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Friday, August 31, 2007
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Charlie Rose - Ratan Tata / Kiran Mazumdar Shaw / Anil...
Ratan Tata / Kiran Mazumdar Shaw / Ani/ speech
Friday, August 24, 2007
Startup Founders: The Involved vs. The Committed
’m going to refrain from starting this off with the story about the chicken and the pig (there’s something about the former being involved and the latter being committed). I’m vegetarian so this particular folksy tale doesn’t have a resonance with me.
In the startup world, the phrase that is often bounced around, is to have “skin in the game”. This is a short-hand for saying that a given individual has some incentive to see the company succeed. One of the most common examples is: “Susan just wrote our startup a $100,000 check – she has skin in the game.”
I’m going to argue that there are multiple levels at which parties can be involved in a startup. Certainly, writing a check is one way to align interests, but that is an over-simplification.
The reason people like to see “skin in the game” is that it motivates the right kind of behavior on the part of the individuals with the skin. Interests are (supposedly) aligned and those with skin in the game are expected to do the right thing more often than not for the company.
But, there’s a big difference between the degree to which interests are aligned and more importantly the degree to which an individual really has skin in the game.
On one end of the spectrum, you have those that are lightly (or heavily) “involved” in the startup. These can be advisors, could be passive angel investors could be members of the management team working for reduced salary – and of course, could even be one of the founders. Yes indeed, you can have involved (but not committed) founders. And, on the other end, you have those that are committed.
Here’s the litmus test for how I try to distinguish between the two: If your startup dies next week, what will be the actual impact on a given individual?
The point here is that just because someone quits their day job, just because they write a relatively large check, just because they take the founder title – none of these necessarily means that they’re committed. It’s possible that in all of these cases, the actual impact on the individual is relatively minor. They find another day job or they mourn the loss of their investment for a week or a month. What I consider “real” co-founders are those that are financially and emotionally committed to the startup. For the founders to be committed, if the startup dies tomorrow, it will forever change their life. They can’t just wake up the next day and have it be life as usual (yes, they’ll recover – but the failure will have a lasting impact).
In the startups that I’ve kicked off, much to my dismay (and my wife’s dismay), I’m always committed. And I’m particularly emotionally committed. Sure, I make substantial investments in the startup, but I really get emotionally committed. My identity becomes tied to the company. I meet great people, I experiment with new ideas, I (hopefully) build great products. But, what really reels me in is that everyone I know, knows that I’m working on a new startup. Sure, I might fail, but it will not be a quiet, subdued failure. It will be (in my own way) – spectacular. Just as everyone I know will know I started, everyone I know will also know it didn’t work out.
For my current startup, HubSpot, it took me some time to “draw in” my co-founder, Brian Halligan. I didn’t have to find him (we already knew each other pretty well, and he was already involved in the company for over a year – but he wasn’t committed). This past summer, he joined full-time as co-founder, but I still wasn’t absolutely sure he was committed until an important thing happened: He started talking to his friends, family and colleagues about HubSpot. He told them why he was doing it, and how great the company was. Now, for good or for bad, he is in. If by mistake or misfortune, HubSpot does not go in the direction we hope, I do not think he will be able to walk away untouched. He is committed, as I am. And that’s what you want in a co-founder.
How about you? Have you had a hard-time getting people to shift from the “involved” stage to the “committed” stage? Would love to hear about your experiences. Please leave a comment.
The Art Of Startup Prioritization: Maximizing The Wow-To-Work Ratio
At most startups, one of the hardest things to do is prioritize tasks. If your startup is anything like mine, you’ve got hundreds of things you could work on. There are always more ideas and tasks than there are people to do them. The trick is figuring out what to work on now and what to work on later. I’ve had to deal with this challenge for most of my professional career.
Figuring out how to prioritize is a non-trivial challenge because there are many factors at play. I don’t think it’s possible to come up with the “optimal” prioritized list of things to do (and even if you had the optimal sequence, you wouldn’t know it or be able to prove it).
So, the way I like to think about this problem is to analyze the inputs into the function. Here’s how I think about prioritization within a startup. Note that these points are related to prioritization of tasks related to the product (in my case, software for internet marketing). But, some of the principles would likely work for other types of businesses as well.
The Art Of Startup Prioritization
When reading this list, assume that all other factors are equal (which I recognize that they never are). Also, it’s important to recognize that a lot of my thinking about startup task prioritization is solving for the somewhat amorphous concept of “startup success”. I’m not just looking to build the “best product” or create the highest margins. Also, I don’t think the classic approach of “work on the things that are most important” is a good one. In tends to sub-optimize because of other factors.
For example: There may be one critically important task that you would think is the “highest priority”, but may need to be deferred based on the fact that it’s so mind-numbingly boring that you’re going to lose your lead developer if you make him work on that task immediately after he just spent a week working on another mind-numbing task. One of the goals of the prioritization process is to make optimal use of resources that you have – and ensure that you still have them.
But, I digress. Here are the things I like to think about when deciding what to do.
1. Proximity To Customer: When choosing between two otherwise equally important tasks, pick the one that will deliver the most direct value to the customer (i.e. it is the closest to the customer’s needs). So, although picking just the right shade of blue for your logo might be important – it doesn’t really help the customer directly. (Note: I recognize this is an extreme example, but since this is the first point, I wanted to make sure I’m clear on the structure of this list).
2. Visible Value: Tasks that create value that can be seen win out over tasks that are under the covers. Customers often lack imagination and appreciation. In the early days, it’s very important to create both the perception of progress and actual progress. On a related note, non-engineers share this some trait with the customers. So, your CEO is likely going to be more impressed with a feature she can see than one she can’t.
3. Non-Controversiality: Pick tasks that are non-controversial and don’t require debate, discussion and lots of analysis. Basically, pick the tasks that are “obvious” (i.e. of course we should do this thing and of course we would do it this way). For example, an easily replicable bug that deletes all the user’s data at random times is non-controversial. Everyone agrees it is a bug and there’s likely not a lot of debate about how to fix it.
4. Maximize Wow to Work Ratio: This is possibly the most important item (and my clear favorite). That's why I changed the title of the article. This tip suggests that when in doubt, pick the task that has the highest “wow to work” ratio (that is, the task that creates the most customer delight for the least amount of effort/investment). You’d be surprised to see how easily we engineers get this wrong. We have this mistaken notion that the “Wow!” factor and the level of work needed are somehow correlated. They’re not. Customers are impressed by the most trivial things sometimes. Find these trivial things and do them.
5. Team Productivity and Preservation: Pick tasks that optimize the level of productivity of your current team and minimize the chances that one or more of them are going to go running into the hills. Business-types get this one wrong all the time. Yes, getting you the report that tells you with precision exactly how much money you’re losing on your freemium product is important. And yes, you have to have it by the end of the week so you can update your VC investor spreadsheet. But, forcing this task is going to be sub-optimal if it causes your programmer to quit on you – because then you have two problems. In short, don’t just force-feed the most “important” tasks. Be mindful of the state of the team.
I've got several more items on my list, but these are the most important. What are your thoughts? How do you go about choosing between the hundreds of possible tasks in your startup's list of things to do? Please leave your comments.
Figuring out how to prioritize is a non-trivial challenge because there are many factors at play. I don’t think it’s possible to come up with the “optimal” prioritized list of things to do (and even if you had the optimal sequence, you wouldn’t know it or be able to prove it).
So, the way I like to think about this problem is to analyze the inputs into the function. Here’s how I think about prioritization within a startup. Note that these points are related to prioritization of tasks related to the product (in my case, software for internet marketing). But, some of the principles would likely work for other types of businesses as well.
The Art Of Startup Prioritization
When reading this list, assume that all other factors are equal (which I recognize that they never are). Also, it’s important to recognize that a lot of my thinking about startup task prioritization is solving for the somewhat amorphous concept of “startup success”. I’m not just looking to build the “best product” or create the highest margins. Also, I don’t think the classic approach of “work on the things that are most important” is a good one. In tends to sub-optimize because of other factors.
For example: There may be one critically important task that you would think is the “highest priority”, but may need to be deferred based on the fact that it’s so mind-numbingly boring that you’re going to lose your lead developer if you make him work on that task immediately after he just spent a week working on another mind-numbing task. One of the goals of the prioritization process is to make optimal use of resources that you have – and ensure that you still have them.
