TagLaboratory Space Boston

How to stop the student exodus

Five years after the Boston Globe sounded the alarm, the question that is still top of mind in Massachusetts is: How can we do a better job of connecting students to the startups that are driving the growth of our region’s innovation economy and persuade them to stick around after graduation?

UMass Boston’s experience with internships shows that universities have an important role to play. They must help educate startups how to create compelling roles for students so they are contributors out-of-the-gate, and then make it easy for startups to effectively find the right kind of students.

At UMass Boston, this is accomplished by the Venture Development Center working with the College of Science and Mathematics and the Career Services and Internships office. That’s how UMass Boston students Valentina Dunn, Bersabel Wondimagegnhu, Amy Worth, Jacob Borr and Hembly Rivas (pictured, above at the Venture Development Center) were recently hired by GnuBIO, enEvolv, Parabase Genomics and Pressure BioSciences.

Students light up when given a chance to experience the excitement of goal-oriented, product-focused research first-hand. And startups learn how to expose students to why their team, company, and vision are fantastic, and get them committed to joining full-time upon graduation.

The state has done its part to make internships attractive. The Mass Life Science Center Internship Challenge will pay a company up to $7,200 per intern to bring them on board.

Now, it is up to universities to facilitate the match-making. Think of it this way: What university doesn’t want to enroll the kind of entrepreneurial student interested in a chance to intern at a world-changing startup?

Sample6: $11M richer but you’d never know it

On Wednesday food safety diagnostic test firm Sample6 announced it has secured $11 million in a Series B financing round. But don’t expect them to spend the money on anything but what’s absolutely essential.

The discipline of Sample6, embodied by co-founder Mike Koeris (pictured), impressed us from the beginning. And it was manifest in many memorable ways.

The first question Mike asked when the company joined the VDC was how to find an intern or two from UMass Boston. He wanted to leverage his senior team. We’d arrive in the morning only to find the results of a night’s worth of dumpster diving at area universities. Why buy new equipment if used works just as well?

Once, he asked us to print paychecks after the company’s $5.4 million Series A because they didn’t yet have a $99 printer. Another time, when all of our meeting rooms were booked, Mike wheeled a table into the storage room for a board meeting. The next day there’d be a box of chocolate from Mike.

The company’s sole focus was finding the right application for their engineered phages. Once they did, they spent on hiring experienced talent, including Will Cleveland, a UMass Boston biology graduate.

Our introduction to Sample6 was a call from Boston University, where the technology was born, asking us if we would consider accepting the company. They weren’t just looking for lab benches, but wanted a place where they could develop their company, team and culture.

We are proud to have given Sample6 its start, and have no doubt they will continue to be successful.

The Chasm of Skepticism: The Greatest Barrier to Raising Capital

Guest Post By Dennis Ford, CEO, Life Science Nation

Recently, I have been interacting with a lot of startup incubators and accelerators, revolving around fund raising boot camps that LSN teaches for scientists.  Basically, LSN’s “Discovery to Distribution Boot Camp” stays away from the strategic and concentrates on the tactical aspects of commercializing and raising capital. The marketing task is all about doing the research and finding a list of investors that are a fit for your products or services. It’s really a marketing 101 exercise: the first step is LSN helps them identify all the companies on the planet that look like their firm. In marketing parlance, this is identifying and sizing the competitive landscape.

Why is this important? This exercise – when done properly – will not only include most of the look-alike companies, but also the look-alike-companies and their lead and co-investors that have invested in the past and present. This über list of investors is quite valuable, as we know that these investors will understand the company, the market and the product, service or technology. I refer to this list as the global target list, and the reason is that these investors are a fit.

The next aspect is finding even more investors that are a fit based on present mandates to invest in the future. These investors have dry powder (investable capital), and are looking to allocate. When done properly, LSN can help them aggregate a list of relevant investor targets in their orbit that have shown a distinct past, present or future investment interest. Sounds simple enough, but here is where the world of the scientist collides with the world of the generic sales and marketing.

