Applications for San Francisco (Batch 12) extended through September 15th, 2021!

IndieBio San Francisco Class 11 Demo Day

Thank you so much to everyone who attended San Francisco’s Demo Day (virtually). We are so excited to present 13 companies who are impacting the future of human and planetary health. In case you missed it, you can watch the event, see company videos, and read the blogs by clicking here. If you are an investor and would like to get in touch with us, please email.

Aja Labs – plant-based hair extensions (Video)
Avalo.ai – faster gene discovery for the food system (Video)
California Cultured – cell based chocolate (Video)
Canaery – digitizing scent (Video)
Capra Biosciences – biomade engine lubricants (Video)
Innate Biology – fasting mimetic supplement (Video)
Lypid – phytofat, made from vegan oils to perform like animal fats (Video)
Oncoprecision – drug screening platform for oncology (Video)
Ozone Bio – emissions free adipic acid (Video)
Proteinea – biomanufacturing platform using insect larva (Video)
Sundial – plant based chicken wings, with skin and bone (Video)
Vertical Oceans – clean shrimp raised in urban towers (Video)

The New Biotech

Explore the “New Biotech” with the IndieBio team and learn how we can re-imagine, re-materialize, and rebuild the world together.

As a traditional natural science, biologists used microscopes to better understand the human body. “A lot of therapeutics have been observations through nature. Like finding a tree bark and turning that into a drug,” CSO and Partner, Jun Axup explained. Yet as we continue to integrate technology into biology, we’re able to redesign and reengineer our very nature.

“Over the last 70 years, we have really perfected the ability to read, write, copy, cut, and paste DNA,” Axup continued. “Pretty much everything we see and use around us has some relation to biology, and can be potentially improved upon using biotechnology.”

Five years ago, in the early days of biohacking, IndieBio started as an experiment out of SOSV Accelerator, to give scientists a chance to become entrepreneurs. “We think that PhDs and other scientists can actually take the science that they’ve been working on and build a company,” Axup said.

In the early stages of IndieBio we invested in food, agriculture, medical devices, biopharma, neurotech, computational bio, industrial bio, and regenerative medicine. “We took the risk that nobody else would take,” Head of Investor Relations, Maya Lockwood said.

In some ways IndieBio is a petri dish, where we spread startups out into the bio-atmosphere. Some will survive and some will not. From watching many startup’s life cycles we’ve learned some important variables. What works in the market, who’s paying for what kind of technology, and what kind of team culture makes a successful company?

We’re now at an inflection point, where the pandemic has rapidly exposed our system’s vulnerabilities in our healthcare and food supply systems. While at the same time the technologies of the “future” don’t seem so far away.

For the last couple of decades humans have engineered digital systems to manipulate biology to scale sustainable solutions, launching the synthetic biology revolution. “We’re seeing a lot of this convergence in the neurotech space,” CTO, Pae Wu said. “New materials and digital systems are being able to interface really well and elegantly with biology, neurons, and muscles.”

Enter 2020, and we’ve experienced the reality of natural disasters and diseases threatening our lives. Through this we have realized, to maintain our human health we must also maintain our planet’s. “The two are hand in hand,” Axup said, “and in some ways, planetary health is more important. If we don’t have a planet, then our individual health doesn’t really matter.”

Here at IndieBio, we kept these lessons in mind when we invested in solutions for food supply, climate change, agriculture, medicine, and diagnostics.

As people continue to spearhead the development of biotechnology, we call out to investors to launch sustainability into the future. “For these companies to move on to the next level and grow, we need the participation of everyone,” Lockwood said. This requires the participation of venture capitalists, corporations, and policy makers.

We are building these world changing technologies by assessing the talent, and fostering an ecosystem that will help these companies through to the end. “As our companies graduate through our program,” Lockwood continued, “we’ve been learning that they are raising a lot of capital and going on to create whole new industries.” Within the next two to three years, many of the companies will raise to series A.

“Our long term vision is to improve human and planetary health by making more industries sustainable,” Lockwood said. The latest solution companies to our portfolio are in cosmetics, construction, fashion, and food industries.

In alliance with SOSV & Mayfield fund, we created the Genesis Consortium, to promote human and planetary health and make it accessible for others to co-invest in a sustainable future. “It’s really important right now that this is a process of collaboration and that we are more inclusive in building ecosystems that gets everyone involved,” Lockwood explained.

Last March we expanded our reach beyond Silicon Valley and opened an office in New York. “When you think of New York, you think of investors, right?” NY Communications Director, Julie Wolf said. Well, while NY pulls in NIH dollars, it’s not so great at pulling in VCs. As of 2016, for every NIH dollar there was only $0.06 in VC. “There’s not a lot of actual biotech startups,” Wolf said. IndieBio wants to change this.

With seven percent of all postdocs moving to New York City, “One of the roles at IndieBio New York is to identify the talent that needs that chance, that opportunity to take their idea and turn it into a company with transformative technology,” Wolf said. “Hopefully we won’t be alone.”

We are entering a new world where we can restore contaminated soil, improve fertility, make new blood supplies, and create abundant supplies of protein. There are solutions to the global challenges, we’re just not pulling our resources together. “We need to recognize that there’s huge potential at our hands,” Lockwood said. “Materials can now be made without extracting more resources from the earth and this is the news we want to focus on.”

This is an opportunity to rematerialize, reimagine, rebuild the world. “We need to stop and listen and reassess how we have been living,” Lockwood said.

For anyone who wants to explore the expansion of biology as a technology, our Managing Director, Po Bronson, along with IndieBio’s founder and Venture Advisor, Arvind Gupta, recently published a roadmap for the curious, Decoding the World.

To learn more about IndieBio and the portfolio of companies, watch our Demo Days. They showcase the talent of scientists who are rebuilding the world.

The Future of the Planet: Food Systems

Po Bronson, Managing Director at IndieBio hosted this panel featuring Special Guests:

Bruce Friedrich, Co-founder and Executive Director of The Good Food Institute (GFI), Christine Moseley, Founder & CEO of Full Harvest, Tom Tomich, Founder of the Food Systems Lab at UC Davis, &  James Joaquin, Co-Founder & Managing Director at Obvious Ventures.  Thank you all for joining us!

“Grocery stores once felt abundantly restocked, that was until COVID-19 hit our food systems. Restaurants closed, plant workers contracted the virus, milk was poured out, rice piled up at ports, hogs were asphyxiated.

In reaction, IndieBio asked today’s food pioneers and leaders – What will the future of our food systems look like and how will our food security be impacted?

The Current Food Situation

Christine Moseley, founder and CEO of Full Harvest, first saw the food waste problem at a lettuce farm.

“I watched as they were harvesting only 25 to 30% of the romaine head to perfectly bag it for grocery stores and let up to 75% fall to the ground, even before it reached the consumer,” Moseley said.

A study conducted by Santa Clara University in 2019 found that one-third of all edible produce in the US doesn’t leave the farm. “It’s purely just because of access, or it’s just not perfectly shaped for retailers.”

Tom Tomich, Founder of the Food Systems Lab at UC Davis and Professor at the Department of Environmental Science and Policy, extended on access to transparency. “The food system is about profits, and it’s also about power. You need to bring in ontologies that allow us to understand more about, well – Who’s pulling the levers? Who’s got the power here?”

