This week, Russo Partners talked with Shehan Dissanayake, CEO of Tavistock Life Sciences, about his perspective on the current life sciences investment market.
Although the recession has made some people wary of the general market, Dissanayake believes that strong investment opportunities are still available to investors who are willing to look for them.
“Tavistock Life Sciences is extremely excited about the current opportunities in the life sciences marketplace,” he said. “As investors, we are being presented with more opportunities today than ever before. For companies seeking investment, however, the situation is challenging as numerous companies are seeking an ever-decreasing pool of investment dollars.”
In the current market, Dissanayake explained, companies must aggressively solicit financing to survive. Although this higher level of fundraising activity has led to a significant increase in the volume of life sciences investment opportunities in the past year, “the number of ‘quality’ opportunities has not [increased], thus making the filtering process even more important for investors,” he said.
Dissanayake takes a positive stance on the state of the market, but he stresses the importance of making educated decisions when investors choose where to stake their resources. “It is a great time to invest in life sciences,” he said. “As with the general market, valuations are depressed and excellent investment opportunities can be found. However, due to the current surplus of companies seeking financing it is more important than ever for investors to choose their opportunities wisely.”
Dissanayake recommends that investors take the time to do advance research and educate themselves about any companies they might be interested in supporting. “In addition to scrutinizing a company’s technology and the market it seeks to penetrate, potential investors should also carefully examine the organization’s operations, fundamentals and management team,” he said. “At the end of the day, high-quality companies with a good story will attract funding.”