Authors: Katarzyna Krzywicka, Filip Cvetko Edited by: Burcu Anil Kirmizitas
Startups are all about the idea. But without passion, commitment and expertise, even the most groundbreaking idea would not come into life. On 4th of May, Science Innovation Union Cambridge team welcomed experienced startup founders who shared with our audience the tactics on how to present all these features with a startlingly short pitch to investors. This SIUConversations session was titled "Meet The Founder: Pitch Perfect” and we hosted Simon Lambden, LIFNanoRX Therapeutics, Age Curve and Vocalens to learn about what it takes to successfully leap from an idea to business.
The talks focused on a selection of areas of science, featuring new drug discoveries, novel molecular diagnostics, and modern assistive technology ideas. Our first speaker, Simon Lambden is a researcher at the Intensive Care Unit team in the University of Cambridge academic hospital. He is working on sepsis, an uncontrolled response to infection, and one of the major causes of death among ICU patients. Simon has just secured private funding for his new drug and his company is on a fast track to growing success. He showed us how to pitch his work to investors and how to prepare for meetings with them.
Su Metcalfe, our second speaker, was also very successful in convincing us of the potential of her ideas. Having recently won Business Weekly’s Woman Entrepreneur of the Year Award, she is the founder and CSO of LIFNanoRX. LIFNanoRX is a nano-biomed company focused on treatment of Multiple Sclerosis (MS), a common autoimmune inflammatory disease of the central nervous system causing a range of debilitating neurological and psychiatric symptoms. Su offers new solutions to curing MS. She is developing nanoparticles delivering Leukaemia Inhibitory Factor – a stem cell factor that activates tissue repair - into the brain and the central nervous system. In November, her company received £1 million in funding from the Cambridge Judge Business School venture “NanoMedicine” and Su is planning to start the clinical trials in 2020.
Attila Csordas, founder of AgeCurve Limited, is also an expert in molecular biology – but with a focus on diagnostics, rather than treatment. AgeCurve Limited is a startup with a vision to provide age profiles by detecting molecular patterns in the analysis of people’s proteome from saliva. Analysis of the molecular patterns of human and bacterial proteins can then be used to assess lifestyle interventions.
The last speaker of the evening was Portia Asli, the founder and COO of Vocalens, a University of Cambridge spin-off. Vocalens develops smart wearable assistive technology for people with visual impairment. In the UK only, there are over two million people with impaired eyesight and Vocalens, creating novel wearable image-to-speech technology, is giving them an opportunity to fully reintegrate into society. The startup was incubated and accelerated at the Judge Business School.
The event had a format resembling that of venture and accelerators events for potential investors. The founders pitched the idea behind their business to us, focusing their time on either the science or financial backing. The pitches were engaging, and illustrated a palette of colours one could use to brush up their presentation. Conciseness, passion and a phenomenal potential for future development were key to a successful pitch. Afterwards, the attendees and the speakers discussed the hardships all the founders had to go through in the early development phase of their companies. The first issue commonly faced by all the startups was, not surprisingly, the financial security. The founders discussed two schools of thought regarding the source of financial investment. Since the costs of bringing a drug to market today are extremely high - on average £2.6 billion per drug - launching a new drug clearly requires external funding. However, given that even in specialised pharmaceutical companies less than 10% of drugs enter the market, drug-based startups are inherently risky and hence difficult to fund. Su Metcalfe told us she received her funding from various sources (including charities and government), but has also cooperated with “the Big Pharma companies” for the purpose of developing her product to reach the clinical trial phase. Dr. Lambden explained how his negotiations with pharmaceutical industry, which typically avoids high risk, did not bear any fruit. We then debated how in some cases large pharmaceutical investors do not support early stage ventures but are interested in acquiring companies later on. The venture capitalists (such as Rubicon, Terraventure and Biotech 365), view this approach as an opportunity to be involved in the external biomedical research, and as Dr. Lambden eventually found out they can be convinced to finance your endeavours but they do end up owning a certain stake in your company. Finding an investor, however, especially beyond the pharmaceutical industry, is highly dependent on the company’s business model.
There is a growing number of technology-based ventures in the biomedical world and patent securing in those areas appears to be a bit less daunting as we found out from Attila and Portia. Both startups are in the very early stages, but proposed viable, albeit opposite business models during their pitches. Vocalens is betting on the business-to-business model, while AgeCurve seeks its place running a business-to-customer model. Therefore, the founders could not emphasise enough the importance of having a clear idea of the target clients for your startup.
The second issue recurring in the discussion was about the missed expectations as well as about legal and administrative ambiguities. Wherever the money comes from or whoever is sitting on the other end of the table, your pitch will need to convince them. The founders, who are also scientists, shared their stories on how important it was to realise that listeners were not Principal Investigators - they were not interested in the molecular mechanisms behind their work, but their financial potential. The investors always have the same old questions: “Who owns the patent?” and “What is the intellectual property position of the company?” A technology/invention needs to be a novelty in order to be patented. Therefore, the founders told us how they had to educate themselves in relevant fields of management, economics and law (often with the help of the Cambridge University Judge Business School) and have shared the importance of having some legal wisdom at hand. The take-home message was that scientists are put at a crossroads as they are wired to publish before they perish, but publishing robs them of the chance to patent. The advice was clear, although controversial - if you wish to own a startup, let your entrepreneurial mind dominate your academic curiosity, when it comes to breakthrough discoveries.
The evening definitely raised important points on how to successfully take the determining step from idea to venture and the take-home message was: although the idea of becoming a start-up founder is certainly terrifying and risky, it is clearly a tempting and a contagious one.