Getting into psychedelics – Sports focused private equity – Gamified fitness – Preclinical biotech – Cultured meat – (More) functional beverages – Women's hormonal health
Week 17
Skin In The Game is a weekly newsletter dedicated to sports investing. We curate the startups and investors shaping the future of sports and its adjacent markets.
We also run a regulated startup investment club connecting investors with visionary sports, health, and entertainment startups – a platform for investors to collaborate and co-invest. Hit me up by if you want to find out more.
Confessions
How much do you know about psychedelics?
I know I don’t know much at all, and I know I want to know more. This is more than a burgeoning investment vertical (the global market for functional mushrooms is forecasted to reach $34.3 billion by 2024); it’s a scientific frontier that promises unimaginable boons for humanity.
Psychedelic medicine might be hot right now in certain enlightened circles – powered by mind-blowing scientific research, accelerating deregulation, and barely credible social media influencers – but it remains misunderstood and maligned. Thanks to acid-tripping hippies, the War On Drugs, high-profile psychotic episodes, and other click-baited horrors, the enormous potential (and impressive empirical track-record) of psychedelic medicine tends to be obscured, even distorted.
Psychedelics come with a lot of baggage, as you might expect from substances that are able to alter consciousness and unlock animal spirits. But if correctly regulated and paired with professional psychotherapy, these medicines have the potential to revolutionise mental health at scale.
This presents an enormous opportunity for investors. And the fact that psychedelics are controversial, even taboo in some circles, creates entry points at half-decent valuations for angels; chances to mount the adoption curve before it steepens and taxi drivers start opining about the therapeutic use cases of MDMA.
I don’t believe in predicting the future, which is why I don’t go in for betting on public markets (apart from investing in some pretty conservative funds via ISA and SIPP structures and a bit of index-linked stuff to get exposure to long term economic growth). Instead, I believe in the old adage that, “the best way to predict the future is to invent it”, which is why I’m interested in angel investing and venture capital.
Guilty pleasure digression – the man who came up with that gem of an insight goes by the name of Alan Kay, and he does more than say very clever things… a true polymath, he has fused engineering with knowledge of child development, epistemology, molecular biology, computer programming, portrait painting, and jazz, changing the way that human beings interact with technology and inspiring the likes of Steve jobs to bring us the iPhone.
Psychedelics feels like a place where the future is being invented – but the vast majority of people know nothing about something that is going to become a big part of their lives in the years to come.
We live in a world plagued by mental health problems – problems which are literally killing us. Untreated mental health issues account for 13% of the total global burden of disease. Treatments haven’t changed much since the 1980s, but the way we are engaged, acquired, and monetised by technology companies certainly has. Of course, technology is not the only cause of our existential malady, but it’s a major driver. In recent decades the mental health problem has mutated and the solution has failed to evolve. Without meaningful innovation, it’s projected that mental health problems will be the leading cause of mortality and morbidity globally by 2030.
We are literally holding out for a hero – one that is under our noses, and has been hiding in plain sight for millennia. The archeological record shows that humans have used psychoactive plants for 10,000 years and Professor David Nutt, a leading neuropsychopharmacologist, is not simply talking his own book when he argues that:
“There are three things that define humans; one is drug-taking the others are language and culture.”
The prevailing wisdom seems to be that anxiety and depression are a relatively new thing – a symptom of post-Internet society. But wherever people live, anxiety, fear, doubt, depression occur in plentiful supply. Social media is simply an accelerant; fuel chucked on a fire that threatens to burn the house down (if by house we mean our lives, relationships, healthcare system, economy, politics, and society).
As human beings we tend to “solve” challenges by adding complexity. Social media answered the impossible challenge of keeping in touch with people without the need to actually invest time, energy, and attention in building and maintaining relationships – but it has added a lot of complexity to our personal and social lives, not to mention second order effects that go well beyond popularity contests and faux pas. The most elegant solution would be spend less time connected to the matrix in order to slow down, practise mindfulness and focus on experiences that truly connect us to the wonders of the world around us – but the brute reality is that life has moved online, our livelihoods depend on scrolling, typing and clicking, and it’s unrealistic to expect people to slash their screen time.
Blaise Pascal said that, “all of humanity's problems stem from man's inability to sit quietly in a room alone (without checking his phone)” – or something like that. Mental health issues related to technology overuse and its unintended consequences are snowballing and threatening to overwhelm our people, heath services, and our very culture.
Psychedelics have the potential to ameliorate psychological and physiological problems caused by our 24/7, tech-enabled, coffee-and-alcohol-fuelled, consumption-addicted, spiritually-alienated lifestyles. They are another example of adding complexity to an already complex system when we would be better served by subtraction and simplification), but they are perhaps the best option available to us considering the immutable realities of the human condition. Psychedelics might not be a silver bullet in mankind’s eternal battle against anxiety, depression, and alienation, but they’re a bullet, nonetheless.
