Lindy Fishburne, a deep science investor, co-founded startup and early-stage venture company Breakout Ventures a few years ago after co-founding Breakout Labs within the Thiel Foundation in 2011. She has amassed a large number of holdings in the process. Her company’s portfolio companies include Cortexyme, an Alzheimer’s disease treatment company. the sustainable materials manufacturer Modern Meadow; and Strateos, a company whose robotic cloud platform is redesigning the way the laboratory works.
We spoke with Fishburne late this week about where we are – based on what she sees – on the arc of this pandemic. We also talked about why more of their investments that once looked like long shots are suddenly looking like solid bets. Parts of our chat below have been edited slightly for length and clarity.
TC: We’d like to see what progress has been made in vaccinating Americans. What is your sense of things based on the conversations you have?
LF: The speeding up of vaccines is like nothing we’ve ever seen in science, and now we’re really down to the unsexy part of the logistics of introducing them. That is clearly our greatest challenge. Then the next thing we need to do is deal with what happens when the world is vaccinated [at] very unequal levels and how people feel about travel and exposure and equity on these issues.
TC: Science was the big story of last year. Have you heard from investors and potential consortium partners who have not contacted you before?
LF: Yeah. The pandemic has greatly eased the importance of investing in science. For the first time, we’re really seeing a slew of traditional tech investors reading about the mRNA vaccine that Moderna encoded over a weekend and starting to believe that we are able to develop biology and biology that it is itself no longer feels like an artisanal process.
TC: You are talking about coding a vaccine. Are laboratories becoming less and less important as scientists are able to do a lot more in simulation, and if so, what does that mean for human testing? Are we getting to a point where we no longer have to rely on human testing as much as we did in the past?
LF: We hope to come across the human test piece there. We are not there yet. You may have read and heard about organs on a chip and growing organoids where you can have a very small piece of liver to test for toxicity [and] We’re doing more of it. That said, we’re not ready to make that leap from fully executing in silico to super-confident people. The human body is such a complex system that we cannot yet fully model it.
I think what you are pointing out, to some extent, is democratization in science and access for more people with fewer skills to be able to work remotely in drug discovery and development. For example, we have a company called Strateos that we worked with that has a full robotic lab that, instead of having technicians standing there, has robots and a small railroad track that moves assays around the room so scientists can That was stuck at home that year, experiments could continue regardless of their geography or safety in the laboratory or time constraints.
TC: You have another interesting portfolio company, Opus 12, that converts industrial carbon dioxide emissions into chemicals. For what purpose?
LF: Obviously, decarbonizing the world is a big focus. And you see for the first time that companies like United Airlines are making commitments on what their carbon footprint will be, or that they will no longer cause carbon emissions. Opus 12 emerged a few years ago from two PhD students and an MBA at Stanford. Your breakthrough is a catalyst material that you can use, for example, to waste CO2 – the bad stuff – and let it run through that catalyst material and produce useful CO. This year, for example, they worked with Daimler to produce green polycarbonate auto parts. The material is exactly the same, which makes it easy to fit into existing products, but it’s actually made by reusing carbon.
The shift in consumer awareness of carbonaceous materials is a tremendous opportunity.
TC: Do companies get some kind of carbon credit for this?
LF: Yes, and in the past we’ve seen a lot of companies try to green themselves by basically buying and trading carbon credits and the shift we’re going through is everyone saying, “Okay , to some degree, that was a bit of financial engineering; Now we really need to see these companies change their direct fossil fuel use and direct impact on the amount of carbon. ‘ [There’s growing awareness that] Buying carbon offset payments will not be enough. For the first time you are really seeing commitments to change processes, supply chains and ultimately products.
TC: In the past few years, biotech companies went public two and three years after they were founded. Now we are seeing a much larger number of younger companies being turned into public companies by a growing number of blank check companies. Any thoughts on whether or not there are parallels here?
LF: On the therapeutic side, you usually have a very clear playbook about what the potential exit is and who the acquirers are. We know that big drug companies are cash rich and pipeline poor [these pharma giants] need to pick up the assets that are working and you see them do that on a regular basis. And you have comps and you know what that looks like. So when you place a wide range of bets on early-stage therapeutics it is clear that if you win, you are covered.
The SPAC world is going to be really interesting as most of these companies are not working with traditional playbooks and it is not clear whether they will act as public companies for longer term. Are They Really Set Up For Acquisition?
[Another] The difference is that these companies will have this tremendous amount of funding and still not be able to operate in the dark, the traditional metrics we all want [in] With public companies and sales and profits and these metrics, we need to look at these SPACs and their growth from a different perspective, and I’m not sure how receptive the public markets will be to that in the next 24 months. I think it is unclear whether we will have a settlement there or not.
If you’re curious to learn more, including why there might be new cash pots in sight for deep tech startups, you can hear the full conversation here.