Intro - 00:00:06: Welcome to The Biotech Startups Podcast by Excedr. Join us as we speak with first-time founders, serial entrepreneurs, and experienced investors about the challenges and triumphs of running a biotech startup from pre-seed to IPO with your host, Jon Chee. In our last episode, we spoke with James Evans about his time at MIT's Whitehead Institute, his journey towards entrepreneurship, and how he created the unique work culture at PhenoVista. If you missed it, be sure to go back and give it a listen. Today we are excited to chat with James about solving recurring problems in a startup, the difference between being bootstrapped versus finding venture funding, how to make clients feel secure in your business, the importance of being scrappy, and why adapting and having backup plans is critical. So sit back, relax, and let's get started.
Jon Chee - 00:01:06: You need a lab. It sounds like you found the hoods for 500 bucks, which just sounds like a steal. How did you find your first lab space? How did that come about?
James Evans - 00:01:13: So here in San Diego, there's a JLABS which at least seemed like an option. And I don't know that we would have been allowed to go in JLABS, but we certainly looked at it as an option and it was relatively expensive and wasn't a great fit for our needs because the one thing that we needed lots of was tissue culture and that was at a premium within JLABS. And we're like, well, that's really the only thing we need. And so we kind of looked at the cost of signing a one-year lease at the business park that we're in now, which is the Cornerstone Court. It was more of a commitment. Like the commitment at JLABS was shorter, but from a dollars perspective, it was more expensive than signing a one-year lease. So like, well, let's go both boots in, sign up for a year and you know, we can cover the cost and let's just see if we can generate some business during that year. So we did that as far as lab space.
And then you know, like I said, we found those hoods, which was a fun adventure, but there was also a really great nonprofit that we used. I don't think it's going anymore. They would have this used equipment that they would get donated from big companies and you know, we bought like a centrifuge, you know, just a bunch of like generic lab equipment for a couple thousand dollars or something. We, you know, had all the basics. So that was really, really great too. And we've tried to sort of, you know, hand that equipment down. Companies that have started since and, you know, replace things. And we're like, well, this still works. We could do something with that. So we've tried to hand that down and things like that.
And then for us also being a service provider, we wanted to make sure that clients knew this wasn't just something we were going to do for a few months and then get real jobs or something. So, you know, having real sort of brick-and-mortar lab space, you know, really try to convey the fact that we planned to be around for a long time. But yeah, it was. Signing that first lease was nerve-wracking.
Jon Chee - 00:02:55: Yeah, I'm sure. I mean, it's a big commitment. And I love hearing this story because I think especially nowadays, it almost feels like dogma. You must run a company like this, fund it like this, and it's kind of like this, one step after the other, predetermined. It's kind of like run the playbook. But what I'm hearing is very much a kind of blazing your own path. And it works sometimes.
James Evans - 00:03:18: Yeah. I mean, so far.
Jon Chee - 00:03:19: Yeah, yeah, yeah. I mean, you know, fast forward a decade later. I think that's something to be proud of. Absolutely. And I love to hear that. It's kind of like a choose-your-own-adventure in the world.
James Evans - 00:03:29: It's funny how I went for a walk before this. I was telling my wife, she works from home a lot too, and I was like, oh, God, just listening to these other podcasts. Those guys are rock stars. I was like, I guess I'm scrappy. And she's like, yeah, you're totally scrappy. And like, you know, you're a problem solver. And I'm like, yeah.
I mean, I think that's what Jake was saying, like when growing up in Guatemala and having a plan A, B, C, D, and E, and going back to when we started the company and not really having a plan so much as a strategy as much as like, okay, well, if something comes, we will do our best to take advantage of it. And I think that's really a hallmark of entrepreneurship, I think is just like everyone has a plan until they get punched in the face. Yeah, you plan as much as you like, but at the end of the day, nothing's going to go the way you think. So just, you know, adapt as it comes at you. But yeah, it's definitely a challenging ride. Yeah.