But, I digress. Here are the things I like to think about when deciding what to do.
1. Proximity To Customer: When choosing between two otherwise equally important tasks, pick the one that will deliver the most direct value to the customer (i.e. it is the closest to the customer’s needs). So, although picking just the right shade of blue for your logo might be important – it doesn’t really help the customer directly. (Note: I recognize this is an extreme example, but since this is the first point, I wanted to make sure I’m clear on the structure of this list).
2. Visible Value: Tasks that create value that can be seen win out over tasks that are under the covers. Customers often lack imagination and appreciation. In the early days, it’s very important to create both the perception of progress and actual progress. On a related note, non-engineers share this some trait with the customers. So, your CEO is likely going to be more impressed with a feature she can see than one she can’t.
3. Non-Controversiality: Pick tasks that are non-controversial and don’t require debate, discussion and lots of analysis. Basically, pick the tasks that are “obvious” (i.e. of course we should do this thing and of course we would do it this way). For example, an easily replicable bug that deletes all the user’s data at random times is non-controversial. Everyone agrees it is a bug and there’s likely not a lot of debate about how to fix it.
4. Maximize Wow to Work Ratio: This is possibly the most important item (and my clear favorite). That's why I changed the title of the article. This tip suggests that when in doubt, pick the task that has the highest “wow to work” ratio (that is, the task that creates the most customer delight for the least amount of effort/investment). You’d be surprised to see how easily we engineers get this wrong. We have this mistaken notion that the “Wow!” factor and the level of work needed are somehow correlated. They’re not. Customers are impressed by the most trivial things sometimes. Find these trivial things and do them.
5. Team Productivity and Preservation: Pick tasks that optimize the level of productivity of your current team and minimize the chances that one or more of them are going to go running into the hills. Business-types get this one wrong all the time. Yes, getting you the report that tells you with precision exactly how much money you’re losing on your freemium product is important. And yes, you have to have it by the end of the week so you can update your VC investor spreadsheet. But, forcing this task is going to be sub-optimal if it causes your programmer to quit on you – because then you have two problems. In short, don’t just force-feed the most “important” tasks. Be mindful of the state of the team.
I've got several more items on my list, but these are the most important. What are your thoughts? How do you go about choosing between the hundreds of possible tasks in your startup's list of things to do? Please leave your comments.
Startup Marketing: Big Bang vs. Darwinian Evolution
Broadly speaking, I think there are two types of marketing approaches.
The first is what I'll call "Big Bang". This was very popular in the 1990s, particularly for venture-funded startups. In this approach, the sequence of events goes something like this:
1. Have idea
2. Raise Capital
3. Code like crazy in "super stealth mode"
4. Hire VP of Marketing to plan big launch
5. Hire PR agency to launch
6. Launch!
7. Success!(?)
I'm not a big fan of this approach for one simple reason: I don't think it works all that well. As a developer, I think this is a wee bit like trying to write a 200 page specification document, develop the product, and expect to release something that works and makes users happy. It just doesn't work that way.
The second approach, the one I do like, is more like Darwinian evolution. This is where you start as early as possible, experiment as much as possible, as efficiently as possible and respond to feedback as quickly as humanly possible. Keep doing more of what works, and less of what doesn't. In my experience, this works really well.
So, if I were working on a startup (which it turns out, I am), I'd lean towards a strategy that looks more like this:
1. Have idea
2. Bootstrap / Beg / Borrow
3. Tell the World
4. Release product to the unsuspecting
5. Get feedback
6. Iterate, iterate, iterate!
7. Success!
I'd like to spend a little bit of time on the middle parts of the above sequence. What I think really works today is discussing the idea with your potential market as early as possible. Ideally, this should happen before you've written your first line of code. Less ideally, you can wait a week or two. The easiest way to do this is to start a blog. You can use one of the free services out there (just make sure to register your own domain name). This way you get commenting (market feedback) and RSS subscriptions automatically. Then, post like crazy and do everything possible to get feedback.
In parallel, put the most minimal version of the software imaginable out there as soon as you can. If you're not embarrassed of your product and are not scared to death when users start banging on it, you waited too long. Get it out there. Yes, people are going to point and laugh at your product. Yes, they're going to ridicule you for building something that has a laughably small set of features, most of which don't work. It doesn't matter. GET IT OUT THERE!
From there, your marketing and your product should evolve in tandem -- organically. Don't even think about advertising, PR, launches and other marketing stuff. All of these things will simply distract you from the real problem: figuring out what customers want. As many failed startups have learned, marketing a product that nobody really wants is awfully expensive and frustrating. Even the perfect marketing strategy (if there is such a thing) is unlikely to work. On the other hand, even naive, unsophisticated marketing can work wonders when everybody wants the product.
So, don't get lured into believing you need some super-sophisticated marketing strategy with a big launch to create a mega-hit product. You don't. If you don't believe me, think of five startups that you really admire and that you think were big hits. Now, do some quick research and figure out how much time/energy they spent on a big-bang launch to "release" their product to the world. Chances are, the launch came well after the product was already out there and somewhat successful.
What do you think? Have you mastered the art of launching a successful software product? Are you a PR person that is gravely offended at my suggestion that startups shouldn't really plan formal launches? Would love to read your thoughts in the comments.
The Dark Side of Startups: 5 Corrosive Co-Founder Conflicts
The following is a list of the types of co-founder conflicts that I have encountered in my 15 odd years working in and with startups. Some of them are from my own personal experience, some are from late night conversations with other entrepreneurs dealing with co-founder issues. If you've kicked off a company and had one or more co-founders/partners in it, chances are some of these might resonate with you -- I'd be very surprised if none of them did. If you're on the outside, looking in (i.e. thinking about starting a startup), don't let this list dissuade you. I still think startups are great things, but it's often useful to look at the dark underbelly of exeperiences sometimes to get a fuller understanding of things .
5 Common and Corrosive Co-Founder Conflicts
1. The "Who Gets What?" Conflict: This conflict is likely the most common. Anything that impacts the amount of money made for the various founders has the potential to generate conflict. The most obvious example is equity in the company. Who gets how much? Why? What happens if one of us leaves? Another example is the issue of founder compensation. How much should each founder get paid? Why? Who gets to change it? The good news about economic conflicts (vs. some of the others we'll talk about later) is that the conflict itself is understandable and rational. Everyone wants to be treated fairly and at some level, there is a natural conflict of interest (i.e. if I get more shares, someone else gets less).
Under good circumstances, most conflicts in this category can be resolved through discussion, negotiation and perhaps some outside intervention (i.e. an advisor or mediator). Under bad circumstances, this cannot be reconciled the "easy" way and as such, the legal documents get visited, people hire lawyers and unpleasantness ensues.
2. The "I Work Harder Than You!" Conflict: It is mathematically impossible for each founder to work at exactly the same levels in a startup. It is natural for each co-founder to invest time/energy based on her situation. This could be influenced by how much time they have available, how passionate they are about the company (yes, you heard it here first, not all co-founders are totally passionate about the company), their own style, their personal obligations, etc. When founders begin arguing about who is doing how much, this can often be rooted in the "who gets what" conflict. Example: I'm working 100 hour weeks and Joe's only working 50 hours weeks, so I should get twice as many shares as Joe!".
3. The "Who Gets To Decide?" Conflict: If you and your co-founders are well matched, chances are your skills and talents are not totally overlapping (i.e. they are good at some things and you are good at others). This resolves most of the "who gets to decide" issues as lots of decisions fall into the area of expertise of one co-founder or another. If the founding team is functioning well, most decisions never become issues. But, there are two areas where issues do arise: When you both have some background/expertise in an area (or believe you do) and when neither of you has any background -- but both have opinions. One common example of this is raising capital when all/most of the co-founders are first-time entrepreneurs. Everyone has opinions on whether or not to raise capital -- and if so, how much and from whom. Since there are no easy answers to this (even when you have had prior experience), conflicts can occur. A lof the conflict in this category really comes down to personal goals of the co-founders. Some want/like control. Some like/want a certain outcome ("We've raised money from a major VC -- woo hoo!") and some just want to build something cool. When decisions impact the various personal goals of the founders, tensions can arise. My only advice here is to have conversations about this as early in the process as possible.
