This is the first article in a row of articles about entrepreneurship and financing in life science. They are supposed to spot issues that may come up with starting up a business and structuring the financing and can be used as a hands-on guide through the challenges that may emerge when switching from science to business.
Top 8 recommendations to start up in life science
Starting up is a difficult business in any industry, but especially in life science. As a founder, you not only have to build up a team, you can rely on, and to raise a lot of money, but also deal with the protection of IP and the freedom to operate, i.e. develop and manage your IP.
What are the biggest challenges, what are the lessons learned, what would the advice to founder be?
Attend incubator programmes. You will not only learn entrepreneurship in theory, but make your first steps in a protected area. You will be offered hands-on support, resources, a network to bring you to the next level. Make a business plan and get prepared for the meetings with financial investors. You might need a business plan for yourself as a checklist. However, don’t hand over the full version. No investor is ready to read 20 pages or more.
Get prepared for regulatory and legal issues and be extremely clear with IP. This is the field where you might rely on external advice. Documentation is of utmost importance. If you have a hole in your IP, one of your competitors might find and fill it.
You need a skilled team with experience in many fields covering all entrepreneurial issues. Don’t underestimate the team building process, the energy and time it gets to smoothly work together.
Collaboration & Culture
Be aware of the different quests and quality standards in science compared to industry. Whereas the focus in academia is on publishing, reproducibility is required in industry.
Accept that you might not always understand the agenda and strategies especially of large companies. They click differently compared to a small entity and their responsibilities and decision-making process is distinct.
Find the right investor, someone who understands what he is investing in and fits to the stage you are in. He would carry you through tough times and not drop you if another financial round is needed. Take your time, reach out early to be able to develop strategies with the investor and get him involved.
Try to always have some spare money not to get squeezed, if you need more trials and experiments to fulfill a contract. Have a minimum reserve of operational costs for at least 6 months.
Market & Sales
Get a good understanding of the market. Be aware that accepting new technologies at the market will be a slow and stony process and that you will be facing many obstacles. The vision of a big market is not sufficient. Get someone in the team who is familiar with the do’s and don’ts to enter the market (e.g. one who is experienced with the admission process of the specific industry)
Last, but not least – Take the right decisions
Don’t lose track of your goals, see the clear north. Don’t take decisions just to proceed and to not lay off people.
Picture credits: Pixabay