Jon Chee - 00:04:19: And that's amazing because I actually say that on my morning meeting sometimes to the team internally, because it's exactly that. And I think being light on your feet and just being able to kind of adjust with what comes is super critical. Like super critical. And I think even with outside investors, they want to know that you're quick on your feet too. And I think it is probably better to just admit that, like, you know, some of the things we don't know and we're going to have to figure out on the fly. Because if you have it all figured out and you present it as such, they'll sniff it out. Like, do you really have it figured out?
James Evans - 00:04:48: Right. I mean, it's like this year, right, everybody's been kind of caught out by disruption in industry and credit challenges that people are having. And it's been hard. It's been a hard few years. Yeah. Every year there's been something, a new challenge, you know, with the pandemic and then supply chain issues, labor shortages, and then this year's thing. It's been a really challenging year. And I'm very grateful that PhenoVista is still growing and got great clients and good repeat business and stuff and growing our team and everything. But it's like an ongoing new challenge and you just wonder what next year is going to be like. Yeah, it's nice, predictable, easy growth year. Yeah, we do one of those. Yeah.
Jon Chee - 00:05:26: And I'm sure it's invaluable to have built the muscle early days on being efficient. Keeping the lights on without outside investors is no small feat. And I think that's a lesson that anyone can find value in. It's just treating the dollar as such.
James Evans - 00:05:41: Yeah. I mean, I can't take full credit for it. I mean, it's really the team in the lab especially, obviously the commercial folks too. But in the lab especially, doing more with less and really aligning on what the daily, the weekly, the monthly, the quarterly goals are like. Okay, what do we have to get today? Who's doing what? No one's sitting around.
There's a lot of things that just I'm not part of anymore that the guys here, Tony and Chris and the lab, really make sure that there's really good communication and coordination amongst the team as far as priorities go and making sure the quality of work is always there. And if that's not happening, it doesn't matter what I say, you know, be more efficient, spend less money. It's not going to happen unless you got buy-in from the team. And we're really lucky to have high-quality folks working for us.
Jon Chee - 00:06:28: Totally. And if we're going to think about the PhenoVista journey as divided into eras. Were there any key takeaways of specific eras of PhenoVista and how did you problem solve that? And perhaps someone else could find value in how you did that.
James Evans - 00:06:41: So getting professional business development involved was an inflection point where we started to know how to do sales. More than learning what you've learned as a customer, it's a real skill to be a professional salesperson and BD and marketing and all that. So bringing that capability in-house after like four years or so on like that really helped us professionalize that aspect of the business.
I would say after that sort of the third phase of PhenoVista has really coincided with the taking on outside investment and really looking at operationalizing or industrializing, making the business more scalable and getting handles on key metrics for productivity and success and making sure that you know, you aren't doing things that are losing money or if you are, like fixing them early on in the business. Just do stuff, don't think, just do better things. You know, now the stakes are a lot higher and it's more about creating efficiencies and priorities, things like that. So yeah, that's kind of the three stages. So sort of initial startup scrappiness, do anything but just do something, to then having professional help on key parts of the business, and then this third phase of the scaling.
Jon Chee - 00:07:55: Totally. And I'm always curious about the sales and marketing efforts and I know you work with large institutions and smaller folks as well. And I guess early days it was like almost door-to-door sales for anyone who's looking to secure new business with big folks or small folks. Are there tips and tricks for anyone looking to do that?
James Evans - 00:08:12: And I wish I had the secret sauce. It's hard. Yeah. I mean it is still knocking on doors. There are tools and there are agencies you can use, but it's a mixed bag. And I think the hardest thing is, you know, and it sounds contrived a little bit, but if you find something that works great, have a backup plan because it's probably going to stop working in three to six months. So you always got to be having a multifaceted approach. I mean, did you imagine you'd be doing podcasts three or four years ago? Right.
Jon Chee - 00:08:40: Actually pushed back against it. I had my arm twisted.