Time and time again when we put on these boot camps, the inevitable questions arise. The list is great, but am I allowed to call these investors? I hear that if someone doesn’t refer you, investors won’t talk to you. Can you prove to me or give me a reference of someone that has actually called an investor cold? I want proof that getting a list of investors that are a fit is how entrepreneurs actually raise money. On and on, the skeptical scientists create a thousand reasons why getting a list of investors that are a fit for their particular market segment or indication won’t work, and how in the past it worked like this (the old, outdated map). Enter the sequel to the Valley of Death version 2.0: The Chasm of Skepticism.

I make no bones about who I am and where I come from; I am genetically a sales person. I have been selling for decades, I am a selling CEO, I am an entrepreneur with 8 startups under my belt. Of the 8 startups I have been involved with, I have been part of the executive management team, the CEO or the founder. I have been part of 2 IPO’s and 4 acquisitions, with 2 more in the wings (I hope). So please imagine my reaction having spent my life in sales, marketing and business development when I have to debate whether a person who is a startup entrepreneur is allowed to make an outbound phone call to a complete stranger to move his/her company along.

What is even more chilling is this ethos is passed around in the life science marketplace as some sort of rule. Entrepreneurs shun rules. Entrepreneurs break rules. Entrepreneurs don’t listen to the status quo out-of-date dictums, and they don’t use old antiquated maps! They create new ones they do whatever they have to do. They jettison their comfort zone. They embark on hideously uncomfortable journeys. They do whatever it takes and making a blind cold call to a complete strangers who are a known fits for their product or service isn’t even the ante into the game. So here is how to get across the chasm of skepticism: get a list of investors that are a fit for your firm, do an email introduction, and then call and set up an intro meeting, then rinse and repeat.

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On June 4, 2013, the Venture Development Center hosted LSN’s “Discovery to Distribution Boot Camp.” We witnessed first-hand the world of the scientist colliding with the world of marketing and sales. But what was interesting is that the founders who already had been around the block a few times embraced the new approach to fundraising, more readily than others who wanted proof that it works before they will try it.

The Last Three Feet: Vetting and Grooming the Scientists for Success

Guest Post By Dennis Ford, CEO, Life Science Nation

“Scientist-entrepreneurs remain unprepared for the reality of how difficult the process is for connecting with a partner in the market place.”

I spend a lot of time observing and analyzing early stage investment trends in the life science industry. The product of this research has led me to identify the biggest trend in recent years: that new categories of investors are surfacing to fill in the void left by the lack of VC funding.

Part and parcel to the new investor group’s trend is a bevy of new entities that are spending time and money vetting and grooming biotech and medtech start-ups.  They range from world renowned hospitals, research clinics, academic tech transfer offices, patient groups, foundations, both private and public sector initiatives all morphing into different forms of life science incubators pushing scientists and their innovative technologies to commercialization.  The essential idea is that there is enough general domain knowledge to pick the likely candidates for success based on their own sector or indication expertise. This is a great concept and is still getting off the ground. However, what most of these initiatives fail to grok is that “the last three feet” of the fundraising/commercialization is the actual going out into the market and finding the channel partner or investor and getting a deal done!

I have met and interviewed countless graduates and winners from these entrepreneurial programs. They graduate with eager smiles and hearts full of enthusiasm, take a deep breath, and then say…now what?

It was Edward R. Murrow who said, “It has always seemed to me the real art is not so much moving information or guidance or policy 5 or 10,000 miles. The real art is to move it the last three feet in face to face conversation.” Although he was speaking about international exchange, I think the quote is wholly applicable to the life sciences.

This last three feet is exactly where LSN staff spends most of their time. At the end of the day, where the real failure lies for many of these initiatives is in that scientist-entrepreneurs remain unprepared for the reality of how difficult the process is for connecting with a partner in the market place. Everybody understands their marching orders, but hardly anybody has been given the training and tools to carry out the mission.

What I am talking about specifically is the basic, tactical sales and marketing 101 skill set (the training) to go out and fundamentally execute a partnering campaign. This has to do with using databases to gather and vet lists of targets to go after, and identifying the low-cost, cloud infrastructure applications (the tools) that will enable and support the endeavor. For example, once you have gathered together the targets that are a good fit for your partnering initiative, you have a list – and the associated tasks – that you will have to manage. Most scientists will go right after the color-coded Excel spreadsheet to do this, which may as well be the kiss of death.