4. The "I Can't Stand Jill, One Of Us Has To Leave!" Conflict: This is the worst. If the situation degenerates to the point where two co-founders are so conflicted that one or the other has to leave the company, several bad things can (and likely will) occur. In some situations, it's not the loss of a co-founder that's the most traumatic for the startup -- but the time leading up to the loss. If there are other members on the team, their morale is impacted. If there are other co-founders (besides the two in conflict), they are pushed to "take sides". Lots and lots of unpleasantness. Of course, getting to this point is not always a bad thing. There comes a time in the evolution of a startup that it makes good sense for a co-founder to leave. Everyone involved discusses the situation, determines what the best path is for the company and parts friends. It's all rainbows and sunshine. If you find yourself with this situation, congratulations, you're working with some great people. If not, and you have this conflict, your life is going to suck for a while. My sympathies are with you.
5. The "We're Going Down In Burning Flames…" Conflict: In my experience, most startups have near-fatal experiences regularly. In my first startup, not a year went by that we didn't he a day where we just thought the company was going to die. It could be some major product issue. Could be the potential loss of a significant client. Could be the draconian activities of an important business partner. Whatever it was, something really bad was going on and it was easy to come up with all the reasons why the company would just not be able to survive this setback and the "why don't we just cut our losses" type thinking begins. The conflict arises because not all the co-founders will see the situation in the same way. Some, because they're natural optimists (like me) and will ignore the evidence. Others, because they are influenced by having too much, or too little at stake in the game. Regardless, the conflict arises because one or more co-founders want to just go ahead and call it quits -- and the others do not. As is usually the case in these situations, there's no clear answer. Perhaps it is time to call it quits, but nobody really knows for sure In my first startup, we had several of these near-death experiences, but did not decide to call it quits and were reasonably successful. In another of my startups, we probably should have called it quits sooner, but didn't. In any case, it's hard to know the right answer and even if you knew, it's sometimes hard to get everyone to agree.
So, what do you think?
Have you experienced (or are you experiencing) any of the above conflicts now? How do you deal with them? When do you bring in outside help? [Note to self: Write future article about the difficulty of finding competent, non-conflicted advisors].
Have I missed any major types of conflicts? Leave a comment
5 Common and Corrosive Co-Founder Conflicts
1. The "Who Gets What?" Conflict: This conflict is likely the most common. Anything that impacts the amount of money made for the various founders has the potential to generate conflict. The most obvious example is equity in the company. Who gets how much? Why? What happens if one of us leaves? Another example is the issue of founder compensation. How much should each founder get paid? Why? Who gets to change it? The good news about economic conflicts (vs. some of the others we'll talk about later) is that the conflict itself is understandable and rational. Everyone wants to be treated fairly and at some level, there is a natural conflict of interest (i.e. if I get more shares, someone else gets less).
Under good circumstances, most conflicts in this category can be resolved through discussion, negotiation and perhaps some outside intervention (i.e. an advisor or mediator). Under bad circumstances, this cannot be reconciled the "easy" way and as such, the legal documents get visited, people hire lawyers and unpleasantness ensues.
2. The "I Work Harder Than You!" Conflict: It is mathematically impossible for each founder to work at exactly the same levels in a startup. It is natural for each co-founder to invest time/energy based on her situation. This could be influenced by how much time they have available, how passionate they are about the company (yes, you heard it here first, not all co-founders are totally passionate about the company), their own style, their personal obligations, etc. When founders begin arguing about who is doing how much, this can often be rooted in the "who gets what" conflict. Example: I'm working 100 hour weeks and Joe's only working 50 hours weeks, so I should get twice as many shares as Joe!".
3. The "Who Gets To Decide?" Conflict: If you and your co-founders are well matched, chances are your skills and talents are not totally overlapping (i.e. they are good at some things and you are good at others). This resolves most of the "who gets to decide" issues as lots of decisions fall into the area of expertise of one co-founder or another. If the founding team is functioning well, most decisions never become issues. But, there are two areas where issues do arise: When you both have some background/expertise in an area (or believe you do) and when neither of you has any background -- but both have opinions. One common example of this is raising capital when all/most of the co-founders are first-time entrepreneurs. Everyone has opinions on whether or not to raise capital -- and if so, how much and from whom. Since there are no easy answers to this (even when you have had prior experience), conflicts can occur. A lof the conflict in this category really comes down to personal goals of the co-founders. Some want/like control. Some like/want a certain outcome ("We've raised money from a major VC -- woo hoo!") and some just want to build something cool. When decisions impact the various personal goals of the founders, tensions can arise. My only advice here is to have conversations about this as early in the process as possible.
4. The "I Can't Stand Jill, One Of Us Has To Leave!" Conflict: This is the worst. If the situation degenerates to the point where two co-founders are so conflicted that one or the other has to leave the company, several bad things can (and likely will) occur. In some situations, it's not the loss of a co-founder that's the most traumatic for the startup -- but the time leading up to the loss. If there are other members on the team, their morale is impacted. If there are other co-founders (besides the two in conflict), they are pushed to "take sides". Lots and lots of unpleasantness. Of course, getting to this point is not always a bad thing. There comes a time in the evolution of a startup that it makes good sense for a co-founder to leave. Everyone involved discusses the situation, determines what the best path is for the company and parts friends. It's all rainbows and sunshine. If you find yourself with this situation, congratulations, you're working with some great people. If not, and you have this conflict, your life is going to suck for a while. My sympathies are with you.
5. The "We're Going Down In Burning Flames…" Conflict: In my experience, most startups have near-fatal experiences regularly. In my first startup, not a year went by that we didn't he a day where we just thought the company was going to die. It could be some major product issue. Could be the potential loss of a significant client. Could be the draconian activities of an important business partner. Whatever it was, something really bad was going on and it was easy to come up with all the reasons why the company would just not be able to survive this setback and the "why don't we just cut our losses" type thinking begins. The conflict arises because not all the co-founders will see the situation in the same way. Some, because they're natural optimists (like me) and will ignore the evidence. Others, because they are influenced by having too much, or too little at stake in the game. Regardless, the conflict arises because one or more co-founders want to just go ahead and call it quits -- and the others do not. As is usually the case in these situations, there's no clear answer. Perhaps it is time to call it quits, but nobody really knows for sure In my first startup, we had several of these near-death experiences, but did not decide to call it quits and were reasonably successful. In another of my startups, we probably should have called it quits sooner, but didn't. In any case, it's hard to know the right answer and even if you knew, it's sometimes hard to get everyone to agree.
So, what do you think?
Have you experienced (or are you experiencing) any of the above conflicts now? How do you deal with them? When do you bring in outside help? [Note to self: Write future article about the difficulty of finding competent, non-conflicted advisors].
Have I missed any major types of conflicts? Leave a comment
Management of Intellectual Property -The Driver of Biotechnology Industry
Inventor designation on a patent application
Inventor identification is very challenging and a sensitive issue to a project manager in a biotechnology company. Unlike authorship on research papers, not all members of a research team can be considered as inventors. Inventors by definition are those members of a research team who conceived the complete and operative aspects of the invention. Of course the invention has to be worked through appropriate experimental examples, otherwise called "reduction to practice" which can be performed by anyone trained in the scientific disciplines. Therefore, those experimenters cannot be designated as inventors. Sometimes, although rare, reduction to practice may require extraordinary skills and in such cases contributions made by the experimenter may qualify for inventorship.
Ownership of a patent
Inventorship provides the basis for determining the ownership. Most often a signed employment agreement obligates the inventor to assign the rights of the invention to the employer. Thus, for biotechnology enterprises it is very important that legally well drafted employment agreements are executed by all employees, which require that the employer be assigned of all rights to the invention conceived and reduced to practice in connection with the employment.
Intellectual property portfolio strategy
The development of a IPR portfolio strategy varies from the needs of a start-up biotech company which is centred around a scientific concept or a technology platform to a biopharmaceutical company which produces or markets biopharmaceutical products or an agricultural biotech company which produces or markets products such as pest resistant plant seeds or strains or biopesticides and others. Nevertheless, a well thought out IPR strategy is essential in all cases.
The term of a patent is 20 years, which starts from the date of filing. Thus, the timing assumes importance in terms of the duration for marketing a product. If the patent is filed too early during R&D, the window of opportunity to market the product as well as the size of the market will be smaller.
