My Take on Micro-IPOs in Biotech: Insights from My Discussion with Carina Clingman

Written By David Sans
David Sans discussed micro-IPOs at Carina Clingman’s Business of Biotech Podcast

David Sans discussed micro-IPOs at Carina Clingman’s Business of Biotech Podcast

As the Head of Healthcare Investment Banking at D Boral Capital, I’ve had the opportunity to work with many biotech companies navigating the complex world of fundraising. One financing strategy that has gained traction in recent years is the micro-IPO—a smaller-scale public offering that allows emerging biotech firms to access capital while maintaining strategic flexibility.

In a recent discussion, I broke down why micro-IPOs are an attractive option for biotech startups, how they compare to traditional IPOs, and what companies need to consider before taking this route.

What Makes Micro-IPOs a Smart Move for Biotech?

Unlike traditional IPOs, which often raise hundreds of millions of dollars and require significant resources, micro-IPOs allow companies to raise smaller amounts of capital—often between $10 million and $50 million—without the same level of complexity. This makes them particularly valuable for early-stage biotech firms that need funding to push their therapies and technologies forward but aren’t yet ready for large institutional investors.

Micro-IPOs also offer a crucial advantage: they open the door to public investment while giving companies more control over their financial future. With a lower capital raise, companies can minimize dilution, maintain a leaner cap table, and position themselves for future financings or acquisitions on their own terms.

The Investor Perspective

One of the key points I always emphasize is that micro-IPOs attract a different type of investor. Rather than large institutions focused on immediate returns, micro-IPOs tend to bring in retail investors and long-term biotech enthusiasts who are willing to bet on early-stage innovation.

For biotech companies, this can be a double-edged sword. On one hand, these investors understand the high-risk, high-reward nature of drug development. On the other hand, companies must work harder to maintain investor confidence, ensuring that strong scientific progress and clear communication remain at the forefront.

Challenges and Considerations

While micro-IPOs can be a great funding tool, they aren’t the right fit for every biotech startup. Before going public, companies need to consider several factors:

  • Market Conditions – Timing is everything. A weak biotech market can make raising capital difficult, even with strong science.

  • Regulatory Requirements – While a micro-IPO involves less regulatory burden than a full-scale IPO, companies still need to meet SEC reporting standards and maintain public company compliance.

  • Post-IPO Strategy – The IPO itself is just the beginning. Companies must have a clear roadmap for capital allocation, clinical milestones, and future fundraising to keep momentum going.

Final Thoughts

Micro-IPOs are becoming a valuable alternative for biotech companies looking to fund their research and development without giving up too much equity or control. They provide an entry point into public markets and, if executed properly, can set the stage for future growth.

However, they require careful planning and execution. Companies considering this route should work with experienced advisors who understand the nuances of biotech investing and public markets.

If you're interested in learning more about micro-IPOs and whether they might be a fit for your biotech company, I invite you to check out my recent discussion on the topic.

🎥 Watch the full interview here: Demystifying Micro-IPOs in Biotech with David Sans

David Sans