Colin Sanctuary CEO & Founder QGel SA

Scientific Project Design

Regenerative Medicine & Diagnostics

29 September 2014 15:15 – 17:00

BC 02

Lecture 2

BIO-469 - ET

Ryder Clifford Investor

Serial Entrepreneur Arctic Fox Ventures

The map

•  Plot your way

Mountaineering vs. Start-ups?

•  You know the mountain is there •  You know people have made it to the top

•  You can find out what tools people have used before you

•  What are the risks? •  Do you have the right skills? •  Are you prepared physically and mentally? •  Be prepared to turn back and start again

People first… then money

•  Good people vs. Good relationships •  The value of money

–  Is every dollar worth the same amount?

! Biotech is risky, but return can be huge

Why is Biotech so risky?

•  High cash burn rates •  Highly trained, highly qualified people •  Long development cycles •  Uncertain capital markets

•  Takes $1 billion - $12 billion to develop 1 drug!

Biotech is risky

Source: Forbes Feb 2012, Thomson Reuters Fundamentals via FactSet Research Systems,ICRBI

So why do Biotech?

•  Successful therapies bring huge returns •  Success goes beyond making money for some

•  Value of restoring health & saving lives

Stages of financing

Not just about people and money

•  A lot to start-ups and being an entrepreneur – Zero to One by Peter Thiel (2014) – The Art of the Start by Guy Kawasaki (2004)

14

Market Analysis Valuation of a new product depends on understanding:

1.  The size of the market

2.  Market dynamics

•  Who pays? Who treats?

•  Who manufactures? Who sells?

•  Who are the competitors?

15

Market Analysis Valuation of a new product depends on understanding:

“Top down model”

Potential pool of indicated patients

Treatable patients with existing products

New product technology

16

Market Analysis Valuation of a new product depends on understanding:

“Top down model”

Potential pool of indicated patients

Treatable patients with existing products

New product technology

17

Market Analysis Valuation of a new product depends on understanding:

“Top down model”

Potential pool of indicated patients

Treatable patients with existing products

New product technology

18

Market Dynamics Is the market growing or shrinking?

19

Market Dynamics How many patients are there and what happens to them?

20

Market Dynamics How many patients are there and what happens to them?

October 2008: Big Company

•  Acquiring technology from struggling companies

•  Sixty slide presentations,14 pt font

•  Extrapolating from historical data •  Staying at top-class hotels •  Masterminding incentive plans for sales reps •  Holding customer meetings at exclusive sites •  Reiterating business plan every week

* The Art of the Start –Guy Kawasaki

October 2009: Start-up •  Trying to come up with a company name •  Struggling to make people understand the

innovation of our technology •  Ten slide presentations, 30 pt font •  Wishing we had historical data •  Sleeping on floor of friend’s friend’s living room •  Desperately seeking advice •  Rewriting business plan every week •  No trophies, no medals, hooray for VK + CTI

* The Art of the Start –Guy Kawasaki

Now what?

* List non-exhaustive and subject to change without notice

Shareholders’ resolutions

Drag-along ESOPs

Tag-along

Subscription rights

License Agreement

Rights of First Refusal

Intellectual Property

Valuation

Waivers

Future IP

Key Hires

Get help!

YOU

Books

Groups Network

Friends

Lawyer, investors MBAs, Professors

other entrepreneurs

CTI, Venture Kick EPFL-MoT, FIT DEWS, Vaud

Intimidating

KNOW YOUR WEAKNESSES •  Finance •  Legal •  Intellectual Property

TAKE THE LEAD •  Show you can do it •  Communicate •  Be the first to raise issues

• Revenue is vanity • Profit is sanity • Cash is reality