ARCH Venture Partners announced Wednesday that it has closed on nearly $3 billion for its 12th flagship fund, which will focus on early-stage biotechnology companies.
The fund is the largest to date for the 35-year-old, Chicago-headquartered firm, which is known for its persistent approach to investment across market cycles. Currently, even as public biotech valuations are far below last year’s highs, ARCH co-founder and managing director Robert Nelsen indicated there would be no slowdown in funding activity.
“Science doesn’t care what markets are doing, and science moves forward,” Nelsen said in a statement accompanying the funding announcement.
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Nelsen said the firm is looking to fund startups “with potential to solve some of the biggest health challenges.” Startups of interest are working on breakthroughs in a range of focus areas, including infectious disease, mental health, immunology, oncology, neurology, age-related disease, genomic and biological tools, and ways to reimagine diagnostics and therapies.
So far this year, ARCH has made 11 disclosed investments, per Crunchbase data. Earlier this month, the firm co-led an $85 million Series C round for Vizgen, a startup focused on single-cell spatial genomics. Other big lead rounds this year include a $167 million Series C for mRNA-focused Nutcracker Therapeutics, and a $76 million Series A for immunotherapy developer Pheast Therapeutics.
ARCH invests primarily in companies it co-founds with scientists and entrepreneurs. The firm is commonly a lead investor, but also co-invests with other VCs, particularly in larger rounds. Its early- and later-stage rounds tend to be on the large side by venture standards, typically in the tens of millions and often exceeding $100 million.
Several ARCH-backed companies have also debuted on public markets in recent quarters, including drug developer EQRx, cancer therapy developer Lyell Immunopharma, and genetic medicines company Verve Therapeutics.
The latest fund is a big step up in size. ARCH raised nearly $2 billion for its previous fund, ARCH Venture Fund XI, which closed in January 2021.
Illustration: Li-Anne Dias
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Author: Joanna Glasner