Deal sizes have been steadily increasing, despite the recent downturn in overall funding. This reinforces the "haves and have-nots" dynamic that has existed in biotech the last several years.

Crossover investors and hedge funds (public equity investors in the charts below) are an increasingly dominant force in the biotech VC space. Private biotech investing has long been dominated by specialist venture funds, but public equity investors are now leading nearly as many deals as specialist biotech VCs. Public equity and crossover investors have long been a force in later-stage private rounds, but in 2020 and 2021 they have become the most active Series B investors.

The Series A market has been more resistant to competition from new entrants. However, in 2021, these Series A VCs have lost share to emerging "tech-bio" investors: funds that originally focused on software and technology that are now investing in biotech. The share of "tech-bio" VCs leading Series A deals is still small (comparable to the share of public equity investors leading Series A rounds), but will likely continue to grow. There are a large number of "tech-bio" funds that have been focused on seed investing who are raising Series A-focused funds. These funds offer better terms to founders and generally close deals more quickly. While founders still prefer the track records and experience of traditional biotech VCs, emerging biotech VCs are building their track records and expertise and will be increasingly competitive in this regard as well.

The most active VCs generally only lead a handful of deals per year. Many of these Series A investors create many of the companies they fund in-house.

Emerging "tech-bio" investors are leading more Series A rounds. These funds focus more on investing in existing companies versus creating companies in-house (although some of them do company creation). However, the pool of tech-bio VCs that lead multiple Series A deals per year is still quite low.

The most active Series A investors in 2021 are non-traditional funds: seven of the fifteen most active lead Series A investors are crossover funds.

Oncology represents about a quarter of venture-funded programs from 2018-2H2021.

While rare disease has historically received the second-most funding after oncology, neuro + neurodegenerative programs now receive more Series A funding than rare disease

These charts represent the therapeutic areas of all companies receiving funding. Many companies have programs in multiple therapeutic areas.

Series A investment trends can inform what kinds of companies will get funded in future rounds

Oncology makes up a lower percentage of Series A-funded programs than rare disease, autoimmune and neuro combined, though oncology is still the single most funded therapeutic area