December 19, 2024
As we approach the end of 2024, the RiverVest team would like to thank our investors, portfolio company leaders, syndicate partners, colleagues, and friends for your continued confidence in RiverVest’s mission to address significant unmet medical needs of patients and deliver consistently strong returns to investors. We are gratified by the progress we have made this year, and we are excited for the future.
An important bellwether for the firm is the health and progress of our portfolio companies. Many of our companies achieved major milestones in 2024, setting themselves up for attractive financing rounds or perhaps even exits. These accomplishments include nine companies that reported data on clinical trials and eight companies that initiated clinical trials. Eight of our companies raised follow-on equity rounds in 2024 totaling $411 million, proof of the catalytic impact of our early-stage investments.
We added three firms to the portfolio of Fund V in 2024 – Engrail, InterVene, and a company that has not yet announced its successful raising of Series B. In early 2025, we expect to add two more companies to the portfolio. These companies are in the final stages of their fundraising processes as we negotiate the definitive investment documents. We are excited about these investments, all of which could result in impactful therapies for patients and high returns on our investments.
2024 was also an excellent year for the firm from an operational standpoint. We welcomed Nafise Masoumi to our team as a senior associate based in our San Diego office, and we recognized the outstanding contributions of two members of our analytical team by promoting Andrew Kleiboeker to associate and Jeff Seitz to senior analyst. The promotions at the end of last year of Karen Spilizewski and Isaac Zike to managing director and Pascal Krotee to principal have given us great depth in leadership as we connect with peer firms, structure financing deals, serve on boards, and work with management of companies to help them advance. We also expanded our Scientific Advisory Board in 2024 with the addition of two pioneering researchers — John Cambier and Gary DiCrescenzo.
Another milestone for the firm in 2024 was the winding down of RiverVest Venture Fund II. The Fund was a great success by any measure. Its financial performance places it in the top quartile for all funds in its vintage year. Additionally, 10 products have been commercialized out of companies from this Fund.
We look toward 2025 with strong optimism as many factors are aligning to make the coming years quite attractive for RiverVest’s investment strategy. For several reasons, valuations on early-stage companies have returned to a lower, more reasonable level than we saw in 2022 and 2023. During those years, we passed on many investments where the valuations of the companies were not consistent with our long-term return targets. At the same time, the buy-side environment in the pharma industry should be conducive to highly attractive exits. The industry is on the verge of seeing many blockbuster drugs go off patent; hence, product pipelines need to be bolstered. Meanwhile, the major companies in the industry have strong balance sheets (high cash balances and significant borrowing capacity) that will allow them to make sizeable acquisitions to this end.
RiverVest will mark its 25th anniversary in 2025. From the time RiverVest was founded in 2000, its founders, including Managing Directors Tom Melzer and Jay Schmelter, were committed to building a strong firm that would stand the test of time. As proud as we are of RiverVest’s accomplishments to date, we are equally proud that the firm is so well-positioned for the future. We are grateful that many of you have been and continue to be important parts of our journey.
We wish you a happy holiday season and a pleasant and lucrative 2025. We will keep you apprised of our firm’s progress and always welcome your feedback.
Sincerely,
The RiverVest Team