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How to fund my biotech and big data startup idea?
I think I have a startup idea that lies at the intersection of biotech & big data which could prove quite successful. It is in fact tackling one of PG's frightenly ambitious startup ideas [1]. I have a good proof of concept prototype. However, I'm having a hard time to find any funding opportunities that could help me to go beyond that stage.
I'm a graduate student at Cambridge University, which is one of the hottest biotech hubs in the world so this is a bit disappointing. I don't seem to be alone here, one slightly old WSJ article points in the same direction [2].
My startup would require ~$0.5M to get started, mostly for purchasing expensive machinery, which is a quite modest amount in biotech terms. That's partly because a large part of the startup functions would be machine learning-based, which is thankfully a lot cheaper to run than a wet lab.
We would be tackling a very general problem, so this amount seems even more modest in perspective. Google got funded with $25M back in '99 to get past the prototype stage.
Understandably, places like YC won't go up to that much of initial funding because it doesn't fit their model [3]. On the other hand, biotech VCs seem to prefer investing on drug pipelines. My idea is very IT-based, so they seem to dislike going into that alien route. Therefore, I might be stuck between both worlds.
Any ideas on who should I approach or possible VCs happy to fund this kind of thing? (Email details on my profile if you prefer to reach me that way).
[1] http://paulgraham.com/ambitious.html
[2] http://www.wsj.com/articles/SB10001424052970203961204577267814201399918
[3] http://www.nature.com/news/start-up-investor-bets-on-biotech-1.15096
- czbond 12y agoMust you buy the equipment? Can you beg or borrow time on the machines someone else has at night?
- nextos 12y agoThat's a very good point. Sadly we need to generate quite a lot of data to get the idea going. This means we would use the machines 24x7 for a long period of time. Long enough that outsourcing data generation would effectively be more costly. Since those machines are quite expensive, everyone is using them or renting them at full capacity to amortize the investment, so borrowing is not an option.
- logn 12y agoTake this with a grain of salt, as I've never done anything frighteningly ambitious. One point of advice from the PG article is "Empirically, the way to do really big things seems to be to start with deceptively small things." And another article http://paulgraham.com/pinch.html http://paulgraham.com/pinch.html which may apply here is that consulting can help generate money temporarily. So maybe you can get a couple of clients you do consulting for that is enough to cover the cost of equipment. Maybe that consulting directly involves using said equipment, and you can rent it temporarily until you have a critical mass of clients which enables you to buy it. Once you're ready to be profitable with your ultimate vision, wind down the consulting business. edit: Also HN does invest in businesses that are outside of your typical web 2.0 thingy (they have a nuclear power startup). And the goal of demo day is to get you seed funding that might meet your requirements.
- DevX101 12y agoHi Nextos, First you'll need to identify VCs that would consider funding you. There are some VCs that exclusively focus on reformulations, others that focus on devices, others that do HealthIT, and some that do new drug discovery. If you're going to a VC and they don't have a track record of investing in similar technology you're likely outside of their comfort zone and/or investment thesis and they will likely pass. Second, once you've identified your target firms, find some of their portfolio companies and offer to meet exec at the company. I would explain what you're working on, try to share your vision for why the project you're working on is 'frightenly ambitious' and why you can actually pull it off. If you've done a good job at convincing this exec, I'd followup with a request for an introduction to their VC investor. Alternatively, (or perhaps in parallel), I would look into getting an intro from a professor at Cambridge! Many professors in biological research have some ties to investors (as consultants) or companies via former students or projects that have gone through their lab. As a current grad student, I imagine such a meeting would be trivial to setup but be prepared to rigorously defend your proposition before they expend their reputation by introducing you. Whatever you do, don't cold email these VC firms. They get thousands of emails every year and they simply don't have the bandwidth to review them all. Which is why an introduction from a trusted intermediary is so important. Check out this post for a biotech vc, he has some good tips: http://lifescivc.com/2013/09/ten-tips-for-raising-startup-capital-in-biotech/ http://lifescivc.com/2013/09/ten-tips-for-raising-startup-ca... Good luck
- ScottBurson 12y agoYou could try Peter Thiel's Breakout Labs: http://www.breakoutlabs.org/ http://www.breakoutlabs.org/ This seems a little bit bigger than their usual deal, but maybe they'll be flexible. I would think they would like the interdisciplinary aspect.
- Mz 12y agoUnderstandably, places like YC won't go up to that much of initial funding because it doesn't fit their model I will suggest you fill out the application anyway, if only for the value of thinking through the questions, even if you do not submit it. You seem to think you have the next billion dollar idea (presumably by that you mean billions in profit) and yet you seem to have no real business plan other than "get funding." That doesn't sound to me like it is very solidly fleshed out.
- kayhi 12y agoCan you say the equipment that is needed?
- blokebloke1 12y agohttp://www.imperialinnovations.co.uk/ http://www.imperialinnovations.co.uk/ i suspect you are aware of this, but if not...