September 30, 2024 • 22 mins
In the 20th century, corporate powerhouses like Bell Labs and DuPont Central Research funded R&D from their balance sheets, creating a clear path for postdoctoral scientists to innovate beyond their university research. In 2024, with the decay of corporate laboratories, graduates are taking the commercial start-up route more and more. C&EN, business reporter Matt Blois discusses several such start-ups, exploring how the founders are making the transition from PhD to CEO and mapping the various routes they've taken to secure funding to continue their research.
C&EN Uncovered, a project from C&EN’s podcast, Stereo Chemistry, offers a deeper look at subjects from recent stories. Check out Matt’s story on how PhDs are learning to become CEOs at cenm.ag/chementrepreneurs
Cover photo: Laura Stoy inside a laboratory at Rivalia Chemical
Subscribe to Stereo Chemistry now on Apple Podcasts, Spotify, or wherever you listen to podcasts.
A transcript of this episode is available at cen.acs.org.
Credits
Executive producer: David Anderson
C&EN Uncovered host: Craig Bettenhausen
Reporter: Matt Blois
Audio editor: Ted Woods
Copyeditor: Bran Vickers
Episode artwork: Jim Prisching
Music: “Hot Chocolate,” by Aves
Contact Stereo Chemistry: Contact us on social media at @cenmag or email cenfeedback@acs.org.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Craig Bettenhausen (00:00):
Welcome to CNN uncovered. I'm Craig
Bettenhausen. Cn uncovered is apodcast series from stereo
chemistry. In each episode,we'll take another look at a
recent cover story in chemicaland Engineering News, and hear
from cn reporters about strikingmoments from the reporting,
their biggest takeaways and whatgot left on the cutting room
floor. In this episode, we'retalking about making the jump
from academia to the C suite inthe 20th century, corporate
(00:23):
powerhouses like Bell Labs andDuPont Central Research funded
r&d from their balance sheets,creating a clear path for
postdoc scientists to innovatebeyond the university research
in 2024 with the decay ofcorporate labs, graduates were
taking the commercial startuproute more and more. In a story
that appeared in the August 19print issue CNN, today's guest
looked at several such startups,how the founders are making the
(00:44):
transition from PhD to CEO, andthe various routes they've taken
to secure funding to continuetheir research. We'll put a link
to the story in today's shownotes. I'm here with CNN
BUSINESS reporter Matt Bloys,who wrote the article, Hey,
Matt.
Matt Blois (00:56):
Hey Craig.
Craig Bettenhausen (01:01):
So Matt, for anyone that hasn't yet had a
chance to read the article, canyou give a brief recap of what
it's
Matt Blois (01:07):
about? Yeah, so like you said, it's, it's kind of
looking at this idea of peoplewho take a technology that they
developed in either like a PhDor a postdoc, and then instead
of going on to, like a bigcompany or going on to try and
get a job at a university. Theytake their technology and they
found a startup, and thenthey'll become the CEO of that
(01:27):
startup. And so the way I toldthe story is I really followed
three specific people who wereCEOs of early stage startups
based on technology that theyworked on or that they developed
during a PhD or postdoc. Istarted talking to them about
late last year, and I kind ofstuck with them for, I think,
about six to eight months, andjust checking in with them every
couple months to see what'sgoing on, and just just get a
(01:48):
sense of what that early stageis like, and kind of what their
motivations were, how they'remaking this transformation from
scientist to CEO, and thentrying to just sort of capture
that whole journey.
Craig Bettenhausen (01:59):
How did you pick who to follow. I
Matt Blois (02:00):
wanted to find people who were willing to talk
to me for a long time, you know,because that was, that was the
thing I wanted to do, is Iwanted to get a really honest
look at this, because it's areally tough journey. And so I,
you know, I give a lot of creditto the three people that I
talked to, which is Laura, stoy,Sid arson, Duran Athen, Andrew
Wang. I talked to them early onand said, Hey, I want to stick
with you for a while, like, Iwant to hear what it's really
(02:21):
like. I want you to be candidwith me. And they were really
great about that. And so thatwas kind of what I was looking
for, is, you know, kind ofprobing to see, you know, are
you gonna stick with me formonths? Are you gonna be willing
to have multiple conversationsI'm gonna take up a lot of your
time, and are you gonna, youknow, be willing to sort of tell
me the truth about what'shappening, not just sort of give
me the glossy press releaseversion. So I feel like they did
a really good job of that. Itwas fun to talk to them so fun
Craig Bettenhausen (02:43):
to talk to him. Yeah, this trend that we
end up writing about a lot andseeing the end of venture
capital backed chemistrystartups, it can be tricky,
because venture capital was kindof built around the software
boom, and that's not instant,but it's a lot faster than
building factories. But thatalso wasn't the way that
chemistry innovation happenedfor a long time. Can you talk a
little bit about that earliermodel, with your bell labs, your
(03:04):
DuPont central research and howthat worked,
Matt Blois (03:07):
right, right? So there was, you know, in the 20th
century especially, you seethese organizations. The one I
write about the most in thisstory is Bell Labs, but you have
other big corporations thathave, like, really big research
departments with tons ofscientists doing, you know, a
range of work, some of some ofit, sort of fundamental basic
science, but a lot of it sort ofthis, like translational piece,
(03:29):
where you pick up an idea thatcame out of academia, or that is
basic science, and you sort ofturn that into some sort of
useful innovation in the 20thcentury at Bell Labs, you Had
you had Dupont, you had Ge, youhad companies like Xerox, and
all these companies really cameup with some really powerful
innovations, and sometimes noteven within sort of the thing
(03:50):
that they're, you know, BellLabs came up with all kinds of
stuff that was useful for thingsbeyond telephones. The lead of
the story kind of deals with thetransistor, which ended up being
sort of more of a computertechnology that was sort of a
big success story in many ways,but there's some trade offs
there too. Because when youthink about Bell Labs, one of
the reasons they did all of thisresearch into basic science and
translational research wasbecause they were basically
(04:13):
allowed to have a monopoly overthe phone system. I don't know
how specifically sort ofcodified that was, but I think
the monopoly was allowed inpart, I think in maybe in an
unwritten way, because they weregenerating so much useful
research, and, you know, thegovernment didn't want to get in
the way of that. So a couple ofthings happened, you have, you
know, one, the government comesin and says, Okay, that's
(04:35):
probably enough monopolies.We're gonna bring you guys up.