Bruce Friedrich, Co-founder and Executive Director of The Good Food Institute explained, “the meat industry is a big part of the problem in terms of inefficiency and in terms the range of environmental harms.”

He explained the inherent contradictions in our eating behaviors to environmental needs. Basically, most people know that slaughterhouses are not sustainable.

“Yet per capita, meat consumption just goes up and up and up… 2019 was the highest it has been in recorded history,” explained Friedrich.

“There’s something about human physiology. We like meat, we want to eat meat, we want the sensory experience of meat,” continued Friedrich. “So rather than continuing to beat our head against this wall… let’s change the meat.”

“We need products that taste the same or better, and that costs the same or less. That’s the Holy grail,” said Friedrich.

Launching our Minds and Stomaches into the Future

One solution has been cellular meat, which allows meat cells to grow without complications of animal welfare.

“That’s going to take a long time to scale,” mentioned James Joaquin, Co-Founder and Managing Director at Obvious Ventures. “But there’s some of our greatest minds working on it.”

 “The excitement around regenerative agriculture is getting us past this monoculture, of how efficiently can we grow corn and soybeans?”

Joaquin mentioned lupini beans from Europe and duckweeds from water.

Then there’s the world of mushrooms. “There’s a startup called Meati, growing mycelium root systems to create this really textured fibrous kind of substrate,” explained Joaquin. “You can then season and flavor to create a whole cut meat alternative.”

Moseley, who’s business seeks to solve farm food waste with technology, mentioned experimental methods of fermentation and preservation including, IQF freezing, pureeing, and powdering.

“I think a lot that can, will, and needs to be done not only for nutrition purposes and extracting things out of it as much as possible, but making it last as long as possible,” Moseley explained.

With emerging technologies at our fingertips, collaborations will widen our culinary experience – that is as long as it tastes good.”

Summary by Emily Quiles

IndieBio Coronavirus Initiative

We are seeking up to 8 startups to receive a minimum of $250,000 each to pursue the development of diagnostics, therapeutics, vaccines, disinfection, and other solutions addressing the worldwide problem of emerging infectious diseases.

We have an unprecedented opportunity to contribute to solving the remarkable scale of challenges that Covid-19 presents to our planet. Scientists need funding and they need it immediately in order to work at the pace that the coronavirus is moving. The time to accelerate and mobilize all scientific discovery has arrived. We are excited to work together in finding solutions. 

“There’s a long war ahead and our Covid-19 response must adapt” ~Dr. Tom Frieden, Former CDC Director

IndieBio’s current portfolio of companies, backed by SOSV,  has been built with the anticipation of a future that requires massive systemic change impacting every area of human and planetary health.  We have already made investments in companies like CASPR Biotech, who is working on molecular diagnostics for Covid-19. To read about more of IndieBio’s companies working on Covid-19, scroll down to the bottom of the page. To learn about all of SOSV’s Covid-19 startups visit www.sosv.com/covid-startups.

Members of Caspr Biotech headed to the frontlines.

IndieBio seeks to work with companies that can detect, treat, and prevent COVID-19:

Companies who focus on detection may include those that: 

  • Improve diagnostic capabilities in speed, cost, or scaling.
  • Predict negative post-infection sequelae for COVID-19 patients.
  • Enhance serological testing kits.

Companies who focus on treatment may include those that:

  • Mitigate patient inflammatory reactions (cytokine storms).
  • Regenerate lung function or address other long-term health consequences.
  • Formulate therapeutics for tough-to-penetrate organs like the liver and nervous system.

Companies who focus on prevention may include those that:

  • Develop novel vaccine platforms or formulations.
  • Sterilize contaminated buildings, waters, or foods.
  • Block disease transmission from animal reservoirs or vectors.

Apply your scientific expertise to eliminate the serious challenge of COVID-19:

  • Application is on a rolling admissions basis 
  • Apply at Indiebio.co/apply

About IndieBio: IndieBio enables scientists to become entrepreneurs and build breakthrough companies to solve the world’s biggest challenges through biology as a technology.  IndieBio drives innovation to improve human and planetary health. To date, 116 biotech companies have been through the program, creating a combined valuation of over $2.4 billion. IndieBio is a division of SOSV.

Over a dozen IndieBio startups are already on the front lines of the COVID-19 response. A sample of these includes: 

  • Renegade Bio: Improved Diagnostics. Renegade Bio is testing SF Bay Area’s first responders with a “we come to you” service. Renegade invented an improvement on the CDC testing method, turning four reactions into a single-step reaction and eliminating the RNA extraction requirement. The result is a testing process that is 70% cheaper, taking half the time, for a net 4x increase in throughput. They partnered with Bay Area Phlebotomy & Laboratory Services to open testing for the public with an on-demand, Uber-like service. They are starting testing of all SF Bay Area first responders and police forces, running 1300 tests every three days. https://sosv.com/portfolio/renegadex/
  • Prellis Biologics: Faster Antibodies. Prellis Biologics is 32 days from anti-SARS-CoV-2 human antibodies using bioprinted, human mini lymph nodes. In 2017, Prellis Biologics printed human mini lymph nodes, which they injected with Zika virus. The mini lymph nodes produced human antibodies for passive immunity against Zika. Now, Prellis is doing the same for the coronavirus. In one week, they will be growing immune cells, in two weeks growing lymph nodes, and in a month screening the antibodies. In six weeks the antibodies will be sequenced for scale-up and trials, which could begin in as soon as 10 weeks. This is a much faster turnaround time for antibodies and even if other approaches yield antibodies first, Prellis’ approach is a more rapid way to generate antibodies as the virus mutates.
  • Amaryllis Nucleics: Sequencing for Diagnostics and Epidemiology. Amaryllis Nucleics is developing a universal viral RNA detection kit to detect COVID, Influenza, and other viral infections in the same test, while detecting and tracking mutations as they arise. Using established next-gen sequencing technology and optimizing their RNA sequencing kits for COVID, they can enable thousands of samples to be run per machine each day.
  • Diadem Biotherapeutics: Lung Immune Modulators. Diadem is engineering exosomes to be inhalable cell-specific immune modulators. Exosomes are small, virus-sized particles released by cells to communicate throughout the body. Diadem plans to develop a SARS-CoV-2 vaccine by engineering exosomes with surface bound SARS-CoV-2 proteins and immune-stimulating ligands, effectively turning them into non-replicative virus-like particles (VLP). To increase immune response and memory for the SARS-CoV-2 antigen, the VLPs can be engineered with immune stimulating ligands (e.g. 4-1BB). 
  • mFluidX: Diagnostic Accessibility. mFluiDx is developing a low-cost microfluidic diagnostic to detect COVID-19 in under 15 minutes in decentralized settings. Their chip is as simple and cheap as paper tests, yet has DNA/RNA level sensitivity able to diagnose onsite. 

Learn more details about all IndieBio and other SOSV-backed startups here.

Header image credit: Fusion Medical Animation on Unsplash

IndieBio Call for Applications

SOSV Announces Launch of IndieBio New York

— World’s leading life sciences accelerator expands to New York City —
— Call for Applications Open Now —

(NEW YORK, January 7th, 10:30am EST) — SOSV, the world’s most active investor in both life sciences and hardware, announced that the inaugural cohort of IndieBio New York will start in Manhattan in May 2020, with applications being accepted beginning today.  