Granting patent rights to inventors is a legal provision created by each nation according to its constitution. Therefore, patent applications have to be filed in countries where the applicant seeks the protection. However, several nations including India have entered into a treaty called Patent Cooperation Treaty (PCT), which is administered by the World Intellectual Property Organization (WIPO). Thus, a single PCT filing establishes a common priority date for the invention in all the countries, which are signatories to the treaty. A PCT application can be filed at any of the Regional Patent Offices in India. It must be remembered that the PCT prosecution does not result in the issuance of any national patents, but it provides a cost effective means of establishing the priority date and also buys in 18 months of time from the date of filing to determine the commercial value of the invention. The decision on choosing, in which countries the patent application designated in the PCT application should be prosecuted, rests with the biotech company and its commercial strategy or business plan. The PCT route offers several advantages. One can obtain a patentability search and initial examination on a single application, which limits the costs for examination in each country, but the disadvantage is that a single examiner rules on the patentability. Alternatively, by filing a PCT application and choosing an option to file for Intellectual Property Protection in selected countries, one can defer for up to eighteen months for examination thus delaying the expenses involved in prosecuting the patent application.
Evaluation of inventions in biotechnology
The monetary worth of inventions is the prime consideration for bioentrepreneurs to seek investments from banks and venture firms. Although at the moment, investing organizations and banking community in India are not accepting patents as collateral, it is bound to come into vogue soon. There are many approaches to put a price tag on biotechnological inventions such as the cost of invention, the market and income from licensing. A novel method of risk adjusted net present value has been described recently which helps in arriving at a fair value for an invention (J.J.Stewart, P.N.Allison & R.S.Johnson, Nature Biotechnology 19 (2001) 5-9). However, it is important to realize that intellectual property (IP) has a value cycle, which has three distinct stages. The first stage is the growth phase during which technology and market development takes place. As the technology matures and the market uncertainty is lowered, the value of IP increases. The second stage is when the value of IP reaches a peak and the revenue generation reaches a maximum and the third stage is the period when the "net present value" drops due to competing products entering the market. Therefore, the evaluation of IP has to be made carefully by allocating weightings to a number of factors such as duration of IP protection, market forces and the size of the stage II window of opportunity.
Licensing of biotechnological inventions
A successful licensing strategy depends on the company's (institution's) business objectives. Different inventions require different licensing strategies. Small biotech start-up companies or university departments or public research institutions usually have technology platform type of inventions such as scientific tools or very early stage "proof of principle" type of inventions with potential wide applications. These are licensed on a nonexclusive basis whereas inventions, which require significant investments and/or resources, are generally licensed on an exclusive basis.
The concept of "freedom to operate" agreement among pharmaceutical companies is becoming a common practice, which includes a non-exclusive cross- licensing provision. By this agreement, the companies agree to use each other's intellectual property for research and development of some defined number of products for a specified time and financial consideration. Such agreements minimize the risk of infringement of each other's intellectual property and save considerable resources.
There are large numbers of patents on enabling technologies, which are owned both by private and public institutions world over. These include mainly tools of biotechnological research, such as expression vectors, selectable markers on plasmids, synthetic or constitutive promoters, transformation methodologies, assay methods, genes and gene products, etc. Prof. David Zilberman and colleagues at the University of California Berkeley (Calif. USA) have proposed a novel concept of a form of collective rights organization (Clearinghouse), whose functions include, identification and extent of availability of technologies for licensing, facilitating an interaction between patent owners and potential users and assisting in contractual licensing agreements. Clearinghouse concept of Prof. Zilberman is a viable strategy for Indian biotechnology research based industry
The governance of IPRs
Intellectual Properties are essentially intangible resources and assets not only for business enterprises but also to the country, which influence economic growth. The governance of Intellectual Property Rights therefore, assumes a crucial role in policy making. The adoption of IPR regime inevitably brings into fore claims, conflicts and disputes particularly in the fiercely competitive knowledge-based industries. Thus the implementation of IPR laws through an efficient legal system assumes greater importance in the governance of the IPR regime since benefits of the IPR system can be realized only if there is an effective enforcement process in place. Although the Indian Legal system is known for fair dispensation of the law, it has the reputation of being extremely slow and riddled with complex procedures. There is an urgent need to streamline the process and establish new institutions to handle IPR litigations. However litigations in India and elsewhere are expensive in addition to being time-consuming. Hence, many business firms are opting for alternative dispute resolution (ADR) processes.The World Intellectual Property Organization (WIPO) Arbitration and Mediation Centre located in Geneva (Switzerland) offers dispute resolution services particularly for cross-border IPR disputes, which include both contractual disputes (patent licenses) and non-contractual disputes (patent infringement).
IPR licensing practices sometimes introduce conflicts related to monopoly and national interests, such as unilateral refusal to license a patent or sell items covered by such a patent. Although there are many potential benefits to cross licensing, concerns may arise with agreements, which are intentionally designed to facilitate product-market collusion. Adequate safeguards are to be built into laws related to monopoly and restrictive trade practices (MRTP).
Opportunities knocking on our doors
There is little doubt that India is embarking on a knowledge-based economy. There is also an unprecedented hope that biotechnology will provide an opportunity to garner a significant part of the world market for Indian biotech products and services. Although the hope is well founded because India has trained human resources and scientific expertise but at the moment India is ill prepared to meet the challenges to realize the dream. Educational systems have to be revised to include innovation culture by removing rigid barriers to widen opportunities. There has to be a war front effort to mobilize resources and streamline operations to drive the industry to compete in the world market. Indian government must perceive that Intellectual Property Rights are essential for the rapid growth of the biotech industry. Subsequent to the introduction of the patent regime, Indian Patent offices will receive a large number of patent applications from within the country and outside, which will provide a significant revenue source. However, Indian patent offices lack both human resources and expertise in examining biotechnological inventions and the claims made. Human resource mobilization to process biomedical, agro-biotech and other biological inventions is of immediate need. Thus, there exists an enormous opportunity for students engaged in biological, chemical and medical sciences in a variety of functions both in public and private sectors, such as in technology development, technical writing for IP protection, mining data for innovation, legal drafting of patent applications, patent search and examination of claims, as well as in litigation, arbitration and mediation.
Another area where Indian biotech entrepreneur could greatly benefit from is, private funding of research. Although there is considerable venture-funding activity in India, there is very little investment into biotechnology research leading to novel products. Bankers and investment managers allude to ignorance of domain knowledge. There is an urgent need to provide basic courses in biotechnology and business opportunities to bankers, investment managers, SEBI and other investing agencies.
It is hoped that with the introduction of laws to protect Intellectual property rights, India will usher-in the culture of innovation and propel the Indian economy to achieve the goal of transforming India to a developed country by 2020.
Wednesday, August 22, 2007
Thursday, August 16, 2007
Venture capitalists and biotech sector — Discovering the potential
Long gestation periods of biotech ventures, near absence of public-listed companies, and lack of regulatory framework, have been cited as major impediments for getting venture funding in the sector. The tepid demand for venture capital from the start-up firms could be another reason.
Biotechnology industry
The biotechnology industry is a knowledge driven capital-intensive one. The two most important applications are in life-sciences industry, where the focus is on treatment of diseases, and in the farm business, where the aim is to produce foods with enhanced nutrition and flavour, longer tenability and a natural resistance to insects, viruses and herbicides. This is evident from the share of agro-products and pharmaceuticals in the global biotechnology market, at 35 per cent and 25 per cent respectively in 1999.
India has been practising conventional biotechnology for decades, but modern biotechnology is rather new to India and is growing rapidly. In 1997, the total biotech market in India was valued at $500 million. This grew to $1 billion and $2.5 billion in 1999 and 2001 respectively and is expected to grow to $4.5 billion by 2010.
India is a large market and opportunities exist for biotech products and businesses in the areas of biogenerics, biopharmaceuticals, agricultural, food and nutrition sectors, not only domestically but also internationally. India's clinical capability and research access to a diverse patient profile, makes the industry competent.
In addition, there are significantly lower operational costs and a higher profit margin. Bio-diversity of human gene pools and unique plant, animal and microbial diversity also offer exciting opportunities for genomic research.