You know, that's one thing.Another thing people have talked
about is just globalization. Youknow, part of that is maybe due
to communication technologies,the world becomes smaller.
You're having to compete withcompanies all over the world
that are doing different sortsof things. And so, you know,
there's, there's this argumentthat maybe you have to be more
careful with your balance sheetand betting on super risky ideas
(04:56):
becomes harder to justify. Andso they've moved towards. Big
corporations have moved towards,let the startups develop
something, and then when it getsto a certain stage where it's
not so risky, we'll just acquirethem. It's kind of the model
that a lot of the biggercorporations use now. And so
yeah, we've moved into morefragmented ecosystem, where you
have universities still doingsort of basic research. A lot of
(05:16):
startups sort of pick that upand run with it a lot of times
the venture capital money, andthen if you get to a certain
point, if you're lucky, most ofthe time, these startups are
looking to be acquired, youknow, get bought up, and then
that's sort of the bigger firmswould be, the ones that sort of
commercialize it in a largescale way. So that's kind of
been how things have evolved,system wise, over the last 100
(05:37):
years. So,
Craig Bettenhausen (05:39):
so is there a specific person or company
that you feel has led to thisincreasing trend of startup
chemistry companies.
Matt Blois (05:46):
I wrote a lot about these training programs or like
accelerators. They're looking atthis ecosystem where there's
tons of people with good ideasand who are graduating with
PhDs. They can't go get a job atBell Labs and just tinker away
for the rest of their lives, andso many of them want to start
businesses, but they don't knowhow to start a business. How to
start a business because theyspent the last eight years
figuring out how to dochemistry. And so there's a
(06:07):
couple of organizations that arereally devoted to training
people who have skills ontechnology and have really good
ideas to run a business and leada business and do fundraising.
So some of the big ones I talkedabout in the story is there's a
fellowship program calledactivate, which basically does
some of this training, and thenalso essentially gives the
founders of these companies asalary for like, two years so
(06:28):
they can, you know, they can paythemselves. It's sort of startup
funding. Gives them two years toreally prove out the technology
learn how to be a CEO. It issort of like a training wheels
period. They typically end up insort of a seed round, you know,
raising their first round ofventure capital by the time
they're at the time they're atthe end of that program. And
then there's other ones that aresimilar to that Breakthrough
Energy, which is a big forprofit venture capital firm,
(06:49):
also has sort of a fellowshipprogram that's sort of for
earlier stage founders to getthem sort of out of the gate and
up and running. And then theother one I really like, too, is
there's a Department of Energyfellowship that puts
entrepreneurs, or people whowant to be entrepreneurs, into a
national lab, and they sort ofwork hand in hand with
scientists at the National Labto work on their technology, and
(07:09):
similarly, just sort of givesthem, you know, they're funded
themselves for two years to sortof figure things out and learn
how to be the leader of acompany and prove out their
technology and all that. And Ithink those types of programs
more than like a specificstartup company, to me, that's
sort of like the quickest way tosort of understand this trend
and how people are viewing it,rather than a company, is these
training programs.
Craig Bettenhausen (07:29):
In my, you know, fantasy of this podcast,
you know, investors arelistening, I wonder, if you give
it just some sense of, you know,what the timeline is, from
making an investment in theseearly stage companies to the
exits that your real hardcore,like business office wants to
think about,
Matt Blois (07:44):
yeah. I mean, it certainly depends on the
technology. It depends on yourindustry, but it's all slower
than software. Like, the mosthardcore flex that you can do as
a clean tech founder is to startyour own software company. I
think, like, like, oh, software,yeah. One of the founders I
wrote about, Laura stoy. She wasactually the co founder on a
software company, and it'ssomething that, basically, it's
(08:07):
a software that helps the scorecompetitions. They do like
science fairs, and they do likeacademic poster sessions. So
it's not like a huge, you know,it's not going to be Google or
anything, but it was, you know,you still had to write the code
and sell it to people. And, youknow, when she was in grad
school, I think it was her, andI think her, now husband,
created this software, and, youknow, started a whole company,
and it's still going. She stillruns that company. On the side
(08:30):
of, like, this technology thatshe's developing is which has to
do with extracting rare earthelements from the ash from coal
fired power plants. And so shedid a lot of, like, comparing,
you know, what happened withthis software company I built
versus what do I think is goingto happen with this clean tech
company that I built? Thetimelines are just so much
longer, and because they'relonger timelines, it's harder to
(08:50):
see that far into the futuretoo. I think there's so many
checkpoints that you have tomake it through that can either
slow you down or divert you ontoa different path. I mean, it can
take years, decades. It can be areally, really long time. I'm
sure you could look up thetimelines from sort of
successful technologies of thepast, but even ones that seem
commonplace to us today, thatare like materials technologies,
(09:12):
it took a really long time forthose things to really gain
traction. So it's, I think, allthese new ones. It's no
different. If you're introducinga new chemistry or material
technology. It's a long time. So
Craig Bettenhausen (09:23):
with Laura's story, specifically ravalia,
their initial funding came fromAlabama Power, a public utility
with some of the big coal ashponds, which is one of the
byproducts of just coalelectrical generation. Is that
kind of thing available? Arethose fits common? How can
Laura's story influenced some ofthe future entrepreneurs who are
looking for that perfect fitfunding. Well,
Matt Blois (09:46):
I think, like with her story, because there was
such a perfect fit funding waswhy she felt like, Okay, this is
like, I should do this. I thinkshe was patient. You know, she
had this technique. She was sortof developed the technology
during a PhD. Yeah, and, youknow, didn't start a company
right away, because I think shewas like, I want to get to a
point where I feel like I'vegot, I've got the right fit. And
(10:06):
so I think it was when thatopportunity came up, shit,
that's the perfect thing. That'snot, that's my signal to go for
this, you know. And I thinkpeople can get a lot into a lot
of trouble if they're not sortof lined up with sort of the
right sorts of funding in a lotof different ways. Like, I think
Laura valued that partnership,because it was like she got to
