A top VC who’s spent 3 decades investing in healthcare shares her best piece of advice for investors

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A top VC who’s spent 3 decades investing in healthcare shares her best piece of advice for investors

When Annie Lamont started her career as a venture capitalist, she was interested in making investments in tech companies.

But at the time, in the 1980s, most of the companies were focused on hardware, which interested her less than software. Instead, she was drawn to the world of biotech and medicine and decided to make healthcare her primary focus.

“In any industry, particularly in venture, have your lane — have something you know better than anybody else,” said Lamont, now the cofounder and managing partner of Oak HC/FT, which has $1 billion under management. “You’ve got to pick your spot. So I picked my spot, and that was going to be healthcare.”

She started by investing in neuroscience biotechs like Cephalon (later acquired by Teva) and Alkermes. Over the next decade, Oak went on to invest in about 15 to 20 biotech companies. By 1998, though, there were thousands of public biotech companies, but only a few had gotten their drugs approved.

“You could just see the disenchantment coming,” Lamont said. “You want tailwinds when investing in any industry. I felt like it was going to be headwinds, not tailwinds, because the biotech industry had disappointed.”

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Seeing those headwinds, Lamont shifted her attention to other parts of the healthcare industry in the 1990s, backing companies developing health plans for Medicaid, running hospices, and focusing on behavioral health.

“I just felt like I needed I wanted to understand the system better, and I felt like I didn’t want to be completely dependent on the biotech industry for my investing,” Lamont said.

Since then, she’s moved her focus to other areas, like health IT in the early 2000s and, following the changes from the Affordable Care Act, insurance startups like Devoted Health and new primary-care models like One Medical.

“You have to be re-potting yourself in the venture world,” Lamont said. “Otherwise, like any other industry, you’ll become stale. You won’t have the tailwinds you need to be a successful VC.”

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