Sep 13, 2017, 11:53 AM ETInterview, Fireside Chat

Elizabeth Iorns on Biotech Companies in YC

Elizabeth Lyons, PhD, is the founder and CEO of Science Exchange and a cancer biologist by training.
She completed a PhD at the Institute of Cancer Research in London and a postdoc at the University of Miami before leaving in 2011 to launch Science Exchange.
Science Exchange participated in the Summer 2011 batch of Y Combinator (YC).
Two years prior to the interview, Lyons joined YC as a part-time partner in the "Expert Program" to assist biotech applicants.

Capital Access: The program has facilitated over $200 million in capital raised for participating biotech companies, often exceeding what they could raise through traditional biotech venture channels alone.
Cross-Sector Crossover: Companies gain exposure to diverse sectors like artificial intelligence, leading to unexpected funding and technological crossover opportunities.
Focus on De-risking: The 3-month program prioritizes de-risking technology (e.g., achieving proof of concept in animal models) and refining go-to-market strategies over fundamental experimental breakthroughs.
Experimental Acceleration: Companies utilize funds to outsource critical path experiments, such as proof-of-concept or efficacy studies, to external service providers to generate regulatory-ready data quickly.
Market Clarity: The program helps teams define minimal viable products and navigate the "translation gap" between academic discovery and clinical application.

Biotech founders typically do not require a separate business co-founder, as the market potential for curing specific diseases is often assumed to be massive.
The primary barrier for scientists is technological risk, not market validation; therefore, scientists can often manage business strategy if they possess strong articulation and grant-writing skills.
Unlike software startups where market fit is a primary early question, biotech teams focus on proving biological mechanisms and reducing technological uncertainty.

The "Postdocalypse": A surplus of PhDs and a lack of academic faculty positions has driven graduates to consider industry entrepreneurship as an alternative career path.
IP Complexity: Intellectual property in academia is generally owned by the university; founders must navigate tech transfer offices to license IP, a process where YC provides strategic support.
Timing: Founders often emerge near the end of a PhD (median 7 years in the US) or postdoc, looking to commercialize discoveries before the "7-year itch" of academia becomes untenable.
Misconceptions: Many PhD students incorrectly believe venture funding is a loan requiring personal repayment or are unfamiliar with corporate structure and liability protections.

Capital Intake: Successful YC biotech companies have raised significant seed rounds (several million dollars) and are progressing toward Series A funding.
Investor Demographics: Early-stage investment is driven by traditional Silicon Valley funds (e.g., Andreessen Horowitz, Founders Fund, NEA, Coastal Ventures) rather than just legacy biotech VCs.
Investor Motivation: Funds are increasingly interested in "science-first" founders who possess deep domain knowledge of discoveries, filling a gap left by traditional biotech funds that prefer repeat professional entrepreneurs.
Market Gap: There is high demand for early-stage companies with proof of concept data that can transition from academic labs to clinical studies.

AI in Biology: Significant innovation is occurring in using AI to predict drug efficacy and toxicity during pre-clinical stages to reduce clinical trial failure rates.
Clinical Trial Design: Innovations include designing Phase 1 trials with early efficacy endpoints rather than solely focusing on dose escalation and toxicity.
CRISPR Applications:
- CRISPR is viewed as "game-changing" compared to previous RNAi technologies due to its ability to fully knock out genes rather than just downregulate them.
- Near-term traction is expected in editing genetic defects and RNA editing (transiently modifying gene expression), which may face fewer regulatory hurdles than genomic editing.
Longevity & Life Extension:
- The field is currently hindered by a lack of robust clinical endpoints in humans to measure intervention success quickly.
- Paradoxically, parabiosis (blood transfusion between young and old mice) has shown consistent effects in extending healthspan, though the specific active factors remain unidentified.
- Calorie restriction shows mixed results across different animal models (rodents and primates), creating controversy over its efficacy.

Elizabeth Lyons practices fasting for approximately 36 hours monthly but notes it significantly impairs cognitive function during the fasted state.
She rejects the use of supplements or nootropics in favor of researching personalized dietary responses.
Current research into individual responses to food suggests significant variability in population efficacy (e.g., paleo diet results), driven by genetic diversity.
Key metrics for understanding personalized diet responses include continuous monitoring of insulin and glucose levels.