“We’re doubling down on life sciences,” said Sean O’Sullivan, founder and Managing General Partner of SOSV. “We are looking to bring what IndieBio has created for the California life science industry to the East Coast. New York is a great hub for life sciences research and financing, and will be a natural center for life science startups.”

SOSV created the world’s first life sciences accelerator in 2014, and in the past five years has backed nearly 200 life science startups with a combined valuation of over $3 billion, raising more than $700 million, and employing over 2,000 people. This number includes pioneering deep-tech startups like Memphis Meats (cellular agriculture), Prellis Biologics (human tissue engineering), Synthex (cancer therapeutics), NotCo (plant-based animal-free food products), and Perfect Day (milk without the cow).

Sweetening an already attractive deal – Up to $2 million per therapeutics startup
SOSV’s IndieBio already has the most competitive terms in the industry, funding 20 to 30 life science startups each year in their program with $250,000 in exchange for a small equity position in the teams. With IndieBio now in New York and San Francisco, SOSV will double the number of startups funded and will also trial a therapeutics track that will fund up to $2,000,000 per startup accepted into the program. This will be the first time an accelerator anywhere has offered such a cash-rich package of benefits.

“We’ve seen a lot of success with our therapeutics startups already,” said Arvind Gupta, SOSV General Partner and founder of IndieBio in San Francisco. “Yet therapeutics companies often require more animal and safety studies in order to de-risk the startups for later-stage capital and unlock huge value creation. We want to see what will happen to our deal flow by offering up to 8 times the capital for an initial group of startups.”

Upon success, IndieBio will expand the therapeutics funding track to as many as 12 therapeutic startups per year across both San Francisco and New York. Therapeutic startups in the program will receive up to two years of wet lab facility, coworking space, and mentoring access to on-staff PhD scientists. SOSV will be building out a 24,000 square foot lab and co-working space for their NY-based startups, more than doubling their space in New York City as part of this expansion.

Solving Global Challenges With Hands-On Support
SOSV invests over $10 million annually in infrastructure — building out and running wet labs, electronic labs, and mechanical facilities, in addition to  offering on-site support teams of dozens of experts, engineers and PhD scientists. The benefits of these programs help startups with accelerated product development and increased access to an ecosystem of corporations, investors and over 1,000 specialized mentors.

“This year nearly $1 billion will go into SOSV-backed companies from VCs and corporate investors,” said O’Sullivan. “On top of the $65 million SOSV invests directly into our startups every year, SOSV’s deep-tech startups are getting huge funding leverage from our syndicate of VCs, angels and corporates.”

SOSV closed the $277 million SOSV IV fund in December 2019. From this fund, SOSV both provides accelerator funding as well as provides post-accelerator follow-on funding of $200k to $2 million per startup, per round, for all startups which go through SOSV programs. 

Call for Applications Solving for Human and Planetary Health
Startups can apply for IndieBio New York’s first cohort until March 1st, 2020 at http://indiebio.co/apply. The program kicks off in April 2020.

Additional Portfolio Highlights
In the life sciences arena, SOSV invests in human and planetary health, as an early investor in plant-based foods, cellular agriculture, computational biology and regenerative medicine.

SOSV is a pioneer in ‘clean food’ and cellular agriculture with investments in Geltor (animal-free collagen), Clara Foods (egg proteins), and Abbot’s Butcher (plant-based meat). SOSV was the initial investor in Jungla (A.I.-driven genomics), acquired in July 2019 by Invitae (Nasdaq: NVTA).  

Therapeutics has always been the core application of biotech, and SOSV has remained one of the industry’s most active funds, investing in cancer therapeutics (Filtricine, A2A Pharma), new modalities for autoimmune diseases (Diadem, DNA Lite), regenerative medicine (Membio, BioAesthetics), and gene delivery (Serenity).

About the IndieBio New York program
IndieBio New York has been created with the support of New York State’s Life Science Initiative, administered by Empire State Development. New York State will invest up to $25 million over five and a half years in support of IndieBio’s work connecting life science entrepreneurs with the tools and resources needed to move their discoveries out of the lab and into the marketplace. The Partnership Fund for New York City will invest $10 million into the startups coming through the program. SOSV also plans to invest an additional $60 million or more into the IndieBio New York startups. 

The program will work alongside New York’s leading academic institutions to commercialize both local and global inventions. Startups funded by IndieBio New York must relocate to New York for the duration of the program, and can leverage the extensive resources of the east coast life sciences industry.

About SOSV
SOSV manages over $700 million with a portfolio of over 900 startups. Managing Partner Sean O’Sullivan created the firm in 1995 after the IPO of MapInfo, the startup he co-founded that pioneered street mapping on computers. In 2010, SOSV opened Chinaccelerator, the first accelerator program in China, and was the first to create accelerators in hardware (HAX) and life sciences (IndieBio). Today, the firm has eight general partners amongst a 110-person staff across nine locations in the US, Europe and Asia.

In both 2018 and 2019, three of SOSV’s startups were selected each year as creators of the Top Inventions of the Year by TIME Magazine, a feat unparalleled by any Fortune 500 company or any other VC. 

For further information: Kayla.Liederbach@sosv.com

Introducing IndieBio Class Nine

IndieBio helps entrepreneurs build ground-breaking biotech companies. We’re excited to share our ninth class of 11 new startups. They have been here for thirty days, working tirelessly to derisk critical pieces of their science and business. The four month program will culminate in a Demo Day on the 6th of February.

AgriSea is creating methane-negative rice farms in the open ocean, with rice varietals that they’re engineering to grow in saltwater and drought-like conditions. It can also be used for bioremediation of fertilizer runoff zones. Rice feeds half the world, and is a $318 billion market. But in many countries, rice farming is in distress from both drought and seawater flooding. AgriSea’s rice can be grown in open water, or in conventional paddies flooded with seawater. https://www.agrisea.co.uk/

Avisa Myko: The molecule melanin is evolution’s answer to radiation. This natural supermaterial has unparalleled capacity to absorb all of the radiation spectrum and convert it into different forms of energy. Research has long shown that if melanin could be made affordable, there would be wide industrial applications for it — to replace SPF factors to block UV radiation in sunscreens, cosmetics, and clothing, to blocking gamma waves during cancer radiation therapy, and protecting workers and astronauts exposed to gamma radiation. It can also be used in energy applications, such as low-cost batteries and hydrogen production. However, production of melanin industrially has been stymied, and melanin has remained more expensive than gold. Until now. The team at Avisa Myko has spent years reducing the cost of melanin production via fungal fermentation, and can now produce it at 500 times lower than existing methods. Avisa is partnering with many corporations to include their melanin in a variety of products and formulations.  https://www.avisamyko.com/

BioLumen makes a pill for weight loss and gut health; it’s made of a highly functionalized cellulose matrix to entrap sugars in the stomach so they are digested by your microbiome, not your body. https://biolumen.tech/

