June 3, 2024 • 23 mins
Welcome to a special edition of Conversations in Drug Development, brought to you by the team at Boyds. In this episode, our host Harriet Edwards hands over the mic to two of her colleagues to discuss a critical topic for early-stage biotech companies: funding challenges and how to overcome them.
Dr Nick Myers and Dr Neil Fish, share their extensive experience and insights into navigating the complexities of funding and investment. They delve into what makes an effective pitch deck, the importance of presentation skills, and the role of a well-organized data room. Additionally, they offer valuable advice on matching fundraising activities to the right investors and the impact of market trends on investment strategies.
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Transcript
Episode Transcript
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(00:00):
Music.
(00:05):
And a warm welcome to the latest edition of Conversations in Drug Development,
brought to you by the team at Boyds.
This podcast is for our fellow community of scientists and clinicians working
in the wonderful world of cell and gene therapy and drug development.
Thank you for tuning in and we hope you enjoy the conversation.
Music.
(00:30):
Hello and welcome to another installment of Conversations in Drug Development.
My name is Harriet Edwards and I am your usual podcast host.
However, today I will be handing over the mic to two of my colleagues and I'm
very excited to share with you this podcast special.
We'll be discussing the challenges faced by many early stage and startup biotech
companies when seeking funding.
(00:51):
So my colleagues Nick Myers, VP of Product Development and Neil Fish,
VP of Business Development here at Boyd's both have a wealth of experience in
this area and understand the challenges and pitfalls faced when seeking funding
and critically how to overcome these.
Both have helped many companies overcome the complexities of funding and investment
and will share their knowledge today in this podcast.
(01:13):
I really do hope you enjoy the episode and subscribe and like for more content coming soon.
Hello, my name's Nick Myers and I'm VP of Product Development and Program Management
at Boyds. And today I'm joined by my colleague, Dr.
Neil Fish, VP of Business Development. Hi, Nick. Hi, Nick.
What we're going to do today is talk a little bit about how companies approach
(01:36):
and be prepared for investment rounds.
So without further ado on that topic, Neil, as a VP of Business Development
and in your life actually as a part-time investor as well, what do you like to see in a pitch deck?
Well, I think the first thing, Nick, is to get the length right.
(01:56):
I think if we talk about the venture capital community, they probably see 100 decks a week.
So I think the first thing to say is it hasn't got to be too long.
So when I joined Boyd's, one of the very first things I did was to get the pitch
deck right. It's a maximum of 10 slides.
And I pride myself in doing it in six minutes flat and getting the story straight.
(02:17):
I think it's important to be able to do that because if you can't explain it
in less than six minutes,
you probably don't understand it yourself and you've got pretty much no
chance of convincing anybody else so it's got
to be a good story and i think also you know the slide content
is really important on the sort of you know the types of things you see in there
and nick yeah one of the things i'd like to ask you is you know we see lots
(02:38):
of pitch decks ourselves and some of them have got you know hardly any science
and some have got huge amounts of science in so as a product development specialist
yourself what do you like to see.
Good point well i think that the slides can't be too technical or too scientific
they have to contain the right amount of science for the audience and actually
(02:59):
thinking about that the audience could be different because sometimes you're
not just doing a 10-minute pitch presentation,
you might have longer than that you could be in a conference situation where
you've got 20 minutes or half an hour and you could be doing a behind closed
doors sort of pitch to investors in which you might have a variable length of time.
(03:20):
However, going back to the technical content, you have to pitch that right.
I think it's very easy for early stage companies to focus so much on the science.
They don't cover off topics such as the unmet medical need.
They lose sight of the fact or can lose sight of the fact that at the end of
the day, they're going to develop a product.
(03:41):
What disease or indications is that product going to treat?
What do they need to show in the clinic what's the
mechanism of action you know how much efficacy
do they have compared to competitor products all
of these sorts of things have to come in so i think you need enough science
to explain what the product does how it works how good it is but not too much
(04:07):
that it's going to bamboozle investors because or switch them off and you see
their eyes glaze over that's never a good No, agreed.
So how about the presentation style? Yeah, it's a good one.
Sometimes the CEO is not actually the right person to get up on stage and give
the presentation. I think the first thing to say is,
(04:27):
I was at a meeting last week where there were some people who I know present
very well who basically messed it up completely because they actually hadn't
rehearsed it. That's the first thing to say.
I would genuinely do it 10 times
in front of a bathroom mirror before I go anywhere near anybody. I agree.
But sometimes, you know, maybe it's the CFO is the best presenter.
It doesn't always have to be the CFO. The front person isn't necessarily the best presenter.
(04:51):
And I know that kind of might require a little bit of swallowing pride.