Venture capital in biotechnology firms
Biotechnology firms have access to capital through two avenues: Private venture capital and government funding. Venture capital funding in India is severely limited. There are six or seven prominent venture capital firms, including ICICI, and Morgan Stanley, which have been fairly active. But most venture capitalists are unwilling to invest in biotech R&D. Rather, they want to fund companies whose products and markets are clearly identified. Their focus is on funding the commercialisation of techniques already developed.
Given the growth potential, biotechnology is an ideal area for venture capital investment. A high level of drug discovery is expected in small start-up companies. The potential for emerging biotechnology can be fully realised only if venture capital funds (VCFs) come forward more proactively.
Role of venture capitalists
Venture capitalists finance innovation and ideas with a potential for high growth but with inherent uncertainties. This makes it a high-risk, -return investment. According to a recent report, of 100 proposals received by venture capitalists, only one reached the final stage of discussion and evaluation.
Apart from finance, venture capitalists provide networking, management and marketing support as well. The venture capitalist is a business partner, sharing the risks and rewards and provides strategic, operational and financial advice to the company based on experience with other companies in similar situations.
Factors affecting choice of partners by venture capital
Venture capital target companies with superior products or services focussed at fast-growing or untapped markets. Venture capitalists must be confident that the firm has the quality and depth in the management team to achieve its aspirations. They will want to ensure that the investee company has the willingness to adopt modern corporate governance standards.
Firms strong in factors relating to patents, management, idea, and potential are more likely to obtain VC financing and willing partners to support commercialisation activities.
Last, venture capitalists look for clear exit routes for their investment such as public listing or a third-party acquisition of the investee company.
Though the biotechnology segment is gaining prominence and has the potential to address some of the socio-economic deficiencies, venture capitalists need to develop a sense of confidence to invest more into the sector. One of the ways to do this is to compare the relative performance of venture capital funds-backed and non-venture capital funds-backed firms.
The Table shows how venture capital-backed firms have performed vis-a-vis non-venture capital-backed firms for both expansion and start-ups firms.
Comparing the expansion stage investment of the venture capitalists in Biocon with that of Nicholas Piramal, it can be seen that in 2003, immediately after Biocon received venture capital funding, its profits rose 76 per cent, followed by a quantum jump of 247 per cent in 2004, whereas for 2004, Nicholas Piramal's profit rose merely 60 per cent. Both these firms are in the expansion stage and were started at the same time.
Panacea Ltd was also started around the same time. Its profit fell both in 2003 and 2004, whereas Biocon is experiencing a high growth in profit partly due to the support of the venture capitalists.
Another established firm, Monsanto India, which got venture capital support in 2002, has shown fair results compared to its contemporary, Shasun Chemicals and Drugs. In 2001, Monsanto's profits rose 10 per cent while the latter reported a 40 per cent fall in profits. With venture capital support, the profit of former jumped to 60 per cent, leaving Shasun's profit growth at only 17 per cent.
A comparison of Genomic and Haffkine Bio-Pharmaceuticals, both started in 1999, shows that the latter had not experienced any growth in profits from 2002 onwards. Whereas, venture capital-backed Genomic's profits rose 671 per cent in 2003 followed by 32 per cent growth in 2004 compared to Haffkine, whose profits fell 4 per cent and 111 per cent in the same periods.
Krebs Biochemical is also a startup, but has been performing badly compared to companies backed by venture capital. Its profits fell from 2001 onwards. In comparison, venture capital-backed Bharat Serum and Vaccines, set up in 2003, showed a positive profit growth of 18 per cent in 2003.
Venture capital is a nascent industry in India. With a sea-change in the mindset of people towards risk and investment, expatriates are returning to invest more than just money in start-ups. Also, the Government is promoting the establishment of biotechnology centres within industrial parks. Some are already established, such as the Marine Biotech Park in Chennai; others are in the pipeline.
According to a recent Nasscom study, venture capital funding in India is focussed primarily on expansion. Funding on startups fell from 36 per cent in 2001 to less than 10 per cent in 2003.
The same is true of the biotech sector, where seed funding accounted for only 15 per cent of the total disbursement, while late-stage funding constituted 41 per cent.
If India is to become one of the top five global locations in the creation of technology ventures, leading to the annual investment of over $10 billion by 2008 as envisaged by Nasscom, this trend needs to be reversed. Perhaps, a look at the performance of venture capital-backed start-up firms vis-Ã -vis non-venture capital-backed firms can surely induce more funding.
Tuesday, August 14, 2007
Communicating Success
Cepheid CEO John Bishop, a biotech veteran of nearly 40 years, guides his company into the next wave of clinical diagnostics.
On a fall afternoon, John Bishop, the CEO of Cepheid, a company that develops genetics-based analysis systems for clinical diagnosis and biothreat assessment, pulls a piece of paper from behind the desk of his sparsely decorated Sunnyvale, Calif., office. On the paper - which Bishop holds perhaps more dear than anything else in his office - are bar graphs displaying the personality attributes of his key employees.
Bishop explains that by knowing how individuals in his staff approach the world, he can best communicate with them. For example, someone who gets high marks as a "persister" makes decisions based on the opinions he or she holds rather than excitement that may stem from a specific choice ("rebels") or what may be the most expedient choice in a given situation ("promoters"). (Bishop himself is a "workaholic," which makes him goal-oriented, approaching the world via thinking, rather than values or beliefs.)
If Bishop knows how his staff thinks, he can both understand the motivations for their recommendations as well as communicate his positions to them in the most likely way to get them to respond, says Tom Coble, a partner with the Gardena, Calif., leadership consulting firm Spencer Shenk Capers. Coble worked with Bishop and his staff to figure out their personalities by using a behavioral assessment tool that has its origins in psychoanalytic theory.
The approach is important to Bishop because he doesn't like to waste time on miscommunications. In 1978, he had been sent by his then-employer, the American Hospital Supply Corporation (AHSC), to Kobe, Japan, to head a joint venture between AHSC and Japan's Green Cross Corp. Bishop was the CEO as well as the only non-Japanese employee. In Japan, his predecessor insisted on business being done in English, says Bishop, and this meant that the entire staff had to translate everything they did, slowing their ability to do their jobs. Bishop turned the business back to Japanese. This, he says, made his staff more effective, while also improving dynamics between himself and employees.
Years later, because of team dynamics that didn't work - particularly between the CEO and Bishop - he left Gen-Probe, a San Diego, Calif.-based company that makes DNA-based diagnostics to test for microorganisms. So when he became CEO of Cepheid in 2002, he sought to fast-track his understanding of his staff with a weekend together to model each personality and for the team to work on how they communicated with each other based on their traits. "We went to Monterey, saw different styles of people, and if you know this, you can engage that part of them," says Bishop. "The program was to speed up communications, rather than trail and error, which is slower."
"The idea is to be able to modify your communications so you can be clearly understood and your communications inspire and motivate," says Robert Koska, Cepheid's senior vice president of sales and marketing, who participated in the Monterey weekend. "Knowing that my sales manager is a workaholic persister and thrives on direct communications and prescriptive instructions, I can walk into his office and say, 'Where are we with sales and how are you going to take care of it?' With bench scientists, you can't take that approach."
His approach has paid off: Bishop's office also contains three Lucite-encased pieces of paper celebrating money raised: $10.6 million in 2002 via a private investment in a public equity (PIPE), and $61.9 million in 2004 and $98 million in 2006 from follow-on stock offerings.
Lost in translation
Armed with a bachelor's degree in zoology from the University of Miami in 1968, Bishop started his ride through biotech as a technical sales representative at the American Dade division of AHSC. Already married, he had thought about medical school, he says, but decided business was a better route to financial stability. He traveled around southern Texas, showing customers - major medical centers as well as the Southwest National Primate Research Center in San Antonio - how to use the company's chemistry and diagnostic equipment. He rose through the ranks, becoming a district manager, product manager, sales and marketing manager, and eventually director of product management.
After 10 years, he was sent to Kobe, Japan. In addition to returning the company to a Japanese-speaking organization, Bishop, who spoke no Japanese, consolidated multiple brands produced or distributed in the United States and Japan into a single brand with an identifiable look and feel. There were some bumps, of course, including bringing in a product manager out of US-based Thunderbird University, known for its international management program. This caused resentment from within, he says, especially in an atmosphere in which people in Japan often worked for the same company their entire lives, and promotion from within was seen as the natural order of things. Bishop sent his recruit packing.
