When our mutual friend, Saurav, introduced you to me, he introduced you as the Elon Musk of biotech.

Why did he introduce you like that?

You can always think about really big technology problems, but health has a particular calling.

Right?

I think we all have a story where we've lost someone, and usually somewhere along that journey, right?

Even we tell this part of the story to people, there's a moment where we just, we feel helpless.

And sometimes that's because there aren't drugs for the condition.

Sometimes it's because care is being denied.

Sometimes it's because we can't afford a treatment.

Sometimes it's because it's too late.

A whole set of different reasons for it.

And so I just find it super motivating to try to find solutions to the problems that take the people who are close to all of us.

And it's kind of that foundation where if you couple that with a willingness to ask really big questions, and frankly, a willingness to be wrong a lot, importantly, to accept when you're wrong, great things can happen.

And I think that's kind of been the core of the approach that I've taken.

That's led to a number of companies that have been founded north of '20, I think closer to '30.

And it's been a great honor to work with some outstanding teams that have led seven of these companies that have founded to become unicorns.

And we've had the ability to bring drugs and other products to market with the vision of trying to help transform society for the better.

I can't do that kind of math on my hands, but I think seven of 30 unicorns, somewhere around, like, a 22% rate.

What have been the common themes in the seven unicorns that you've been a part My thesis advisor back when I was in doing my PhD was Bob Langer and Ron Slicesacker.

And then Bob used to say, you know, all problems are equally hard, so why not go after the big ones?

So with that perspective, right, you know, you can basically look at any of these problems and try to come up with some core solution.

But the best way to have great ideas, as Edison said, is to have a lot of ideas.

So the way I think about it is start out, put a lot of ideas out there, be willing to be wrong, be willing to accept that you're wrong.

And the framework here is that what you got to do is just is recognize what is the core of the thing that you're trying to do, and be willing to see very, very early on that it's right or it's not right.

And I'd say one of the things that's happened in all good companies is somewhere along the journey, it's probably about nine months, twelve months in, something fascinating happens.

And that's this moment where you had your idea, you were convinced it was going to work, but then something comes up and it was just not what you were expecting.

And that's the moment where I think greatness can get created, which is that you can find that nugget because that is truth.

And if you can learn from that, you get the opportunity to point the company in the right direction.

I tend to think of company creation, it's all about perseverance.

Entrepreneurial life gets so glamorized, and there's so many dynamics you have to fight against.

People telling you you're wrong constantly, competition, bad luck.

And it all comes down to you willing to make it work and willing, putting that will to make it work.

I've seen that so many around entrepreneurs make them almost want them to fail.

And I think one of the things that Elon does so well, and I admire him for is just sheer drive, the sheer will that says, this is my vision, I'm gonna make it work.

And you got to imbue that not just to your vision, to your company, but to the whole team.

Startups, unlike established companies, are default dead versus default alive.

In other words, if nothing gets done, it dies versus a corporation.

If nothing gets done, maybe it dies over a century, but it essentially continues to live.

Exactly.

And you can almost think about it as almost like a gravity that exists around any company, which is you have to constantly fight those forces and cause the company to grow, cause the company to lift off, cause the company to get into orbit, and then continue from there.

And that constant drive, recognizing that look, starting up a company is one thing, getting a company through a series A is another thing, getting a company through a series B is another thing.

And as the company continues to mature, that evolution and that push is something that you have to continue to do right for the company.

You mentioned that as you're starting a company, you sometimes uncover a kernel of truth that could be the basis of something really big.

It could also be a distraction.

And oftentimes, those labels are put on different changes in strategies in retrospect.

How do you know that something's a great pivot versus a distraction?

It's hard.

Whenever you see something, the question is what is the ground truth?

And I think that's where you have to start because seeing something that might just be a slight tweak on your business model because, Oh, that sale was hard as one thing.

But when you get a piece of data, that's just, it's true, it's reproducible, it is durable, You owe it to the company, you owe it to the data to at least do the work and figure out what actually might be happening.

And you have to be a little careful, right?

Because when you're managing a company, employees don't want to be whip sawed back and forth.

It's an incredible distraction.

But at the same time, you got to do the work to figure out if what you're seeing, that signal is that signal that drives you into something greater.

One of the things that I found is that you want to not be the person that just changes the course because they're bored or because they don't have what it takes to succeed, but you also don't wanna be polar opposite, meaning that you don't want to change because you wanna stay the course.