James Evans - 00:08:43: Yeah. Yeah, it's great. I mean a lot of companies are doing it and it's a great way to showcase that you're involved in this area and your approach on things. But yeah, so it's constantly evolving. Whereas like email campaigns might have been a thing that worked, you know, last year people's filters evolved to it and they stopped working. So you're back on the LinkedIn cold calls and phone calls and now the world is kind of slowly opening up and people are getting more amenable to in-person meetings and lunch and learns, sponsoring coffee socials and things like that. So do all the things. Yeah.
Jon Chee - 00:09:20: And I keep thinking about skateboarding. Like I keep going back to that. It's like again, you just try and you try and you try and you try until you land it and then you move on from a kickflip and you try to do heelflips and then you know, and then you have to learn something new and then you just continue to level it up and level it up as best as you can. And once you've secured these clients, and I think for founders who are starting off, they may not know that working with a small business is very different than working with a big business, which is also very different than the government. What has your experience been working with a diverse clientele and maybe let's start with the big folks, right?
James Evans - 00:09:56: So big folks for the small folks. Big folks take forever to get all the paperwork done. And so if you're just starting to have a conversation with a big pharma client, you might not see any money for six months. It might take that long. Like working through some of the marketplaces can sometimes speed that up. So like Science Exchange and Scientist.com, those are both great resources that we use and those can speed things up. But then big pharma companies can vary within that group, you know, some better or faster than others. I think small companies tend to be faster.
But I'd say the biggest difference is the maturity between big companies and small companies. Big companies, the people there are usually more experienced at working with service providers and know the process and the dance and what's reasonable to ask for and what's considered mission creep and what's unreasonable and the kind of just the professionalism. And it's not all, but you know, some of the smaller companies and of course small companies range from one or two people to 300 people. So there's a big range.
But there are definitely more instances with small companies where, particularly if the companies come from... Right now there's a lot of AI companies that maybe don't understand when you ask somebody to replace the cells or you're doing the experiment today. "Can I change all the conditions?" You're like, no, that's not acceptable. And part of it is, you know, on us too, you've got to make sure you set expectations. And this is just a learning process for us, right? Learning the different types of clients that you work with and what they come to the table with as far as their experiences and sort of making sure that they know how things are going to go. But yeah, with bigger, they tend to know what they're doing and it's usually smoother sailing though slower.
Jon Chee - 00:11:34: Yeah, totally. And the dance with government labs and going through the procurement, do you have any experience with that or tips and tricks on that?
James Evans - 00:11:41: Only from past lives. There can be, you know, big company on steroids. So even worse and even slower and even more bureaucracy. We've had some grants but that's not so bad because it tends to be sort of more creative work. But we don't necessarily do a lot of government contracts right now. But my past experience would pre-warn me that it tends to be a lot of paperwork and very slow. But it can be a meaty, decent-sized project. So it can be worth it.
Jon Chee - 00:12:03: Absolutely. And just kind of looking forward now we've kind of done a retrospective. What's in store for PhenoVista in the next year or two?
James Evans - 00:12:10: Yeah, right now. So we are scaling our revenue. We're launching some new off-the-shelf services that are pretty exciting in the areas of cell and gene therapy. So some new services that really support AAV uptake into different human cell types, some functional assays so that this is all stuff that's going to launch in the next six months. But then really we're tackling some toxicology areas as well using cell painting which is pretty exciting right now.
And then continue to grow. Probably another series of fundraising in the next year or so which would enable us to develop some essentially knowledge management platforms that we're looking at. So our measurement technology, imaging is really rich in data and being able to measure abundance in space and time in different cell types and locations within cultures. And then of course you got the disease model. So it's a really rich environment to model biology. So it's an area we're looking to explore in terms of capturing that information with some of our AI tools that we have.
Jon Chee - 00:13:12: I'm so excited. I just got pumped up just hearing about what's on the roadmap. That's so cool and thank you for your time James and I really appreciate it and I just have two closing questions I'd like to round things off with. Would you like to give any shout-outs to anyone who supported you throughout your career?
