Two recent news items suggest that venture capital firms are taking extra care to make sure scientific research can properly inform their investment decisions.
A brief item in Science-Business Exchange (full article requires subscription) notes that at least one firm – Atlas Venture – has taken to hiring contract research organizations to independently validate academic science prior to making significant investment. One could consider this simply conducting proper due diligence on the firms in which it may invest. However, this could speak to the increases in retractions and other instances of scientific misconduct. (That I saw this first via a Tweet from one of the folks behind Retraction Watch suggests the second possibility is at least plausible.)
Another venture capital firm will work with a scientific academy to help it assess future opportunities in late-stage biomedical companies. The Academy of Medical Sciences in London will work with Park Vale Capital to connect its Fellows to investment advisors at the firm. The Academy will receive a retainer to assist with administrative costs and receive a certain percentage of performance fees Park Vale receives on its investments. In an effort to manage potential conflicts and avoid disclosures of proprietary or confidential information, the Academy will establish an oversight committee. Relationships that go past the initial Academy-facilitated meetings will be handled through the researchers’ home institutions.
Both of these events are new in the area of venture capital. Whether or not they will be the beginning of trends may depend on how well such arrangements work. But at least in the case of Atlas Venture, these developments should remind us that the reliability of the research data and the processes behind it matter. Put another way, while the moves could bring additional money to research, the additional scrutiny comes at least in part over increasing concerns about the quality assurance behind scientific research.