It has been speculated that Biology will reinvent trillion dollar industries. My definition of wealth is good health, happiness, a depression - free work environment, financial freedom and a life of service to others. Although my definition of wealth certainly does not require a trillion dollars, the power of biology on future technologies is not an overstatement. Consequently, creating a biotechnology start-up is not a waste of time but you must, however, be warned that unlike computer engineering you will not build a billion dollar App in your parents garage within a month. Most articles that talk about the start-up world are not tailored for the South African landscape and those that are barely mention the challenges associated with biotechnology. I have deliberately structured my writing to speak to this, that is, how to move from an idea in biotechnology to the manifestation of that idea within the South African landscape. Some challenges overlap with creating a biotech start-up anywhere in the world and other challenges speak specifically to the African landscape.
Abandon hope all ye who enter here
A clear distinction must be made between biotechnology and computational information technology (I add “computational” because biology too is information technology that is driven by natural or directed evolution). The distinction between the two is expectation. You cannot be a self-taught biological scientist, consequently, attempting to superimpose the many Silicon Valley tropes made famous by some of the most charismatic tech founders (e.g dropping out of college or university, writing code in a parent’s garage or college dormitory, being a unicorn in a very short space of time) simply will not work in biotechnology. Biology demands a level of expertise that requires an advanced degree past the undergraduate level and requires a huge initial investment that in most cases is a bottleneck for start-ups. Additionally, it demands a greater deal of time. It is highly improbable that you will create anything worthwhile in two weeks to a month. The take away of this paragraph is that biotechnology takes time, a lot of it. It requires money, a lot of it and it requires expertise with advanced degrees. A phrase from Dante’s Divine Comedy seems ideal in describing anyone that expects less from biotechnology.
Starting from scratch (Show me the money)
Now that expectation has been set, one has to acquire funding. I will base the spirit of the article within my experiences of the South African landscape. I will not tell readers to bootstrap their way into a biotech start-up for two reasons (i) Having experienced the journey, I think it is cruel to tell aspiring biotechnology innovators to bootstrap their way into something that requires hundreds of thousands to millions of rands or dollars. You can certainly bootstrap your way in other ventures (perhaps when developing an App or when starting a website or when selling something that does not require the development of intellectual property such as a vegetable business). Secondly even if bootstrapping was applicable, most young, African biotechnology innovators simply do not have the personal finances to do so. They are usually first or second generation graduates in their families with great expectations placed upon them. So innovators must acquire funding. The funding process is long and frustrating and I would encourage anyone to have at least enough money or support to sustain themselves (i.e. enough transport money to attend a meeting with a potential investor or meet with other people in a networking event etc.). Raising biotechnology funds boils down to one thing, confidence.
In the article, I refer to confidence as the ability to assure potential investors that they are making the right decision by supporting you. Since I have ruled out bootstrapping as good advice within the South African biotechnology start-up landscape then investor confidence is something that your whole start-up identity must revolve around. Tips to increase investor confidence in biotechnology are as follows:
Qualification: Be very qualified. In the absence of any evidence of real vertical acceleration (i.e profit margins, revenue, etc.) investors have to know for sure that you are qualified and have the trained ability to execute on this great idea. This applies to a lot of industries but none more important than biotechnology because biology affects people, whether it is developing therapies or testing samples the implications of biology affect people in real ways. Here I recommend post graduate degrees, masters or PhD with work experience in the sector.
Teamwork: Without bootstrapping to revenues and profit margins you need to demonstrate that you have a solid and equally qualified and competent team. You need to show a united front each with skill sets that complement the entire team. Here I recommend forming a corporation of young talented people. Attempting to go solo WILL NOT WORK. A group of people coming together united in thought inspires a lot of confidence.
Vision and Plan: Have a clear vision of the company and a well laid out plan. Chances are you will have gone through many rounds of perfecting your business plan through countless competitions, seminars, networking events etc. Apply for everything, go to every competition, lose as many times as you can (and trust me you will lose so many times) but perfect your idea and vision with each loss. Remember the idea is not to win but to garner enough experience that allows you to project the confidence required to assure investors. If your company is worth a billion dollars in your spirit then manifest it. Visualize it, behave it and act like it. Ask for investment equivalent to what you believe your company will be (not what it is now-because in all honesty you do not even have money yet so if you value your company based on your current challenges then it won’t be worth much).
Prove vertical acceleration: If someone can pay you for consultation let them pay you and record that. If someone can pay you for anything associated with your start-up let them do it however far in between. Remember you are not trying to show profit margins but rather, you are trying to build enough confidence for investors. There is no greater confidence booster than showing that someone has actually paid you. If the aim is to develop the next blockbuster drug, charge for academic consultative gigs as a company before you become a blockbuster big shot. Take payments from anyone that can pay for your services even if it is consultative. Anyway, back to vertical acceleration, let your vision for the company show that the technology you are developing or will be has the potential to be scaled rapidly across the world. Your vision/plan, qualifications and competency as well as the few times you have been paid by others helps greatly.
Do not quit: The urge to quite is in every champion, DO NOT QUIT, you will go through every emotion: frustration, joy, sadness, happiness, disappointment, you will question were your life went but more than anything you will experience the urge to quit. DO NOT QUIT.