James Evans - 00:13:27: Oh, yeah. I mean, like I mentioned Alan and Pam back in grad school, really us, Waterme and everybody in the lab back then in Paul's lab, you know, Paul in particular. And then I worked with a really talented postdoc there, Ivan Corayer, who really supported me in terms of getting to know my way around MIT and Whitehead.
And obviously Sanjoy really has done a great job of equipping me with plenty of caffeine back in the day. So Sanjoy was always an English gentleman. He would be dressed in a suit and would wear a hat and you know, he'd look very dapper. And I was always kind of skate punky and really disheveled and different color hair and things like that. He would always buy me coffee. So I definitely still enjoy several thousand gallons of coffee.
But and then just ongoing, I mean, especially right now as the advisors that we have at PhenoVista who just, you know, are really experienced and give us great advice on dealing with the stuff we're learning on the go. So. Yeah, it's just so many people that have helped along the way.
Jon Chee - 00:14:27: Yeah, I always think about this and how critical it is to have a team. And I'm always so grateful for the generosity of these people. Like, you know, early days they don't have to take that meeting with you, but they did.
James Evans - 00:14:38: Yeah. In that. And even more shocking is the people who believe in you and join your company. Yeah, yeah. And they're like, you're like, oh yeah, okay, I'm going to take a job with you and I believe that we can make this work. And yeah, that's always super humbling. And especially it's easy when things are going well, but when things are tough, you know, and it's challenging and you know, people stick by you and work extra hard to make it happen. It just makes you want to work even harder to make it happen. So that's really humbling. Yeah, yeah.
Jon Chee - 00:15:07: And one last question. If you were to give any advice to your 21-year-old self, what would it be?
James Evans - 00:15:13: Do more yoga. I wish I'd done more yoga back then. That would help. But yeah, I always wish I had been more skilled in sort of computational approaches where I would all like throw together some code and things like that. But I think everything's going all right. It's working out.
Jon Chee - 00:15:27: Yeah, no, totally. Actually, nowadays I have to make a concerted effort to actually stretch after being hunched over at a computer all day. It's important to not lose sight of your general physical well-being as well.
James Evans - 00:15:38: It's super important. I mean, like, we haven't got a chance to sort of touch on that. But as far as dealing with the stress, definitely looking after your body is part of being an entrepreneur and looking after your cardiovascular, your mental health, I mean, these are really important things that people don't tend to talk about enough. But yeah, I would say that's part of that puzzle, you know, is definitely making sure you're physically and mentally in shape to deal with the ups and the downs there.
Jon Chee - 00:16:03: Yeah, totally. And entrepreneurship on paper kind of looks like just a purely cerebral exercise, but it's very physical. If you don't take care of your body, you won't be able to show up to work. So I'm the same, like, tried my best to not just have atrophy and just, you know, wither away. But James, thank you so much for your time. It's been super fun.
James Evans - 00:16:23: Yeah, thanks for having me on it. Yeah, it's really always very great talking with you and thanks for asking me to be a part of it. I'm looking forward to whoever comes next and will be tuning in.
Jon Chee - 00:16:32: Yeah. And I'm so grateful that we're able to do this and also to be able to work with PhenoVista. So thanks again and maybe next time we'll do another deep dive on other aspects of company building. Thanks again.
James Evans - 00:16:41: Yeah, thanks, Jon.
Outro - 00:16:43: The Biotech Startups Podcast is produced by Excedr. Don't want to miss an episode? Search for The Biotech Startups Podcast wherever you get your podcasts and click subscribe. Excedr provides research labs with equipment leases on founder-friendly terms to support paths to exceptional outcomes. To learn more, visit our website www.excedr.com. On behalf of the team here at Excedr, thanks for listening. The Biotech Startups Podcast provides general insights into the life science sector through the experiences of its guests. The use of information on this podcast or materials linked from the podcast is at the user's own risk. The views expressed by the participants are their own and are not the views of Excedr or sponsors. No reference to any product, service, or company in the podcast is an endorsement by Excedr or its guests.