Those of you who enjoy scrolling deep into newsletters will have noticed that my weekly ramblings are replete with psychedelics and functional medicine deal flow. Beckley Psytech, TRIPP, Journey Clinical, Palo Santo, Leiio, and a host of others have raised significant sums of capital in recent weeks to scale businesses focused on brain performance, mental health, and psychotherapy provision. This is a key investment theme for Skin In The Game along with AI, tokenisation, NFTs, esports, and a number of other growth sectors that straddle sports, health, and entertainment.
Predict the future. Invent it. Or do both. Investing in startups enables us to claim a front row seat as tomorrow unfolds. Depending on your investment style, you can take a hands-on role, chastising founders for the colour of their logo – or you can be a silent partner, checking in from time to time whilst fly fishing for King Salmon in Patagonia. The point is, you have agency, which doesn’t happen when you’re betting on crypto or watching commodities markets melting up.
There’s something else. Inventing the future is so much more fun than predicting it. It is, of course, fraught with risk, but it can be very rewarding – even if the future doesn’t turn out as you hope it will.
Deal flow
💵 Arctos Sports Partners Fund Reaches $2.9bn in Assets – Sports-focused private equity firm Arctos Sports Partners has $2.9bn in assets in its first fund and has made 14 investments. Among the investments Arctos has made are a minority stake in Fenway Sports Group, parent of the Boston Red Sox, Liverpool FC and Roush Racing, and sizeable limited partner equity in the NBA’s Golden State Warriors and Sacramento Kings.
🚲 Playpulse Raises $2m for Exercise Bike that Turns Fitness into a Game – Playpulse has raised $2m to build an exercise bike that motivates people to work out using games. Investors include Courtside VC, Initial Capital, and several angel investors with relevant backgrounds, including Jamie Brooker and Johan Brand from Kahoot, Jasmine Maietta from Peloton, and Walter Cruttenden from Acorns.
🧠 Meru Health Raises $38m Series B Financing to Transform the Way Mental Health Care is Provided – Meru raised a $38m Series B funding round led by Industry Ventures. Additional investors in the round include early backers Bold Capital Partners, Freestyle VC, FMZ Ventures and Leksell Social Ventures, along with debt financing provided by JP Morgan.
👩⚕️ Sanome Raises £2m in First Funding – Sanome, a London, UK-based health startup, raised £2m in first round of funding. The round was led by Heal Capital, with participation from Crista Galli Ventures, Selvedge Ventures, o2h Ventures, Meltwind and a number of high-profile angels including David Cleevely and Pam Garside.
👨💼 Mojo, a men’s sexual health startup that’s pushing therapy not pills, gets $4.4m seed – A number of sexual health startups have spun up in recent years offering men discreet help with the awkward issue of erectile dysfunction. Now UK based startup Mojo has raised a £3.25m round co-led by London early-stage fund Kindred Capital and Octopus Ventures. Angel investors in the round include some familiar names in the European startup world, including Tom Blomfield (Monzo), Julien Callede (Made.com), Ian Hogarth (SongKick), Freddy Macnamara (Cuvva), Alex Rose (Let’s Do This) and Errol Damelin (Wonga).
👩⚖️ Alpha Medical Announces New Funding of $24m to Further its Leadership in Women’s Health – Investors in this round feature digital health experts such as SpringRock Ventures, Margo Georgiadis, Outcomes Collective Growth Capital, FMZ Ventures, Samsung Next, Chamaeleon, AV8 Ventures, and GSR Ventures.
🧪 Delix Therapeutics Closes $70m Series A – The Boston-based company became known in the space for developing “non-hallucinogenic psychoplastogens,” molecules derived from traditional psychedelics and altered to reduce risk and safety liabilities.
🇮🇳 Fantasy sports startup Fantasy Akhada raises $2m in pre Series A round – Gurugram-based Fantasy Akhada, an online fantasy sports platform, has secured about $2m in a pre-Series A round through Prime Securities, Team India Managers Limited, and existing investors.
🍄 Psychedelic biotech startup Psylo raises $1.1m to treat mental health issues with the key ingredient in magic mushrooms – Psylo, a preclinical biotech firm, has raised $1.1m as part of a plan to treat mental illness with naturally occurring psychedelic drugs. The Sydney-based startup, part of Startmate‘s current W21 cohort, has been backed in a round led led by Chris Hitchen’s global micro-VC fund Possible Ventures. The venture’s prominent angel investors also include Airtree’s Daniel Petre.