go talk to people who were, youknow, would be using this
(10:27):
technology, and get a sense oflike, what does this look like
if you actually use it? Whatproblems is it going to cause
you was, how is it going to makethings better? How could I, you
know, tweak it to make it evenmore useful? And I think that
sort of feedback getting in andtalking to customers one of the
other companies. So Corin bio issudarsan duarna company. So he's
an agriculture technologycompany. The first product is
(10:49):
microbes that go into the soiland they break down phosphorus,
which makes it available toplants, and then farmers have to
use less phosphorus, lesspollution. Farmers are spending
less money. So it could bereally impactful technology. And
he has an interesting piecewhere he he ended up getting a
fellowship that put him in NewYork, in New York City, and so
their labs are in New York City.And he talked to me a lot about,
(11:11):
you know, there's some realadvantages to being in New York
City, because you get connectedwith, you know, there's a
million climate tech investorsin New York City. When he goes
and meets with an investor, hejust, you know, he's up the
street, and talent wise, too.You know, biotech talent, New
York City can be a good place toget scientists, and he's had a
lot of success with that. But heis always on the road. Like,
every time I called him, it waslike, I'm in this part of the
(11:31):
world. I'm in this I'm out inthe Midwest. I'm, you know,
meeting the farmers in Memphis.And I think that was a really
important thing for him in asimilar way, just like I got to
get out there and get to wheremy customers are, the more you
can sort of align your fundingwith people who care about what
you're doing, is the better. So
Craig Bettenhausen (11:48):
the third company in your story is
standard potential. And that'sAndrew Wang, right? Yes. So what
is he trying to do with standardpotential?
Matt Blois (11:56):
Standard potential was a really interesting one to
follow. Their technology isthey're trying to use sodium ion
cathode materials to makebatteries cheaper. And so most
batteries that you see in anelectric vehicle, and what
standard potential is reallyfocused on is more like
stationary energy storage, likestoring electricity from a
windmill on the power grid, mostof those batteries are going to
be made with lithium. Lithiumwas, for a long time, very
(12:21):
expensive, and the price waskind of going crazy. And people
were really worried, how do we,you know, this is really going
to affect our ability to produceenough batteries. It's going to
make it so expensive. And sothere's a lot of interest in,
can we use sodium instead oflithium, which would be a lot
cheaper. You basically aremaking these batteries out of
soda ash, I think is kind of theultimate starting material. And
then the price of lithiumtotally tanked. And so the
(12:43):
argument, you know, do we need acheaper raw material gets weaker
and weaker as time goes on? Andso they had a really interesting
it's Andrew, and then he has aco founder, RICHARD MAY, who's
really involved too. It wasreally interesting to talk to
them throughout sort of collapseof the lithium price as as
they're saying. Okay, so what dowe do now? You know, we think
sodium ion could be this,really, you know, regardless of
(13:04):
what the point I said, lithiumis like, it's still a more
abundant, cheaper technologythat has some other advantages.
It's safer in many ways. Theymade several pivots in the time
that I was talking to them. Youknow, they pivoted to, okay, so
one of the things that keythings we had is additive that
was going to extend the lifespanof our batteries. We could
actually use that same additivein a lithium ion battery and
(13:25):
extend the life of that. Andthat sort of protects you
against sodium versus lithium,because you could use it either
way. And they just kept pluggingalong. They kept working. And
they actually just through theprocess of making a lot of
batteries, came up with a newway to make sodium ion batteries
that they thought would just bea lot cheaper, even though what
(13:46):
they were doing before, and ithas to do with the manufacturing
process, rather than the rawmaterials that made it cheap
enough that even though theprice of lithium dropped, like
we have this new way of doingit, and it's going to be even
cheaper and even more impactful.And you know, as we sort of
start to put batteries out onthe electrical grid, like an
important way of doing that. So,you know, it was really
interesting to follow them asthey sort of shifted and pivoted
(14:08):
and figured out, okay, how do wesort of orient ourselves to
adapt to, like, what the realityof the battery industry is right
now?
Craig Bettenhausen (14:15):
So in some ways, getting a PhD is the act
of becoming the world's foremostexpert in one incredibly
specific thing. It requiresmassive amounts of tenacity, the
ability to keep going eventhough things aren't working,
which is, as from that example,sometimes the opposite of the
skill sets you need to be a CEO,where you need to be able to
make decisions and pivot. So howdo you bridge that gap as a PhD
(14:39):
to CEO?
Matt Blois (14:40):
So so one of, one of my favorite people I talked to
about this was Ray widecamp.He's the founder of a company
called polyspectra, and theymake resins that get used in 3d
printers. And they're reallythey're really rugged. And he,
he was a PhD to CEO. He did aPhD at Caltech, went straight
and founded this company, gotsome funding through activate. I
had a lot of success. Then Iforget exactly when, but at some
(15:03):
point, he started this emailcourse where he said, You know,
I'm going to help other peopledo the same thing. He had so
many interesting ideas aboutthis, like, how do you make this
jump? And he had this quote inthe story where he says, you
know, there's so much you haveto unlearn. You know, you're
taught to do so many things inacademia that end up being
detrimental if you become a CEO.You know, the people who are
(15:24):
successful at this, I think, arepeople who are not incredibly
rigid, like they went into aPhD, and they learned a bunch of
stuff, and they learned how tobe a certain way there. You
know, they learned how to, like,keep going after there's a
million failures, and just go.And I think someone who can
learn to do that and then turnaround and learn to do something
else. They've certainly shownthe capacity to learn a new way
(15:47):
to do things. And so I thinkthere's an argument. I a couple
of people made this argument tome, you know, if you figured out
how to be the world's foremostexpert in something you're good
at learning like, as long as youcan sort of be flexible and be
willing to sort of undo some ofthe habits that you learned as
as as you were trained to be ascientist, you probably are
going to be pretty good atlearning how to be a CEO. So in
Craig Bettenhausen (16:09):
some ways, your article is about that
transition from PhD to CEO, andif we could talk a little bit
more about the trainingresources that are available,
because obviously there is afinancial incentive through
these venture capital funds andaccelerators for people to do
that, but how do they get theskills?
