Many life sciences companies are founded by scientists. But there is certainly a path, somewhat less trodden but nonetheless viable, for the inspired entrepreneur who may not be a brilliant researcher.
Each year, over a million companies are started in the US with about 5–10% (57,793 in 1998) of them classified as high technology companies1. Many nascent entrepreneurs exist around us, and thinking about starting a new venture is not an uncommon activity—in fact at any given point in time, over 4% of the working age population might be thinking of an idea for a new venture2. Not surprisingly, turning ideas into business ventures is tricky: only about 10% of budding entrepreneurs have a new firm in place within 12–18 months3; the other 90% either fail to define a sound business model that can drive their business idea forward to a new venture or realize their idea was flawed.
A key ingredient in successful entrepreneurship is self-knowledge. If entrepreneurs know their limitations and strengths, they may be able to avoid some common pitfalls in starting up a biotech company. In this article, I distinguish between two types of life sciences entrepreneurs and highlight the traits of each.
Turning science into business
Typically new life sciences venture is started up in the United States when a scientist, through initial government or foundation grants, discovers a pathway or mechanism in biology that is particularly interesting and appealing for disease intervention or treatment. The scientist then files a disclosure through the university office and begins discussions with the technology transfer or licensing officer at the university about commercializing the discovery. She or he then writes a small business innovation research grant to fund the startup activities, rounds up some collaborators (other scientists or business associates) and licenses the discovery from the university.
The scientist-entrepreneur then has two choices: either continue in the university position while developing the company on the side, or leave the academic position (permanently or temporarily on a leave of absence) to actively pursue the commercialization of his or her discovery. In the latter case, funding comes from personal funds, second mortgages on residences, loans, friends, families and other angel investors and venture capitalists. The venture is launched, typically focused on products, with a business model of forming a fully integrated company.
Read the full article at Bioentrepreneur
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