Cloud applications like SalesForce.com can provide you with a fabulous automated list, as well as task-management capability for a small monthly fee. Email applications such as iContact are a necessary tool for your outbound partnering campaigns, and you get a lot of compelling reporting for a low-cost monthly fee that will provide insight into who is clicking and interacting with your emails and outbound marketing. Newsletters, blogging and whitepapers are another excellent way to reach out to targets to either start a dialogue (or continue a dialogue) with multiple clients. These Cloud apps have created an affordable, easy-to-use campaign management infrastructure that just wasn’t here a few years ago. These applications are the picks and shovels for the gold the entrepreneur is trying to mine.

My point here is that there is not a lot going on tactically in teaching the last three feet – how to find and start a dialogue with investors, how to arrange a meeting, schedule a roadshow, run a meeting, and nurture & cultivate an ongoing relationship with your prospective partners. All the aforementioned criteria are critical in finishing what has been started with the scientist-entrepreneurs. After all the pie-in-the-sky strategy and perfect pitch role-playing is done, you still have to go that last three feet, stick out your hand and introduce yourself.

Where biotech is better off than anywhere else

(This article was published on June 18, 2012 by BostInnovation.)
More than 15,000 people from around the world have descended upon Boston for the annual BIO International Convention. Among them are economic development officials hoping to entice companies to move to their region with cheap land, low tax rates and regional culinary novelties such as fresh crawfish.

But they are likely to leave empty handed.

We’ve seen biotech companies in the Boston area move seeking cheaper land. But the Boston suburbs are about as far as they go. And they inevitably come back to the city.

Biogen Idec, the third largest biotechnology company in the world, just reversed its relocation two years ago from Cambridge to Weston.

And drug maker Vertex is moving its headquarters from Cambridge – but only across the river to Boston to two new office towers under construction.

Life science companies stay close to their roots

Why is it so hard to uproot a biotech company? Biogen Idec co-founder Phillip Sharp, an MIT professor, expressed the reason well: “Biogen Idec is a high-tech company and must be in touch with the cutting edge of biotech.”

While the proximity to scientists and universities is the top factor influencing the decision to be in Boston, it is closely followed by the ability to find appropriately trained talent in all aspects of the business, from product research to manufacturing and distribution.

Any hope economic development officials coming to the BIO International Convention have of establishing a biotech hub in their state will rest upon developing unique pockets of expertise.

Long-term nurturing bears fruit

Massachusetts’ biotech credentials did not develop overnight. But after decades of tactical and strategic nurturing, the cluster is bearing fruit. As the following chart* of Series A deals shows, Massachusetts now is producing more than twenty new venture-backed companies each year.

The blossoming comes at a time when large drug companies, with research budgets shrinking, are instead looking to startups in hopes of feeding their drug development pipelines.

A startup takes root

Like apples falling from a tree, startup firms tend to take root near their parents. Because these children tend themselves to spawn further spinouts, the cluster becomes stronger.

An example serves to illustrate the point:

A postdoctoral fellow at Novartis and a senior officer with Genzyme founded 4s3 Bioscience after discovering a mechanism to deliver large molecules to muscle tissue, key to tackling neuromuscular disorders for which there are no treatments.

Outsourcing the research supported by a grant from the Department of Health and Human Services, 4s3 obtained results that led to seed funding from Genzyme Ventures.

While applying for an accelerator loan from the Massachusetts Life Science Center, 4s3 began looking for its first laboratory space and contacted a former colleague at Genzyme now at the University of Massachusetts Venture Development Center, which had just opened new incubator space for emerging life science companies in Boston. After obtaining the loan from the Massachusetts Life Science Center, 4s3 moved into the incubator. Eighteen months later, after successfully completing key studies, 4s3 obtained a $20M Series A, and is making preparations to expand its operations in Massachusetts.

Grow your own

Massachusetts economic development officials attending the BIO International Convention no doubt will talk about how helpful it is to start a company in a place where there is infrastructure for biotech companies, accumulated knowledge about how to make them succeed and many others starting up companies.

Instead of wooing companies, economic development recruiters coming to the BIO International Convention ought to be listening to what the biotech industry needs, and building an ecosystem that nourishes them.

After all, it seems increasingly apparent that the secret to success in biotech is to have a successful parent.

* Data compiled and analyzed by Aijan Isakova, Venture Development Center, based on data from OnBioVC.