Recently, we attended the CED Tech Venture Conference in Raleigh. There was an excellent set of presentations, many relevant to the future life science entrepreneur. The most notable comment came from Silicon Valley venture capitalist (VC) John Doerr of Kleiner Perkins. He was intimately involved in the support of Amazon, Google, and Apple. He is an icon in the VC field.
The co-presenter asked him what he felt was the most potentially lucrative area for investment going forward. His answer was to ask the presenter how much money is spent on Google and Facebook versus how much of the money is spent on healthcare. With healthcare spending at over 17% of GDP in 2015, the winner is far away healthcare—more than 50 times as much. So his enthusiasm regarding entrepreneurship was in the life sciences. One of the most influential financiers believes that now is the time for an entrepreneur with a life science background to pursue a business in order to address a health-related issue.
The conference had some unique investor reverse pitches. It was clear that VCs have particular interests they will fund. For example, the Stanley Tools folks are interested in material science and batteries (no surprise). But others started out saying they are interested in life sciences and then clarified that only a tiny portion of life science interested them. Assume that someone seeking funding would only be able to identify perhaps two out of 20 VC firms that would fund a startup with overlapping interests. Also, VCs are primarily interested in later stage companies and large amounts of capital. For the early stage entrepreneur, VC holds little potential. Apparently, the days when John Doerr gave money to Google’s founders (even though they didn’t seem to like business) and money to Jeff Bezos (even though he didn’t have a business plan) are very much over.
The presentations by many companies at the conference were excellent. They did a nice job of conveying a simple pitch, outlining their unique value proposition, and providing some financial data to back it up. All of the CEO presenters at this conference were well-funded. The companies that presented were looking for funds to expand globally and already had substantial success. They echoed the above finding. VC is for companies in later stages and a proven business model.
Finally, we were inspired by the entrepreneur workshop and lunch with Scot Wingo by Robbie Allen, founder and executive chairman of Automated Insights. He spoke on “building a startup culture that scales.” Mr. Allen explained the secret of success for his small business; the low-key atmosphere of the company was the driving force. He knew his employees would work hard, and they needed to have a comfortable environment that supported energy and enthusiasm. To that end he included a ping pong table, which was apparently well-used.
He worried at first that this would make his company look childish, but he found the employees were quite enthusiastic, and in fact, it didn’t harm productivity at all. More importantly, he found that when his investors visited the office, they viewed the ping pong table in a positive light. They felt the ping pong table showed that his company was a dynamic and fun place to work. They noted that his space would be attractive to current and future employees. In fact, his employee retention was phenomenal.
Even as the company proliferated and at times was overly crowded, given limited office space, the team morale remained high. His message? Be yourself. If you are someone who enjoys a playful atmosphere, then create a corporate culture that works for you. You’ll be surrounded by people who share your vision of a comfortable work environment.