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Bioverge Review 2021: Best Startup Investing Platform?

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Bioverge
  • Minimum Investment
  • Accessibility
  • Transparency
  • Investment Fees
  • Offering Selection
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Summary

Bioverge is a startup investing platform dedicated to healthcare companies. Through the platform, investors can invest directly in a variety of healthcare startups that were once only available to ultra wealthy investors.

The Bioverge platform not only offers investors a way to participate in the growth of startups, but also to use their investing as a means of impacting causes that matter to them.

Minimum investments start at $500 for Crowd SAFEs $5,000 for SAFEs or $25,000 for investing in the Bioverge Access Fund.

Pros

  • Non-accredited investors can invest
  • Ability to invest in single startups or into a fund
  • Track record of multiple successful exits

Cons

  • Higher minimum investment for some deals
  • Healthcare startups are subject to additional risks

When many investors think about startups, their minds typically go to companies like Uber, Spotify, and Robinhood. While these all are (or once were) startups, they all have one thing in common. They are all tech companies.

While many startups are tech companies, this is only a subset of all startups. There are direct-to-consumer startups, B2B startups, and education startups. However, arguably one of the most exciting niches of startups is healthcare companies.

Throughout the world, there are thousands of quickly-growing healthcare companies that are focused on solving big issues. From cancer, to cardiovascular disease, to mental health, these startups are addressing widespread societal health problems.

For impact investors that want to put their money to work on issues that matter to them, these can be compelling companies to invest in. Plus, the upside potential for many of these companies is significant. This is due to the fact that they are tackling challenges that effect a large percentage of the population.

One of the leading platforms for investing in healthcare startups is Bioverge. In this Bioverge review, we’ll discuss exactly how to invest in healthcare startups and whether this platform is an effective way for doing so.

Bioverge Review: Platform Highlights

  • Bioverge allows investors to access investments in healthcare startups through an easy-to-use interface
  • While some deals are exclusive to accredited investors, many of the deals are open to all investors
  • Investing on the Bioverge platform requires a smaller minimum of $500 per deal
  • In addition to investing in individual companies, accredited investors are also able to invest in the Bioverge Access Fund
  • Bioverge offers a Pro Membership for investors that wish to reduce their fees and gain early access to deals

Bioverge Logo

What is Bioverge?

Bioverge is a platform that allows users to invest in healthcare startups. The platform is unique because unlike most other startup investing platforms that cater to a wide range of companies, Bioverge only lists healthcare startups.

On top of that, they are very strict about the startups that they decide to list. Their involved vetting and due diligence procedures result in only a few startups being offered at any given time. For context, as of the time of publishing, there are two active deals on Bioverge.

As a result of the niche-specific nature of the platform, Bioverge knows exactly what they are looking for from companies. Their team of specialists is able to identify promising signals and warning signs that broader platforms may miss. This is proven out in their portfolio which has already experienced a number of exits and seen some solid success.

While you are investing in highly vetted companies, you’re also able to invest in startups making a difference on issues that matter to you. The two current listings are working on improving epilepsy care and providing data-driver personalized nutrition. Depending on your situation, these may be very important issues that you’d like to invest in.

How Does Bioverge Work?

Investors on the Bioverge platform are able to browse their selection of highly-vetted healthcare startups and invest directly through the platform. When searching through the platform, there are three different investment structures that investors will encounter. These include SAFEs, Crowd SAFEs, and funds.

A SAFE is a Simple Agreement for Future Equity and is the industry-standard funding vehicle for early-stage companies. Most angel investors are investing in companies with a SAFE. In order to invest in Bioverge deals that utilize a SAFE, you will need to be an accredited investor and meet a $5,000 minimum investment.

Crowd SAFEs are a newer fundraising structure that are more accessible for the everyday investor. Bioverge Crowd SAFEs come with a $500 minimum investment and do not require investors to be accredited.

The Crowd SAFE came about thanks to Regulation CF and merges aspects of crowdfunding and angel investing. For example, if a Crowd SAFE does not meet its fundraising goal, investors receive their money back similar to a crowdfunding project.

Bioverge Funds give investors the ability to diversify their investment across many different healthcare startups. Currently, the Bioverge portfolio holds 10+ companies and already has a track record of successful exits. The only fund currently available on the platform is the Bioverge Access Fund.

In order to invest in the Bioverge Access Fund, investors must be accredited and meet a $25,000 minimum investment.