But actually you've got to have somebody who's very
good at telling the story very efficiently and i
think i would just also just delve into a little bit more about you know
again i've been at some pitch presentations in the
last couple of weeks and i've been at a partnering meeting i've had
people sit in front of me first of all without a deck at all you
(05:13):
know i had one person waving his hand out pointing at the
cloud but then i was supposed to sort of somehow from
my sort of telepathy they have to understand what he was talking about
another guy waved his hands in front of me like it was like semaphore
it doesn't take very much to have an ipad
with a pdf of your presentation on it and
give a really top class professional presentation but
(05:36):
i think the key thing is to rehearse it and so you know the
slides are almost incidental you need to know the
story yeah i would agree i mean obviously we've discussed
there the situation where one person is presenting which
could well be the case in a conference type scenario but.
In a behind closed doors presentation to investors
it is actually possible to break that up and have
(05:58):
different people present so it can be useful to
have the chief medical officer or the chief scientific officer
present certain pieces of information which aligns
with their expertise and actually just going back briefly to the content i think
one of the other things i've seen is that investors want to know what the use
(06:18):
of the proceeds are going to be of the fundraise how are you going to spend
this money and also the timeline line, what are the milestones.
And what are the inflection points where an investor can see a return on investment and maybe exit.
This is a key area which is often missing, I think, from pitches that I sometimes see.
Yeah, I agree with you entirely, Nick. And to come back to the earlier point
(06:41):
you were making about how much science,
you can always leave a much longer deck behind afterwards, which has got that
information in, to help the investors really get into the nitty-gritty,
which you just can't do in a 10-minute pitch.
And actually, talking about the teams then and how one gets the right team together,
obviously we must bear in mind that some of these
(07:03):
early stage companies especially companies have
just spun out of academia the founders may
or may not be again the right people to do the pitches
and if at this point they haven't hired internal staff
they may not have some options but it is
actually possible to bring in consultants especially in the behind the doors
(07:23):
type of pitches to investors to take those people out on the road to help them
give the pitch which perfectly legitimate because what you're just doing is
communicating your scientific ideas and how you propose to develop the product.
So I think that's... And I agree, Nick. And sometimes you get a double whammy
that maybe some of these experienced people you're using are very well known
(07:45):
to the investment community and are trusted by them.
And that can be another sort of big help going forwards. Yeah. Okay. Lovely.
Let's move on now to talk about another stage of the process, which is the data room.
So most investors want to go and to look at the data themselves and see what you've got.
Data rooms can vary quite a lot in the way they're set up.
(08:08):
Do you have any thoughts on what you do and don't like to see?
Yeah, well, you and I have been into hundreds of data rooms.
And I think the first point, and it's so important, is to make it simple and
make it so clearly organized that the person and going in can find the information they want.
Because if you hide things or accidentally hide things, it looks like you've got something to hide.
(08:31):
And it kind of can raise suspicions that may be completely unfounded.
But a really simple, well-designed data room is absolutely core to making the
investor happy and comfortable with what you're trying to do and part of building trust.
It's a really important part. It's amazing, actually, that sometimes they really
(08:52):
are just a big dump of documents.
And it's amazing people don't spend the time just ordering those in a logical
way, you know, manufacturing, analytical, non-clinical, clinical,
regulatory, etc. It's so easy to do, but makes people's lives a lot easier.
I would also include in the timelines as well, you know, whether it's a formal
(09:14):
Gantt chart in Microsoft Projects, at least some information on the timelines,
which have probably been showed in schematic form in the pitch,
but perhaps with a bit more detail in the data room. and that will trigger questions.
But I think it's very important as well to show the credibility that you've
actually thought about the timetable rather than just plucking it out of the
(09:37):
air. It's got to be based on reality.
Yeah, I think another important part of the data room is what I call a Q&A log.
And that could be a simple Excel type folder.
You have the question, you have the answer and it's there.
And it's very helpful to investors that they don't keep asking the same question.
And helping them also sort of build up the picture as they read this Q&A log
(10:00):
of what the story is about the product.
Absolutely. What about market research, if you like?
Or I'm guessing for me that really means thinking about the competitors,
the external environment.
What do you think people should do before they embark on investment in turn?
Yeah, it's a really good question, Nick. I think it's quite sad that when I
(10:21):
look around sort of the investment world and what people are pitching,
almost half of what we see is for diseases that are already very well treated.
And it's part of reflection, I think, of the R&D community perhaps not really
understanding what's going on in the commercial world.
The things they think are great ideas, actually, they might already be products for.
(10:41):
So I think it's really important to sort of really try and understand what is
the product you're trying to develop?
And is there actually a need for it in the marketplace? place because there
are very many diseases i mean lots of cardiovascular diseases cholesterol.