Overall, the four years of running the company were "a general management MBA-type program," he says. But, after growing sales from $13 million to $30 million, it was time to return to the States: "When you leave your own culture, it's like you're frozen in time. You go back once a year, you go to the department store and shop, people would look at you like you're Rip Van Winkle."
 |
| Inside the labs at Cepheid. |
A journeyman CEO
When Bishop returned to Orange County, Calif., the AHSC "didn't know what to do with me," he says. "I had done well running the joint venture in Japan, so they asked me to take a shot" starting Paramax, a clinical chemistry systems business. He was there for two years, and his biggest lesson was one he learned early, he says: Focus on systems integration.
Early on, the "engineering group was pointing fingers at the reagents group, and the problem was figuring out where problems were coming from. We realized we needed systems-oriented people who can take in the entire system, not just instruments or reagents. You have to address things as a whole. If you don't have a systems integration group, you can be destined for failure." Bishop created the group and had it report directly to him.
But in 1984, he saw the science change and with it, a business opportunity. "Up until that point, everything you were doing was outside the cell, on cell-surface receptors. As a result, you were looking at downstream reactions. Trying to catch disease earlier and earlier was the challenge. Until we got into molecular, that was limited."
The new molecular science was validated as a business with the sale of San Diego-based Hybritech to Eli Lilly, says Bishop. "I saw highflying people making money," he says, and he wanted to do the same. A succession of jobs followed. As president of Gen-Probe, he got a lesson in team dynamics at a company with a lot of stars: "Like the LA Lakers, they were a great team, but there can be problem with too many stars."
His take-away at his next job as CEO of Source Scientific Systems (formerly Ocean Scientific, and which he merged with MicroProbe), was that he didn't like to be in the business of original equipment manufacturing, making systems for other people to put their name on. "You're not in control of your own destiny," he says. "You can't control the marketing of your product." And at Vysis, he says he learned to make the hard decision of cutting one's losses relatively quickly. In this case, he closed down the company's infectious disease division, which was robust, he says, but in an already crowded field. Bishop instead focused the company on genetics. Five years after joining the company, which he initially helped spin off from Amoco, he took the company public. And in 2001, he orchestrated the sale of Vysis to Abbott Laboratories.
| When Bishop came to Cepheid, he actively sought to understand how employees thought and worked together. |
Aboard at Cepheid
In 2002, he joined Cepheid, taking over leadership from Tom Gutshall, who cofounded the company in 1996. Cepheid had started life combining microfluidics with gene-based diagnostics. In 1999, it delivered a PCR-based system for detecting biowarfare agents, including anthrax, to the US Department of Defense. After the Sept. 11, 2001, terror attacks, biodetection contracts with the military continued, as well as an agreement through Northrop Grumman to supply the US Postal Service (USPS) with an automated system to spot-check letters for anthrax via DNA analysis. USPS currently runs approximately 1,100 of its systems every day. The deal, which generates approximately $45 million annually, meant that "Cepheid had decided to forgo the clinical and focus on the biothreat" market, says Bishop.
Cepheid was ready to focus on the clinical molecular diagnostics market, which is projected to be $3.6 billion worldwide by 2010, according to Frost & Sullivan. The challenge, and opportunity, is in the rapid evolution of this space, says Adam Chazen, vice president of the global healthcare group at Merrill Lynch. But "John is a seasoned diagnostics veteran. He was at the helm when he sold Vysis to Abbott, and it's the core of Abbott's molecular oncology business."
Bishop decided it was time for a change for Cepheid. "The company was only selling instruments, it was a tools play," says Bishop. "If you're instruments-only, you're relying on other companies putting tests on your instruments." Bishop wanted the company to have control of its own destiny. The company was low on cash, so he quickly raised $10 million. Another round of funding in 2004 brought in $61.9 million and allowed the company to pay $32 million for license rights to real-time PCR from Roche and Applied Biosystems. With the new money and intellectual property, and more money raised in 2006, Bishop has been building up the company's clinical diagnostic offerings, which now include two platforms: a real-time thermal cycler used for identifying DNA/RNA in approximately 20 minutes from prepared biological samples, and a cartridge-based sample-prep system to purify, concentrate, detect, and identify targeted nucleic acid sequences in about 30 minutes. Tests include those for Bordetella pertussis, enterovirus, flu A/B, respiratory syncytial virus, Mycoplasma pneumoniae, and group B Streptococcus.
The immediate challenge, says Merrill Lynch's Chazen, will be for Bishop to pick the right kinds of tests and offer enough of them to entice a lab or hospital to invest in the company's platform. Part of that strategy, says Bishop, is simplifying the tests so that they can be used by as many people as possible. In August, the FDA categorized its strep test as "moderate complexity," which makes it available to more than 27,000 US laboratories registered in that category, in addition to the approximately 7,000 high-complexity laboratories.
Back to the cheat sheet
Growing Cepheid has meant reaching back into Bishop's past. He knew Humberto Reyes, the new senior vice president for operations, from AHSC. "John called, said he needed someone with my level of experience," says Reyes. "I was doing consulting, traveling to Europe, and he convinced me that I shouldn't be traveling so much." Other key people and former colleagues Bishop has recruited include vice presidents for regulatory and clinical affairs, sales and marketing, clinical affairs, and a CFO: all are alumni of Vysis, MicroProbe, Gen-Probe or AHSC.
All those employees are featured in Bishop's bar graphs. Bishop keeps his personality "cheat-sheet" close by, and plans to use it often over the next five years to reach his goals: positive cash flow (vs. a current burn rate of $3 million per quarter, with $98.4 million in unrestricted cash and marketable securities), and $100 million in revenue a year (2005 revenue was $85 million). To get there, he sees the staff doubling from its current 290. Bishops says that he will retire after this job, though his management guru Tom Coble thinks otherwise: "I don't think John will ever retire. If he does, he will die. John needs a challenge and a purpose."
EIGHT INGREDIENTS TO BUILD A LIFE SCIENCES HUB
Hubs of life science activity can now be found around the world. To build such a science center, it takes the right combination of ingredients:
1. A Rainmaker: Areas need single groups that make large investments. As an example, Southwest Michigan First has poured $62 million, most of it private capital, into attracting business to Kalamazoo, Mich. Likewise, the Philadelphia, Pa., metropolitan area benefits from the money that Merck & Co. spends to build infrastructure there.
2. A Collection of Capital: Many areas hope that venture capital can attract startups. But it takes more than that, says Ted Abernathy, vice president of the Research Triangle Regional Partnership, an economic development group in North Carolina. "It takes all types of money," he says. This includes angel money (long-term investors) and mezzanine money (comes in during later phases of development).
3. Local Talent: Nothing can replace human capital. Once it leaves, it's not likely to come back. Cities and regions looking to become life science centers need to hold on to people. Their presence often leads to business growth. Take Chicago, for example. Dave Miller, president of the Illinois Biotechnology Industry Association, says the presence of Abbott Laboratories in the Chicago area led directly to the creation of successful startups such as Hospira and Valent BioSciences.
4. "Coolness": When trying to build clusters in a new knowledge-based economy, companies looking for a home want to know: Can we attract good people here? In this economy, it's good to be "cool." Examples of cool include a high quality-of-life rating, accessibility to outdoor recreation, or a thriving arts scene.
5. Government Support: To attract top life science companies, government needs to get involved. In the past five years in Kalamazoo, for example, the state of Michigan has earmarked more than $220 million to help cultivate the life science industry there, according to Jeff Mason of the Michigan Economic Development Corporation. This, says Mason, has helped build some 2,000 life science-oriented companies.
6. Attention: A region also needs attention. Andy Levine, president of Development Counsellors International, says the Research Triangle Park in North Carolina is a place that has benefited from such attention in the past 30 years. "If there is a perception that a cluster is developing and growing and building in a particular region of a particular city, I think that helps to attract other people," says Levine.
7. Major Academic Institutions: It helps to have a support network already in place, including universities, medical schools, and major hospitals. Boston, Chicago, and San Francisco have all grown their life science and biotech industries with the help of nearby universities.
