Today we're announcing NFX Bio, a new fund initiative led by some of biotech's most successful Founder/CEOs. Our mission is to back seed-stage companies building bio-platforms that solve the biggest challenges facing humanity. NFX Bio is led by Omri Amirav Drory, Ph.D., Founder/CEO of Genome Compiler (acquired by Twist Bioscience). Joining him on the Investment Committee is Emily LeProust, Ph.D., Co-Founder & CEO of Twist Bioscience (TWST - NASDAQ), as well as NFX GP's James Currier and Gigi Levy-Weiss. By combining software/data tech with biology, and by architecting businesses with a platform approach, a whole new future of possibilities is unlocked. Information technology has dominated human progress for forty years. And the next phase is going to be led by Scientist-Founders who build info-tech powered bio companies. The rise of the Scientist-Founder is now. In this closed-door conversation, Omri, Emily, and James break down what they’re looking for, and what Scientists need to master in order to be CEOs. Read the full NFX Essay here - https://www.nfx.com/post/launching-nfx-bio/
Gita Reinitz:
Today we're talking about the rise of the scientist-founder and what it takes to go from the lab to the world of startups. I'm Gita Reinitz from NFX Bio, and this is the NFX Podcast.
James Currier:
Today we're announcing NFX Bio. Today I'm sitting around with Omri Drory, PhD, and with Dr. Emily LeProust of Twist Biosciences, and we are here to announce what we're doing. The last 50 years have been about software, but the next 50 years are going to be about bio, and in particular, the combination of information technology and bio. The costs have come down so much that now we can address so many different industries and progress with bio that we could never do before.
James Currier:
NFX Bio is our group that's dedicated to those type of investments. It's the pre-seed and seed investor for this industry, and we are bringing a Series-A-level infrastructure and team to invest in pre-seed and seed. We've been scientist-founders ourselves. We've been in your shoes, and so we know every aspect of the business you're in. When you take money from NFX Bio, you're getting people who understand the science, the connectivity to the right people. They know how it works. They've been in your shoes. That's really the difference.
James Currier:
Good to see you guys.
Omri Amirav-Drory: Good to see you.
James Currier:
Omri, please introduce yourself so people can know more about you.
Omri Amirav-Drory:
It's great to be here. My name is Omri. I did my PhD in Tel Aviv University, and then got the Fulbright Fellowship and came to Stanford for postdoc. I'm a scientist, like many of the founders we see.
Omri Amirav-Drory:
I then started a company called Genome Compiler. That company builds software for bioengineers, and I was lucky enough to get the investment from NFX. This is how I know the team there so well.
Omri Amirav-Drory:
I ran that company for five and a half years, so I've been in the trenches and I know how it feels. I was lucky enough back in 2016 to get acquired by Twist Bioscience, and I've been working with Emily ever since.
Omri Amirav-Drory:
I served as the head of corporate development for Twist Bioscience for two and a half years, and then left just before the IPO and started Tech.Bio, a fund that invested at the pre-seed stage in companies at
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the intersection of biology and technology. NFX was a big part of my fund. Then now I'm happy to be
part of NFX Bio.
James Currier:
You got to meet Emily, because Emily acquired your first company, Genome Compiler.
Omri Amirav-Drory:
Yeah, but actually we met each other years before that. I think both of us were in the room for the first synthetic biology, SynBioBeta, conference back in, I guess, 2013, even before she started Twist Bioscience. We've been interacting from the ... I still remember the first office of Twist, and we've been interacting ever since.
James Currier:
Fantastic. Dr. Emily LeProust, I'd love for people to get to know you as well. Can you give us some of your background?
Dr. Emily LeProust:
Yes. Happy to do it. I'm Emily LeProust. I was born in France. I'm an American. I studied chemistry, and then I got my PhD in organic chemistry and DNA synthesis from the University of Houston. I learned English in Texas, although I didn't pick up the accent. I can tell you that one person is "you all" and two or more is "all y'all", so I do know that.
Dr. Emily LeProust:
Then after my PhD, I went directly into industry. I did R&D for 13 year in a big company. I was really drawn to the commercial aspect. I was lucky enough that my two co-founders at Twist, they had invented the Twist technology and they were looking for a CEO to do everything that the CEO does. I am the victim. It's been a great partnership since then.
James Currier:
Could we get a little more detail, Emily, on your journey from PhD to founder and CEO of Twist Biosciences? Because you've gone from this idea to IPO. It's now worth about $10 billion. It's an incredible story. What were your steps? Just a little more detail on that would be great.
