In a recent fireside chat, Navjeewan Khosla, a partner at Novo Holdings Asia Investments, discussed the company’s investment strategies and focus areas. The conversation covered a range of topics, including Khosla’s professional background, the structure and operations of Novo Holdings, and the company’s investment approach.

Khosla explained that Novo Holdings, the investment arm of the Novo Nordisk Foundation, primarily focuses on healthcare investments in Asia, excluding China. The company manages around 155 portfolio companies, primarily in life sciences and healthcare, with an AUM at the foundation level of around $135 billion.

Khosla highlighted the differences between working for a typical private equity firm and working for Novo Holdings. He emphasized the company’s long-term investment mindset, its ability to provide follow-on capital, and its focus on the reputation and integrity of the entrepreneurs they invest in.

In terms of investment sectors, Khosla identified three key areas of focus in India and Southeast Asia: healthcare service providers, pharma services, and digital healthcare. He also discussed the company’s approach to deal flow, due diligence, and incentivizing entrepreneurs.

The chat provided valuable insights into Novo Holdings’ investment philosophy and strategies, as well as the broader trends shaping the healthcare investment landscape in Asia.

Key timestamps:

00:09: Introduction to ION Influencers Fireside Chats
00:33: Background and Description of Novo Holdings
01:35: Professional Background and Career Path
02:59: Investment Approach and Philosophy
04:03: Comparison of Investment Approaches
05:26: Long-Term Mindset and Approach to Exits
06:31: Follow-on Capital and Long-Term Partnerships
06:54: Entrepreneurial Fit and Reputation Risk
08:20: Entrepreneurial Evaluation Criteria
09:15: Investment Signals and Entrepreneurial Partnerships
11:21: Opportunities in the Indian Healthcare Market
14:32: Investment Focus in India – Healthcare Service Providers
17:46: Focus on Pharma Services
18:41: Focus on Digital Healthcare
19:58: Barriers to Entry and Advantage of Being a Leader
20:19: First Mover Advantage in Digital Healthcare
21:13: Barriers to Entry for Pharma Services
22:14: Barriers to Entry for CROs and CDMOs
23:14: Quality and Complexity Differentiation in Healthcare Service Providers
24:30: Proprietary Deals vs. Auction Deals
25:16: Negative Aspect of the Investment Model
26:09: Adding Value and Synergies with Novo
27:49: Incentivizing Entrepreneurs for Long-Term Success
29:17: Differences Between Investment at Novo and a Bank
29:38: Incentivizing Entrepreneurs for Long-Term Success
31:56: Linking Sustainability Targets to Incentives