SDBN Bootstrapping Biotech Final

Bootstrapping Biotech

Bootstrapping BiotechWifi Password: tanguero

Presentation: http://sdbn.org/bootstrap

October 29th, 2009 SDBN Networking Event

Bootstrapping Biotech

~60 min. presentationInterrupt at any time

http://sdbn.org/bootstrap Presentation & ResourcesVideos of eventList yourself!

What is Biotech?Area Products Customers Examples No. in SD

County*Biotech/Pharma Therapeutics Investors/Partners,

ConsumersAmylin, Intellikine

133

Life Sciences Research Tools & Services

Research Scientists Invitrogen, Millipore

278

Medical Device, Diagnostics

Point of Care Tools or Tests

Clinical Researchers BioSite 74

Biotech/Ag Biofuels, Food & Consumer Products or Additives

Investors/Partners, Consumers

Sapphire Energy, Verenium

53**

*Data from Biocom’s Product Database**Additional data provided by CleanTECH San Diego

val⋅ue  /ˈvælyu/ noun, verb1. relative worth, merit, or importance: the

value of a college education; the value of a queen in chess.

2. monetary or material worth, as in commerce or trade: This piece of land has greatly increased in value.

3. the worth of something in terms of the amount of other things for which it can be exchanged or in terms of some medium of exchange.

Value

CreateGetting fundingWhat is your product?

CommercializeFinding & protecting technologiesTurning products into profits

CommunicateWho cares?

Steve Scott

CEO of Technology Acquisition GroupOver 25 years leading companies to the next level. Frequent Interim CEOSix acquisitions, 3 turn arounds14 boardsLaunched over 220 products300 million raised Twitter: Steve Scottstevescott@techacq.com

Lorna NeilsonFounder and Principal, inGENEuity Life Science Group, LLC

Ph.D., Molecular BiologyOver 17 years in Biotech/Life Science Industries

Corporate & Business Development, Licensing, Marketing, R&D

– Large and small public companies and start-up private companies» Applied Biosystems, Invitrogen (now Life Technologies),

Sequenom, GeneFormatics, Reprogen, Isis Pharmaceuticals

Certified Licensing ProfessionalServed on several M&A due diligence teamsLead negotiator/ integration leader for company acquisition by Invitrogen

Mary Canady

Founder & Principal, Comprendia LLC & SDBN

10 yrs at bench & computerHighly technical structural biology research

9 yrs marketing & business developmentLarge (Invitrogen, Calbiochem/EMD) & small biotech/life science

Social mediaEstablished biotech & scienceBlogger/microblogger, thought leader

David WelchWritten, directed, and produced more than two hundred films, videos, and commercialsBroadcast-quality presentations cover all three sectors of biotechnology and have focused on:

immunotherapies, Alzheimer’s, MS, various cancers, cellulosic ethanol and biofuels, malaria, transgenic seeding and genetically enhanced farming methods, gene silencing, and animal viruses

First Place honors for several biotech videos in major national film contests. Jim Greenwood, CEO of the Biotechnology Industry Organization, calls David Welch “one of the best in the business when it comes to telling biotech’s story.”

Give Me MoneyPresentations which Attract

Investment

Tell Them What They Want to Know

Steve Scott, CEO, Technology Acquisition Group

Bio-BMonitoring with Style

San Diego, CA

Problem – Crippling Costs

ResearcherLack of Quick Subject IdentificationHigh cost: estimated 25% of staff timeLoss of sensor and data stream

ResidentDesire for individual styles

The Problem

What pain does your solution solve?How big is the problem?How much does it cost?Ideal customer

Bio-Bling

Sensitivity Measurement

Your Solution

Picture of productDiagram of product or serviceMain benefitHow much does it save

Simple Distribution

Standard Lab SupplyCatalogWeb3 distributors signed

Promotional

How do you generate revenues?

Operate your businessGain market share – Go to market strategyFocus on realistic operation and distributionOnly the most important points

Market Growth

Dollars (m)

Marketing and Sales

Size of opportunityMarket segmentsServed available market is keyGraphics best

Competition

Painful

Easy

Slow Fast

Tatoo

Color Dot

Isolation

BLING

Competition

Competitive landscapeDirect and indirectMap

Competitive AdvantageMatrix

Technology

Color change based on chemical sensor and temperature changeFuture activity/passivity sensing

Underlying Magic/Technology

Concepts onlyDifferentiation from competitive methodsIP strategy mentioned in presentation

Projections

Year 1 Year 2 Year 3 Year 4 Year 5

Revenue 1,600 5,300 18,300 31,000 41,000

COS 400 1,325 4,575 7,750 10,250

SG&A 240 795 2,745 4,650 6,150

Net Profit 960 3,180 10,980 18,600 24,600

Projections and Milestones

Typical 5 year forecastReview possible revenue sourcesTotal RevenueCOS, SG&ANet ProfitSome add residual cash lineDon’t need details

Management Team

CEO – E. X. HarveHarvard MedicalKatrina Rodent Project

CTO – Keep M. GlowingCTO 25 yrs - Dow Chemical DOD

CMO – M. SlingerFormer CMO – Roche, J&J, Fischer, Beckman, K-Jewelry, Mousekateers

Your Team

Sell your accomplishmentsHigh value associations

Schools, companies, awards, big titles

One of most important slide in presoOffer a plan to fill gaps

Use of Funds

Funds Raised 750K

Your Funding Need

How much are seeking?Use of moneyHow long will it lastWill you need more money later?