Which are really well treated with cheap generic products
already there's almost no business case for
(11:02):
developing these types of products whereas rare diseases obviously cancer are
areas where you can really you know there are real still real needs i agree
with you i mean for me this is about credibility as well many academic researchers
and small companies tend to do their work almost in a vacuum,
I give points for people who've clearly looked at the wider picture and they've
(11:25):
seen what products are approved, what the standard of care is in hospitals now,
and what products are in the process of being developed.
And that actually leads on to the laboratory work they're doing as well.
Well yeah so have they got any comparative data either
in vitro or even better in vivo in large
animals about how their new product compares against
(11:47):
standard of care or similar products in development this
is key yeah information and i'll give an example from
last week in a partnering meeting there was a fantastic pitch
i went to from a sort of young youngish opportunity
a young company and i did
a little bit of research afterwards there were 10 other
ways of treating what they're trying to develop their product for and
(12:08):
this product was going to probably cost ten thousand pounds of treatment
but i didn't see a need for it and certainly not at
ten thousand pounds so absolutely okay
let's uh switch to a different topic now
so we've talked about the pitches we've talked about data
rules how about the corporate website what are
the big do's and don'ts about yeah that's a very
(12:30):
interesting one from my perspective there
is almost no excuse in this modern age to have
like a one-page website unless you are genuinely still
constructing it you'd be amazed how many sort of
websites that even scroll down what appears like
many feet on one page i think anybody can produce a nice professional multi-page
(12:52):
website very easily these days i just don't think there's any excuse for that
not being done really professionally because that's almost the first thing an
investor is going to see it's a big sort of tick in the box of credibility.
One of the very next things I always look at is the news section.
Because that usually tells me if the company is still alive or not.
You know, if you have got no news articles on there for two years,
(13:14):
probably means the company's gone bust, honestly.
And that might not be the case. But it's really important if you've got a website,
you've then got to look after it and make sure it's up to date.
You know, and make sure all the personnel are correct, the story's straight.
But I think really in this modern day and age, the engines around to produce
really professional websites relatively cheaply, it's all there.
(13:36):
And it's it's so important to get that right i
agree i think some information on the team is also critical
you want the obviously the team in the company at the
time you want some information on the board who
their scientific advisory board is and also their
consultants i mean it's not you wouldn't expect
people to divulge necessarily on their website which
(13:56):
cro's and cdmo's they're working with but those
sorts of questions will come out during the due diligence when
the investors as you're really asking you because that's all part of
the credibility yeah and i think it's sometimes you'd see
websites which just look a bit strange as we were talking about data
rooms and you look at i mean you just get the gut feel there's
there's something not quite right here absolutely and it's usually
(14:18):
sort of there are private companies let's say
with very strong founders who've got their own views
and it kind of just looks a bit odd and out
of kilter with maybe what a conventional website would
look like that's right i mean you know one could
level the the accusation that all websites are becoming
to look quite similar you've got the who we are meet the
(14:38):
team etc and you've got the pipeline side but there's a reason for
that it's credibility when you don't match up to those expectations or if it
looks things look a bit odd that's probably because they are a bit odd yeah
yeah great so moving on to another topic how do you match your fundraising activities.
To the right investors because there are lots of different types of investors?
(15:02):
Yeah, that's a very good question, Nick, because if you just sort of do a blanket
approach to all venture capitalists in Europe or United States,
you're going to get a lot of rejection.
I think the good news is most VCs on their websites are actually fairly clear
about what they're interested in, be it devices, therapeutic products.
AI is very hot at the moment. I would say a large number of VCs are very much into AI at the moment.
(15:28):
So I think you You just have to do the homework of basically looking at the
websites, what are the venture capitalists interested in, and really don't bother
sending an AI proposal to someone who's only interested in devices because your
book was certainly going to get rejected.
Yeah. I've got a question, actually, you may be able to answer,
about seed rounds versus series A. Yeah.
(15:50):
Is this really just about the size of the raise or where you are in development?
What determines how many seed rounds you will go for before you go for a Series A, right?
Yeah, I mean, that's a good question, Nick. There is the classic sort of pre-seed
almost, and then the seed, and then Series A, B, C, D, and that probably goes on further than that.
It's usually a reflection of the amount of money being raised and the type of
(16:14):
investor that's coming in.
Because again, some venture capitalists will only specialize in seed.
Some do series a and b and probably
would follow on to c and d but actually they might the next rounds
might be so big that they can't follow on into those
rounds but yes seed seed investment is
quite interesting because it can be sort of vcs that specialize in that that
(16:36):
sort of type of smaller raise or it could be like high net worth individuals
specialists in the area who really understand the company and it could also
be the management themselves of the company but yeah seed Seed can be,
it's not so much the amount.
