Investing in Psychedelics for Mental Health
Investors are increasingly turning their attention to psychedelics as a potential game-changer in the field of mental health. The recent $100 million Series A financing for Lykos Therapeutics (formerly known as MAPS Public Benefit Corp.) is a testament to the growing interest in psychedelic therapies. These therapies have the potential to not only manage but cure debilitating mental health conditions such as post-traumatic stress disorder (PTSD). Approximately 13 million adults in the US suffer from PTSD each year, imposing a significant economic burden of at least $232 billion. Lykos Therapeutics’ CEO, Amy Emerson, was motivated to pursue this line of work after witnessing the positive impact of psychedelic therapies on abuse survivors. The company’s new drug application for MDMA (ecstasy) in combination with talk therapy has been submitted to the FDA, and results from Phase 3 clinical trials are promising.
Sustainable Bioproducts: A Solution for Agriculture
FA Bio, a UK-based company, has secured £5.3 million in funding to develop sustainable bioproducts for the agriculture sector. The company focuses on sorting microbes found in farm fields to create eco-friendly alternatives to chemical fertilizers, pesticides, and other inputs. The overuse of agrochemicals in intensive agriculture has contributed to a 70% loss in biodiversity over the past 50 years. FA Bio aims to address this issue by accelerating the development of bioproducts that can help restore biodiversity and reduce the environmental impact of farming. The funding round was co-led by the Clean Growth Fund and impact venture investor Pymwymic, with support from Ship2B Ventures.
Navigating Impact-Linked Compensation
Impact incentive structures, such as impact-linked carried interest and bonuses, have gained popularity among fund managers as a way to align their financial incentives with their impact goals. However, implementing these mechanisms can be challenging due to the complexity of measuring and managing impact. Fund managers have questions about selecting relevant metrics, determining appropriate levels of ambition for impact targets, and establishing effective governance systems. The ImPact, a global network of families investing with purpose, provides guidance on navigating these challenges to ensure transparency, independence, and accountability in impact incentive structures.
Impact(ed) Podcast: Exploring Venture Capital
In the latest episode of the Impact(ed) podcast, KJ Sidberry of Google Ventures and Evelysse Vargas of Zeal Capital Partners share their unique paths into venture capital. The podcast, hosted by Eric Horvath and Lucas Turner-Owens, explores the potential of venture capital as a force for good. Previous episodes have featured discussions on how pension funds and foundations can drive impact through their investment strategies. The podcast provides valuable insights into the world of impact investing and highlights the pioneering work of individuals who are using venture capital to create positive social and environmental change.
Agents of Impact: Follow the Talent
Several notable individuals have recently made moves within the impact investing space. Tanja Kramer, formerly of Slingshot Ventures, has joined ABN AMRO as the head of its sustainable impact fund, bringing her expertise in impact investing to further the bank’s commitment to sustainability. Yves Frey, previously with SUSI Partners, has joined Una Terra as a founding partner and executive board member, contributing to the organization’s mission of mobilizing private capital for sustainable development. Additionally, Kataly Foundation is currently recruiting a managing director of programs in San Francisco, offering an exciting opportunity to lead impactful initiatives. Makeway is seeking an impact investment analyst, providing an excellent chance to work with a purpose-driven organization. Applications are also open for the Integrated Capital Initiative’s Transformative 25 Funds, which aims to recognize funds making a significant impact on social, environmental, and economic justice.
These moves and opportunities highlight the growth and diversity of talent within the impact investing sector, as well as the increasing focus on sustainable and impactful investment strategies.
Analyst comment
News 1: Positive
Market Impact: The market for psychedelic therapies is expected to grow as investors show increasing interest. The successful financing for Lykos Therapeutics and promising clinical trial results suggest potential for significant growth in the field of mental health treatments.
News 2: Positive
Market Impact: The market for sustainable bioproducts in agriculture is expected to expand with the funding secured by FA Bio. As the demand for eco-friendly alternatives to agrochemicals increases, FA Bio’s development of bioproducts could gain traction and lead to further growth in the sector.
News 3: Neutral
Market Impact: The guidance provided by The ImPact network may help fund managers navigate the challenges of implementing impact incentive structures, but it is unlikely to have a direct impact on the broader market. It may, however, contribute to increased transparency and accountability in impact investing.
News 4: Neutral
Market Impact: The Impact(ed) podcast provides valuable insights into impact investing but is unlikely to have a direct impact on the market. It can serve as a source of information and inspiration for individuals interested in venture capital as a force for good.
News 5: Positive
Market Impact: The moves and opportunities within the impact investing sector suggest a growing focus on sustainable and impactful investment strategies. This highlights the market’s increasing demand for talent and signals potential growth in the sector.