Chi Botanic: We may not realize how inefficiently many high-value plant products are grown. Some take years, or decades, to grow. And then the desired ingredients are often a tiny part of the plant. Chi Botanic creates just the end products, in bioreactors, without any of the waste — such as aloe, natural rubber, and citrus oils. Plant cells are poised to be the next big market in fermentation. https://www.chibotanic.com/

Dalton Bioanalytics detects thousands of blood biomarkers in a one-shot assay, using liquid chromatography mass-spectrometry enhanced by chemical normalization. https://daltonbioanalytics.com/

Diadem Biotherapeutics makes shelf-stable, engineered exosomes for the anti-inflammatory market, starting with COPD. Their engineered exosomes have the best aspects of both biologics and cell therapies, without their compromises. https://www.diadembio.com/

Lupa Bio: Destructive inflammation underlies the vast majority of chronic diseases, however, current treatments are too toxic to be used in all but the most severe diseases. Lupa Bio is developing an entirely new therapeutic, derived from an oligosaccharide found in human milk, with the potential to be as effective as current drugs yet safe enough for all patients. http://www.lupabio.com/

MemBio makes blood, using a novel hollow-fiber bioreactor to make universal O- blood, replacing or complementing the current volunteer donor system. For hospitals and blood centers, Membio’s OmniBlood solves the shortages in the supply chain and the difficulty of patient matching. http://www.membio.ca/

Michroma is a desperately needed solution for the food tech revolution. Michroma produces natural thermostable colorants for foods and cosmetics that are free of chemicals and mycotoxins. 70% of the foods we eat are colored with dyes. Many are synthetic chemicals linked to hyperactivity and cancer, or extracted from insects. Shouldn’t food dyes be made from food? https://michroma.co/

Pando Nutrition is solving the problem of antibiotic usage in the livestock industry. Even though growth-promoting antibiotics have been banned by the FDA since 2017, they are still widely used throughout the industry. Pando creates super-probiotics for healthy, productive livestock. https://www.pandonutrition.com/

Primitives: Anything made of plastics today can be replaced by biopolymers. Primitives is a biomaterials company that engineers alternative plastics that can sense the environment and communicate to its users. Some applications include compostable food wrap that can tell you when food is rotting, and biodegradable cosmetics that changes color throughout the day. https://primitives.io/

 

The MicroBiome is a Drug Factory

At IndieBio, our perspective on gut bacteria is informed not just by the companies we’ve invested in that do human microbiome science, but by all the companies in our portfolio who work with bacteria and biomes in diverse sectors from the Future of Food to the Future of Energy to Biomaterials to Agriculture.

Early Popularization

A decade ago, the microbiome was a novel curiosity. The public learned that there was anywhere from 3 to 5 pounds of bacteria inside our bodies. Each was around one or two microns long — a tenth the size of cells. The number of them was astounding: estimated at 100 trillion. Exactly how they survived inside our bodies, without being attacked by our immune system, was unknown. Western diets (and overly-sanitary conditions) were eliminating our gut diversity; westerners had lost a third of their microbiome diversity, and flora diversity was correlated with health — across all animals, and all conditions. Probiotic drinks showed up on every store shelf, and soon after came the prebiotic supplements that gut bacteria feed on — oligosaccharides, fructans, and galactans.

A New Metaphor Emerges

Society grew to appreciate how the microbiome was important to health. Early research showed the gut was the source of 90% of our serotonin, and 60% of our oxytocin. That state of your gut was directly connected to the state of your mind. For awhile, the gut was often characterized as our “second brain.”

It’s time to upgrade that metaphor. Yes, the biome acts on our brain — but it acts on just about every other part of our body, too. The microbiome is more like a drug factory. It’s the “invisible organ” of the body that interacts with 70% of our immune system, generating our circadian rhythms, and turning our genes on and off.

When we say “drugs,” we’re using the term a little loosely to make the point. They’re naturally made. And in many species of bacteria, their output might not be quite a drug, but it’s a bioactive compound that acts on a pathway elsewhere in the body, either as a primary metabolite or a secondary metabolite. In this sense, the line between a drug and a bioactive compound is virtually indistinguishable, as the definition of a drug is anything with physiological effects. Traditionally, what we meant by “drugs” was that they were made outside the body and then put into the body. Arguably, most of this definition holds, as the bacteria are not of our body, even if they are inside it.

The Drug Factory’s “Top Sellers”

To list all the drugs made by bacteria in our bodies would take far too long. But here’s a short, starter list — solely for the purpose of illustrating the point that the microbiome has widespread impact on the body, for both better and worse:

  • Histamines, both pro and anti-inflammatories
  • Beta-glucuronidase / hormones / estrogen & estrogen cancers
  • Short-chain fatty-acids / histone chrotonylation / HDAC2 / gene regulation
  • 5-HT biosynthesis / Enterochromaffin cells / Serotonin, brain neurotransmitter
  • Chylomicrons / energy-rich triacylglycerol
  • Tyramine / blood pressure & hypertension
  • Microcins that block salmonella
  • Oxalate / protein transporter SLC26A6 / prevents kidney stones
  • Zonulin / haptoglobin 2 / atherosclerosis
  • Glutamate & cytokines / Vagus nerve / Oxytocin
  • Tryptophan & tryptophan antibiotics
  • Glucagon Peptide 2 / GLP2R / bone and neuroprotection
  • Butyrate / Insulin Sensitivity / Diabetes & Obesity
  • Deoxycholate / fat reduction
  • A-tocopherol / Vitamin E / free radical scavengers
  • G-aminobutyric acid / neurotransmitter / muscle tone
  • Cholate / FXR transcription factor / antimicrobial peptides
  • P-aminobenzoate / Folate / blood cell creation
  • Eicosatetraenoic acid / Endocannabinoids anandamide and 2-AG
  • Commendamide / GPR132/G2A / prevents autoimmune disease

All of the above are from the gut, but the gut isn’t the only place we have bacteria. A skin bacteria, staphylococcus epidermis, fights skin cancers — producing 6-HAP, which inhibits melanoma and lymphoma tumor cells.

Other Mechanisms of Action

Making drugs outright is only one way the bacteria in our gut do their work. Another way is that they chop free bioactive peptides or small molecules from longer chain proteins. A lot of what we eat is digested by hydrochloric acid and protease actions into basic building blocks. But food proteins also contain certain biochemical strings that, if chopped correctly, are then biologically active.

The microbiome also interferes with medical drugs. 80% of our current medical drugs are metabolized in the liver, but 20% of the drugs on the market are metabolized by gut bacteria. Since some people have different flora than others, these drugs tend not to work as intended for certain people. For instance, the emerging market of Anti-PD-1 checkpoint blockade immunotherapy has only a 10% success rate. It’s still a matter of debate just how to get that rate up, but many of the solutions being researched involve first transplanting necessary microbiota into the patient. About 50 medical drugs are now understood to be codependent on gut bacteria populations.

The Birth of Microbiome Therapeutics

The race to translate this research into commercial therapies is well under way. There are at least 6 drugs in development to treat cancers, from solid tumors to mucositis, with one candidate already in Phase II. There are three drugs in development for obesity, and five in development for diabetes, with one at Phase II. Fourteen drugs are being developed for Crohn’s and ulcerative colitis, with one of each at Phase II. There are drugs for lactose intolerance, for dental caries, for repeated urinary tract infections, for celiac disease, and several skin diseases, with one in Phase III for acne. Revenue out of this market is expected to begin in 2021 and reach $10 billion by 2024, continuing to go up steadily in the decade beyond.