I have literally seen a seed round of $100 million last week.
So seed rounds can be very big.
But the seed investors are the people who are making that first move.
(16:59):
In Europe, the seed is probably going to be probably less than £10 million.
But in the States, I think it can almost be whatever it needs to be.
Whoever wants to pile in, if you've got a hot area, it could be a very large amount of money.
I mean, obviously, we have just seen in the UK,
really, hopefully now the the
green shoots of a return of investment after a
(17:22):
little bit of a downturn in 23 does investment
really go through cycles fashion cycles almost
as to what people are looking for it certainly does in therapeutic areas or
technologies so no surprise if i was to say to you that ai is the hot area at
the moment and ai has been used you know throughout drug discovery It's also
(17:43):
been used in clinical development and within various sort of medical device applications.
You know, there's all sorts of ways AI has been using for diagnostics and devices.
That will pass. It was interesting, I was talking to a VC last week and he said
that nobody at the moment is interested in glioma, in a particular form of brain cancer.
(18:03):
Because basically, everybody's already invested in that area,
and they're waiting to see how these investments play out.
Because if the multiple VCs that have invested are successful,
then there's no real investment case going forward.
But if they all fail, then they'll be interested in glioma again.
So yeah, these things do go in cycles. I mean, at the moment,
also obesity is very hot.
(18:24):
You know, we've seen the huge success of Lily and Novo,
and a lot of people are now putting a lot of money into obesity because
now now seems to be a way forward to develop sort
of new medicines that are really meaningful you know with meaningful weight
loss yeah i suppose they do as well thinking about my own past career you know
in the neurodegenerative diseases when people working in alzheimer's and doing
(18:47):
things like anti-amyloid plaque therapies when the first
few clinical candidates didn't really produce the results people anticipated,
there was then a dearth of investment away from those areas.
And similarly in neuro disease and ALS.
When things are going well, people want to come in up to a point.
(19:08):
Then when lots of people are in, it's as you say, wait to see what comes out of that.
But yes, if there are clinical failures, then people move away from those areas.
So it makes sense that they do go in cycles really. Yeah, I mean,
there are some very tough diseases.
Pancreatic cancer is one of them that by the time you see symptoms,
the cancer is usually well advanced.
(19:30):
But, you know, somebody will do something sometime where all of a sudden that
changes and then we see a real sort of shift and then that'll be an attractive
investment area. Just picking up what you said about AI, I mean,
ultimately, AI is a tool.
It's a tool probably mainly in drug discovery.
It has its uses in development, but essentially it's a tool,
(19:51):
but it might get people excited.
Does that really hold up very long? I mean, at the end of the day,
you're still developing products, and you want to see the preclinical efficacy
data, you want to see the tox data, and then you want to see the proof of the pudding in the clinic.
Yeah well we're both old enough to remember the
the competensorial chemistry boom of the 90s
(20:14):
if you remember what that was like where all of a sudden everybody was
doing it you know even if they didn't really understand what they
were doing there was a lot of money poured into that and probably
only about 10 percent of what was invested turned out to be something meaningful
which you know to be fair is widely used in the pharma and biotech industry
but probably not in the way that people believed it was going to be at the time
(20:35):
and this is what happens isn't it we We go through this boom and then sort of
that it just sort of settles out.
You've you kind of the first wave goes and the second wave. OK,
so this is how we're going to use it. And it's no good for that.
You know, that's probably the way every technology goes, isn't it? To some extent.
And then there'll be a third and fourth way. It's sort of narrowed down and
it becomes almost like everyday life.
(20:57):
You don't even know it's there anymore. That's right.
OK, well, that's been a really interesting chat. I think I'll try and summarize
what we've talked about today,
which is really think about your pitch deck and
who you're pitching to put the right amount
of science in don't have hundreds and hundreds
of slides on highly technical data which
(21:17):
doesn't really get to the point really think about
your unmet medical need and communicate what the
product is going to do who's it going to be used by think about the competitive
environment what you need to do to bring the product to market or to actually
bring it to the next stage and think about the inflection points and the timeline
(21:39):
of the development make sure that's credible.
I think we've talked about the importance of having a really well-structured,
easy-to-use data room and a professional-looking, really well-thought-out website
that attracts people to the site.
Do your market research, as I've said, look at the competitive environment,
(22:00):
see who's out there and think about who may want to invest in this product and
actually talk to people, sound out people about who the right investors may be to approach.
So i think we've got some good topics there and you
know it is really important sometimes you only get one shot
on goal here so you really need to
(22:22):
think about your whole investment strategy and all
the materials that go around that before you embark
on it's not something to undertake rightly or in hay style i suggest yeah i
agree nick so before we close out neil any more top tips perhaps your biggest
top tip don't give up i think it's as simple as that yeah you have to be resilient
that's you really do in this industry yeah thank you very much thank you thank you for.
