly raised multiple private rounds, in-licensed clinical-stage assets and went public in May in one of the largest biotech debuts in recent memory.
About a dozen startups are expected to be capitalized through the fund, which will take about three years, Chaurushiya said. Roughly half will be de novo, incubated companies, and the rest will be Series A investments in biotechs seeded elsewhere, she added. Allison said about 40% of the biotechs the VC plans to fund will be in LA. It’s also planning to fund about 40% in Northern California as well as some in San Diego and on the East Coast.
“Right now is a fantastic time to invest,” Chaurushiya said. “In many ways, there’s no better time to be an early-stage investor, and that’s incredibly exciting on top of all the other reasons we do the work we do.”
Westlake came into the spotlight in 2018 with a $320 million fund and has backed more than 20 companies since then, including Kate Therapeutics and Recludix Pharma, among others. Sean Harper, its co-founding managing director and a former longtime Amgen R&D executive, “has chosen not to invest out of fund three,” Seidenberg said, but noted he will “remain committed and focused to his fund one and two companies.”