8. Other Biotech Companies: While there isn't a specific threshold, more companies in the area mean employees have more job choices and employers can draw from a greater pool of talent. Abernathy, for example, knows that top talent wouldn't leave San Francisco for Durham, NC, if they thought they might get stranded there if their startup fails, or gets bought out, somewhere down the line.
Eight Biotech Hubs on the Move
Belo Horizonte, Brazil: Traditionally strong in minerals and automotive manufacturing, this city is also developing an international reputation in biotechnology, thanks in part to facilities such as the Biominas incubator, which provides publicly funded research space and equipment.
Genome Valley, India: This 600 square kilometer area in Hyderabad, India, includes more than 50 biotech companies.
Malaysia: Plans to invest $7.9 billion could make this country a biotech cluster that generates more than one-quarter million jobs.
North Carolina Research Campus, NC: The 350 acres in Kannapolis, NC, are being developed with hopes of attracting 100 biotech companies.
Singapore: This country attracts companies with offers to pay 30% of building costs, and it is home to Biopolis and liberal laws related to biotech, including research on stem cells.
Israel: An ongoing initiative promotes collaborations between local biotech companies and academic researchers, and the new Haifa Life Sciences Park is under development.
Paris, France: This city makes a home for many French biotech companies, and it also attracts others from around the world, including many from California, such as Abbott Laboratories and Genentech. Government agencies in Paris also offer companies help with site selection and tax incentives.
Shenzhen, China: Local government collaborates with biotech companies and, not surprisingly, this city is home to some of China's earliest biotech companies, including SiBiono Gene Tech, which received the first approval for gene therapy.
START IT UP
Ram Sasisekharan is a professor of biological engineering at MIT. He is a co-founder and director of start-ups Momenta Pharmaceuticals and Tempo Pharmaceuticals. In many ways, getting a biotechnology start-up off the ground with a business plan resembles securing a federal research grant. Moreover, the grantsmanship strategy that turns an idea into research funding can also sell an idea for a company. In both cases, however, only a clear strategy can sell an idea.
In a grant application, a scientist describes background and the potential significance of testing an idea. The researcher also provides preliminary data or evidence that supports that idea. The preliminary data make a case that the scientist has the knowledge, expertise, and some level of demonstrated ability to deliver. Following this, a grant application must include specific aims that clearly outline the approach to testing the idea. To be successful, most of those aims should be based on solid approaches with a high likelihood of yielding unambiguous answers. A good grant also outlines pitfalls, limitations, and time lines, as well as how an investigator will address these challenges. Overall, a successful grant application focuses on an idea that is clearly significant in advancing knowledge, provides convincing evidence that the approach is rigorous and innovative, and shows that the investigator, the environment, and the collaborators are more than likely to deliver what they promise.
Likewise, a business plan must clearly articulate the technology or approach and its significance. What can the technology do? Why is it important? This is analogous to the background and significance in a grant application. Explaining the application of the technology is analogous to testing your hypothesis or the specific aims. Very simply put: Think of what problem the business will tackle with its technology and the realistic viability of a timely success. Many grants today include a multidisciplinary section, and a business plan can too. There, an aspiring entrepreneur can blend different approaches to addressing the problem. Often, scientists go after everything that a technology can do, similar to seeing every problem as a nail to pound with this technological hammer. Instead, ask what kind of nail, or problem, the technology can hammer in successfully.
Successful start-ups also depend on strong intellectual property. This can show how a start-up could stay ahead or not have serious competition. Intellectual property applies to the technology and the business strategy. Thinking through these concepts carefully enhances the overall strategy.
Finally, as with a research grant, the intended team can make or break the funding of a start-up. Simply put: Assemble a dream team. Also, a start-up requires a diverse range of expertise and personalities. Create a balance of big thinkers and doers.
Once a start-up receives funding, always remember that one big difference distinguishes it from a laboratory. With a grant, people focus on the science over years, until it's time for renewal. With a start-up, the first months can determine a start-up's success or failure. Once a company starts, it must come out of the gate fast and never stop chasing its goal.
Sasisekharan's Fine Tuning Tips
1. It's not about you; it's about the team. This is a crucial mantra for a successful start-up.
2. Do not think that only you control when your potential start-up can raise funds. Successful entrepreneurs remember this saying: Raise money when you can, not when you want.
3. Focus, focus, and focus to make sure that you deliver what you promise, which establishes your credibility.
4. Think through a strategy and do not rush pitching it to venture capitalists. There is no second chance for the first impression.
5. It's not just the science or the business; it's how both come together to define the start-up concept. So don't get carried away by your science or the money.
9 essentials of entrepreneurship
"Entrepreneurship is an attitude," says Ramalinga Raju. "It's for people who are willing to fail."
Speaking at the 2nd TiE-ISB Connect 2006 forum at the Indian School of Business, Hyderabad, Raju delved on the simple yet arduous task of creating enterprises.
Urging entrepreneurs to focus on customisation of products for India at low costs, he said one has to literally live with one's own idea to succeed ultimately.
"Investors may help entrepreneurs with a long rope, but if you fail they will hang you with the same rope! Entrepreneurship requires you to sacrifice a lot to pursue the business interests," he said.
"When I started my company, Satyam, I had to spend most of the time in the corridors of financial institutions. Finance was a major constraint," he said.
But today the scenario has changed. "Venture capitalists appreciate good ideas, so if you come up with an idea that satisfies customer's demands, you have a good chance of making it big. VCs look at intellectual capital. And there is a huge potential in India," added Raju.
Explaining the change in outlook of companies, Raju said: "Earlier, companies focussed on attracting employees, then the focus was on efficient management and later leadership. Today businesses have evolved and companies are largely focussing on entrepreneurship as a tool to enhance value in a large organisation."
"Satyam is structured in such a way that it allows entrepreneurs to flourish and we will continue to encourage new ideas," he said.
So what is entrepreneurship all about?
- It is all about hard work and applying your mind properly.
- It needs complete dedication to your ideas and putting your best efforts into them.
- It is going to bed thinking about the idea and waking up in the morning thinking about it.
- It is a field where you need constant attention at every detail.
- It is about driving yourself: If you are a professional, your boss will remind you that you are not working, if you an entrepreneur you have to remind yourself.
- It is about convincing others about your ideas too: You have to get the full support of your family and friends to succeed.
- It is about networking: Being an entrepreneur also means that you have to be constantly in touch with clients, customer and business partners at close quarters.
- It is about leadership: You should know how to be a leader and add value to the leadership with your ideas.
- It is about confidence: You have to live with the conviction that even if things don't work out in the initial stages, later on everything will be in place and you will emerge a winner.
Wyeth stumbles badly trying to develop new drugs
he analysts have been picking over Wyeth's carcass over the past few days as they assess a string of woeful developments that have left the company stripped of three of its leading drug candidates. With its hep C trial suspended at the end of last week, the analysts are raising questions about the company's ability to design trials properly. And a pair of FDA rejections hasn't helped the company's reputation one little bit. Add it all up and you see a big pharma company having a terrible time coming up with new winners to replace its fading stockpile of approved drugs. The next big milestone for Wyeth: New mid-stage data from a study for a new Alzheimer's drug being developed with Elan.
- read the report from Forbes
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Monday, August 13, 2007
The Cloud In My Dreams
I reach my hands up to the clouds
And I grab the side one cloud that interests me
I pull myself up onto the cloud
I look around and I see things that I don’t normally see
For we live in a world full of hate, violence, and poverty
And on this cloud, I don’t see any of these things
Instead, I see monkeys playing with hippos
And I see dogs playing with cats
I see butterflies flying with birds
And I see snakes talking with rats.
There is no hunger and there is no pain
There is no poverty and there is no violence
I only see happiness
It’s a happiness in which I have never seen before
In this day and age,
it’s almost impossible for that to happen
But if we all come together,
We can make a difference
The cloud I saw is so unlike the world in which we live
Because on this cloud
Everyone gets along…
Unfortunately, this cloud is only a dream.
If You Have A Dream
Don’t wait for some distant day to come, it may be too late before you’ve even begun.
Not everyone will agree with all you decide.
Be true to yourself first and foremost.
The only important thing in life is what you do with the time you spend here on earth.
Don’t be afraid to follow your desires, they are not silly nor selfish.
Take the time and do what makes you feel alive.
Leave your fears and regrets in the past, for this is where they belong.