Dr. Emily LeProust:
I did my PhD. I realized very quickly that I did not want to go into academia, so I skipped the postdoc step and I followed in R&D. For 13 years I did R&D, and I went up from bench chemist all the way to director of application in chemistry, R&D. I was really good at R&D.
Dr. Emily LeProust:
Kept launching products, those were doing really well, but I didn't enjoy. My passion was more on the commercial side. Actually I wanted to be on the sell side or the marketing side. That's when the Bills, my co-founder, had the idea for Twist. They needed someone to take care of everything that was corporate and commercial. All the fundraising or the corporate strategy, the commercial strategy, they needed someone to do it.
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You just discovered that you loved that.
Dr. Emily LeProust:
I knew I loved it, because when I was in R&D, actually, I was on the road quite a bit to promote and to explain those new products to customers. I realized that even though I was very good at making the product, I enjoyed the selling of it. I enjoyed the communicating around that product much more than the R&D. Even though I had a 13 years R&D career for many years before I switched to Twist, I knew that I wanted to be on the commercial side.
James Currier:
What's that like, if a scientist is out there and they're trying to figure out if they're like you, and that they like both? What's the indication? At the end of the sales meeting, you have more energy? You get up earlier in the morning to go do sales calls than you do to go do research? What are some of the detailed signs that you have that personality?
Dr. Emily LeProust:
To be a great CEO you need to love selling an idea. In order to be a great scientist, you have to be fully grounded in reality, of publishing that paper. You need to make sure that all your data is perfect. You have to sweat the details of the nitty gritty, because that paper is going to be peer reviewed. If you can't prove everything by A plus B equals C, it's not going to work out. That's the scientist's life.
Dr. Emily LeProust:
In the entrepreneurial life, it's sort of about selling the dream. If you don't like that sales process of selling an idea, then you're not going to enjoy the life of a CEO. Because what the CEO has to do is, basically you're selling stock. To sell the stock, you need to have a vision, and you have to sell, you have to bring people onto your vision. You have to sell that idea.
James Currier:
That vision is a little less precise than the actual science that's behind the vision. You have to be comfortable with both languages, communicating in both ways.
Dr. Emily LeProust:
Absolutely. There is a similarity, though, between scientists and CEO. There's a similarity, though, between scientists and entrepreneurs, that you are not daunted by the impossible. To be a scientist, you know you have to push the boundaries. You have to set yourself a goal that almost sounds impossible from the outside.
Dr. Emily LeProust:
It's the same with an entrepreneur. When you go out there, you're trying to build something that has not been done before. That ability to view an outcome that has never been made, that is similar.
Omri Amirav-Drory:
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Yeah. I want to reassure PhDs that are thinking about being founder. What I want to say is three things. Is, one, PhD, you learn how to learn. That's what you do all the time. You have to learn new things, new methods all the time. Second, you learn how to design scientific experiment and learn from it. Third, especially in biology, you learn how to fail, and pick yourself up and try again. That's what you do again and again in the lab, but you still have this optimism and grit that in five years you get your PhD. That translate very well to entrepreneurship.
James Currier:
All three of those elements are very similar to what it's like to be a founder. The other thing is that, look, you don't need to be a CEO founder. You might have the personality to be the CSO, or some other part of a founding team. You can still be a founder. You don't have to be the CEO of a company. You could also be a founder.
Dr. Emily LeProust:
That's right. To me, a litmus test to be a CEO is that, if you do not like to raise money, do not be a CEO. Find something else. You can be the CTO, CSO, like you say. There's lots of other roles. COO. In my view, in order to be a great CEO, you need to love fundraising because it's going to be a big part of your life.
James Currier:
We're using the term "tech bio" here today, but people are maybe more used to the term "biotech" or "synbio". Can you remind us all why we're calling it "tech bio" instead?
Omri Amirav-Drory:
Yes. I think we're moving from traditional biotech to more technology and biology. Hence tech bio.
James Currier:
You're saying information technology combined with bio?
Omri Amirav-Drory:
Yeah. It's driven mainly by three main forces. One is, biology is getting digitized with technologies like DNA sequencing, DNA synthesis, where Twist is the world leader, and sensors turning biological data from analog data into digital, and that is ... Second, now, because the biology is being digitized, you can use computational tools, traditional computational tools, and emerging machine learning/AI tools to make sense of the data.
Omri Amirav-Drory:
Third, we're moving from a world where people are pipetting manually in the lab to high-throughput automation at scale. That really helps create the new categories of companies that go through the design/build/test cycle more rapidly, creating product faster and looking more like tech companies than bio companies.