We view the acceleration of this pipeline as proof of its market potential, but not necessarily as evidence that science has strong command and control over gut bacteria and all they interact with.

Finely-Tuned Control (and Effects)

To gain precise command over the drug factory, a variety of tools and competencies are needed. Science teams with these expertises are what IndieBio looks for and what drives our investments.

  • Daily Fluctuation Tracking. Most microbiome research today uses single-shot samples of patients’ stool samples. But disease states tend to correlate with dramatic, short-term swings in the species population. For researchers to model these correlations, they desperately need a low-cost assay to track population swings. When such a tool is available, we believe it will be widely used — by all manner of researchers, even those who don’t currently factor in microbiome effects. It will also become a common biomarker in clinical trials, and then be required as a companion with microbiome therapeutics.
  • Personalization. Because everybody’s microbiome is unique, and because the bacteria interact with each other, off-the-shelf probiotics are likely to work for some people, and not for others — or, to avoid undesired side effects, they have to be dosed at numbers that are too low to have much impact at all. Companies that built trust with consumers making personalized probiotic services will be able to grow into more and more effective blends.
  • Setting You Up for Life. An infant’s microbiome fluctuates continuously in the first three years, but then largely stabilizes (with the exceptions around the disease-states described here, when health and the microbiome both swing together). There are two significant opportunities in this space. First, how to help an infant’s microbiome, from the first weeks to the first years, and second, how to optimize the biome around that stabilization transition —for a lifelong impact. In the US today, 32% of babies are born by caesarian section,
  • Shared Metabolites. Bacteria by themselves are not the same as bacteria in a biome. A biome is an ecosystem; the bacteria interact, regulate each other, and the metabolites from some bacteria become the feed for others, in a chain reaction. For this reason, transplanting and colonizing individual strains is often ineffective. It’s not enough to formulate a strain in a synbiotic that combines the probiotic with a prebiotic — as soon as that hits the gut, other bacteria may suppress it. Companies that have worked out the interactions within a consortia of bacteria have a much better technology platform.
  • Variants Within a Species. Most news about microbiome-health correlations is based on research looking at relative species populations. People with more of strain X have less of health condition Y, and so forth. But there is still a great deal of genetic variation within a species. Think about all the humans on the planet for a moment — we are all one species, but our DNA (and our health) varies meaningfully. Some of the best microbiome research investigates these differences; cohorts of people with the same species, but some have variants of that species — and dramatically different health functions as a result.
  • Precision editing. Rational design of the bacteria genome is seemingly inevitable. Researchers today are busy editing microbiota as a way of understanding what the edits do — attacking it node by node. The challenge this path faces is that bacteria have ways of sharing their DNA, so precision edits could spread around a microbiome in unintended ways. One approach at a solution is to make the edits in the bacterium chromosome, not in the plasmid. But this has had mixed results.
  • Culturing the Unculturable. 99% of the bacteria found in the wild have been unculturable in the lab; they grow in unusual conditions. A less extreme version of this occurs in the human gut, where some bacteria that have been identified as beneficial have unconventional properties and are particularly hard to colonize. Researchers who have developed expertise in culturing them have an advantage over researchers who’ve merely identified them.

At IndieBio, we are always looking for the next great microbiome company. We don’t just invest in startups — we help create them, often working with post-docs and principal investigators to build a team and transform them into scientist-entrepreneurs. To learn more, visit https://indiebio.co/

Further Reading:

https://www.cell.com/neuron/pdf/S0896-6273(19)30117-5.pdfDiscovery of genetic variants that protect against obesity and type 2 diabetes could lead to new…
Around four million people in the UK carry genetic variants that protect them from obesity, type 2 diabetes and heart…www.cam.ac.uk
The Gut-Hormone Connection: How Gut Microbes Influence Estrogen Levels | Kresser Institute
Emerging research indicates that the gut microbiome plays a central role in the regulation of estrogen levels within…kresserinstitute.com

https://www.chemistryworld.com/features/the-chemistry-of-the-microbiome/3008630.article

https://www.cell.com/cell-host-microbe/pdf/S1931-3128(18)30267-1.pdfGenetically modified bacteria enlisted in fight against disease
People often take medicines to rid themselves of problem bacteria. Now, a counterintuitive approach – turning…www.nature.com
Profiling the gut microbes passed from mother to baby
How an infant is born (by vaginal or cesarean delivery) and what she eats after birth (breast milk or formula)…www.broadinstitute.org
Can Your Microbiome Be Genetically Engineered to Make You Healthy? | Simons Foundation
Some people just know what they want from an early age. “I asked my parents for a microscope at age 6. I don’t have a…www.simonsfoundation.org
The Role of Microbiome in Insomnia, Circadian Disturbance and Depression
Good sleep and mood are important for health and for keeping active. Numerous studies have suggested that the incidence…www.ncbi.nlm.nih.gov
Bifidobacteria and Butyrate-Producing Colon Bacteria: Importance and Strategies for Their…
General Another strategy to increase bifidobacteria and butyrate-producing bacteria in the human colon is through the…www.ncbi.nlm.nih.gov
Lactate-Utilizing Bacteria, Isolated from Human Feces, That Produce Butyrate as a Major…
The microbial community of the human colon contains many bacteria that produce lactic acid, but lactate is normally…aem.asm.org
Mechanisms Linking the Gut Microbiome and Glucose Metabolism
The microbiome is an integral part of the human body with the highest density of bacteria in the gut, ranging from 1 ×…academic.oup.com
Gut microbiota, cannabinoid system and neuroimmune interactions: New perspectives in multiple…
Biochem Pharmacol. 2018 Nov;157:51-66. doi: 10.1016/j.bcp.2018.08.037. Epub 2018 Aug 30. Reviewwww.ncbi.nlm.nih.gov
Gut microbiome modulates response to anti-PD-1 immunotherapy in melanoma patients
Resident gut bacteria can affect patient responses to cancer immunotherapy (see the Perspective by Jobin). Routy et al…science.sciencemag.org
Interactions between Bacteria and Bile Salts in the Gastrointestinal and Hepatobiliary Tracts
Bile salts and bacteria have intricate relationships. The composition of the intestinal pool of bile salts is shaped by…www.ncbi.nlm.nih.gov
Zonulin Regulates Intestinal Permeability and Facilitates Enteric Bacteria Permeation in Coronary…
Several studies have reported an association between enteric bacteria and atherosclerosis. Bacterial 16S ribosomal RNA…www.nature.com
Indigenous Bacteria from the Gut Microbiota Regulate Host Serotonin Biosynthesis
Yano, Jessica M. and Yu, Kristie and Donaldson, Gregory P. and Shastri, Gauri G. and Ann, Phoebe and Ma, Liang and…authors.library.caltech.edu

“The $100 Trillion Opportunity”

Arvind Gupta, Managing Director & Founder of IndieBio:

Meeting the challenge of climate change is commonly characterized as a tradeoff with industrial economic growth. In order to save the planet, we have to reduce consumption, and we have to stop production, and we have to give up behaviors we’ve long been accustomed to. The party’s over. In the conventional framing, both planetary health and declining human health are inevitable suppressors of economic activity.