Corporate Development

Yr 1 Yr 2 Yr 3 Yr 4

Phase IDevelopment

Petri RingDevelopment

Pilot Test

Scale up Production (II)

Yr 5

Exit

Scale upProduction (I)

ProjectMilestone

FinancialMilestone

Fund Raising (I)US$ 750k Fund

Raising (II)US$ 1.5M

Yr 0

Market Launch

Status and Timeline

Show what you’ve doneWhere you areWhen you will do the next stepsTechnology, business and fundingExit planGantt chart or timeline

Strong market demand

Scalable product Large cost improvement

Time savingIndividual identity

Seeking $750,000 for market launch

Contact: exHarve@biobling.com

Summary & Call to Action

How much capital are you seeking?Key strengthsContact info

Life Science Group, LLC

CommercializingTechnology & IP Strategy

Position for Success

Company Core Competency

Technology TrendsMarket Needs

Ideal position for new ventures

Ideal position for new ventures

Commercializing R&D

Idea

Lab

Proof of Concept

Commercial

Produc

t

The Development

Gap

The Development

Gap

The Development Gap

Too Newlack of validation by other parties and/or commercial acceptance

Too early in development vicious cycle - need money to complete development

Weak IP positione.g., early patent applications or need 3rd party IP

Solution for Patent Problems

Key Strategies for Success

Must have a business planExecutive summary, team biographiesProduct(s) description, including IPMarket and competitive researchGo to Market planDevelop a budget/funding strategyHave intellectual property (IP) strategyThink about exit strategies

Intellectual Property

Different factors to considerOne strategy per product or technologySeveral strategies for the businessFunding consideration

PatentsTrade SecretsTechnical InformationKnow-How

IP Strategy

IP creates value by giving investors confidence to investDiscourages others from trying to develop the same technologyThe starting point in develop IP strategy that fits company business objectives

Development Parnerships

Research GrantsUniversities, Foundations and Research InstitutionsBiotech to BiotechBiotech to Big Pharma or Dx

Getting Started

Bi-lateral AgreementsJoint researchInvest in the biotech companyUp front payment and/or milestone paymentsSponsored researchOpting in, Opting out – at different stagesDistribution

What to Pay Attention ToLicense FeesJoint funding of development, manufacturing, commercialization, or marketingLoansEquity InvestmentsJoint InvestmentsSteering TeamsIntellectual Property Issues (prosecuting, enforcing and maintaining patents)Transferability

Agreements Are Often Interrelated

R&D

IP License

manufacture

training

consulting

Services

Distribution

Investment

Technology licensing occurs in the context of a business relationship in which other agreements are often important

An IP Strategy Has 3 Goals

Secure freedom to operateEstablish control over intellectual property assetsDevelop and assert an IP portfolio that provides meaningful exclusionary power for the company’s products in the market

Preparation For NegotiationWhat is the business reason for this license?What leverage do you have?What is the time frame for signing the license agreement?What data and documents do you or the other party need?What are your positions on the key issues of the license?What is your negotiating strategy?Will you need preliminary agreements?What are the strengths of the other side?

Term Sheet

The Term Sheet provides a solid foundation for negotiation

Clarifies issuesShows problem areasCommunicates to each teamClears positionsKeeps track of goals

SummaryA technology at any stage of development may be appealing to an industry strategic alliance partnerLicensing and commercialization occurs more often between people who know each other – network!There are many approaches and ways to structure dealsProper management of IP assets can create greater value for the company

Resources

Licensing Executives Society (LES) www.lesusacanada.org

Association of University Technology Managers (AUTM) www.autm.net

inGENEuity Life Science Group, LLC www.ingeneuityllc.com

Marketing Plan: Commercializing

Market ResearchWhat do your customers want?How much are they willing to pay for it?What is your customers’ perception of you?Format

InterviewsFocus groupsOnline survey

Marketing Plan: Commercializing

Customer ProfilingWho is your customer?What are their daily ‘pains’?Where are you likely to reach them?

Marketing Plan: Commercializing

Competitive AnalysisIdentifyAnalyzeIs your offering unique?How will you compete?