James Currier:
Emily and Omri, just express to me again, as you've done in the past, why are you doing this? Why are you so excited about this space?
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I am so excited about DNA technology. In the '50s, you wanted to be in aeronautics, in the '60s, in semiconductor. In the '70s and '80s, in computer, in '90s, in the software. In 2000, you had to be in mobile. My view, this is the decades of biology starting now.
Dr. Emily LeProust:
Biology has been so hard for so long that it took a lot of time to get somewhere. It would cost so much money that you could only apply biology to drug development. Now because of lower cost of sequencing, lower cost of synthesis, because of automation, of computing, you can do biology at a much lower cost. What that means is that the number of opportunities are much broader than just drugs. You can still do drugs, but you can do many other things. That's where I'm excited is, right now we are living in the era of biology. It is the place to be.
Omri Amirav-Drory:
What we need to realize is biology is the most advanced technology on earth. It's nanotechnology that actually works. It's been around for at least 4 billion year. It scales. You can see biology from space. All the air we breathe came from biology. All the food we eat comes from biology. Everything we care about comes from biology.
Omri Amirav-Drory:
Right now it's in the intersection of many technologies that are going up exponentially in their capability, where is DNA synthesis, DNA sequencing, computation, automation. It's all coming together right now. You have a chance to impact the biggest markets and the most important markets. As we said, things that you can help people, you can cure people. You can feed people. You can provide for people. This is the best place to be in. I'm so excited just to be part of it.
James Currier:
Omri, what are you looking for in tech-bio companies right now?
Omri Amirav-Drory:
what we like to invest is the platform companies, where they have a core technology, especially a core biological technology. An IP that allows them to create many application, not just one small molecule for one indication. We want something that help you create a lot of different diagnostics, a lot of different therapeutic. These are the things that really excite us.
James Currier:
Yeah. Because traditionally you've had companies that got quite big just doing one therapy or one agricultural application. But increasingly because information technology is becoming more a part of the core technology infrastructure of these companies, you can now start to spread the core bio IP across multiple indications, multiple use cases.
Omri Amirav-Drory:
There are many examples. If you look at some recent and very interesting example, like Moderna, they have a core messenger in their technology and delivery technology. They're using it to create not just one vaccine, and, by the way, it took them two day to design the vaccines after the COVID genome was
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published, but they can do many vaccines. They can do also a vaccine for cancers, and other things. This
is the kind of companies we like.
Omri Amirav-Drory:
Or like Mammoth Bioscience, where they have core IP around Cas14 and Cas5, and Cas system used for diagnostic. You can use it both to create many different diagnostics by changing the guide RNA, but also creating many different therapeutics.
James Currier:
Emily, as you look at companies, what are you looking for? What are some of the things that excite you?
Dr. Emily LeProust:
What excites me is those three aspect of the market, the technology, and the people. You want an executive founder that are going after very big market. I think life is too short to create small goal. Then I'm excited about the kind of technology that are being developed to make a better mousetrap to go after that market. Then ultimately one very important part is the funding team and the culture that it creates in the company. Those are the three aspects that I'm looking for.
Omri Amirav-Drory:
It's so funny because it just demonstrate how me and Emily think the same. What I tell founders is, "There is three slides you need to show me." The three question that we'll ask you. One, is it big enough? Is the market big enough? Second, do you have any magic? Is this magic defensible? Is your technology is really magical and helping people? Third, are you the right team to execute this magic technology on this huge market to make something special? Again, me and Emily are really very similar.
Dr. Emily LeProust:
To build on what you said earlier, Omri, it's true that money is a commodity. There's a lot of money available. If you're a founding team, it's almost certain that you can be funded. Then therefore you have an opportunity and a responsibility to make sure that you pick the best money.
Dr. Emily LeProust:
Because when I first started doing fundraising, I was naive. Frankly, I thought, "I'll take anything. I'll take any money. I need capital." It turns out that you have to be very careful, because not all capital is created the same. You want to make sure that you pick investors add a differentiation compared to others. Funders should be very careful in which money they take.
Omri Amirav-Drory:
Exactly. I shared the same thing. Beginning, you think every money is green, but you soon figure out the big difference between good and bad investors. The one thing I promised myself is never to be the kind of bad investors. It's the oath that doctors make. At least never, ever cause harm.
James Currier:
Do we have a very developed bio ecosystem for investing? It seems to me that we've been developing the VC infrastructure for 50 years for software and information technology. Yet we're not nearly as developed, particularly at the seed and pre-seed stages for bio.