Matt Blois (16:26):
And actually, I want to talk about this on the
podcast, because this is the onethat blew my mind. Is the so NSF
has National Science Foundationhas has something called
Innovation core, or I core. Thewhole point is, like there's
basically helping people sort ofrecognize, you have the
scientific idea, what are thepossible commercialization
opportunities around this? Andthe way they do this is by just
(16:50):
forcing the scientists to talkdo, like, tons and tons of
interviews. I think the numbersthat they have to do 100
interviews over the course oflike, eight weeks or seven
weeks, or something like that,100 it's supposed to force them
to like, listen, rather thanlike pitch and rather than sort
of like, explain. I talked tosomebody at NSF about this, and
(17:12):
she said, what we found isthere's a real turning point,
like the first 50 interviews,people don't quite know where
they're going, and they're justa little bit overwhelmed by it.
And then after you talk to 50people like, people just sort of
get the sense of like, it allsort of starts to coalesce. And
they're like, I think I get itlike, I think I know who I need
to talk to next. And then sortof the second 50 interviews are
really directed by that, andthey're like, Okay, now I need
(17:34):
to know who to talk to. And theysort of get on a roll. And I
thought that was so I related tothat as a reporter, because I
like, sometimes you start areporting process, you're like,
what I don't really understand.Like, I don't know how to frame
this. I can't quite pick outwhat the trend is. And then
after you get through the middleof it, you're like, now I know
what it is. Now I know who needto know who I talk to. But I
(17:55):
just kind of blown away by that,that 100 interviews is just so
many hats
Craig Bettenhausen (18:02):
beyond the obvious one, which is money and
how to get enough of it to makeyour thing a reality. What are
the biggest upsides into goingthe startup route versus
continuing your research in theuniversity lab, you know, trying
to get a professorship and thenhave a, you know, be a PI
somewhere. I
Matt Blois (18:17):
think it really depends on what you personally
want and what your personalgoals are, because that was some
of the like, sort of businessside of the research thing I
looked at. It's like, it totallydoes not make sense financially
to start, like a chemistry ormaterial startup. I think it
really comes down to, like, youknow, why are people doing this?
It's like, it's impactmotivated, like people want to
(18:38):
have the biggest impact. Butthat's not entirely it. So
Andrew Wang talked to me, hesaid something really
interesting to me that sort ofupended the way I think about
this. Because he was saying,like, yeah, we think about, you
know, we want to go out thereand have, like, a big impact on
climate change. That's a hugepart of why we're doing this.
But he's like, but if I reallywanted to, like, have the
biggest possible impact onclimate change as, like, a
battery scientist, probably thebest thing for me to do is,
(19:00):
like, brush up on my Chinese.Like, go work at C, ATL, like
one of the big, the biggest,huge battery manufacturers in
China, and help them, you know,make their separator in the
battery, like one micronthinner, which will make, like,
all of the batteries theyproduce just that little much
better. He's like, I bet if youadded up the sort of, like,
climate change, you know, CO twoemission reduction potential,
(19:23):
like, that's probably the routeto the most impact is sort of
like, make an incrementalimprovement to a already scaled
technology. Like, he was justsaying, I just like
Unknown (19:33):
the challenge of sort of transforming myself into a
CEO. It's a huge challenge. Ihesitate to say fun, but, but,
you know, like, I think it'srewarding. Maybe rewarding is
the right word. I think it'srewarding for people to, you
know, take on something that isthat seems really difficult. It
requires you to, like, learn alot really fast. It's fast
paced. And, you know, I thinkthat's really appealing to a lot
(19:54):
of people, and certainly thepeople that are actually doing
it. I think you have to wantthat. I think to be successful,
you have. To, like, enjoy therewards of just sort of bringing
the most out of yourself, andlike learning to do these things
that you didn't know how to dobefore and really succeeding at
it.
Craig Bettenhausen (20:09):
So stepping back to the 10,000 foot view,
how does our current innovationsystem compare to the corporate
lab model in terms of thatultimate goal of getting world
changing technology out into theworld. It
Matt Blois (20:22):
depends on who you talk to, and I certainly didn't
talk to every businessresearcher in the world, but
most people I talk to thinkwe're worse at it now than we
were before. I think for me,it's really hard to determine
what metric to look like andalso understand exactly what
that metric means in terms ofhow innovation is happening, it
(20:43):
feels like we are doinginnovation really well, but then
there are signs in the data thatwe're not doing it that well.
The data is a little bitconfusing. It's hard to know
what metrics to use. I thinkthere's a chance that we're not
doing as well as we have donebefore. It might just be harder
to do innovation than it used tobe before. It might just be
that, like the farther you gettechnologically, the harder it
is to come up with somethingnew. But I feel like people
(21:04):
would have said that 100 yearsago, like it always feels like
we're high tech. No matter whatpoint in time you are, it feels
like you're high tech, andthere's always more to go. So I
don't know, regardless ofwhether we are doing it better
than we were in the 20thcentury, or where we were doing
it better now, we sort of areliving with the system that we
have. And that was another thinga lot of people told me it's
like, you know, we're not goingback to the corporate research
model. Like, you know, I talkedto some people that kind of
(21:26):
favor that, and thought thatthat was really good. Even those
people are like, those days aregone. So like, all we can do is
just try to take what we haveand do it better. But I think
that's the way forward is, youknow, look at what we're doing
now and keep trying to improveit. Because regardless of
whether what the reality is,whether we're doing it better,
or whether doing worse, youcould always do better, but you
know, we always be better thanwe are doing.
Craig Bettenhausen (21:48):
There's a lot more to talk about here.
