CBC CEO’s borderless approach to building healthcare companies

ONE would think you would need a PhD in a bio-related field to think about changing the healthcare space. But that’s not what Wei Fu, chief executive officer (CEO) of healthcare-dedicated investment firm CBC Group, thinks.

With a lifelong career in investment banking, Fu got his start with Temasek after graduating with a degree in electrical and electronic engineering from Nanyang Technological University. Stints with Standard Chartered and Macquarie Capital followed.

“I don’t have the best understanding of a single molecule, but that becomes my advantage. I am always spending efforts to recruit the best talent to tell which molecule works and which doesn’t,” Fu tells The Business Times.

Fu’s start in healthcare was borne out of his drive to do something of his own back in 2013. His experience in investment banking was with the infrastructure sector, which made starting a healthcare-focused investment a disadvantage to him. But CBC has grown from US$185 million in assets under management to over US$5 billion in the last 8 years, and has incubated a number of biotech and pharmaceutical companies such as RVAC Medicines, Ensem Therapeutics and I-Mab.

Healthcare to Fu is borderless and something that should be shared across the world, not concentrated in 1 market. World-class innovation and the most efficient drugs will need talents from across the world.

“Most of our incubated companies have Americans, Chinese, Indians putting in joint efforts to build the best innovation. This is the reason why our portfolio companies have offices in Shanghai, Boston, Singapore, to give us the best chance to produce the best drug for the benefit of the whole world,” said Fu.

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Attracting the best talent is a key refrain that Fu harps on, with strategy and development based around this objective. With each biotech or pharmaceutical company CBC incubates, he is laser-focused on attracting the best talent.

Rather than complaining when a targeted talent chooses another company, Fu introspects and figures out how to make his firm attractive to better talents. Besides talent, attracting capital is another point that CBC has to keep up with.

“We need to design your firm to be trusted by institutional investors who will give you long-term support from a capital perspective. The way we attract talent and capital, we need to industrialise this process. For a firm to keep going 10, 20 years down the road, you can’t just rely on myself,” said Fu.

That’s CBC’s secret formula: industrialising its process of building biotech and pharmaceutical companies that they can apply across their portfolio. Learning from mistakes is how Fu claims that CBC is the most experienced healthcare entrepreneur in the world. As an institution, CBC has started 10 biotech and pharmaceutical companies. This idea of industrialising the process came after investors challenged Fu on whether he could build biotech companies with no experience. He believed he had the right talent and know-how to solve the challenges they would meet.

“How to make sure the mistakes won’t be repeated? We need to centralise the company building process,” says Fu.

CBC has a portfolio management team that summarises all the lessons learnt to ensure mistakes aren’t repeated. There are also shared resources on recruitment, compensation, how to raise capital through the various tiers, and 2 managing directors to access different capital, in the West and in Asia, among other capabilities.

At the start there wasn’t this capacity, but it grew with the mentality of improving the hit and success ratio. It’s an ongoing learning process, with a monthly operation excellence meeting for the leaders of the business to ask which area can be improved and how to do it.

“Every month we carve out 2 hours. If you sit down and think about how we can make improvements, there will be improvements. This is the kind of culture we build. There’s nothing you should keep relying on. With everything, you should think about making improvements or disrupting the process,” says Fu.

Having experienced forming and bringing to market 10 different biotech and pharmaceutical companies, CBC’s experience is what sets it apart from other investment firms. This is what enables a flywheel effect attracting bigger capital and better talents, according to Fu.

“This isn’t about science, this is about business - building the right culture at our firm and the leadership of our firm,” he says.