(22:50):
Music.
Listening to conversations in drug development the podcast series brought to
you by the team of boys don't forget to follow us on the usual podcast platforms
or visit our website to ensure you don't miss out on any of our future episodes.
Music.
Music.
(00:05):
And a warm welcome to the latest edition of Conversations in Drug Development,
brought to you by the team at Boyds.
This podcast is for our fellow community of scientists and clinicians working
in the wonderful world of cell and gene therapy and drug development.
Thank you for tuning in and we hope you enjoy the conversation.
Music.
(00:30):
Hello and welcome to another installment of Conversations in Drug Development.
My name is Harriet Edwards and I am your usual podcast host.
However, today I will be handing over the mic to two of my colleagues and I'm
very excited to share with you this podcast special.
We'll be discussing the challenges faced by many early stage and startup biotech
companies when seeking funding.
(00:51):
So my colleagues Nick Myers, VP of Product Development and Neil Fish,
VP of Business Development here at Boyd's both have a wealth of experience in
this area and understand the challenges and pitfalls faced when seeking funding
and critically how to overcome these.
Both have helped many companies overcome the complexities of funding and investment
and will share their knowledge today in this podcast.
(01:13):
I really do hope you enjoy the episode and subscribe and like for more content coming soon.
Hello, my name's Nick Myers and I'm VP of Product Development and Program Management
at Boyds. And today I'm joined by my colleague, Dr.
Neil Fish, VP of Business Development. Hi, Nick. Hi, Nick.
What we're going to do today is talk a little bit about how companies approach
(01:36):
and be prepared for investment rounds.
So without further ado on that topic, Neil, as a VP of Business Development
and in your life actually as a part-time investor as well, what do you like to see in a pitch deck?
Well, I think the first thing, Nick, is to get the length right.
(01:56):
I think if we talk about the venture capital community, they probably see 100 decks a week.
So I think the first thing to say is it hasn't got to be too long.
So when I joined Boyd's, one of the very first things I did was to get the pitch
deck right. It's a maximum of 10 slides.
And I pride myself in doing it in six minutes flat and getting the story straight.
(02:17):
I think it's important to be able to do that because if you can't explain it
in less than six minutes,
you probably don't understand it yourself and you've got pretty much no
chance of convincing anybody else so it's got
to be a good story and i think also you know the slide content
is really important on the sort of you know the types of things you see in there
and nick yeah one of the things i'd like to ask you is you know we see lots
(02:38):
of pitch decks ourselves and some of them have got you know hardly any science
and some have got huge amounts of science in so as a product development specialist
yourself what do you like to see.
Good point well i think that the slides can't be too technical or too scientific
they have to contain the right amount of science for the audience and actually
(02:59):
thinking about that the audience could be different because sometimes you're
not just doing a 10-minute pitch presentation,
you might have longer than that you could be in a conference situation where
you've got 20 minutes or half an hour and you could be doing a behind closed
doors sort of pitch to investors in which you might have a variable length of time.
(03:20):
However, going back to the technical content, you have to pitch that right.
I think it's very easy for early stage companies to focus so much on the science.
They don't cover off topics such as the unmet medical need.
They lose sight of the fact or can lose sight of the fact that at the end of
the day, they're going to develop a product.
(03:41):
What disease or indications is that product going to treat?
What do they need to show in the clinic what's the
mechanism of action you know how much efficacy
do they have compared to competitor products all
of these sorts of things have to come in so i think you need enough science
to explain what the product does how it works how good it is but not too much
(04:07):
that it's going to bamboozle investors because or switch them off and you see
their eyes glaze over that's never a good No, agreed.
So how about the presentation style? Yeah, it's a good one.
Sometimes the CEO is not actually the right person to get up on stage and give
the presentation. I think the first thing to say is,
(04:27):
I was at a meeting last week where there were some people who I know present
very well who basically messed it up completely because they actually hadn't
rehearsed it. That's the first thing to say.
I would genuinely do it 10 times
in front of a bathroom mirror before I go anywhere near anybody. I agree.
But sometimes, you know, maybe it's the CFO is the best presenter.
It doesn't always have to be the CFO. The front person isn't necessarily the best presenter.
(04:51):
And I know that kind of might require a little bit of swallowing pride.