📝 Insurance startup Alan acquires Jour to address mental health – Paris-based health insurance provider Alan has acquired Jour, a guided journaling app, for $20m. The deal marks Alan’s first acquisition and will be used to launch a new mental health service, Alan Mind, which will focus on cognitive behavioural therapy and help users book appointments with psychologists.
💰 SeventySix Capital eyes sports betting and esports with new VC fund – The fund is expected to be $50m when fully capitalised. Athlete investors include NFL’s Emmanuel Sanders, James Develin, DeMarco Murray and Brian Westbrook, as well as MLS player Alejandro Bedoya.
🍖 New Age Meats bites into $25m for cultured meat product line development – Berkeley-based cultured meat company New Age Meats raised $25m in Series A funding that will enable the company to begin production of its first product offering, a variety of pork sausages, next year. Hanwha Solutions of South Korea led the funding round and was joined by existing investors SOSV’s IndieBio, TechU Ventures, ff VC and Siddhi Capital.
🎾 Slinger Acquires Artificial Intelligence Company GAMEFACE.AI – Slinger has joined forces with the award-winning artificial intelligence sports technology company.
🎮 Andreessen Horowitz Leads $150m Round for ‘Axie Infinity’ – Sky Mavis, the developer of the popular crypto-based online game Axie Infinity, is raising approximately $150m in Series B funding at a valuation near $3bn in a new round led by Andreessen Horowitz. The valuation for the three-year-old startup reflects the tremendous growth in sales on Axie Infinity, an Internet-based multiplayer game that uses NFTs.
🏈 Silver Lake Invests in Cris Collinsworth’s Sports-Data Firm – Pro Football Focus, owned by broadcaster and former NFL player Cris Collinsworth, sold a minority stake to private equity firm Silver Lake as the data company plots an expansion into markets including soccer. Cincinnati-based PFF already works with all 32 NFL teams, as well as more than 95% of the so-called Power Five college football programs. Silver Lake invested about $50m for the stake.
🧃 Wildwonder Closes $2.1m Seed Round, Moves to Cans – San Francisco-based functional beverage maker Wildwonder closed a $2.1m seed round which will fund the brand’s expansion on the West Coast and beyond.
👱♀️ London-based femtech startup Jennis raised €1.17m to become go-to-app for helping women improve their hormonal health – The femtech app, Jennis, founded by Olympic and World Heptathlon Champion Dame Jessica Ennis-Hill, has raised €1.17m in pre-seed funding to improve hormonal health for all women and tackle the gender data gap in women’s health (only 6% of sport and exercise studies are done using exclusively female participants). The funding round was led by Maki.vc, supported by existing investors Venrex and several angel investors.
🥛 Goldman Sachs Invests in Pea Milk Startup – Goldman Sachs participated in a $65m investment in Ripple Foods, a little-known beverage company that makes a milk-like drink from yellow peas. The investment, which was led by Euclidean Capital, includes funding from Khosla Ventures, Fall Line Capital and S2G Ventures, a food and agriculture investment firm started by OpenTable’s founder.
🇸🇦 Saudi fitness app Rumbl raises $1.07m Seed funding – Saudi Arabia-based health and fitness startup Rumbl has raised $1.07m in a Seed funding round led by Investor’s Mine Angel Group, with the participation of BIM Ventures.
🧫 MIG Fonds leads €65m Series B financing of iOmx Therapeutics – MIG Capital AG, one of Germany's leading VC firms, is investing in iOmx Therapeutics AG, a biopharmaceutical company developing cancer therapeutics based on next generation immune checkpoint targets, as part of a €65m Series B round. The financing was led by MIG and ATHOS, the Strüngmann family office, with participation from existing investors Wellington Partners, Sofinnova Partners and M Ventures.
🧄 Yuvraj Singh-Backed Wellness Startup WellVersed Raises Funds From Jubilant FoodWorks – WellVersed has previously raised a Pre-Series A funding round led by former India cricketer Yuvraj Singh.
🇪🇸 Iker Casillas’ Sportboost startup accelerator gets LaLiga Tech backing – Founded by former Real Madrid goalkeeper and Fifa World Cup winner Iker Casillas, Sportboost aims to turn sports-related startups into sector-leading companies.
Some tweets
The will-they-or-won’t-they saga surrounding the Ashes has been driving me crazy. So it was a big relief to wake to news that it SHOULD be going ahead. If the tour is canned then Christmas is effectively cancelled and it’ll be wall-to-wall Paw Patrol in our household for a month. The stakes have never been higher.
Cheers,
Ed
—
Edward Rhys
Founder / Skin In The Game
www.skininthegamegroup.com
🙏 A favour
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Skin In The Game is a startup investment club connecting investors with visionary sports startups. We provide a regulated platform for fans, athletes, entrepreneurs and brands to collaborate and co-invest. By investing in SportsTech we can unleash the full potential of sports, enriching the lives of people everywhere.
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