In a three-part series of articles, hosted on Medium, IndieBio founder Arvind Gupta argues the opposite. He believes that the technological shift that will be forced on the economy by the twin catastrophes of planetary and human health comprises the greatest economic opportunity ever. Biotech is the technology that will drive this change, and those with the better biology will win this growth.

IndieBio modeled the global economy 25 years from now, in 2043, by industry. Just as the economy doubled between 1971 and 1994, and then doubled again from 1994 to 2018, it will double once more by 2043, adding $100 trillion to global GDP. But to achieve that, we will have to reinvent manufacturing and production to lower our demand of the planet’s natural resources.

Many have long declared there’s an economic opportunity in sustainable technologies. But nobody has ever put such a large figure on that opportunity — orders of magnitude bigger.

Read the series on Medium:

The $100 Trillion Opportunity
https://medium.com/indiebio-sf/the-100-trillion-opportunity-3d827f18c56a

Designing Science
https://medium.com/indiebio-sf/designing-science-24f2a4b5767f

Accelerating Planetary Health
https://medium.com/indiebio-sf/accelerating-planetary-health-f8ee3e70c603

The Most Incredible Technology You’ve Never Seen

Guest post By Bryan Johnson, founder of Kernel, OS Fund, and Braintree

Saving the world (or some subset of people in it) is in vogue among the world’s wealthiest.

Jeff Bezos has a rocket company, Blue Origin. Bezos believes our future is extraterrestrial, and his rocket company exists because he thinks the price for getting anything off this rock is too damn high.

Bezos is not alone. Elon Musk is also building huge, reusable rockets. He wants to see humans fly to Mars, initially on a lark but eventually for forever.

This type of long-term thinking about the future of our species coupled with serious investment is important. But Bezos and Musk (and most other investors) are missing the most significant — and smallest — technological opportunity to save humanity.

No one has captured this tech blindspot better than my friend and Ginkgo Bioworks Co-Founder Jason Kelly. He did it by showing an image like this:

“What’s the most advanced piece of technology you see on this desk?,” Kelly asked his audience. The correct answer is in green.

A $4 houseplant is one of the most astonishing objects ever assembled. It’s a biodegradable, carbon-capturing, self-replicating, solar-powered work of art. Have you ever bought an electronic gadget that even comes close?

The mind-bending fact that a common shrub is more advanced than the latest MacBook Pro is overlooked by almost everyone. We fail to see it for a simple reason: the coolest parts of a plant can’t be seen. Not with the naked eye, at least.

It’s at the molecular level that plants fix CO2, soak up sunlight and churn out nutrients that we can eat. Way down at the level of atoms and molecules, the most mundane living objects are doing things that our best engineers can only dream of.

Small solutions to big problems

Humanity faces enormous, imminent challenges. The way we use energy is poisoning the planet, we are on track to use up many of our most important non-renewable resources, and we are ill prepared for the next inevitable global pandemic. And that’s just a small sampling of the challenges we see coming; there are dozens more around corners we can’t see around.

Major advances in deep tech – the marriage of hard sciences and emerging technology –  is going to be critical if humanity is to survive these challenges and thrive, but most of the money in the world is maintained or managed by people who do not have formal scientific training. For example, just 5% of the Forbes richest 400 people have formal scientific training. Most therefore invest in things they’re familiar with, like real estate, software and finance.

I founded OS Fund to support the scientists entrepreneurs bringing deep tech to market; leveraging hard sciences and technology to rewrite the basic operating systems of our world. Atoms, molecules, genes and proteins can be designed like never before. The biological world has already demonstrated what’s possible on this scale — if we’re going to aim big as a species, it’s time we think small.

At OS Fund, we don’t invest in particular problems. Instead of trying to solve energy or climate change or the spread of disease, we invest in the foundational technology that could be applied to solve all problems. In the same way that early computer companies like Intel, Apple and Microsoft helped spawn the modern era of computing, we aim to do the same thing with atoms, molecules, organisms and complex systems.

The scientists at Ginkgo Bioworks, one of the first companies in the OS Fund ecosystem, are charting their way by designing bacteria that puff out perfume, crops that fertilize themselves, gut microbes to make medicine, and much more. With three highly automated foundries up and running, the company is poised to upset almost every industry you can think of.

Arzeda, another OS Fund company, is using computers to design new genetically-encoded nanomachines, otherwise known as proteins. Although most of us know proteins only as food, these intricate biological objects actually do almost all the work needed to keep cells alive. Designing new proteins from scratch will let humanity play by biology’s rules, meaning we can design our way to better food, fuels and chemicals in the greenest way possible.

Another OS Fund company rewriting our world is NuMat, where they’re  arranging atoms in MOFs (metal organic frameworks) to create the most powerful sponges you’ve never heard of. NuMat works at the intersection of high-performance computing, chemistry, and hardware systems to design and manufacture materials that can filter non-renewable material like xenon out of thin air.

But wait, I can hear you thinking, isn’t AI going to eliminate the need for this kind of innovation?

That may be the grandest challenge of them all. How are we as a species going to thrive in a world where artificial intelligence can do more even than our best minds? The answer again requires innovation at the molecular level.

I started Kernel, a neuroenhancement company, personally investing $100M, to help ensure that humans and AI evolve together. We are working at the bleeding edge of neuroscience, solid-state quantum devices, materials science, and photonics to develop the science and brain interface products to allow people to bring their brains “online,” and use that data to radically improve themselves. Radical human cognitive improvement is a requirement if humanity is going to thrive in the future we are barrelling toward. We are a few tools away from an evolutionary leap; what’s on the other side of it is beyond what we can possibly imagine.

Investing in huge rockets, brain interfaces and tiny molecules isn’t actually that different. Developing a green global economy and exploring beyond our pale blue dot are complementary — not competing — visions of the future. It’s time investments in our future here on Earth get the attention and scale afforded those focused on our future in the cosmos.

For PhDs, Science is Easy, Marketing is Hard.  

Guest post by Neil Cohen, IndieBio Mentor, Branding & Marketing Expert 

If you’re a PhD, the lab is your happy place.   And if you’re persistent enough, you can create something that can change the world.   But when you do, reality hits.  For game changing concepts to become game changing science the world needs to know about it.   It’s time to shed the lab coat and become the last thing you’d ever thought you’d be – a marketer. 

Certainly, this short blog post won’t enable that transition.   That said, the goal here is to make you more comfortable to begin that transition and possibly, even embrace this new, unfamiliar role.   To be a marketer, you really just have to answer four simple, basic questions about your product/service to tell your story well.

1. What problem do you solve – The best marketers understand that whatever they are selling must solve a real problem.   Maybe you’ve heard the cliché, “be a pain killer, not a vitamin.” For example, there was a bio-remediation solution that was telling people they could save farmers money.   Nice. But what they really did is increase the yield of what the farmer was growing while also improving their margin. Saving money is nice, but more to sell at a higher profit is a pretty good pain killer.   It’s your job to frame your solution in a way that is simple, to the point and essential. Which gets me to my next point – focus exclusively on that singular value proposition. You’ve worked long and hard on your research and bringing your idea to life.   No one cares. What they do care about is what you can do for them, in simple, jargon-free, language, so get to the point. As I like to say, when someone asks you for the time, don’t describe how the watch works.