Matt, thanks for diving deepwith us on this. Yeah, yeah. It
was super fun. Love talkingabout it. Listeners can find me
on social media as at Craig ofwaffles. Matt, how can our
listeners get in touch with you.Call me 805-233-1686, you don't
hear very often anymore. Nicelydone. You can find Matt's cover
(22:08):
story about PhD students turnedCEOs on CNNs website or in print
in a double issue that came outAugust 19. We put a link in the
show notes along with theepisode credits. We'd love to
know what you think of CNNuncovered. You can share your
feedback with us by emailingcenfeedback@acs.org This has
been CDN uncovered a series fromcn stereochemistry. Stereo
(22:30):
chemistry is the officialpodcast of chemical and
Engineering News. Chemical andEngineering News is an
independent news outletpublished by the American
Chemical Society.
Unknown (22:37):
Thanks for listening. Foreign
Welcome to CNN uncovered. I'm Craig
Bettenhausen. Cn uncovered is apodcast series from stereo
chemistry. In each episode,we'll take another look at a
recent cover story in chemicaland Engineering News, and hear
from cn reporters about strikingmoments from the reporting,
their biggest takeaways and whatgot left on the cutting room
floor. In this episode, we'retalking about making the jump
from academia to the C suite inthe 20th century, corporate
(00:23):
powerhouses like Bell Labs andDuPont Central Research funded
r&d from their balance sheets,creating a clear path for
postdoc scientists to innovatebeyond the university research
in 2024 with the decay ofcorporate labs, graduates were
taking the commercial startuproute more and more. In a story
that appeared in the August 19print issue CNN, today's guest
looked at several such startups,how the founders are making the
(00:44):
transition from PhD to CEO, andthe various routes they've taken
to secure funding to continuetheir research. We'll put a link
to the story in today's shownotes. I'm here with CNN
BUSINESS reporter Matt Bloys,who wrote the article, Hey,
Matt.
Matt Blois (00:56):
Hey Craig.
Craig Bettenhausen (01:01):
So Matt, for anyone that hasn't yet had a
chance to read the article, canyou give a brief recap of what
it's
Matt Blois (01:07):
about? Yeah, so like you said, it's, it's kind of
looking at this idea of peoplewho take a technology that they
developed in either like a PhDor a postdoc, and then instead
of going on to, like a bigcompany or going on to try and
get a job at a university. Theytake their technology and they
found a startup, and thenthey'll become the CEO of that
(01:27):
startup. And so the way I toldthe story is I really followed
three specific people who wereCEOs of early stage startups
based on technology that theyworked on or that they developed
during a PhD or postdoc. Istarted talking to them about
late last year, and I kind ofstuck with them for, I think,
about six to eight months, andjust checking in with them every
couple months to see what'sgoing on, and just just get a
(01:48):
sense of what that early stageis like, and kind of what their
motivations were, how they'remaking this transformation from
scientist to CEO, and thentrying to just sort of capture
that whole journey.
Craig Bettenhausen (01:59):
How did you pick who to follow. I
Matt Blois (02:00):
wanted to find people who were willing to talk
to me for a long time, you know,because that was, that was the
thing I wanted to do, is Iwanted to get a really honest
look at this, because it's areally tough journey. And so I,
you know, I give a lot of creditto the three people that I
talked to, which is Laura, stoy,Sid arson, Duran Athen, Andrew
Wang. I talked to them early onand said, Hey, I want to stick
with you for a while, like, Iwant to hear what it's really
(02:21):
like. I want you to be candidwith me. And they were really
great about that. And so thatwas kind of what I was looking
for, is, you know, kind ofprobing to see, you know, are
you gonna stick with me formonths? Are you gonna be willing
to have multiple conversationsI'm gonna take up a lot of your
time, and are you gonna, youknow, be willing to sort of tell
me the truth about what'shappening, not just sort of give
me the glossy press releaseversion. So I feel like they did
a really good job of that. Itwas fun to talk to them so fun
Craig Bettenhausen (02:43):
to talk to him. Yeah, this trend that we
end up writing about a lot andseeing the end of venture
capital backed chemistrystartups, it can be tricky,
because venture capital was kindof built around the software
boom, and that's not instant,but it's a lot faster than
building factories. But thatalso wasn't the way that
chemistry innovation happenedfor a long time. Can you talk a
little bit about that earliermodel, with your bell labs, your
(03:04):
DuPont central research and howthat worked,
Matt Blois (03:07):
right, right? So there was, you know, in the 20th
century especially, you seethese organizations. The one I
write about the most in thisstory is Bell Labs, but you have
other big corporations thathave, like, really big research
departments with tons ofscientists doing, you know, a
range of work, some of some ofit, sort of fundamental basic
science, but a lot of it sort ofthis, like translational piece,
(03:29):
where you pick up an idea thatcame out of academia, or that is
basic science, and you sort ofturn that into some sort of
useful innovation in the 20thcentury at Bell Labs, you Had
you had Dupont, you had Ge, youhad companies like Xerox, and
all these companies really cameup with some really powerful
innovations, and sometimes noteven within sort of the thing
(03:50):
that they're, you know, BellLabs came up with all kinds of
stuff that was useful for thingsbeyond telephones. The lead of
the story kind of deals with thetransistor, which ended up being
sort of more of a computertechnology that was sort of a
big success story in many ways,but there's some trade offs
there too. Because when youthink about Bell Labs, one of
the reasons they did all of thisresearch into basic science and
translational research wasbecause they were basically
(04:13):
allowed to have a monopoly overthe phone system. I don't know
how specifically sort ofcodified that was, but I think
the monopoly was allowed inpart, I think in maybe in an
unwritten way, because they weregenerating so much useful
research, and, you know, thegovernment didn't want to get in
the way of that. So a couple ofthings happened, you have, you
know, one, the government comesin and says, Okay, that's
(04:35):
probably enough monopolies.We're gonna bring you guys up.
You know, that's one thing.Another thing people have talked
about is just globalization. Youknow, part of that is maybe due
to communication technologies,the world becomes smaller.