Invest In Bioverge

Invest in Bioverge

Currently, investors are able to not only invest in startups though Bioverge, but also in the Bioverge company itself. Bioverge is currently running its own fundraising campaign through StartEngine, another popular startup investing platform.

On the StartEngine listing, investors can learn more about Bioverge and make an informed decision about whether or not they want to invest. This is a relatively unique offering as not many other startup investing platforms are raising money themselves.

Bioverge Returns

It’s important to preface this by saying that investing in startups is some of the riskiest investing you can do. Unlike publicly-traded companies, private companies involve much more uncertainty. While the risk of Apple or Amazon going bust is fairly low, the risk of a startup going to zero is quite high.

Additionally, as a startup investor you’re only able to exit your position in a liquidity event. This could be either an IPO or an acquisition. Other than those two scenarios, it’s rare that you’ll be able to sell out of your position early. As a result, it’s important to think about startups as long-term investments with a time horizon of 5+ years.

However, with all of that being said, the reason people invest in startups is because of the significant upside potential they provide.

In general, it takes a lot more for a $10 billion dollar company to 10x in size than it does for a $10 million dollar company. The bet you’re making with startups is that while they are small and scrappy now, they will reach a much wider scale in the future.

On Bioverge, you are directly investing into ownership of companies, and so your upside is tied directly to the performance of that company. For example, if you invest in a $10 million dollar company on Bioverge and that company goes on to be acquired for $1 billion in 5 years, you would see a 100x return on your investment not accounting for fees.

Achieving a 100x ROI in 5 years in the stock market is unheard of. However, investing in startups comes with a much higher likelihood of the company going to $0 than going to $1 billion.

Bioverge Fees

The fees investors pay on Bioverge will depend on how the investment is structured. SAFEs, Crowd SAFEs, and funds all have different fee structures that investors need to be aware of.

Fees on SAFEs are similar to traditional venture capital fund fees. These include a management fee and carry on each deal. In general, the management fee and carry will vary with each deal on the platform. However, for the current SAFE listing, there is a 20% carry and a 0.6% management fee.

Crowd SAFEs on the other hand have no carry and no management fee. However, Bioverge does charge the startup a listing fee of up to 7%. On top of that, with some deals, Bioverge will also collect deferred revenue of up to $10,000 from the company. While neither of these fees directly come from investors, they are factored into the offering before it is listed.

Last, the Bioverge Access Fund has a similar fee structure to SAFE investments. This includes the same 20% carry and a 1.2% management fee.

It’s important to note that for SAFE investments and the Bioverge Access Fund, investors are able to pay an upfront fee to reduce the carry. For example, an investor wishing to invest $25,000 in the Bioverge Access Fund could choose to pay an additional $2,500 to reduce the fund’s carry to 15%. This could be an appealing option if the investor felt very strongly about the future performance of the fund.

Bioverge Active Offerings

Bioverge Pro Membership

Another way for investors to reduce the carry on Bioverge investments is through a Bioverge Pro Membership. In addition to reducing your carry, a pro membership provides you with early access to deals on the platform and the potential for early liquidity on your investments.

In order to qualify for a Pro Membership, investors will need to have at least $10,000 invested in the Bioverge Access Fund, and pay a $500 annual fee. With this membership, investors will receive a reduced carry of 15% and exclusive access to Bioverge events and deals.

Bioverge Pros

  • Ability to target the specific niche of healthcare startups
  • Variety of investment structures available to both accredited and non-accredited investors
  • Access to diversification across 10+ companies through the Bioverge Access Fund
  • Reduced carry available in exchange for paying more upfront
  • Strong track record of multiple exits within the Bioverge portfolio
  • Ability to invest directly into Bioverge

Bioverge Cons

  • Higher minimum investment for Bioverge Access Fund
  • Healthcare startups can be riskier as a result of regulatory hurdles and policymaking

Bioverge Review: Final Thoughts

For investors interested in allocating a portion of their portfolio to healthcare startups, there is likely no better place to look than Bioverge. The platform knows what it aims to do and is able to very effectively vet and list early-stage healthcare companies.

Given their track record of success, it’s understandable why the platform is appealing to many. The flexibility in investment structure also allows for some investments to have lower minimums and maintain accessibility for non-accredited investors.

The only potential drawback of the platform are the fees. Investors new to the startup scene may be unaccustomed to seeing management fees greater than 1% or carry on their investments. While this may initially be a shock, it is largely a norm in the startup investing space.

So if you’re after diversification into healthcare startups, it’s likely worthwhile to sign up for an account with Bioverge and keep an eye out for a company that catches your interest.