But actually you've got to have somebody who's very
good at telling the story very efficiently and i
think i would just also just delve into a little bit more about you know
again i've been at some pitch presentations in the
last couple of weeks and i've been at a partnering meeting i've had
people sit in front of me first of all without a deck at all you
(05:13):
know i had one person waving his hand out pointing at the
cloud but then i was supposed to sort of somehow from
my sort of telepathy they have to understand what he was talking about
another guy waved his hands in front of me like it was like semaphore
it doesn't take very much to have an ipad
with a pdf of your presentation on it and
give a really top class professional presentation but
(05:36):
i think the key thing is to rehearse it and so you know the
slides are almost incidental you need to know the
story yeah i would agree i mean obviously we've discussed
there the situation where one person is presenting which
could well be the case in a conference type scenario but.
In a behind closed doors presentation to investors
it is actually possible to break that up and have
(05:58):
different people present so it can be useful to
have the chief medical officer or the chief scientific officer
present certain pieces of information which aligns
with their expertise and actually just going back briefly to the content i think
one of the other things i've seen is that investors want to know what the use
(06:18):
of the proceeds are going to be of the fundraise how are you going to spend
this money and also the timeline line, what are the milestones.
And what are the inflection points where an investor can see a return on investment and maybe exit.
This is a key area which is often missing, I think, from pitches that I sometimes see.
Yeah, I agree with you entirely, Nick. And to come back to the earlier point
(06:41):
you were making about how much science,
you can always leave a much longer deck behind afterwards, which has got that
information in, to help the investors really get into the nitty-gritty,
which you just can't do in a 10-minute pitch.
And actually, talking about the teams then and how one gets the right team together,
obviously we must bear in mind that some of these
(07:03):
early stage companies especially companies have
just spun out of academia the founders may
or may not be again the right people to do the pitches
and if at this point they haven't hired internal staff
they may not have some options but it is
actually possible to bring in consultants especially in the behind the doors
(07:23):
type of pitches to investors to take those people out on the road to help them
give the pitch which perfectly legitimate because what you're just doing is
communicating your scientific ideas and how you propose to develop the product.
So I think that's... And I agree, Nick. And sometimes you get a double whammy
that maybe some of these experienced people you're using are very well known
(07:45):
to the investment community and are trusted by them.
And that can be another sort of big help going forwards. Yeah. Okay. Lovely.
Let's move on now to talk about another stage of the process, which is the data room.
So most investors want to go and to look at the data themselves and see what you've got.
Data rooms can vary quite a lot in the way they're set up.
(08:08):
Do you have any thoughts on what you do and don't like to see?
Yeah, well, you and I have been into hundreds of data rooms.
And I think the first point, and it's so important, is to make it simple and
make it so clearly organized that the person and going in can find the information they want.
Because if you hide things or accidentally hide things, it looks like you've got something to hide.
(08:31):
And it kind of can raise suspicions that may be completely unfounded.
But a really simple, well-designed data room is absolutely core to making the
investor happy and comfortable with what you're trying to do and part of building trust.
It's a really important part. It's amazing, actually, that sometimes they really
(08:52):
are just a big dump of documents.
And it's amazing people don't spend the time just ordering those in a logical
way, you know, manufacturing, analytical, non-clinical, clinical,
regulatory, etc. It's so easy to do, but makes people's lives a lot easier.
I would also include in the timelines as well, you know, whether it's a formal
(09:14):
Gantt chart in Microsoft Projects, at least some information on the timelines,
which have probably been showed in schematic form in the pitch,
but perhaps with a bit more detail in the data room. and that will trigger questions.
But I think it's very important as well to show the credibility that you've
actually thought about the timetable rather than just plucking it out of the
(09:37):
air. It's got to be based on reality.
Yeah, I think another important part of the data room is what I call a Q&A log.
And that could be a simple Excel type folder.
You have the question, you have the answer and it's there.
And it's very helpful to investors that they don't keep asking the same question.
And helping them also sort of build up the picture as they read this Q&A log
(10:00):
of what the story is about the product.
Absolutely. What about market research, if you like?
Or I'm guessing for me that really means thinking about the competitors,
the external environment.
What do you think people should do before they embark on investment in turn?
Yeah, it's a really good question, Nick. I think it's quite sad that when I
(10:21):
look around sort of the investment world and what people are pitching,
almost half of what we see is for diseases that are already very well treated.
And it's part of reflection, I think, of the R&D community perhaps not really
understanding what's going on in the commercial world.
The things they think are great ideas, actually, they might already be products for.
(10:41):
So I think it's really important to sort of really try and understand what is
the product you're trying to develop?
And is there actually a need for it in the marketplace? place because there
are very many diseases i mean lots of cardiovascular diseases cholesterol.