SWOT AnalysisStrengths, Weaknesses, Opportunities, Threats

Marketing Plan: Communicating

Positioning & MessagingWhat is your niche?What is your value?How will you compete in the long term?How will you communicate your message?

Communication TacticsMaterials

ContentBrandingPrint & online mediaPresentations

PlanningCampaignsConferencesPRMedia placements

Communicating 2.0

Smaller companies can do moreGet by with help from friendsEngage, don’t broadcast

Social Media: How?

Create a community that cares about you & your productSpend more time than $$Learn from others

http://sdbn.org/sdsms http://sdbn.org/sms

We can help! http://comprendia.com/socialmedia

Check out the Appendix & http://sdbn.org/bootstrap for more information

Case Study: SDBNSan Diego Biotechnology Network

Founded Oct. 2008 by Mary & PartnerMission: Promote communication in the San Diego Biotechnology communityMonthly events focus on hot science, networking, and workshopsPromotion via Social Media (SM)

LinkedIn (2100+)Twitter (950+)Meetup (175+)Facebook (300+)

Amazing growth—85-100 at each eventBranch out to charity events, mini-conferencesEngage Scientists in SM to help grow

Case Study: TigerTox

Inspired by Comprendia, SDBNBuild Toxicology ‘community’

Needs: Logo, Website/Blog, PowerPoint TemplateBioStartup™ Marketing KitCreative Brief Process

Case Study: TigerTox

Complete PackageAlso Provided

TrainingMaterials

Blog/website upFull story

Bootstrapping Biotech

Science Communication 101

What we will discuss:The importance of videoHow to leverage social mediaIntegration of video with traditional public relationsCreating a buzz

Biotech Branding Campaign

What is it?Why are we doing it?How are we doing it?

Biotech Branding Campaign

Telling the Story

Why it’s important to use stories to communicate science:

Stories help put a human face on the biotech industryThey show how science offers hope to the world

Telling the Story

Using videoWhy it’s important

If you can’t view this video watch it at http://sdbn.org/wcs1

Telling the Story

How video can help explain complicated science

If you can’t view this video watch it at http://sdbn.org/wcs2

Telling the Story

What are your options?

High-end video production Flip cameras

If you can’t view this videos watch them at http://sdbn.org/wcs3

Promoting videos through social media

Video 2.0

Video 2.0

Video 2.0

Cost and analytics

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Traditional Communications Vs. Web 2.0

Traditional 2.0

Press releases Press releases with integrated video

Earned media Free media (blogs, Twitter, Facebook, FriendFeed)

Top-down messaging

Bottom-up communications, grassroots education efforts (websites, creating an online movement)

Branding your product with paid advertisements

Building online credibility, creating a “buzz” on social media sites, online promotions

“Buzz”: Why You Want it and How You Get it

Leveraging your social media presence

Build your networkDevelop strategic partnerships

“Buzz”: Why You Want it and How You Get it

Self-promote ONLY after promoting othersKnow your audience and cater to their needsMake it worth their while to listen

Provide interesting contentRespond to feedback

How do you create a buzz? It’s simple:Communicate; stay informed; and differentiate yourself, your company, and your products

“Buzz”: Why You Want it and How You Get it

Next Steps

Find us after the presentation to be interviewed on camera for IAmBiotech.org Sign up on IAmBiotech.org and get involved!

Ask us how we can help you: http://WHITECOATstrategies.com

Appendix: Funding Resources

Resource DetailsSan Diego Venture Group Funding, events.Tech Coast Angels Funding, quick pitch competition.

UCSD Connect Workshops and resources for startup/early stage companies.

Keiretsu Forum Angel investing forum and network. Meets monthly in San Diego.

Biocom Myriad resources for established biotech and life science companies in San Diego. Searchable directory of local companies.

OnBioVC Detailed life science funding information.

SDBN Calendar, listing of networking, funding & support organizations, directory of companies.

Founder Institute Business incubator & executive training.

Southern California Venture Capital Community (LinkedIn)

Forum to connect & discuss funding in the region.

Xconomy Great resource for funding & general news about the region.

Appendix: Bootstrapping Resources

Tool Details Resources

WordPress Set up blog/website quickly & affordably. Comprendia Blog: WordPress Wrevol

ution

Google Apps

Gmail: Set up email host for company--mail will come from your domain. Google Sites: Create sites for sharing information. Google Wave (beta): Collaborate in real time.

Google Docs in Plain English

The Company Corporation Incorporate or form an LLC. Skype, Gotomeeting Inexpensive phone calls & webinars.

docstoc Document templates, including contracts, marketing plan.

Salesforce.com, SugarCRM Affordable Customer Relationship Management (CRM) software.

Amazon, PayPal Accept credit card payments.

OpenOffice.org Word processing, presentations, spreadsheets.

LinkedIn Manage contacts, spread the word, create communities.

Comprendia Blog: Getting Your Team 'LinkedIn' for Free Advertising