DNA Capital sees opportunities in the healthcare industry in the backlog of technology

DNA Capital continues to see plenty of opportunity in Brazil’s health tech startup market, although it is in no rush to raise new funding as its current fund nears the end of its investment cycle.

The manager, exclusively focused on the health sector and founded in 2013 by Pedro Bueno, the current president of the Dasa health group, has already invested 6.5 billion reais. Investments include private equity (more advanced-stage companies), such as Dasa itself and hospital supplies distributor Viveo, or venture capital (early-stage startups), such as Memed, a digital prescription company.

“Between the large-scale business and the craft, we are much more for the craft. It builds companies in healthcare for the long term,” said Luiz Noronha, managing partner, in an interview with Reuters, along with José Guinle, also a venture partner.capital at DNA.

Among the recent theses explored by the manager is the application of technology, particularly software, to health services.

“The industry is 20 years behind in the software and infrastructure aspects of technology,” said Guinle, who sees slower change compared to other areas.

“Without being in the healthcare sector, the main competitor of software is other software. In healthcare, we say that the main competitor is paper. That’s where the market is. There are a lot of opportunities, a lot of opportunities are coming,” he said.

One investment that illustrates this point is that of the Brazilian company CM Tecnologia, which integrates the main healthcare tools – from telemedicine platforms to chatbots and medical reports – for companies in the sector. The executives did not report the amount invested in the business.


DNA Capital has 16 employees in offices in São Paulo and San Francisco in the United States of America, and in addition to those two countries, it also has investments in Great Britain. In startups alone, DNA has so far collected 150 million dollars for investments and invested in 21 companies, and has already exited three, such as Feegow, which digitizes medical documentation.

“The fund is running out, but we still have gas, even for follow-on investments, and one or another investment will be announced soon,” Guinle said, without giving details. “We’ll shoot it at some point, but no rush,” he added.

Noronha stated that the financing condition is more to find a favorable market moment. “The overall scenario has a lot of volatility”. Faced with the alienation, DNA expects to continue working with around 15 venture capital investment theses at once, they said.

In addition to the focus on healthcare software startups, another recent thesis, particularly in US investment, given the greater volume of public-private partnerships, comes from companies applying technology to serve the most demanding publics, such as the elderly. “Providing real value to the patient, not just a specific service at a specific time,” Guinle said.

In the North American market, the manager has investments including Cortex Health, which provides software for companies that provide monitoring services, such as post-hospitalization.


One of the points that make investing in healthcare difficult, according to Noronha, is that the markets are smaller than they usually appear, which reduces the potential to create large companies.

Data from market research firm CB Insights shows that among Brazil’s 16 unicorns — startups that have reached a billion-dollar valuation — none are in the healthcare sector. Six of them are fintech, while sectors such as logistics, e-commerce and real estate are also among those represented in the group.

Another factor of difficulty, according to him, is market dynamics, such as negotiations on the formation of prices between agents of the sector and regulatory issues. “You start running into glass barriers, you don’t see them, but they make it very difficult to build a business in this segment,” Noronha said.

When asked if recent political and regulatory changes in the Brazilian market, such as the upcoming and missing taxation rates of the National Supplementary Health Agency (ANS) procedure list or the minimum salary for nurses, could be included in these obstacles, they said that it is not crucial for DNA full stop.

“We know the environment we live in. The fundamental thing is that we always invest in companies that are able to deliver what they propose in a way that is far above the market. When you have that, I think these questions, in general, end with adaptation,” he said is Guinle.

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