Venture capitalists invested more than $7 billion during the first quarter of 2007, according to the National Venture Capital Association. Yet competition for that capital is fierce. American Venture Magazine talked to Ilya Nykin, managing director of Prolog Ventures, about what his firm looks for when evaluating potential investments.
How long have you worked in the venture capital industry?
Over the past 20 years, I've been both an entrepreneur and an investor. I've launched and led my own companies, and now I help other entrepreneurs do the same. My partners at Prolog also have significant experience in both investing and operations.
What kinds of opportunities does Prolog look for?
Prolog focuses on life science investments. We've invested in biopharmaceuticals, medical technology, and other traditional healthcare areas, but we also look for opportunities in emerging fields such as nutrition, wellness, plant science, and bio-energy.
How do you screen companies when you receive requests for capital?
Most firms focus initially on two things: breakthrough products and strategic fit. At Prolog, we look for opportunities that meet a critical unmet need in the marketplace, and they must fit within our life science focus and our current investment strategies. We also tend to focus on very early-stage companies, where we can add the most value. And while we do screen incoming requests, we're very active in looking for investment opportunities ourselves.
What happens when you identify a company that meets your criteria?
We do some initial research to determine key risks and opportunities – competitive landscape, strength of the technology, etc. If we believe it's a good opportunity, we'll meet with the management team and assess their ability to lead the business...
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