Proximal Ventures Closes $27.5M Debut Fund for AI Drug Discovery

First-time fund managers continue navigating a challenging fundraising climate, but Sahir Raoof has successfully closed a $27.5 million debut solo venture capital fund named Proximal Ventures. Raoof, a former investor at SignalFire and an executive at healthcare startups, is directing the new vehicle toward startups utilizing artificial intelligence to transform infrastructure, tools, and services within drug development.

Historically, pharmaceutical companies have relied heavily on specialized service providers for various stages of development, ranging from synthesizing molecular compounds and scaling manufacturing to clinical trial data analysis. According to Raoof, the conventional assumption was that pharma made a poor software buyer but an exceptional services buyer. He argues that artificial intelligence can automate much of that manual labor.

By leveraging AI, emerging companies can potentially deliver existing industry services at lower costs and in substantially shorter timeframes, capturing a significant slice of pharmaceutical spending. Raoof notes that just as AI has found valuable service-oriented applications in sectors like law and finance, similar opportunities are ripe for the taking within pharmaceutical services.

Proximal Ventures focuses its capital deployment strategy on pre-seed and seed-stage companies, writing initial checks between $500,000 and $1.5 million. The fund has already established a footprint by backing seven startups, including ChronicleBio. Co-founded by former OpenAI executive Fidji Simo, ChronicleBio applies AI to biological and medical data analysis to better comprehend chronic diseases and pinpoint potential treatments.

Before launching his fund, Raoof spent two years as a principal at SignalFire, led business development at clinical trial recruitment startup Iterative Health, and oversaw partnerships at Flatiron Health, an oncology data enterprise acquired by Roche for $1.9 billion in 2018. His operational background and industry network helped convince limited partners of his capability to source deals and help portfolio companies navigate early commercialization.

Proximal's LP base features prominent venture institutions like SignalFire and Kleiner Perkins, alongside Bertelsmann Healthcare Investments and individual backers such as Dimension Capital co-founders Nan Li and Zavain Dar. Amy Abernethy, co-founder of Highlander Health and former principal deputy commissioner of the FDA, also invested in the fund, highlighting Raoof's talent for identifying industry bottlenecks and building relationships.