Which are really well treated with cheap generic products
already there's almost no business case for
(11:02):
developing these types of products whereas rare diseases obviously cancer are
areas where you can really you know there are real still real needs i agree
with you i mean for me this is about credibility as well many academic researchers
and small companies tend to do their work almost in a vacuum,
I give points for people who've clearly looked at the wider picture and they've
(11:25):
seen what products are approved, what the standard of care is in hospitals now,
and what products are in the process of being developed.
And that actually leads on to the laboratory work they're doing as well.
Well yeah so have they got any comparative data either
in vitro or even better in vivo in large
animals about how their new product compares against
(11:47):
standard of care or similar products in development this
is key yeah information and i'll give an example from
last week in a partnering meeting there was a fantastic pitch
i went to from a sort of young youngish opportunity
a young company and i did
a little bit of research afterwards there were 10 other
ways of treating what they're trying to develop their product for and
(12:08):
this product was going to probably cost ten thousand pounds of treatment
but i didn't see a need for it and certainly not at
ten thousand pounds so absolutely okay
let's uh switch to a different topic now
so we've talked about the pitches we've talked about data
rules how about the corporate website what are
the big do's and don'ts about yeah that's a very
(12:30):
interesting one from my perspective there
is almost no excuse in this modern age to have
like a one-page website unless you are genuinely still
constructing it you'd be amazed how many sort of
websites that even scroll down what appears like
many feet on one page i think anybody can produce a nice professional multi-page
(12:52):
website very easily these days i just don't think there's any excuse for that
not being done really professionally because that's almost the first thing an
investor is going to see it's a big sort of tick in the box of credibility.
One of the very next things I always look at is the news section.
Because that usually tells me if the company is still alive or not.
You know, if you have got no news articles on there for two years,
(13:14):
probably means the company's gone bust, honestly.
And that might not be the case. But it's really important if you've got a website,
you've then got to look after it and make sure it's up to date.
You know, and make sure all the personnel are correct, the story's straight.
But I think really in this modern day and age, the engines around to produce
really professional websites relatively cheaply, it's all there.
(13:36):
And it's it's so important to get that right i
agree i think some information on the team is also critical
you want the obviously the team in the company at the
time you want some information on the board who
their scientific advisory board is and also their
consultants i mean it's not you wouldn't expect
people to divulge necessarily on their website which
(13:56):
cro's and cdmo's they're working with but those
sorts of questions will come out during the due diligence when
the investors as you're really asking you because that's all part of
the credibility yeah and i think it's sometimes you'd see
websites which just look a bit strange as we were talking about data
rooms and you look at i mean you just get the gut feel there's
there's something not quite right here absolutely and it's usually
(14:18):
sort of there are private companies let's say
with very strong founders who've got their own views
and it kind of just looks a bit odd and out
of kilter with maybe what a conventional website would
look like that's right i mean you know one could
level the the accusation that all websites are becoming
to look quite similar you've got the who we are meet the
(14:38):
team etc and you've got the pipeline side but there's a reason for
that it's credibility when you don't match up to those expectations or if it
looks things look a bit odd that's probably because they are a bit odd yeah
yeah great so moving on to another topic how do you match your fundraising activities.
To the right investors because there are lots of different types of investors?
(15:02):
Yeah, that's a very good question, Nick, because if you just sort of do a blanket
approach to all venture capitalists in Europe or United States,
you're going to get a lot of rejection.
I think the good news is most VCs on their websites are actually fairly clear
about what they're interested in, be it devices, therapeutic products.
AI is very hot at the moment. I would say a large number of VCs are very much into AI at the moment.
(15:28):
So I think you You just have to do the homework of basically looking at the
websites, what are the venture capitalists interested in, and really don't bother
sending an AI proposal to someone who's only interested in devices because your
book was certainly going to get rejected.
Yeah. I've got a question, actually, you may be able to answer,
about seed rounds versus series A. Yeah.
(15:50):
Is this really just about the size of the raise or where you are in development?
What determines how many seed rounds you will go for before you go for a Series A, right?
Yeah, I mean, that's a good question, Nick. There is the classic sort of pre-seed
almost, and then the seed, and then Series A, B, C, D, and that probably goes on further than that.
It's usually a reflection of the amount of money being raised and the type of
(16:14):
investor that's coming in.
Because again, some venture capitalists will only specialize in seed.
Some do series a and b and probably
would follow on to c and d but actually they might the next rounds
might be so big that they can't follow on into those
rounds but yes seed seed investment is
quite interesting because it can be sort of vcs that specialize in that that
(16:36):
sort of type of smaller raise or it could be like high net worth individuals
specialists in the area who really understand the company and it could also
be the management themselves of the company but yeah seed Seed can be,
it's not so much the amount.
I have literally seen a seed round of $100 million last week.
So seed rounds can be very big.
But the seed investors are the people who are making that first move.
(16:59):
In Europe, the seed is probably going to be probably less than £10 million.