Don’t cloud today with things that can’t be undone.
You have no more control over yesterday or tomorrow, than you do the raging of your passions.
Do not quiet these dreams nor quench your desires.
For if you do, your journey is ended.
You have only today to begin anew and follow your dreams, For in the end all we have are our memories.
Stepping Stones
The Lord came to me like a dream one day and asked, why do you sorrow
I answered, Lord my life is so full of pain, I can’t face one more tomorrow.
The Lord sat down beside me, and gently took my hand.
He said, Let me explain to you and then you’ll understand.
Each sorrow is a stepping stone you must surmount each day,
And every stepping stone you climb is a sorrow that’s passed away.
The road of life is a mountainside, with crevices in which to be caught,
But as you struggle on your way, I, the Rock, will lend support.
Every stepping stone you climb, makes spirit and heart grow strong.
Exercising character and faith this road seems painful and long.
The way is paved with stepping stones, to uplift your heart and soul,
Though difficult they aid your way, to a City paved with gold.
I know that you are tired, for I too have walked this way,
My sorrows did they multiply, but I cleared the stones away.
I left my rock to lift you up, I left behind my story.
To give you strength to make your climb, to that special place in glory.
And never fear, the Rock is here, You’ll never climb alone
Surmount life’s sorrows, continue on, For they are but stepping stones.
Dreaming Your Dreams
Don’t ever be reluctant to show your feelings when you’re happy, give in to it. When you’re not, live with it.
Don’t ever be afraid to try to make things better you might be surprised at the results.
Don’t ever take the weight of the world on your shoulders. Don’t ever feel threatened by the future, take life one day at a time.
Don’t ever feel guilty about the past what’s done is done. Learn from any mistakes you might have made.
Don’t ever feel that you are alone there is always somebody there for you to reach out to.
Don’t ever forget that you can achieve so many of the things you can imagine. … It’s not as hard as it seems.
Don’t ever stop loving don’t ever stop believing, don’t ever stop dreaming your dreams.The “Be” Attitudes
Be understanding to your enemies.
Be loyal to your friends.
Be loyal to your friends.
Be strong enough to face the world each day.
Be weak enough to know you cannot do everything alone.
Be generous to those who need your help.
Be frugal with that you need yourself.
Be wise enough to know that you do not know everything.
Be foolish enough to believe in miracles.
Be willing to share your joys.
Be willing to share the sorrows of others.
Be a leader when you see a path others have missed.
Be a follower when you are shrouded by the mists of uncertainty.
Be first to congratulate an opponent who succeeds.
Be last to criticize a colleague who fails.
Be sure where your next step will fall, so that you will not tumble.
Be sure of your final destination, in case you are going the wrong way.
Be loving to those who love you.
Be loving to those who do not love you; they may change.
Above all, be yourself.
Don’t Abandon Your Dream
There were once 2 brothers who lived on the 80th level. On coming home one day, they realized to their dismay that the lifts were not working and that they have to climb the stairs home.
After struggling to the 20th level, panting and tired, they decided to abandon their bags and come back for them the next day. They left their bags then and climbed on. When they have struggled to the 40th level, the younger brother started to grumble and both of them began to quarrel. They continued to climb the flights of steps, quarreling all the way to the 60th floor.
They then realized that they have only 20 levels more to climb and decided to stop quarreling and continue climbing in peace. They silently climbed on and reached their home at long last. Each stood calmly before the door and waited for the other to open the door.
And they realized that the key was in their bags which was left on the 20th floor
This story is reflecting on our life…many of us live under the expectations of our parents, teachers and friends when young. We seldom get to do the things that we really like and love and are under so much pressure and stress so that by the age of 20, we get tired and decided to dump this load.
Being free of the stress and pressure, we work enthusiastically and dream ambitious wishes.
But by the time we reach 40 years old, we start to lose our vision and dreams. We began to feel unsatisfied and start to complain and criticize. We live life as a misery as we are never satisfied. Reaching 60, we realize that we have little left for complaining anymore, and we began to walk the final episode in peace and calmness.
We think that there is nothing left to disappoint us, only to realize that we could not rest in peace because we have an unfulfilled dream …… a dream we abandoned 60 years ago.
So what is your dream? Follow your dreams, so that you will not live with regrets.
Keep Trying
Two frogs fell into a deep cream bowl.
One was an optimistic soul,
But the other took the gloomy view.
“We shall drown,” he sobbed with much ado!
And with a last despairing cry,
He flung up his legs and said, “Good-bye!”
Said the other frog with merry grin,
“I can’t get out, but I won’t give in.
I’ll just swim around till my strength is spent,
Then will I die the more content!”
Bravely he swam till it would seem
His struggles began to churn the cream!
On top of the butter at last he stopped,
And out of the bowl he happily hopped!
So what is the moral? ‘Tis easily found;
If you can’t hop out, keep swimming around!
Live For Today
Have you ever wished, when a day went wrong
a wish that’s quite in vain
that it were only possible
to live that day again
You’d start out in the morning
with the prayers you should have said
and through the days your actions
with tolerance be led
The many little instances
that tried your patience, true
if only you could start again
you’d know now what to do
You’d kneel and say your evening prayers
and thank the lord above
for all the pleasant hours past
your heart at peace with love
But since this is a wish in vain
and never can be true
there’s only one alternative
just one thing you can do
To live today in such a way
that when tomorrow comes
the memories of yesterday
will all be cherished ones.
It Couldn’t Be Done
Somebody said that it couldn’t be done,
But he with a chuckle replied
That “maybe it couldn’t,” but he would be one
Who wouldn’t say so till he’d tried.
So he buckled right in with the trace of a grin
on his face. If he worried he hid it.
He started to sing as he tackled the thing
That couldn’t be done, and he did it.
There are thousands to prophesy failure;
There are thousands to point out to you one by one,
The dangers that wait to assail you.
But just buckle in with a bit of a grin,
Just take off your coat and go to it;
Just start to sing as you tackle the thing
That “cannot be done,” and you’ll do it.
But he with a chuckle replied
That “maybe it couldn’t,” but he would be one
Who wouldn’t say so till he’d tried.
So he buckled right in with the trace of a grin
on his face. If he worried he hid it.
He started to sing as he tackled the thing
That couldn’t be done, and he did it.
Somebody scoffed: “Oh, you’ll never do that;
At least no one ever has done it”;
But he took off his coat and he took off his hat,
And the first thing we knew he’d begun it.
With a lift of his chin and a bit of a grin,
Without any doubting or quiddit,
He started to sing as he tackled the thing
That couldn’t be done, and he did it.
There are thousands to prophesy failure;
There are thousands to point out to you one by one,
The dangers that wait to assail you.
But just buckle in with a bit of a grin,
Just take off your coat and go to it;
Just start to sing as you tackle the thing
That “cannot be done,” and you’ll do it.
Don t Look Back
As you travel through life, there are always those times
When decisions just have to be made;
When the choices are hard and solutions seem scarce,
And the rain seems to soak your parade.
And taking your life day by day.
There’s a brighter tomorrow that’s just down the road,
Don t look back, you’re not going that way.
When decisions just have to be made;
When the choices are hard and solutions seem scarce,
And the rain seems to soak your parade.
There are some situations where all you can do
Is to simply let go and move on,
Gather courage together and choose a direction
That carries you toward a new dawn.
So pack up your troubles and take a step forward-
The process of change can be tough,
But think about all the excitement ahead,
If you can be stalwart enough.
There could be adventures you never imagined
Just waiting around the next bend -
And wishes and dreams just about to come true
In ways you can’t yet comprehend.
Perhaps you’ll find friendships that spring from new interests
As you challenge your status quo,
And you learn there are so many options in life
And so many ways you can grow.
Perhaps you’ll go places you never expected
And see things you’ve never seen -
Or travel to fabulous far-away worlds
And wonderful spots in between.
Perhaps you’ll find warmth and affection and caring -
A “somebody special” who’s there
To help you stay centered and listen with interest
To stories and feelings you share.
Perhaps you’ll find comfort in knowing your friends
Are supportive of all that you do -
And believe that whatever decisions you make,
They’ll be the right choices for you.
And taking your life day by day.
There’s a brighter tomorrow that’s just down the road,
Don t look back, you’re not going that way.
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