Executive Q&A: Adam Bauer, Venture Partner, Caduceus Capital Partners

Apr 6, 2021 | Blog

Adam Bauer, Provider Services Partner, IBM Watson Health Consulting and Venture Partner, Caduceus Capital Partners

Tell me a bit about what you do every day. What is mission critical for your work at IBM Watson Health Consulting in 2021?

Watson Health Consulting is in the business of helping our clients be more successful through the application of technology. There’s a lot to unpack there across the healthcare landscape –reducing delivery and operating costs, improving experience for patients and providers, and helping to achieve better outcomes through clinical intelligence being some of the highest-level objectives. Fortunately, IBM has a rich tapestry of technology solutions to address those objectives – everything from hybrid cloud and infrastructure services to custom software and apps to robotics and artificial intelligence.

Watson Health Consulting gets the fun job of figuring out how to “point the big blue battleship” at our clients’ challenges, working with our clients to create strategic approaches and managing the delivery of technology and services from across IBM to reach defined goals.

What made you want to get involved with Caduceus Capital Partners in particular?

It’s no secret that digital health is a hot market in a behemoth industry, so as far as innovation and investment goes, there are fewer more exciting places to get involved in venture capital. What drew me to Caduceus in particular was the leadership team. This is an “A Team” of health technology executives building on multiple careers-worth of success in this space – as founders, executives, and investors. The trust factor combined with a strong thesis and sharp focus on early-stage digital health was a “perfect storm” of opportunity in my eyes.

You are not just an investor with Caduceus Capital Partners, but also a member of “The Syndicate.” What is your perspective on The Syndicate model?

I consider it a massive win/win for the fund, the Syndicate members, and our investors. “The Syndicate” is a group of Venture Partners who are both active participants in the business and investors in the fund. I think of it like putting together a baseball team. You start with a great Manager, you want someone with lightning reflexes at shortstop, a righty and a lefty in the pitching rotation, a big power-hitter, and so on. This is the same model, where our Managing Partners have hand-picked executives and trusted colleagues to “fill the roster” as it relates to our ability to make and manage smart investments. If we see a revenue cycle company come through our deal flow, we can get our revenue cycle executive to take a look at them. If we need to fill a board seat on a mental health company, we might consider seating the executive who has designed and implemented mental health technology. It lets us spread the work, be more focused and deeply engaged individually, and bring the best people to bear against the opportunities in front of us. A team of 12 is going to beat a team of 2 every time!

You have a front-row seat to implementing new technologies at a large, powerful corporation. Meanwhile, there are so many startups trying to succeed in digital health these days. How do you find the companies worthy of purchasing?

To make sense for a company like IBM, an acquisition has to pass two tests: does it help to create a competitive advantage, and can it scale? With digital health advancing and changing so rapidly, acquiring a novel and impactful solution may make more sense for a large technology firm than investing the resources – and, more importantly, the time – to develop a competitive offering. That said, the solution has to make sense and fit within a broader digital transformation portfolio. Most firms of our breadth wouldn’t acquire a startup solution and stick to narrowly implementing it – it’s about infusing the solution into the overall value proposition we can bring to our clients across software and services. That’s where scale comes in. Attractive solutions are ones that are mature enough to be deployed rapidly across many clients and backed by a team that can support both the integration of the solution into a greater whole and exponential growth in the market.

What have you learned from your mentors over the years and how has it helped you to achieve success in your endeavors?

My mentors taught me about the importance of taking calculated risks. Success doesn’t come from standing still; whether it’s changing jobs, going after a complex deal, or making a big investment. I’ve been fortunate to observe how my mentors have weighed major decisions, evaluated risks, and made high-return choices as they’ve built successful careers.

When you are not working, what are your favorite things to do in Dallas?

There are some great running and biking trails maintained around the Metroplex area, which are usable practically year-round. We also have a world-class botanical garden, which is one of my wife’s favorite places. We’ll often plan a day around spending a few hours walking the garden and enjoying a snack and bottle of wine on the lawn. As we move past the pandemic, I’m also looking forward to visiting some of the many local whiskey distilleries we have across Dallas and Fort Worth.

What is your favorite cause or nonprofit to support and how do you get involved?

I worked for many years with several New York City and New York State agencies that support individuals with intellectual / developmental disabilities. These agencies do tireless and vital work, supporting children and adults with education, vocational skills, housing, activities of daily living, and access to healthcare. I’ve always had a passion for supporting this essential community of social and physical care provision that often gets overshadowed by hospitals and health systems when we think about “healthcare.”

If someone is looking to invest in a venture capital fund, what advice would you give them?

Deals come and go, so invest in a team that gives you confidence for the life of a fund. The combination of our leaders’ experience and the unique assembly of “The Syndicate” has given me great confidence in participating both as a member of Caduceus Capital Partners and an investor in the fund.