How do you navigate that dilemma?

There's probably two different scenarios you can think about them in.

One is in the context of a company.

So one of the ways that I've tried to solve this in the past is to actually have a team who is specific focus is to look at these new insights and figure out what they might mean.

I would often call it a strategy team.

So we get an insight that causes an moment.

You can't often moment just go and say, all right, we're gonna go do this without doing the work.

Then you also don't want to take the whole company and have them take their foot off the gas pedal and start doing some other work.

So what I found that's really useful is having a dedicated group of people who can be deeply analytical, deeply thoughtful, understand the logic train that gets you there to go and do that work.

But then what you have to do at the back end of that is you've got to draw the conclusion, and then you have to make sure whatever conclusion it is, is communicated really clearly, I.

E.

Stay the course, or no, we're making this change.

But what I always find is that the vast majority of people, and this often can show up in a board CEO dynamic or a CEO management team dynamic, people want to stay the course, they want to keep doing what they were doing.

Sometimes it's because they had comfort in it.

Sometimes because they just naturally want to resist change.

Sometimes it's because they don't fully understand what the new opportunity is.

And of course, that's part of the CEO job, is to bring people along the journey and understand what that direction is.

But it is really important to be able to get there, convince yourself first, and then bring teams around you.

Sometimes you just want to go from 20,000,000 to 22,500,000.0 to 25 to 27.5, and that just feels good for everybody.

Even if you've missed a billion dollar opportunity or a $10,000,000,000 opportunity, just having that incremental progress, there's something very viscerally satisfying about that.

It feels safe, it feels safe.

And people will tell you, you always win by compounding.

But let's get into the honesty of it.

If you compound at a low rate, it's not as good as compounding at a high rate.

Is it much more difficult to change the direction of a company when you actually have a little success?

Is that really the most difficult part?

It's incredibly difficult to get companies to change when they're fully going.

And that's why I always think about the early phases of a company is so incredibly important, right?

When you, in the early days, there's not many people.

So you have tremendous control over culture, tremendous influence on culture, tremendous ability to make sure you're hiring the right people, people who live to those values, to the goals, to the virtues you're trying to instill in the company, but also people who have a shared vision.

And the people I think who joined companies in very early days are just driven by this passion to do something special.

And they're the sorts of people that they'll bring to you that funny thing when they see it.

And they want to engage with you in that conversation.

And they're looking for how we can do something that's great.

What happens when a company gets bigger is well, your systems get diffused, your hiring gets diffused.

And so sometimes the ability to hire people that are aligned with culture or aligned with standards or aligned with values tends to drift a little bit.

Because I have a goal, I have my near term goal that I'm trying to achieve and I need X, Y and Z number of people to be able to achieve it.

So I know at corporate we think about this, but in my little world, I think about my end to your goal.

It just creates this drift.

When you get companies that are at that size, inducing change, of course, is a much more complicated phenomenon that involves change management, bringing people along the ride.

And what you find is if you don't do it right, these little silos will go off and keep doing the old thing, and not follow along the journey in the way that you're intending the company to go.

And I actually want to give my brother a tremendous amount of credit on this.

When he built TripleLift, even as that company got to several 100 people, they were really strong at maintaining the quality of hiring, at maintaining the culture, and keeping an environment that kept the the community focused on the goal.

And to the point that when they were acquired by Vista, I think they had one of the highest scores in Vista's history for how the team was performing.

There's a psychological principle called negative contagion, which is the scientific explanation of one bad apple spoiling the entire batch.

One conventional thinking person that is a conformist could actually create a gravity around him or her to bring the entire company into this kind of small thinking.

And that's why I think it's so important.

Preproduct market fit is really where you're creating the the DNA of the company to keep that with truly first principles thinkers, with truly non egotistical people that can change course if needed.

100%.

I think when you can find people like that, who share the goals of being able to do something specific that has big impact, you're building a great team.

And then you get that alignment where people are driven by the end result as opposed to the means of being able to get there.

And the more people you can find like that in a company, the latter, not the bad apples, the better.

You you started $7,000,000,000 companies from beginning to scale.

Used to be this conventional wisdom that the people that started the company shouldn't be the ones that scale.

Do you find that to be true in that the true first principles thinkers can actually scale, or is it more that the middle management people can't be early employees?