You're having to compete withcompanies all over the world
that are doing different sortsof things. And so, you know,
there's, there's this argumentthat maybe you have to be more
careful with your balance sheetand betting on super risky ideas
(04:56):
becomes harder to justify. Andso they've moved towards. Big
corporations have moved towards,let the startups develop
something, and then when it getsto a certain stage where it's
not so risky, we'll just acquirethem. It's kind of the model
that a lot of the biggercorporations use now. And so
yeah, we've moved into morefragmented ecosystem, where you
have universities still doingsort of basic research. A lot of
(05:16):
startups sort of pick that upand run with it a lot of times
the venture capital money, andthen if you get to a certain
point, if you're lucky, most ofthe time, these startups are
looking to be acquired, youknow, get bought up, and then
that's sort of the bigger firmswould be, the ones that sort of
commercialize it in a largescale way. So that's kind of
been how things have evolved,system wise, over the last 100
(05:37):
years. So,
Craig Bettenhausen (05:39):
so is there a specific person or company
that you feel has led to thisincreasing trend of startup
chemistry companies.
Matt Blois (05:46):
I wrote a lot about these training programs or like
accelerators. They're looking atthis ecosystem where there's
tons of people with good ideasand who are graduating with
PhDs. They can't go get a job atBell Labs and just tinker away
for the rest of their lives, andso many of them want to start
businesses, but they don't knowhow to start a business. How to
start a business because theyspent the last eight years
figuring out how to dochemistry. And so there's a
(06:07):
couple of organizations that arereally devoted to training
people who have skills ontechnology and have really good
ideas to run a business and leada business and do fundraising.
So some of the big ones I talkedabout in the story is there's a
fellowship program calledactivate, which basically does
some of this training, and thenalso essentially gives the
founders of these companies asalary for like, two years so
(06:28):
they can, you know, they can paythemselves. It's sort of startup
funding. Gives them two years toreally prove out the technology
learn how to be a CEO. It issort of like a training wheels
period. They typically end up insort of a seed round, you know,
raising their first round ofventure capital by the time
they're at the time they're atthe end of that program. And
then there's other ones that aresimilar to that Breakthrough
Energy, which is a big forprofit venture capital firm,
(06:49):
also has sort of a fellowshipprogram that's sort of for
earlier stage founders to getthem sort of out of the gate and
up and running. And then theother one I really like, too, is
there's a Department of Energyfellowship that puts
entrepreneurs, or people whowant to be entrepreneurs, into a
national lab, and they sort ofwork hand in hand with
scientists at the National Labto work on their technology, and
(07:09):
similarly, just sort of givesthem, you know, they're funded
themselves for two years to sortof figure things out and learn
how to be the leader of acompany and prove out their
technology and all that. And Ithink those types of programs
more than like a specificstartup company, to me, that's
sort of like the quickest way tosort of understand this trend
and how people are viewing it,rather than a company, is these
training programs.
Craig Bettenhausen (07:29):
In my, you know, fantasy of this podcast,
you know, investors arelistening, I wonder, if you give
it just some sense of, you know,what the timeline is, from
making an investment in theseearly stage companies to the
exits that your real hardcore,like business office wants to
think about,
Matt Blois (07:44):
yeah. I mean, it certainly depends on the
technology. It depends on yourindustry, but it's all slower
than software. Like, the mosthardcore flex that you can do as
a clean tech founder is to startyour own software company. I
think, like, like, oh, software,yeah. One of the founders I
wrote about, Laura stoy. She wasactually the co founder on a
software company, and it'ssomething that, basically, it's
(08:07):
a software that helps the scorecompetitions. They do like
science fairs, and they do likeacademic poster sessions. So
it's not like a huge, you know,it's not going to be Google or
anything, but it was, you know,you still had to write the code
and sell it to people. And, youknow, when she was in grad
school, I think it was her, andI think her, now husband,
created this software, and, youknow, started a whole company,
and it's still going. She stillruns that company. On the side
(08:30):
of, like, this technology thatshe's developing is which has to
do with extracting rare earthelements from the ash from coal
fired power plants. And so shedid a lot of, like, comparing,
you know, what happened withthis software company I built
versus what do I think is goingto happen with this clean tech
company that I built? Thetimelines are just so much
longer, and because they'relonger timelines, it's harder to
(08:50):
see that far into the futuretoo. I think there's so many
checkpoints that you have tomake it through that can either
slow you down or divert you ontoa different path. I mean, it can
take years, decades. It can be areally, really long time. I'm
sure you could look up thetimelines from sort of
successful technologies of thepast, but even ones that seem
commonplace to us today, thatare like materials technologies,
(09:12):
it took a really long time forthose things to really gain
traction. So it's, I think, allthese new ones. It's no
different. If you're introducinga new chemistry or material
technology. It's a long time. So
Craig Bettenhausen (09:23):
with Laura's story, specifically ravalia,
their initial funding came fromAlabama Power, a public utility
with some of the big coal ashponds, which is one of the
byproducts of just coalelectrical generation. Is that
kind of thing available? Arethose fits common? How can
Laura's story influenced some ofthe future entrepreneurs who are
looking for that perfect fitfunding. Well,
Matt Blois (09:46):
I think, like with her story, because there was
such a perfect fit funding waswhy she felt like, Okay, this is
like, I should do this. I thinkshe was patient. You know, she
had this technique. She was sortof developed the technology
during a PhD. Yeah, and, youknow, didn't start a company
right away, because I think shewas like, I want to get to a
point where I feel like I'vegot, I've got the right fit. And
(10:06):
so I think it was when thatopportunity came up, shit,
that's the perfect thing. That'snot, that's my signal to go for
this, you know. And I thinkpeople can get a lot into a lot
of trouble if they're not sortof lined up with sort of the
right sorts of funding in a lotof different ways. Like, I think
Laura valued that partnership,because it was like she got to
go talk to people who were, youknow, would be using this
(10:27):
technology, and get a sense oflike, what does this look like
if you actually use it? Whatproblems is it going to cause
you was, how is it going to makethings better? How could I, you
know, tweak it to make it evenmore useful? And I think that
sort of feedback getting in andtalking to customers one of the
other companies. So Corin bio issudarsan duarna company. So he's
an agriculture technologycompany. The first product is
(10:49):
microbes that go into the soiland they break down phosphorus,
which makes it available toplants, and then farmers have to
use less phosphorus, lesspollution. Farmers are spending
less money. So it could bereally impactful technology. And
he has an interesting piecewhere he he ended up getting a
fellowship that put him in NewYork, in New York City, and so
their labs are in New York City.And he talked to me a lot about,
(11:11):
you know, there's some realadvantages to being in New York
City, because you get connectedwith, you know, there's a
million climate tech investorsin New York City. When he goes
and meets with an investor, hejust, you know, he's up the
street, and talent wise, too.You know, biotech talent, New
York City can be a good place toget scientists, and he's had a
lot of success with that. But heis always on the road. Like,
every time I called him, it waslike, I'm in this part of the
(11:31):
world. I'm in this I'm out inthe Midwest. I'm, you know,
meeting the farmers in Memphis.And I think that was a really
important thing for him in asimilar way, just like I got to
get out there and get to wheremy customers are, the more you
can sort of align your fundingwith people who care about what
you're doing, is the better. So
Craig Bettenhausen (11:48):
the third company in your story is
standard potential. And that'sAndrew Wang, right? Yes. So what
is he trying to do with standardpotential?
