Ben Palleiko recently left his spot as head of life sciences investment banking at SunTrust Robinson Humphrey to launch a merchant bank, Intrepid Merchant Partners, in Boston. Palleiko aims to provide financial and strategic advisory services to small public biotech, pharmaceutical and medical technology companies on the cusp on profitability. Near year-end, Intrepid should start raising a $50-$100 million merchant banking fund to invest in the same companies. "We're not going to be a buyout shop," he said. "We won't take majority stakes. They'll probably be significant, but not controlling stakes in public companies."

Intrepid will be different from an investment bank because it won't execute financing transactions and plans on charging a retainer with warrants, Palleiko said. It will also offer help with clinical trial execution and joint-venture negotiation, issues common to research-driven companies. A handful of firms already offer similar services, Palleiko said, listing Blum Capital Partners, Prides Capital and Baker Brothers Investments. Intrepid will aim to distinguish itself by focusing on healthcare and smaller companies.

Palleiko left SunTrust March 17. He expects to hire another partner in the coming weeks and have at least six people on board--including two or three partners--by the end of the year.