Download The Science of Healing, the Art of Investing By Frank Graziano “The

The Science of Healing, the Art of Investing
By Frank Graziano
“The economic downturn really focuses you to look at projects that are true innovation.
Not just marginal innovation, but true innovation,” says Lisa Rhoads, managing director
of Easton Capital Investment Group.
Easton Capital, which manages $200 million in venture capital and private equity, is
mainly focused on the development of novel medical technology. Many of its
beneficiaries have gone on to multi-million dollar IPOs and acquisitions by companies
like Johnson & Johnson and Procter & Gamble.
But in order to maintain that level of success in recent times, Easton has had to
systematically refine its investment strategy.
While Rhoads and her partners look for innovation in their subsidiaries, fostering it
within their fund has become an informal policy. “I’m always looking at a creative way
of sourcing capital and structuring a deal, it's never just the traditional,” says the Wharton
alumna. “I’ve been a big part of working to evolve our business model into something
that’s appropriate and works in the current environment.” It’s an iterative approach that
has become common in the new recessionary Darwinism.
In March 2012, Easton was involved in a $21.5 million round of financing for Promedior,
a biotech firm developing drugs for previously untreatable forms of fibrosis. It’s the latest
entry in a portfolio of investments that in the past year has grown to include companies
developing everything from a mobile messaging system for doctors, to lupus treatments,
to new techniques for gene therapy.
Easton Capital has worked to shorten the gestation period of its investments — the time
between initial funding and when the firm sells its shares — to under five years. Rhoads
describes this and other changes as the evolution of the traditional venture capital model,
the result of careful tuning during meetings with her partners.
“For me it’s about getting out on the road, talking to people, seeing the patterns and
connect points — all of us doing the same thing and then coming back and discussing
what we’re seeing and how we can connect the dots and make this all work better.”
She says credible, inspiring leadership is everything in this process. “It’s the enthusiasm,
the constant focus on developing a strategy and sticking to that strategy day in and day
out. It keeps your team moving in the same direction.”
And for Easton Capital, that direction is toward innovation improving not only the health
of patients, but also the health of the greater economy.
“I believe that at the base of economic growth is innovation,” says Rhoads. “Growth
comes from the bottom up, from financing innovative companies.”