       No one cares about the details.  Get to your point quickly and clearly.

 2. Who do you solve it for and why they care – Knowing who your customer is and what they care about is essential to successfully marketing anything.   Often, companies oversimplify the audience using demographic information or simple job descriptions. That’s ok. I’m a fan of pairing that with psychographic information. Specifically, how does your audience think and feel. Often, psychographics will cut across most ages, genders, ethnicities, and cultures.   Regardless, psychographics hold the key to the most important thing about your audience, what will trigger an emotional response. Sure, there are components of your solution that make perfect rational sense  — but it is emotions that drive purchases. Is it making their family safer or healthier? Being a better version of themselves? Being a hero at work? Tap into that and you have a good chance of winning.

3. How do you solve it better or differently – Here’s  your chance to get into the weeds, but just a little.  In our first point, you tell people what pain it is you solve.   Here is where you tell them how you do it. Better if you are doing it in new way or better way than the status quo.    Like your core value proposition, these reasons to believe should be short, to the point and free of industry jargon. If they want the details, give them the science in a deeper piece of collateral or a white paper.  

4. How will your customer feel after they use your product/service – In many ways, this should be the first step.   Figure out what is it you want your customer to think and feel when you are done telling your story – then work backwards to make sure the story makes them feel that way.   

There you have it.  Four simple principles.   Now take off that lab coat and get out there and tell your story like a marketing pro.   

Creating a Global Movement

On Conscious Leadership: Jack Sim


By his count, before he turns 80 and is confined to a wheelchair and can’t remember his wife’s name, Jack Sim has 6,734 days left to live. Less than one thousand weeks. He counts his days in order to focus, in order to make it count.

Today, he’s at IndieBio, hoping to plant the seed that can replicate across the 94 startups accelerated here. He’s didn’t come all the way from Singapore to tell them that a million people die every year from diarrhea, spread by flies from human feces. He’s not here to tell them that 90% of the surface water in India is contaminated by feces, or that more people in the world have smartphones than have toilets. He’s certainly not here to take credit for the 100 million toilets being distributed across India by Prime Minister Narendra Modi, nor the small business toilet economy spreading fast across Cambodia, nor the transformation of rural Chinese schools. In fact, he doesn’t even mention these. What he’s really here to do is teach startups how to make people “give a shit” about unaddressed problems, like shit itself. How to not just make a product, but to create a social movement, activating the whole market at once, from investors and funders to consumers and media.

The moment Sim starts speaking, the audience is disarmed. If you’ve ever seen the Dali Lama chuckle and be self-deprecating, you have an imprint of the dynamic we’re in the presence of. Mr. Toilet is an altogether unique hybrid of enlightenment and comedy, not alternating in cycles, but all at once. His words fall on the audience like lyrical parables, haiku, and stanzas of slam poetry.

Growing up in Singapore,

I was not good in school.

I forgave myself.

What else could I do?

“I went into sales, selling imported building materials from Europe. I did real good. Then I had this feeling that the people of Singapore would desire Mediterranean roof tiles. I met an investor. In 1984 there was no such thing as a ‘startup.’ We started a roof tile factory in Malaysia, which became a $110 million business, and a brickworks, which became a $60 million business. Once I had the hang of it, I created 16 businesses in 16 years. But business was stressful, and worse, it was boring. Every business had boring problems that kept repeating — customers not paying and sales never enough. I asked, “Is this the life I want?” I retired at age 40. I have had no salary for 21 years. I thought it was better to die doing social work than making more businesses.

“Running businesses was not hard. I started fires. I didn’t manage companies. I just identified that markets had needs. Sometimes it was logical, but often I could feel the irrational desire, like looking at a Mediterranean house, the desire that creates, I could feel it. I used my gut to empathize, to travel into the minds of all kinds of people. If I was that guy, how would I feel? That’s the research you need. Steve Jobs said ‘people don’t know what they want. You have to tell them what they want.’ I’m not saying I’m like Steve Jobs, but — I’m like Steve Jobs.

“Whatever increases your energy, do.

Whatever reduces your energy, don’t do.

Whoever increases your energy, spend time with.

Whoever decreases your energy, avoid.

“I was a slave driver, I worked my staff to the bone. People quit, and then the people I replaced them with also quit. It took me three years to learn my lesson. Telling people to work hard is not as good as making them feel good about themselves and take ownership. Then they work hard on their own. People need ownership of decisions even more than ownership of shares.

“Individualism is America’s biggest export to the world. Society socializes you to think for yourself. Silicon Valley takes it farther in having a culture of wanting to be awesome. When you think about yourself, you eventually becomes a miserable person. If you think about others, you open up and become a joyful person. If you have the courage and curiosity of Silicon Valley, and the spirituality of the east, this combination will be very very good. If you have this balance, you have both purpose and success.

“Don’t grow up. I’m 61, but like a small boy. Always curious, asking stupid questions. If you don’t grow up, it’s easier. If you grow up, you’re afraid to ask questions.

“When we are children we are told by our parents not to talk about ‘shit.’ This is a real problem. What we don’t talk about, we can’t improve. I realized I needed to make toilets an object of desire — like Mediterranean roofs. You can’t tell people they should use toilets, they won’t, they have their way. You have to make them desirable.

“Back then, rather than calling it our ‘sanitation agenda’ they called it our ‘water agenda,’ because there was no funding for sanitation. And the media couldn’t report on the issue. They had to sell newspapers, not talk about poop. So, I created some stunts. First, I created the WTO, the World Toilet Organization, and set up the first conference. I knew two things could happen. The real WTO could sue us, and that lawsuit would get media coverage. Or, they’d let us be, and media would enjoy the joke and run with the story.

“Humor is a very risky approach. If you make people laugh, they will listen to you, but you become the joke. We held the first World Toilet Summit with 15 countries participating. (Today we have 193.) We had the Big Squat. An Associated Press writer spread our message around the world. The media becomes your partner is spreading your story. It sounds like a joke at first. You become the newsmaker, but the media — even when in on the joke — creates legitimacy. Before that first summit was over, every country was begging to host the next one. Then everyone was on the bandwagon.

“Looking back, I can see a theory. You have to align the stakeholders and use a little humor to help it explode. You can’t try to take credit. You have to make your stakeholders look good. When they look good, they’ll keep coming back for more. We are not here to moralize, we are here to solve problems.

“You have to bring in everybody. You lead through storytelling. You don’t have to do the work —just like with my 16 businesses — you create a vacuum to suck people in to do the work. You won’t get credit, but you create legitimacy for the space, for others to try it. Trust people for what you can trust them with. Mutual exploitation is what we call ‘collaboration.’

“In 2013, the U.N. General Assembly adopted our founding day, Nov 19th, as World Toilet Day. Netflix has a movie about me coming out, a documentary, ‘World’s #2 Man.’ Everyone’s joining the ‘movement.’ This year, at the World Toilet Summit, we’re giving out 80,000 tickets.
“Now I want to organize the BOP, the base of the pyramid, the 4 billion people who live on less than $10 a day. The world spends $150 billion in humanitarian aid for these people, to almost no effect. We need to treat them not as a cause, but as an economic market to activate. I want to turn that $150 billion from aid into an investment with an expected return.”