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This transcript was exported on Jan 27, 2021 - view latest version here. Omri Amirav-Drory:
Yes. Emily can talk a lot about the later stage. Especially in the early stage, not a lot of capital, especially for those companies in the tech-bio industry that are both tech and bio. Right now if you're a scientist and you want to commercialize your technology, you have very few option. You can go to a very few incubators that will take a lot of your equity, or just recently the accelerators got into bio. I was told that almost 15% of who I see every batch is now bio, if not more. There are some accelerators like IndieBio that gives you lot of space and some small amount of money. But to really get your IP out there to see that it actually works, to get the proof of concept, you need a few million dollars. It's very hard to find.
James Currier:
Emily, what first steps would you suggest to potential founders to turn their idea or their research into a startup?
Dr. Emily LeProust:
My advice would be to, first, have a very crisp story. It's interesting because, when you're a scientist, again, you want everything based in fact. But the first time you sit down with an investor, they tell you, "Tell me your story." They actually are looking for a story.
Dr. Emily LeProust:
That is the first thing, is make sure that you can articulate a story that will get people excited to partner with you. You're left to cover the element of the market, the technology, and the people, but that's what you have to think about. It's not about a business plan. Nobody cares. People want to be almost emotionally involved in the story, because in their souls, they have a lot of opportunities. They don't want to mail the tenth PD-L1 inhibitor, they actually want to do something exciting and new, too. That would have been my first advice.
James Currier:
What format does that storytelling take? Is that an email that you send to someone? Is that a tweet that you tweet out? Is that PowerPoint deck that you send to someone? What are the formats in which you communicate that story?
Dr. Emily LeProust:
Yeah. In my view, it has to be in person, in one-on-one, even through Zoom is fine. Nobody's going to invest on a one pager. However, we do need that, the one pagers, to hook people to get the meeting.
Dr. Emily LeProust:
The best, or maybe the only way to really pitch your idea, in person. You cannot cold call a investor. You need to find a way to get the hot introduction. There's, again, a lot of opportunities out there. You need to find someone that's going to get you in the door, someone that's going to put you on the top of the pile. Go through your network, check the tree, and get that hot introduction.
Dr. Emily LeProust:
Your investors, sometimes they ask you to send the deck in advance. If you can resist that, do, in my view, because then they look at the deck and make their own first impression. In my view, they should
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hear that story from you first. I would suggest, get in front of someone through a hot introduction and
have them hear the story from you directly.
Omri Amirav-Drory:
I totally agreed with Emily. I would also add that you want to be in the development cycle, in the research and development, because, especially with biology, the research might take anywhere between a month to forever. You want to start a company, best case is after you peer reviewed your research and you know that the basic biology works before you go around and try to develop it.
James Currier:
If we're talking to the bio founders, what does their seed company need to prove in order to get an A round or to get a seed round? Do they need to have already taken the IP out of the university, or should they come to us before that happens? Do they need to have a full team, or should they come to us before that? How far up the ladder of proof should they try to go before they go out and do a pre-seed or seed round?
Omri Amirav-Drory:
The higher the better. We've been helping companies get the IP out of universities already. We've done it for several company. We've helped companies where the team was not complete, and they need a CEO or a CBO. We're doing it all the time. Obviously the more proof points you have, the easier it is. But again, we're investing in all stages of the seed. Pre-seed, where it's just the scientist with the idea. A seed where the entire team is there and they need some help, maybe get the IP out and get the proof point for the A round. We even do early As.
James Currier:
What geographies do you find yourself deploying most of the capital?
Omri Amirav-Drory:
For me, it's mainly the Bay Area and Israel, but we are not limited by geography. Wherever there are great companies, we'll be there.
James Currier:
What sort of exceptional support do you think that tech-bio companies' scientist- founders should be looking for from their pre-seed and seed investor? What should they be looking for in investors like us?
Omri Amirav-Drory:
As I said, first, do no harm. Mainly help telling the story, help with fundraising, helping with hiring, helping with introduction to the right follow-up investors, helping setting up the scientific advisory board, which is very important for companies in our industry.
Dr. Emily LeProust:
Once you've built a company once, there's a lot of things that sounds difficult or insurmountable for founders which are actually easy. It's happened many times, where I know that I've spent five minutes with a funder, and I know that I've saved him a month of work. Just because, having done it before, you can try some very quick pointers that save time.
