In Conversation: Bill Snider, Partner at BroadOak Capital Partners
For many life sciences companies, access to capital can be difficult at times. However, where there may be obstacles, opportunities can be found.
That’s the philosophy of BroadOak Capital Partners’ Bill Snider, who leads the Bethesda, Maryland-based firm’s growth capital investing activities. One of the founders of BroadOak, Snider said the firm’s vision has been to be something of a merchant bank, providing financial support and advice for the tools and diagnostics products companies operating in the life sciences. As a modern-day merchant bank, Snider said the firm wanted to be flexible in order to provide the best advice for their clients. Clients include those companies that focus on research tools and consumables, diagnostics, biopharma services, and adjacent markets.
“The focus of life sciences research tools and services is niche-y, a subset of a subset. It’s analogous to the picks and shovels business for the gold miners; we want to know everything so we can give the best advice to people who are asking us,” Snider told BioBuzz.
Typically, entrepreneurs within the industry find the quest for financing like a barbell found in a gym, Snider explained. On one end of the bar is the weight of private equity. On the other side is venture capital. But in the middle of the barbell is a less defined area where entrepreneurs are trying to be capital efficient. Most companies find financial solutions from the two different ends. Those companies in the middle of the barbell aren’t finding the funding they need on terms they like. That’s where BroadOak finds itself, he said.
“The access to capital can be tricky, but that’s where there’s opportunity,” said Snider, who was a vice president and portfolio manager at T. Rowe Price prior to founding BroadOak. “Our approach is different than others. It’s not debt or equity. We have a pool of capital that’s very flexible. And it comes from previous success in our industry. Eighty-plus percent of our money comes from investors that have had success in the life sciences tools industry. We are proud to be recycling the capital for the next generation.”
Over the course of his career, Snider has developed a keen sense for the life sciences space. Not only has he served as an investor, Snider has also taken on the role of corporate director at some of the companies he has been involved with, allowing him to take a deeper dive into the business. He currently serves on the boards of Codex DNA, Halo Labs, Science and Medicine Group, Empire Genomics, and the MdBio Foundation. Previously, he served on the boards of Alpha Innotech, Astero Bio, Molecular Transfer, and Atto Biosciences.
Since its start, BroadOak has so far made more than 50 investments, about half of which are still active. Snider said he’s already excited for the next 50 the company will make.
Unlike some investment companies that typically back startups and smaller, pre-commercial companies, BroadOak aims its resources at companies that already have products or services that are on the market. With the due diligence performed by the company, as well as the expertise the BroadOak team has garnered over the past 15 years, Snider said the firm has a “pretty good sense” of the market landscape and what acquirers want to procure. He explained that one of the advantages of their approach is that with commercial products, there is already a wealth of information available with articles published in peer-reviewed journals regarding whether or not it works as intended.
“We are looking to invest in tools that solve problems,” Snider said.
One area of investment the company has made is in the space of cell therapies, supporting some of the tools used to discover and manufacture them. While Snider noted he will never understand the clinical complexities of oncology, as an investment advisor, he said BroadOak understands the types of tools that are being used within the industry and how the landscape is laid out.
“That’s the sort of thing as an investor or as an advisor that we want to be out in front of,” Snider said.
With 50 investments under its belt, Snider said BroadOak may be the most active firm within their investment niche.
“That level of activity is impressive for a firm our size,” he said, adding that BroadOak has successfully exited 28 of the companies in its investment portfolio.
As BroadOak looks at its next 50 investments and beyond, Snider said the firm is becoming increasingly interested in the areas of artificial intelligence and machine learning, areas that companies large and small across the life sciences industry are turning to more and more in order to support their technology platforms. He said there is a new generation of virtual pharmaceutical companies that are conducting their drug discovery based on the massive amounts of big data that can be sifted through by machine learning and artificial intelligence rather than traditional wet labs.
Additionally, and in part because of the virtual companies, Snider noted that he and his colleagues have seen a growth in contract research organizations. Other areas BroadOak is paying close attention to are the areas of synthetic biology, single cell genomics, and cell and gene therapy which has become more and more important to large pharma. He predicted these markets are going to become a future disrupting force to the industry.
Improvements in sequencing are providing greater understanding of the microenvironment of cancer tumors and the different types of mutations that can be found therein. Sequencing provides more data to help diagnosis of the cancerous tumor more so than a biopsy alone, Snider said.
“If you’re an entrepreneur looking for a different kind of partner with a lot of experience helping life sciences tools companies overcome challenges, we’d love to hear from you,” Snider told BioBuzz.