When you think about what some of these companies do that are able to hyperscale and continue to scale and continue to grow and continue to innovate, you tend to see that founders are playing a really important role as you go along the journey.

Because, of course, the founder will help to set up the company in the beginning.

A founder will play, will make an important decision in setting strategy, trying to define that product market fit.

What I've seen often is when you then hire a CEO to replace a founder, one of the first things that that new CEO wants to do, they tend to undo a lot of things that that prior CEO or the founder may have done, and that creates challenges.

Now, in some cases, the company may have done its innovation, and now it just needs to rinse and repeat.

And in that case, probably a founder who's going to constantly innovate is not going to be the best way to do that rinsing and repeating, again, because it's a different mindset.

But the reason that hyperscaling companies hyperscale is they're constantly getting that data, they're constantly getting the information.

They're constantly asking the question, how can we do better?

And I think what they do really well, is they, these sorts of founders will say, what am I really good at?

Which is often innovation, visioning, ideation, creation, bringing people along, etcetera.

And what are they less good at?

Which is, for example, operations in some cases, and they'll surround themselves with outstanding operators.

So you can get the best of both worlds.

And I think that's a really important duality that when you can recognize what one is good at and what one is less good at, you can make an outstanding company come out of it, at all phases.

Double clicking on this $0 company, the companies that start out early and turn into billion dollar companies, how necessary is a culture of working seventy, eighty, ninety hour to becoming a billion dollar company?

What found is you can actually get a really good read on where a company is going, by how long people want to stay working at the company on say a day to day basis without being pushed.

So I think these mandated cultures of, we're gonna work twenty seven hours a day and never go home and sleep, when it's mandated, I don't think it works well because people burn out.

But when the team that you have has the passion that they just want to keep working on it, they want to make it, they want to solve it, they want to get it there, you know that something good is going to come out of it.

And you can actually feel that energy if you walk into a company where people are acting in that way with that kind of passion, it's in the air.

And I think people are more excited to go work there.

They're more excited to work late hours without being told that they have to.

And the output you get is, it's not just eight hours plus eight hours, it's much, much higher, because again, it's all about that drive.

Is that primarily a passion for the mission, passion for personal financial gain, a passion for problem solving, what underpins that desire to stay late at night?

A lot of it, especially when you're dealing with health companies, has a big part to do with the mission.

But I mean, the other two obviously are a big component of it as well.

I don't think it's one or the other.

But why would a computer scientist go to a health company as opposed to a tech company in the Bay Area?

It's probably because they're driven by the mission.

What would people say from the outside that have known you really well?

What would they point to your one or two superpowers that has allowed you to start $7,000,000,000 companies?

I don't know what people say behind my back.

But my favorite line that I've heard someone say publicly is was actually said by Bob Langer who called me fearless.

And what his framework on that was, is that you can pick the problem, but you got to run headlong into it.

You got to be able to say, it doesn't matter how complicated this is.

It doesn't matter that a lot of people said that it's hard.

It doesn't matter that it might seem unsolvable.

It's just you go and you push and you try to find that solution.

And I think that you could call it strong perseverance, could call it maybe an unwillingness to let go.

My wife would call it stubbornness.

I think that plays a really big role into it.

I think that phrase that I've used many times is, you know, if you're running to a brick wall, the question is, are you gonna hit the brakes and leave a skid mark or are you just gonna go right through?

And I always like to think about the latter as the right option.

When you're driving into this brick wall, how important is it to have a inner circle of other great thinkers that could tell you, you know, you're smart to be driving at this brick wall, you have the right vehicle, just go and do it versus kind of doing it as a solo mission.

I remember when I was starting a company called LS9, a very, very well known professor said to me, oh, that idea is obvious, someone should already be doing it.

And one of the things that that made me realize is, if I can put it this way, great ideas are obvious once you hear them.

So what do I mean by that?

Well, you didn't know that it was a great idea and you hadn't thought of it beforehand, but once you hear it, it's like, Oh my God, that is such a good idea.

And I realized that that signal of someone saying, Oh yeah, that's amazing, but I'm sure it's been done before, even though they can't find it, was a really good signal to finding really interesting problems to be working on.

Double click on this idea that a good idea sounds obvious.

Actually found my favorite ideas are these really big markets that only five people in the world know about.

