Many biologists are founding their own firms as venture capitalists show increased interest in science.
Vindication was three years coming for Ethan Perlstein. On 19 October, his California biotechnology company, Perlara, announced a deal with Novartis. The Swiss drug giant will test a compound that Perlara has identified as a possible treatment for a rare childhood disease, and will invest an undisclosed sum in the smaller firm.
Numerous biotech investors turned Perlstein away before he started Perlara in San Francisco in 2014, because he wasn’t the tenured professor that most venture capitalists saw as founder material. “They pretty much told me to take a hike,” he recalls.
But he persevered, and is now part of the vanguard of young biomedical scientists who have started companies instead of taking the conventional academic path and pursuing postdoctoral studies after their PhDs. Among the factors driving this change are an infusion of money into early-stage biotech investing, the emergence of biotech incubators and the scarcity of academic jobs in science.
“We’re starting to see a renaissance of investors embracing the idea that scientists can build businesses,” says Ryan Bethencourt, programme director of IndieBio, a biotech accelerator in San Francisco that began in 2014.
Previously, Bethencourt says, investors preferred to fund companies started by established professors who focused on the science, while investors installed a management team to take care of the business side. But that has changed as crucial technologies, such as genetic sequencing, have become cheaper and lab work has become automated. The cost of starting biotech companies is falling, lowering the risk for investors to fund new science-based companies. IndieBio and Y Combinator — an information-technology incubator in Mountain View, California, that started accepting biotech companies in 2014 — provide funding and mentoring to entrepreneurs in exchange for shares in the companies….Source: www.nature.com/news/young-scientists-ditch-postdocs-for-biotech-start-ups-1.20912