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This transcript was exported on Jan 27, 2021 - view latest version here. Omri Amirav-Drory:
That's magic. I think it's very important, also, psychological help for the founders. We've been there, so we know how hard it is. Just supporting them, never get frazzled, understanding the journey they're going through. We've been there. We understand what you're going through, and we'll support.
James Currier:
Given that information technology is coming together with biotechnology, we get this tech bio, what are some of the areas that are now lighting up? What are some of the things that are now going to be possible areas where we're going to be investing?
Omri Amirav-Drory:
So many things. What I am really excited about are things like cellular therapies. There are new technologies now where you can design immune cells to go after cancer, where it's the first time we've actually seen people getting cured from cancer. This is like coding in living cells. It's pretty amazing.
Omri Amirav-Drory:
There are advances that are being made every day in the field of longevity. We can live longer, healthier life. Again, if you look at COVID, the biggest risk factor is how old you are. We want to solve the underlying problem. We are super excited about moving to a more sustainable world, renewable chemical, renewable materials, all exciting.
James Currier:
I got to know you guys starting about five years ago, almost six years ago now, when we invested in Genome Compiler. We're not pretending here that the software investors at NFX are the great bio investor. We're bringing you guys in because you guys are the great bio investors. We can help out on the business side, strategy side, sales, things like that, financing, but actually understanding the science and having walked in the scientist-founder's shoes, you guys have been. That's one of the major things we're doing. It's so much fun to work with you and to talk. We have a separate partners meeting together. We talk about just the tech-bio companies. That's the process that we're building.
James Currier:
Getting back to what's different about NFX Bio, if I'm a founder, what are some of the things I should know about NFX Bio if I'm thinking about raising money?
Omri Amirav-Drory:
What we are aiming to achieve is to the kind of investors we wish we had. Because the problem with our industry, what we call tech bio, is that if you go to tech investors, you're the bio company. If you go to bio investor, then you're too much tech for them. You want the investor that really understands this is a new industry.
Omri Amirav-Drory:
You want investors that has the Venn diagram that we share. That, being academias, we understand the science. We can make our own mind really quick. We've been operators, so we know the pain you're going through. We've been in the trenches. Then we scaled company, in Emily case, to $10 billion. We
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know what it means. As investors, we can make our own mind quickly. We are leading rounds, and then
we just help you be as successful as we-
James Currier:
All of us at NFX have been founders ourselves. You guys in particular have been founders and scientists in the tech-bio area. By living in their shoes, we can help with every aspect of the business. That's the goal here. We come to the work of building a company from the founder's perspective. We don't see your company as a cap table. We don't see it as a spreadsheet. There's lots of financial investors out there, particularly in Series B and Series C, but we see the building of these companies as a unique expression of the founders. We're their partners. That's really where we're trying to go with this.
James Currier:
The other thing is that we've got this completeness of the team. Not only do we have Omri, and then we have Gita, and then we have Emily here, but we've got myself, we've got Gigi, we've got Morgan, we've got Pete. We've got the NFX Guild. The infrastructure that comes along with that, help with PR, help with hiring, help with human resources and culture building, all the things that are required to build a company.
James Currier:
There's this completeness of our team. We've got a big team. We're not investing at that seed stage, that pre-seed stage in many cases, but we still have the infrastructure of a Series A firm. That's going to be hopefully helpful to folks.
James Currier:
Omri, you received capital from investors when you were first starting out. Now you've been investing pre-seed with your tech-bio fund. How do you see the ecosystem changing right now for biotech investing?
Omri Amirav-Drory:
I think right now it's the golden age of biotech invest. COVID has shown the world how important it is to invest in things like therapeutics and vaccines.
Omri Amirav-Drory:
This is what we like about this industry. Everything we invest in really matters. They like to say in Silicon Valley that "our investment changed the world for the best", but this is exactly what we do. We invest in companies that help heal people either with therapeutical diagnostic, help feed people with ag and food, and then help support people with renewable chemicals and materials, et cetera. All our investment, our impact investment ... It's not just impact investment, we are talking about the biggest markets in the world. Biotech is food, ag, materials, energy, technology. They're all coming together. It's super exciting.
James Currier:
We all agree here. That's why we're doing NFX Bio. We're doing NFX Bio with you because of your character, because of your experience. I know that we're just incredibly excited to be launching this. Can't wait to see what the next 20 years holds.
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This transcript was exported on Jan 27, 2021 - view latest version here. Dr. Emily LeProust:
Thank you. No offense to Google, but it's a lot more exciting to work on some DNA-based technology than to work on autofill of Google.
Omri Amirav-Drory: Or optimizing ads.
James Currier: Agreed. All right, guys.