Hello and Welcome!
This week I've been thinking a lot about what makes for viable scientific ventures and how to draw the line between high science risk venturing and impossible insurmountable leap forward not worth funding.
This is partly stimulated by the video I released this week, on a projectile fusion approach by Oxford company First Light Fusion. If you haven't seen it you can find it here:
Fusion, by its nature, is one of those topics people love to hate. If you're perpetually 30 years away from working then it's easy for enthusiasts to become disenchanted with slow or incremental progress. What that seems to breed is a "shouldn't we be spending our money somewhere else?" mentality, and a lot of folk writing off new approaches, before they've been proven out one way or the other.
This is the issue with “Deep Tech” ventures created from scientific leaps forward; quantum computers, CRISPR, anything to do with graphene, etc. And it always will be. We are looking at technologies that are produced at the edge of our understanding about how the universe works, so pulling these ideas through to the point where they become "just an engineering problem" can take years on the low end, decades on the high end.
So what do I look for?
This is a very long answer which depends on the stage of the company. But let's start with the case where I spend most of my time, the first launch or first few years of a new venture.
One of my start ups, Science Angel Syndicate, helps investors find good companies to invest in. At the point of first introduction to a company, we have a check-list of 5 things that companies must pass with flying colour before we consider taking a deeper look.
In order of importance I look for:
A significant problem so be solved, (personally preferably around health of people or the planet)
That problem must have a meaningful market size behind it ($1bn+) to hope to motivate external investment to support this activity over a long and high risk journey
A great team with diverse backgrounds (commercial and technical) and strong evidence of "genius" in the appropriate technology or field (a PhD helps a lot but isn’t required)
An initial "proof of concept" experiment that shows the idea could work and be competitive against existing approaches
A route to protecting the core idea or intellectual property (preferably a patent already in place) to give investors piece of mind that if the long and high risk journey is completed successfully, the company will have full defensible rights to use it
The finer details beyond this, of which there are a lot, can be determined following a deeper look, or even as the business matures. This is the purpose of the venture, to be a problem solving machine. Typically, the technology development will be a significant fraction of the work for the first 5-7 years (much longer for fusion), but defining the business model, establishing unit economics, and route to market happens along side and very rarely is what you thought it would be on day 0.
So when a fusion breakthrough looks from a distance like its only proven out on a small scale, or still with significant technical or business flaws, the conversations shouldn’t be “oh but they haven’t solved it yet, so they probably won’t”, and more of a “do the puzzle pieces look like they would fit given another 5-10 years to work it out.”
If so, maybe it’s time to get exited.
What I did this week
Speaking of spotting good Deep Tech companies, today we announced our investment into MitoRX, a biotech company working on mitochondrial-protective therapeutics in order to reverse mitochondrial dysfunction and arrest decline in muscular dystrophy and neurodegeneration. That’s a lot of science words.
Damage to critical pathways in the mitochondria, such as sulfide-signalling have been linked to diseases from Duchenne muscular dystrophy, Huntington’s, Alzheimer’s, Parkinson’s and other common neurodegenerative diseases and diseases of aging. MitoRX are developing a platform that reinstates sulfide-signalling capabilities in mitochondria, which early modelling has shown is capable of halting the progression of these diseases. I won’t go to deep into the science here, as I’ll save that for a video, but if you like reading papers, a quite accessible one without a paywall can be found here.
I’m particularly excited to be working with Mito, as the diseases they target have huge impact on quality of life are particularly difficult to treat. To date, there is no known effective therapy to cure neurodegenerative conditions, hopefully Mito can bring us one step closer to treating them at least.
Have a great week!
All the best,
Ben