Millions of people worldwide are affected by autism spectrum disorder (ASD). Both as children and later in life, these individuals and their families need better detection, treatment and support solutions to help them live with autism. But until recently, it wasn’t a space that startups and investors entered.
Autism Impact Fund (AIF) was a trailblazer when it emerged in 2021, three years after co-founder and managing partner Chris Male’s son was diagnosed with ASD. A joint effort by Male and others, AIF sought to become “the investment and innovation arm of the autism community,” Male told TechCrunch.
Since then, neurodiversity startups have gathered momentum, as has AIF, which recently closed its first fund at $60 million. As the first chapter of its kind, surpassing its goal is no small feat, especially in an incredibly difficult environment. (The original goal was $50 million.)
AIF is a VC fund, not a charity, and Male is also vocal about that. “We have great partnerships with the nonprofits, with the foundations, and we’re very intentional about increasing returns. … Our goal is to deliver really strong returns, revolutionizing the status quo for autism and everything in the space through the venture capital model.”
AIF’s limited partners include Uber CEO Dara Khosrowshahi. Brian Jacobs from Emergence Capital Partners. and Bob Nelsen, co-founder and managing director of Arch Venture Partners, who also serves on its advisory board. Andras didn’t want to tell his personal stories about them, but individual AIF supporters often have personal connections to autism.
However, institutional LPs such as investment companies Fairfield-Maxwell and Ferd it also supports the AIF, “which has obviously been very helpful in getting us to this scale,” Male said. It is also another sign of change. “Operators coming into the field are no longer just family members who want to help. They’re really sophisticated entrepreneurs who see an opportunity to affect wholesale change and that’s really great.”
A broad portfolio
Some VC funds wait for a full close to start raising funds, but not AIF. Because she needed to prove herself and her thesis, she started investing from her first close. With 12 startups in its portfolio, it will begin raising its second round within the next six to nine months, and Male is already reporting incoming interest.
That AIF portfolio companies have raised follow-on rounds from other investors is a strong signal of validation. For example, CVS Health Ventures led a $40 million Series D expansion round investments in healthcare startups Cortica in October. Other signals are harder to measure but still important. Male told TechCrunch that OEE has strong access to even oversubscriptions, and even when its check isn’t the biggest, there’s a sense that “it’s a stamp of approval for the market and the community that this is a validated, well managed entity.’
The AIF still has resources in its first fund to do a “handful” more deals as well as follow-on investments. After several “strong bets,” her portfolio is motivated to double. And, Male added, “there is a very good chance that we will have exits within the next six months. so soon why us [starting deploying] in 2021.”
OEE’s portfolio is already quite diverse, although its website groups companies into two categories: life sciences and data and technology services. It’s also going beyond the US with its German-based consultancy Auticonwhich bills itself as a “majority autism company” and UK telehealth platform Sun. But now it’s going to diversify it further, and not because there isn’t enough deal flow or issues to deal with just autism.
The AIF’s decision to expand its scope has to do with autism itself, Male said.
The definition of autism is so vague and so broad that it doesn’t really exist [biologically precise] understanding of exactly what is going on, so to help individuals as well as families, we need to widen that gap. And it’s behavioral and mental health, it’s all of that, but it’s also a broader health care issue. The societal cost is in the trillions of dollars right now, and if the incidence increases at the rate it is, it’s $15 trillion in societal cost. Lack of employment and existence [un]Work capacity is factored into this. But it’s as if society is sleepwalking through this incredible crisis, for which there is no current plan.
Raising awareness
The fund will now allow itself to invest in “behavioural data-driven platforms, innovative healthcare solutions, as well as value-based care frameworks,” and AI is “impossible to ignore,” Male said. It will also continue to invest in addressing the co-morbidities of autism, for example gastrointestinal problems. And then there’s the “independence bucket,” whether it’s employment, financial independence, or housing.
That independence is on the list is a reminder that autism is a spectrum that needs to be treated as such, and that there is a business opportunity for startups that aren’t just focused on kids.
An adult-focused startup, the neurodiversity employment network Mentra, is backed by Sam Altman and others, but not by the AIF. No beef: Mentra partnered with AIF-backed Auticon, and Male called the work they’re doing “incredible.”
It is definitely a good sign that AIF is not one of Mentra’s investors: The space is getting too big to find the same VC at all the capital tables. It is also global, with health technology Genial Care lifting 10 million dollars to help children with autism and their families in Brazil.
When asked if there hasn’t been any push to start a company in this space recently, Malle laughed. Compared to five years ago, he explained, “it’s just fun to see the momentum and shift.” As the investment side also gets busier, there will likely be more.
