Top Silicon Valley VC Andreessen Horowitz is investing $450 million into biotech

Andreessen HorowitzAndreessen Horowitz general partner Jorge Conde
  • Silicon Valley venture firm Andreessen Horowitz is launching a second fund that will focus on biology, investing $US450 million.
  • This one, building on the experience a16z has had with its first biofund, which launched in 2015 with $US200 million, will focus on the intersection of biology and engineering.
  • The fund will focus on investing in companies applying engineering to things like drug discovery, creating new uses for biology, and finding new ways for software to “eat” healthcare.

The venture capital firm with a tagline that “software is eating the world” thinks the same could happen with biology.

On Thursday, Andreessen Horowitz launched its second bio-focused fund to invest $US450 million in companies that sit at the intersection of biology and engineering.

It’s the second bio-fund Andreessen Horowitz has done. In 2015, it launched a fund with $US200 million to invest in companies that were focused on biology and computer science.

Andreessen Horowitz general partner Jorge Conde, who will be leading the fund with Vijay Pande, said that the second fund’s approach to focus on engineering more broadly happened because the firm saw opportunities that extended beyond just computer science.

“We’re at the precipice of bio becoming a part and a transformative part of not just healthcare, but across many industries,” Conde told Business Insider. “Whether it’s energy or food or consumer products, that to us is an extraordinarily exciting moment and area for us to pursue.”

The fund will focus in on three areas where engineering and biology are coming together.

  • Computational biomedicine, and how machine learning and artificial intelligence can apply to biology. It’s an area a16z’s already invested in with companies like Freenome, a company developing a test to look for signs of cancer in the body, and twoXAR, a company using machine learning to help with drug discovery.
  • New ways to use biology, either by reading genetic information, writing it out to make changes to organisms, or by programming organisms to take on a task. These new uses could be things like gene editing, building synthetic DNA, or reprogramming cells to fight certain diseases like the cell therapies being used in cancer.
  • Finding companies building software that “eats” healthcare, especially by creating network effects.

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