On Conscious Leadership: Tim Chang

On Conscious Leadership: Tim Chang

Tim Chang personifies a new breed of leadership in the venture-entrepreneur economy. He’s part of a rising alternative to the tech-bro culture that operates on aggression, domination, and winning. From the Mayfield Fund perch on Sand Hill Road, holding the purse strings on $2.7 billion, Chang has emerged as a soft-key reverend – a humanist who sees the entrepreneur’s psyche as the kernel of company culture. He dares to theorize a very un-Valley concept: that personal growth is a key to unlocking corporate growth. Venture always looks for a pattern, a formula, and after two decades in venture, Chang sees a hidden layer. His litmus test for founders is not in their startup’s growth metrics, it’s in their character and leadership. He asks himself, “Would I ever consider quitting my job and working for this person?” And he asks, even if this startup were to fail – as the vast majority do – “Would I turn around and write this founder a check for her or his next project, without hesitation?” Those are the kind of people Chang wants to back.

 

Chang came to IndieBio to speak to the current class of startups on “Conscious Leadership.” Provoked by only a handful of questions from Communications Director Maya Lockwood, Chang spoke at great length, extemporaneously. He was reflective, vulnerable, and disarmingly sincere.

 

“Venture capital has always tried to have a formula. When I first entered the industry two decades ago, that formula led us to look for repeat founders, with a track record of past success. We looked for MBAs and PhDs from Harvard, Stanford, and a small number of other schools. Then someone drew a histogram, a map, showing the lineage from William Shockley to the PayPal mafia. That became our heuristic; if you were part of the Facebook mafia, the first 100 there, and we know you were also at Google before that, et cetera.

 

“Today, all that is still part of the heuristic. But the founders I work with have deep self-awareness. They know why they’re building what they’re building, why they’re doing what they do. That “why” comes from a few rationals. First, it’s fun. Second, they’re often passionate about a problem they couldn’t pursue at their previous company. We’re often most passionate about that which is denied to us. Third, they’re in a position in life to be in service to society.

 

“I’m looking for entrepreneurs who get the concept of being a servant leader, to employees, to customers, to the world.  Increasingly, I counsel entrepreneurs to focus on process, craft, and the journey, and be less attached to the outcome and results. This attachment to a particular outcome is not helping the process. That drive to reach your goal – we’ve called that ambition, and we’ve called it focus. But it also leads to misery. When you wake up every morning, stressed, because you can see the gap between where you are and your goal, that can be tremendous motivation. But what if what you’re building is the journey? And there’s a craft to what you’re doing.

 

“Think of the sushi master, Jiro Ono, in Tokyo. At age 92 he still loves making sushi so much, he’s still motivated by the craft. He doesn’t care about his three Michelin stars – those are a by-product of his focus on craft and process. Making sushi is his expression of being, the expression of his art.

 

“How does this relate to you? There’s a craft in decoding what customers need. There’s a process in being hyper-present, decoding the data to be able to forecast the trend. Doing that on a daily basis is more important to growth than reaching any absolute number. $100 million revenue in three years is arbitrary.

“I empower founders to not get hung up on the outcome. Life in a startup is a fire drill every day. You’re supposed to act like you’re crushing it all the time, when really, you’re constantly on that knife edge of failure. I help founders not live in fear of that. If we need to pivot, we’ll pivot. We’ll roll with it. There’s a saying in buddhism, “Nothing that ever happens is good or bad, it’s only the story we wrap around it.” And so often we wrap our identity in our work. That identity can become a prison. If the outcome you want doesn’t happen, your identity is torn down, you have no meaning.

 

“I like the pure scientist mindset. My Dad was a scientist. To him, everything was just a hypothesis. The purest of scientists detach their ego from what the science and data says. Even if their experiment fails, the true scientist knows there’s learning from it, and we are one step closer to the truth.

 

“My parents were Asian tigers; I measured myself by scores on tests. I was trying to prove my worth to my parents, to my classmates from school. That can be powerful, but it can also create deep insecurity, a sense the world is out to get me. I came to realize my existence as a VC was fear-based. I was always worried, “Can I stay employed? Will I make partner? Am I still on the Midas List? Will we be able to raise another fund?” I would like to tell my 25-year-old self, “Relax, dude. Think about why you’re doing what you’re doing. Have more joy. Who are you serving beyond yourself?”

 

“Some of my early successful investments were in gaming. I was known by many as “the Gaming VC.” Now I look back and wonder if that helped the world. We were designing for addiction, hacking design principles to keep users playing. Engagement is the code name for addiction. Today those same design principles are being used to hack e-commerce. Get people to buy more. Eat more. The economic system is itself addicted to growth. We’re at peak content, peak gaming, peak calories. I had to ask, “Am I enabling that?” This understanding had led me to making more investments in the re-use or sharing economy.

 

“The challenge of self-growth and spiritual practice is, as you wake up, you shed your old personality. You become aware of how much your motivation was driven by your ego, by your fear of missing out, your insecurity. This period is, at first, lonely. The term for it is “the Dark Night of the Soul,” a spiritual desolation as you shift from one phase of life into another. You can help yourself by getting a coach. Or build a personal Advisory Board, not anybody from work. Spend time with other founders who’ve walked that path. People who you can talk to without fear of judgment or retaliation.

“Your startup is an embodiment of your persona. Your personal energy. And consider for a moment that might not be the healthiest culture. Let’s say when you grew up, you were criticized all the time. It was tough but it made you better, so you understand its value. But if you treat employees like that all the time, if you’re hard on them, that won’t be a great place to work. Many startups, many companies, have created deeply demanding workplaces, and they did well – until they hit a dip. Then it wasn’t sustainable. People didn’t want to be there.

 

“We’re so highly attuned to rationalizing. People are good at saying, “I think this.” Ask them, “You told me what you think. That’s cool, now tell me how you feel about it?” You give people permission in how you speak. If you lead with vulnerability, that can be your superpower. Culture in a company is more felt than analyzed. The art of building a startup is a healing process. We bond through shared transformation, we bond through overcoming adversity. When that happens –the act of that – we’re brothers for life. Those relationships get you through, and will last a lot longer than the money lasts.

 

“The best captains are not always the star players, they bring the best out of others. What makes a team click is how people complement each other. I learned a lot as a musician in bands. The greatest bands, they’re such good listeners to each other’s music. They can sense when to shine and when to hold back. When you have too many star players, for whom it’s always about me, the music doesn’t sound good.

 

“Make sure the values you espouse actually connect to your business on a daily basis. If in meetings, those values aren’t coming up – if they aren’t helping you make decisions – then you chose useless values.

 

“As a VC, 99% of the time, I have to say “no.” There’s very little “yes.” Lately I’ve been more empathetic to that. I love what all founders are doing. Statistically, most won’t make it. But there’s value in the attempt. It creates learning we all benefit from, contributing to the Cambrian seed, the sum of all the possible combinatorial experiments we are running. I want to honor that.