Fuelling Innovation in UK Life Sciences
Life science start-ups face several hurdles along the path to success, with many never reaching their potential. A lack of adequate funding and support can limit the development of potentially game-changing technologies.
Increasingly, business accelerators especially designed for the life sciences and healthcare, such as Start Codon, are working to help early stage innovative start-up companies become commercially successful businesses, by providing the tools they need to grow.
We spoke to Daniel Rooke, Head of Operations and Legal at Start Codon, to learn more about the company and how they can help early stage healthcare and life science businesses in the UK to get off the ground.
Anna MacDonald (AM): Can you tell us about your mission at Start Codon, and how the company came about?
Daniel Rooke (DR): There is a significant gap in funding and support between high-potential, but very early stage, healthcare and life science businesses in the UK who require funding and support to grow, and investors who are prepared and willing to invest at such an early stage. We call this the “equity gap”, and in our view this is stifling innovation and stopping promising, cutting-edge technologies from being developed and commercialised. In turn, this reduces the chances of improving patient treatments, whilst limiting local and economic gain. Start Codon’s mission is to close this equity gap by providing both support, in the form of a six month business acceleration programme, and seed-funding, typically in the region of £250,000, to such companies so that they can perform key experiments, develop their technologies and intellectual property, and expand their team.
The Company came about through mutual interested parties – me, my co-founder Dr Jason Mellad (Start Codon’s CEO) and several well-known key players in the Cambridge ecosystem (Cambridge Innovation Capital plc, Babraham Bioscience Technologies Ltd, Jonathan Milner, Ian Tomlinson and Genentech, a part of the Roche group) – wanting to address the “equity gap” in a way that we all felt was both needed, and lacking, in the current UK healthcare and life sciences ecosystem. We’re hoping that the model and approach that we are developing will fuel innovation and, by helping to grow investee companies fast, create more jobs and enable patients to have access to novel treatments and technologies that will improve patient outcomes.
AM: What services do you offer companies entering the programme?
DR: In addition to seed-level investment, we will provide our portfolio companies with access to lab and office space, an intensive start-up ‘bootcamp’, hands-on mentoring from both our full-time dedicated and experienced team and carefully selected external mentors, introductions to our commercial and investment networks, access to regular educational/training sessions and seminars and, at the end of the programme, the opportunity to participate in a demo day during which they will have the opportunity to pitch to, and network with, external investors and other parties. Through this we believe that the typical risks of investing in very early stage companies can be reduced and that such companies will be better placed to raise and grow beyond their series A financing.
AM: How can a company apply to join? What criteria do you use to select candidates?
DR: Companies can apply to join now, by completing the application on our website. At a high level, we want to see the following information from candidates:
(a) how it is proposed the investment funds are used and what the founders think they can achieve (with the help of us, our partners and our resources) during the six-month acceleration programme;
(b) that there are at least two founders (at least one of which we expect to be a strong scientific founder that is supportive of the company, its ideas, and is committed to its growth/its proposed development/use of the technology);
(c) that a UK company has been incorporated into which we can invest and that such company owns, or exclusively licenses, all intellectual property to the technology in question (or can at least secure one of these options prior to our investment being made). We’d also like the technology to be at a stage where at least a proof of concept can be developed by the end of the six-month acceleration programme (and we’d assist with the milestone setting for this during the programme itself);
(d) that the company and its technology falls within our focus areas;
(e) that the company and its founders are willing to commit to the accelerator for its duration; and
(f) that there has been proper consideration of the market in which the company wishes to operate (e.g. that competitors, market access routes and the development path of the technology has been considered properly).
AM: What key areas are you currently focusing on? Why were these areas chosen?
DR: Whilst we will look broadly across the healthcare and life sciences sector, our key focus areas within these sectors are therapeutics, diagnostics, medical technology and digital health. These sectors play to the strengths of our management team, our board and our mentors/partners, and are also areas where we see the greatest opportunities for investment and growth.
AM: What are the biggest hurdles that start-ups face, and how is Start Codon working to overcome these?
DR: Start-ups face many hurdles. However of these, and looking at healthcare and life sciences start-ups specifically as they have different, and in many cases higher, hurdles than your average tech company, I’d say the biggest are; managing high cash burn rates, planning and protecting what is often a very complex intellectual property position and recruiting the right people to drive the business forward.
We help to address the high cash burn rate hurdle by providing our portfolio companies with a high level of seed investment, access to office and lab space, access to the right external partners at the right commercial rates and by helping the founders to plan and implement their capex requirements carefully.
On the planning and management of intellectual property, our board, management team, mentors and partners come from a variety of sectors and cover many areas of science; this gives our portfolio companies a breadth of experience and resources to tap. Further, Sakura Holloway, our Head of Diligence, is a qualified patent attorney and we also have excellent relationships with leading external patent attorneys and international law firms that our portfolio companies can leverage.
Finally, we will work with our portfolio companies to define, develop and implement their business plans and find the right talent to help them to drive their businesses forward. We have excellent links with national and international recruiters and head-hunters, to whom our portfolio companies will have access, who can also support our portfolio companies with recruitment matters in the short, medium and long term.
Overall, our aim is to empower science entrepreneurs by providing them with a launchpad in which they can take their first significant step into developing and, ultimately, commercialising their novel, cutting-edge technologies. We hope that by doing this we will not only encourage more technologies in the healthcare and life sciences sectors to be developed, which could benefit many facets of the economy and society, but also help to create the business angels and companies of tomorrow, particularly in the Cambridgeshire, UK region.
Daniel Rooke was speaking to Anna MacDonald, Science Writer for Technology Networks.