Family Office Biotech Investment: Where the Money Moved
Family offices used to give their money to venture capital funds and let those funds deploy it. In several parts of the United States they have now pooled and started deploying directly into biotech, and the aggregate is measured in billions. For a founder who cannot raise a conventional round, that is not a curiosity. It is a different door.
The observation comes from Jeremy Levin, co-founder and executive chairman of Ovid Therapeutics and former president and CEO of Teva, in conversation with Sara Jane Demy, who runs the Biotech CEO Summit through her company Demy-Colton.
Why are founders looking beyond venture capital?
Because the sequence founders were taught to expect is not currently dependable. Demy, reporting the consensus from her own CEO summit, is blunt about the A round, B round, C round path.
That model just does not seem to be there right now
Her qualifier matters as much as the claim: the exception is a blue-chip management team backed by a blue-chip investor group, the kind that can raise nine figures in a single A round. Investments are still happening. They are not happening at the frequency or in the shape the playbook describes, which leaves a large population of competent companies without an obvious route.
What changed about family offices?
Levin describes a structural change rather than a mood change.
In the past, family offices would give venture capital the money and let them go and deploy.
That was the arrangement for decades: the family office was a limited partner, and the fund made the decisions. What he describes now is those offices organizing into groups and going direct, which changes both who a founder is pitching and what that person is optimising for.
there are certain areas of America where the family offices have come together, which total billions and billions and billions of dollars
What do family offices actually want?
What they want is not primarily about check size.
Their interest is novel, long term, and they're making bets, not inconsiderable, and they should be considered.
Novel and long term are the two words to sit on. A conventional fund operates against a clock it did not choose, which shapes what it can back and how long it can wait. Capital without that clock can hold a position through a development timeline that would be uncomfortable inside a fund structure, which is a closer match to what early biotech actually needs.
The phrase not inconsiderable is doing quiet work too. Family-office money is sometimes dismissed as a source of small, opportunistic checks, and Levin is specifically rejecting that reading. He is describing groups capable of taking meaningful positions, which changes what a founder should walk in asking for. Treating this capital as a bridge to a real round underestimates it, and a founder who pitches it that way is likely to get the outcome they framed.
Demy agrees, and situates it in a wider shift.
And to your point, Jeremy, family offices, they're part of that private capital network. They're really important.
What other capital is available right now?
Family offices are one source among several that her members are actively working. The summit discussion covered grant money, some federal, alongside collaboration money from patient advocacy organizations and disease foundations, and for smaller public companies a deliberate push on public storytelling to build trading volume and attract capital that way.
None of this is presented as better than venture funding. It is presented as what exists. We have written separately on non-dilutive federal funding and on venture philanthropy, both of which sit alongside this as distinct routes with distinct expectations.
How should a founder approach this?
Levin's practical instruction is to stop assuming a single path exists, and to go and ask.
Think differently.
He names the Miami Biotech Collective as somewhere a founder can simply open the door and ask what they are working on. That geography is a story in its own right, and we follow it in where US biotech startups are actually building now. The wider point is that the map of where American biotech capital sits has widened.
What is the honest caution here?
Direct family-office capital is less standardized than institutional venture. Terms, governance expectations, diligence processes and follow-on behavior vary between offices in a way they do not between funds, and there is no equivalent of a widely understood term sheet convention. A founder trading a tighter clock for a less predictable counterparty should go in knowing that is the trade.
Capital that is harder to raise also changes where it gets spent, and the same two guests describe chief executives reconsidering where their clinical trials run on cost and speed grounds.
There is also a sourcing problem that does not exist with institutional venture. Funds are listed, ranked and easy to research; a pooled family-office group in a city you have never raised in is not, and finding it is closer to networking than to pipeline work. That cost is real and it falls hardest on exactly the first-time founders who have the least access, which is worth naming rather than glossing.
What is not in dispute is that the capital is there, that it is looking for exactly the kind of long-horizon science that struggles elsewhere, that Levin has himself forced through precisely that sort of long-horizon bet from inside a large pharmaceutical company, and that a founder who never asks has answered the question for themselves.
Some of those searches do not end in a raise. David Esposito and Pavel Khrimian walk through what the last ninety days of a biotech wind-down look like, including the obligation to patients that continues after the money stops. The signs that a round is not coming tend to show up earlier, and none of them announce themselves as decisive.
This account is drawn from the recorded, on-the-record conversation on Open Door Salon with Jeremy Levin and Sara Jane Demy, hosted by Lori Ellis. Interested in sponsoring Open Door Salon?