Matt Blois (11:56):
Standard potential was a really interesting one to
follow. Their technology isthey're trying to use sodium ion
cathode materials to makebatteries cheaper. And so most
batteries that you see in anelectric vehicle, and what
standard potential is reallyfocused on is more like
stationary energy storage, likestoring electricity from a
windmill on the power grid, mostof those batteries are going to
be made with lithium. Lithiumwas, for a long time, very
(12:21):
expensive, and the price waskind of going crazy. And people
were really worried, how do we,you know, this is really going
to affect our ability to produceenough batteries. It's going to
make it so expensive. And sothere's a lot of interest in,
can we use sodium instead oflithium, which would be a lot
cheaper. You basically aremaking these batteries out of
soda ash, I think is kind of theultimate starting material. And
then the price of lithiumtotally tanked. And so the
(12:43):
argument, you know, do we need acheaper raw material gets weaker
and weaker as time goes on? Andso they had a really interesting
it's Andrew, and then he has aco founder, RICHARD MAY, who's
really involved too. It wasreally interesting to talk to
them throughout sort of collapseof the lithium price as as
they're saying. Okay, so what dowe do now? You know, we think
sodium ion could be this,really, you know, regardless of
(13:04):
what the point I said, lithiumis like, it's still a more
abundant, cheaper technologythat has some other advantages.
It's safer in many ways. Theymade several pivots in the time
that I was talking to them. Youknow, they pivoted to, okay, so
one of the things that keythings we had is additive that
was going to extend the lifespanof our batteries. We could
actually use that same additivein a lithium ion battery and
(13:25):
extend the life of that. Andthat sort of protects you
against sodium versus lithium,because you could use it either
way. And they just kept pluggingalong. They kept working. And
they actually just through theprocess of making a lot of
batteries, came up with a newway to make sodium ion batteries
that they thought would just bea lot cheaper, even though what
(13:46):
they were doing before, and ithas to do with the manufacturing
process, rather than the rawmaterials that made it cheap
enough that even though theprice of lithium dropped, like
we have this new way of doingit, and it's going to be even
cheaper and even more impactful.And you know, as we sort of
start to put batteries out onthe electrical grid, like an
important way of doing that. So,you know, it was really
interesting to follow them asthey sort of shifted and pivoted
(14:08):
and figured out, okay, how do wesort of orient ourselves to
adapt to, like, what the realityof the battery industry is right
now?
Craig Bettenhausen (14:15):
So in some ways, getting a PhD is the act
of becoming the world's foremostexpert in one incredibly
specific thing. It requiresmassive amounts of tenacity, the
ability to keep going eventhough things aren't working,
which is, as from that example,sometimes the opposite of the
skill sets you need to be a CEO,where you need to be able to
make decisions and pivot. So howdo you bridge that gap as a PhD
(14:39):
to CEO?
Matt Blois (14:40):
So so one of, one of my favorite people I talked to
about this was Ray widecamp.He's the founder of a company
called polyspectra, and theymake resins that get used in 3d
printers. And they're reallythey're really rugged. And he,
he was a PhD to CEO. He did aPhD at Caltech, went straight
and founded this company, gotsome funding through activate. I
had a lot of success. Then Iforget exactly when, but at some
(15:03):
point, he started this emailcourse where he said, You know,
I'm going to help other peopledo the same thing. He had so
many interesting ideas aboutthis, like, how do you make this
jump? And he had this quote inthe story where he says, you
know, there's so much you haveto unlearn. You know, you're
taught to do so many things inacademia that end up being
detrimental if you become a CEO.You know, the people who are
(15:24):
successful at this, I think, arepeople who are not incredibly
rigid, like they went into aPhD, and they learned a bunch of
stuff, and they learned how tobe a certain way there. You
know, they learned how to, like,keep going after there's a
million failures, and just go.And I think someone who can
learn to do that and then turnaround and learn to do something
else. They've certainly shownthe capacity to learn a new way
(15:47):
to do things. And so I thinkthere's an argument. I a couple
of people made this argument tome, you know, if you figured out
how to be the world's foremostexpert in something you're good
at learning like, as long as youcan sort of be flexible and be
willing to sort of undo some ofthe habits that you learned as
as as you were trained to be ascientist, you probably are
going to be pretty good atlearning how to be a CEO. So in
Craig Bettenhausen (16:09):
some ways, your article is about that
transition from PhD to CEO, andif we could talk a little bit
more about the trainingresources that are available,
because obviously there is afinancial incentive through
these venture capital funds andaccelerators for people to do
that, but how do they get theskills?