But in the States, I think it can almost be whatever it needs to be.
Whoever wants to pile in, if you've got a hot area, it could be a very large amount of money.
I mean, obviously, we have just seen in the UK,
really, hopefully now the the
green shoots of a return of investment after a
(17:22):
little bit of a downturn in 23 does investment
really go through cycles fashion cycles almost
as to what people are looking for it certainly does in therapeutic areas or
technologies so no surprise if i was to say to you that ai is the hot area at
the moment and ai has been used you know throughout drug discovery It's also
(17:43):
been used in clinical development and within various sort of medical device applications.
You know, there's all sorts of ways AI has been using for diagnostics and devices.
That will pass. It was interesting, I was talking to a VC last week and he said
that nobody at the moment is interested in glioma, in a particular form of brain cancer.
(18:03):
Because basically, everybody's already invested in that area,
and they're waiting to see how these investments play out.
Because if the multiple VCs that have invested are successful,
then there's no real investment case going forward.
But if they all fail, then they'll be interested in glioma again.
So yeah, these things do go in cycles. I mean, at the moment,
also obesity is very hot.
(18:24):
You know, we've seen the huge success of Lily and Novo,
and a lot of people are now putting a lot of money into obesity because
now now seems to be a way forward to develop sort
of new medicines that are really meaningful you know with meaningful weight
loss yeah i suppose they do as well thinking about my own past career you know
in the neurodegenerative diseases when people working in alzheimer's and doing
(18:47):
things like anti-amyloid plaque therapies when the first
few clinical candidates didn't really produce the results people anticipated,
there was then a dearth of investment away from those areas.
And similarly in neuro disease and ALS.
When things are going well, people want to come in up to a point.
(19:08):
Then when lots of people are in, it's as you say, wait to see what comes out of that.
But yes, if there are clinical failures, then people move away from those areas.
So it makes sense that they do go in cycles really. Yeah, I mean,
there are some very tough diseases.
Pancreatic cancer is one of them that by the time you see symptoms,
the cancer is usually well advanced.
(19:30):
But, you know, somebody will do something sometime where all of a sudden that
changes and then we see a real sort of shift and then that'll be an attractive
investment area. Just picking up what you said about AI, I mean,
ultimately, AI is a tool.
It's a tool probably mainly in drug discovery.
It has its uses in development, but essentially it's a tool,
(19:51):
but it might get people excited.
Does that really hold up very long? I mean, at the end of the day,
you're still developing products, and you want to see the preclinical efficacy
data, you want to see the tox data, and then you want to see the proof of the pudding in the clinic.
Yeah well we're both old enough to remember the
the competensorial chemistry boom of the 90s
(20:14):
if you remember what that was like where all of a sudden everybody was
doing it you know even if they didn't really understand what they
were doing there was a lot of money poured into that and probably
only about 10 percent of what was invested turned out to be something meaningful
which you know to be fair is widely used in the pharma and biotech industry
but probably not in the way that people believed it was going to be at the time
(20:35):
and this is what happens isn't it we We go through this boom and then sort of
that it just sort of settles out.
You've you kind of the first wave goes and the second wave. OK,
so this is how we're going to use it. And it's no good for that.
You know, that's probably the way every technology goes, isn't it? To some extent.
And then there'll be a third and fourth way. It's sort of narrowed down and
it becomes almost like everyday life.
(20:57):
You don't even know it's there anymore. That's right.
OK, well, that's been a really interesting chat. I think I'll try and summarize
what we've talked about today,
which is really think about your pitch deck and
who you're pitching to put the right amount
of science in don't have hundreds and hundreds
of slides on highly technical data which
(21:17):
doesn't really get to the point really think about
your unmet medical need and communicate what the
product is going to do who's it going to be used by think about the competitive
environment what you need to do to bring the product to market or to actually
bring it to the next stage and think about the inflection points and the timeline
(21:39):
of the development make sure that's credible.
I think we've talked about the importance of having a really well-structured,
easy-to-use data room and a professional-looking, really well-thought-out website
that attracts people to the site.
Do your market research, as I've said, look at the competitive environment,
(22:00):
see who's out there and think about who may want to invest in this product and
actually talk to people, sound out people about who the right investors may be to approach.
So i think we've got some good topics there and you
know it is really important sometimes you only get one shot
on goal here so you really need to
(22:22):
think about your whole investment strategy and all
the materials that go around that before you embark
on it's not something to undertake rightly or in hay style i suggest yeah i
agree nick so before we close out neil any more top tips perhaps your biggest
top tip don't give up i think it's as simple as that yeah you have to be resilient
that's you really do in this industry yeah thank you very much thank you thank you for.
(22:50):
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