Dexcom, a maker of wearable continuous glucose monitors for people with diabetes, said Thursday that is launching its first corporate venture capital fund to invest in sensing, data analytics, remote patient monitoring, population health and related technologies.
The San Diego company offered few details about the fund at this time, including its size, saying that it is still in development. But it will be solely a Dexcom undertaking, with no additional limited partners. The company will be open to evaluating investments in both early and later stage startups.
“With this entrance into the venture capital space, we believe we will be able to accelerate development for innovative companies to share our commitment to empowering greater health outcomes for customers and their clinicians,” said Dexcom Chief Executive Kevin Sayer in a conference call with analysts. “This may include technologies with use cases that can be combined with our Continuous Glucose Monitoring system, as well as independent technology platforms.”
Dexcom Ventures will be led by company veteran Steve Pacelli, executive vice president of strategy and corporate development. Initially the fund will support companies working on glucose sensing technologies and in adjacent fields of metabolic monitoring.
“While we have matured as a company over the years, we still consider ourselves to be a ‘start-up’ of sorts,” said Pacelli. “We feel well positioned to invest early and support our portfolio companies as they pioneer markets.’’
Sayer added that Dexcom Ventures likely will invest in firms related to its core business of continuous patient monitoring and diabetes.
“I don’t see us going and acquiring shared interest in 50 different companies that are all over the place, but I do see us with a very focused approach,” said Sayer. “As far as the level of funding, as I’ve chatted with our board, we’re going to leave that open right now for the opportunities that we see and dip our foot in the water. But we think we have some really good opportunities to give us platforms to expand our business over time and help some of these companies grow.”
Corporate venture capital funds are common in the technology and health care industries, with Intel, Qualcomm, Illumina and a host of others investing in startups that are of strategic interest.
Dexcom announced the new venture fund in conjunction with its fourth quarter and full year 2020 financial results. For the quarter, revenue increased 23 percent to $567 million compared with the same quarter in 2019. Net income rose to $3.48 per share under Generally Accepted Accounting Principles, up from $1 per share a year earlier. The improvement came in part from a tax benefit in the quarter.
For the full year, Dexcom’s revenue increased 31 percent to $1.93 billion. Earnings came in at $5.06 per share, up from $1.10 per share a year earlier.
Dexcom’s shares ended trading Friday up slightly at $412.56 on the Nasdaq exchange.