Matt Blois (16:26):
And actually, I want to talk about this on the
podcast, because this is the onethat blew my mind. Is the so NSF
has National Science Foundationhas has something called
Innovation core, or I core. Thewhole point is, like there's
basically helping people sort ofrecognize, you have the
scientific idea, what are thepossible commercialization
opportunities around this? Andthe way they do this is by just
(16:50):
forcing the scientists to talkdo, like, tons and tons of
interviews. I think the numbersthat they have to do 100
interviews over the course oflike, eight weeks or seven
weeks, or something like that,100 it's supposed to force them
to like, listen, rather thanlike pitch and rather than sort
of like, explain. I talked tosomebody at NSF about this, and
(17:12):
she said, what we found isthere's a real turning point,
like the first 50 interviews,people don't quite know where
they're going, and they're justa little bit overwhelmed by it.
And then after you talk to 50people like, people just sort of
get the sense of like, it allsort of starts to coalesce. And
they're like, I think I get itlike, I think I know who I need
to talk to next. And then sortof the second 50 interviews are
really directed by that, andthey're like, Okay, now I need
(17:34):
to know who to talk to. And theysort of get on a roll. And I
thought that was so I related tothat as a reporter, because I
like, sometimes you start areporting process, you're like,
what I don't really understand.Like, I don't know how to frame
this. I can't quite pick outwhat the trend is. And then
after you get through the middleof it, you're like, now I know
what it is. Now I know who needto know who I talk to. But I
(17:55):
just kind of blown away by that,that 100 interviews is just so
many hats
Craig Bettenhausen (18:02):
beyond the obvious one, which is money and
how to get enough of it to makeyour thing a reality. What are
the biggest upsides into goingthe startup route versus
continuing your research in theuniversity lab, you know, trying
to get a professorship and thenhave a, you know, be a PI
somewhere. I
Matt Blois (18:17):
think it really depends on what you personally
want and what your personalgoals are, because that was some
of the like, sort of businessside of the research thing I
looked at. It's like, it totallydoes not make sense financially
to start, like a chemistry ormaterial startup. I think it
really comes down to, like, youknow, why are people doing this?
It's like, it's impactmotivated, like people want to
(18:38):
have the biggest impact. Butthat's not entirely it. So
Andrew Wang talked to me, hesaid something really
interesting to me that sort ofupended the way I think about
this. Because he was saying,like, yeah, we think about, you
know, we want to go out thereand have, like, a big impact on
climate change. That's a hugepart of why we're doing this.
But he's like, but if I reallywanted to, like, have the
biggest possible impact onclimate change as, like, a
battery scientist, probably thebest thing for me to do is,
(19:00):
like, brush up on my Chinese.Like, go work at C, ATL, like
one of the big, the biggest,huge battery manufacturers in
China, and help them, you know,make their separator in the
battery, like one micronthinner, which will make, like,
all of the batteries theyproduce just that little much
better. He's like, I bet if youadded up the sort of, like,
climate change, you know, CO twoemission reduction potential,
(19:23):
like, that's probably the routeto the most impact is sort of
like, make an incrementalimprovement to a already scaled
technology. Like, he was justsaying, I just like
Unknown (19:33):
the challenge of sort of transforming myself into a
CEO. It's a huge challenge. Ihesitate to say fun, but, but,
you know, like, I think it'srewarding. Maybe rewarding is
the right word. I think it'srewarding for people to, you
know, take on something that isthat seems really difficult. It
requires you to, like, learn alot really fast. It's fast
paced. And, you know, I thinkthat's really appealing to a lot
(19:54):
of people, and certainly thepeople that are actually doing
it. I think you have to wantthat. I think to be successful,
you have. To, like, enjoy therewards of just sort of bringing
the most out of yourself, andlike learning to do these things
that you didn't know how to dobefore and really succeeding at
it.
Craig Bettenhausen (20:09):
So stepping back to the 10,000 foot view,
how does our current innovationsystem compare to the corporate
lab model in terms of thatultimate goal of getting world
changing technology out into theworld. It
Matt Blois (20:22):
depends on who you talk to, and I certainly didn't
talk to every businessresearcher in the world, but
most people I talk to thinkwe're worse at it now than we
were before. I think for me,it's really hard to determine
what metric to look like andalso understand exactly what
that metric means in terms ofhow innovation is happening, it
(20:43):
feels like we are doinginnovation really well, but then
there are signs in the data thatwe're not doing it that well.
The data is a little bitconfusing. It's hard to know
what metrics to use. I thinkthere's a chance that we're not
doing as well as we have donebefore. It might just be harder
to do innovation than it used tobe before. It might just be
that, like the farther you gettechnologically, the harder it
is to come up with somethingnew. But I feel like people
(21:04):
would have said that 100 yearsago, like it always feels like
we're high tech. No matter whatpoint in time you are, it feels
like you're high tech, andthere's always more to go. So I
don't know, regardless ofwhether we are doing it better
than we were in the 20thcentury, or where we were doing
it better now, we sort of areliving with the system that we
have. And that was another thinga lot of people told me it's
like, you know, we're not goingback to the corporate research
model. Like, you know, I talkedto some people that kind of
(21:26):
favor that, and thought thatthat was really good. Even those
people are like, those days aregone. So like, all we can do is
just try to take what we haveand do it better. But I think
that's the way forward is, youknow, look at what we're doing
now and keep trying to improveit. Because regardless of
whether what the reality is,whether we're doing it better,
or whether doing worse, youcould always do better, but you
know, we always be better thanwe are doing.
Craig Bettenhausen (21:48):
There's a lot more to talk about here.
Matt, thanks for diving deepwith us on this. Yeah, yeah. It
was super fun. Love talkingabout it. Listeners can find me
on social media as at Craig ofwaffles. Matt, how can our
listeners get in touch with you.Call me 805-233-1686, you don't
hear very often anymore. Nicelydone. You can find Matt's cover
(22:08):
story about PhD students turnedCEOs on CNNs website or in print
in a double issue that came outAugust 19. We put a link in the
show notes along with theepisode credits. We'd love to
know what you think of CNNuncovered. You can share your
feedback with us by emailingcenfeedback@acs.org This has
been CDN uncovered a series fromcn stereochemistry. Stereo
(22:30):
chemistry is the officialpodcast of chemical and
Engineering News. Chemical andEngineering News is an
independent news outletpublished by the American
Chemical Society.
Unknown (22:37):
Thanks for listening. Foreign
Popular Podcasts
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.