Like, there might be some obscure cybersecurity CTOs in oil and gas that see this one problem over and over, and it might be massive.

It might be billions of dollars, but only five people are aware of it.

You're almost saying the exact opposite, which is something that people feel should exist.

Why do those opportunities exist?

Isn't the market pretty efficient when it comes to venture creation?

I don't know that the market is actually that efficient when it comes to venture creation, because the size of the problem is so large.

And there's just a natural framing where people tend to move from an area they know to an area they know to an area they know, it tends to be adjacent.

So can you form great companies by taking a step function innovation in an area?

Absolutely.

But at the same time, you can also look at a problem in a completely new way and see something that just isn't being done.

So I'll take the LS9 example.

This is a company that we launched back in 02/2006, and this was back when that first clean energy boom was taking place, it was starting to shape up in Silicon Valley and whatnot.

There was a lot of investing that was going on to make ethanol, cellulosic ethanol, and other such things.

And when you look at the core of that, right, cellulosic ethanol was driven because there was a replacement of something called MTBE in gasoline.

And the question was, okay, with this growing market, can we find an interesting and effective and low cost way to be able to produce it?

Corn was an interesting way to do it.

Sugar was an interesting way to do it.

We saw the trend line, and the question that came up was, is there something better we could make?

And this is one of those things that we asked.

And when we did the work, right, I remember working through probably about 140 different molecules that you could theoretically make.

And the one that we ended up deciding to make was diesel, not biodiesel, but diesel.

And when I say it like that, it's like, well, yeah, of course you should make diesel.

But at the time, people were making a different molecule called biodiesel because it was easier, right?

And it was a relatively simple step.

People were making other molecules because they were straightforward, but people weren't making diesel, even though again, when you say it's like, oh, yeah, that is the molecule that we use.

It's a massive market.

And if only you could make it, you would say, yeah, let's go make a company that does that.

And that was literally the way that LS9 was born.

So it might not be an obvious idea for somebody to come up with, but once you've gone through the idea maze and you've gone through all the solutions and you come up with the idea, at that point it becomes more self evident versus it's not Exactly, exactly.

It's not something that's in the common parlance that everyone's saying, oh, here's an idea, But it's when you hear a great idea, you wreck it, you can see that it's a great idea when you say it, it just wasn't obvious that it was a great idea until you heard it.

You've returned billions of dollars, and not on a billion dollar, on a much smaller number to investors.

You have one of the best, I think, I've ever seen biotech.

How did you transfer your skills from being a great entrepreneur to being a great investor?

I'd say the first thing is I tend to think of investing as having relatively simple principles.

And these are kind of first principles.

So I know this is gonna sound super mundane, but a return is effectively your exit price divided by your entry price.

So often in the venture industry, what happens is the anchoring is around percent ownership.

And so what will happen is you put a little bit of money in the seed, more money at a higher price in the A, even more money at the B and even more money at the C.

And that's what people do.

Often it's justified that, Oh, there's a capacity issue, can't put that much money in early on.

Fine, I get the story.

But Doug Haines spelled it out really, really clearly to me once.

So Doug used to, I think, run the New York office for McKinsey and then jumped that over to Point 70 two, where he was the president.

And he had the advantage of not being a hedge fund guy when he went there.

So he went around and he asked everyone, what do you do?

How does this all work?

Walk me through how decisions are made, what are the steps that are taken?

And what he pointed out is he said, look, an analyst will go and figure out, this is a stock that you should invest in, and here's my price target.

And they'll take it to a portfolio manager and they'll sell it to them, right?

Nvidia is trading at 100, I think Nvidia will go up to 120.

So what a portfolio manager would do is the same buying behavior that I described.

A little bit of money at 100 as the stock goes up, put a little put more money in as the stock continues to go up, even more and more and more money.

But if you ask the question in the context of Nvidia, it's pretty easy to see, right?

If you're at 100 and someone's convinced that it's going to go to 120, is it a higher probability that it goes from 100 to 110 and gets you that 10% gain?

Or when you're at 110 and you've gotten convinced because that trend has started to take place, is it a higher probability that it's going to go from 110 to now exceeding their target, right?

And the answer is, of course, the former.

The reason I point this out is, well, it basically says, we should be thinking differently.

It's really about how do we drive multiples, right?

Rather than percent ownership.

And the context on that is, okay, where are the points where you can minimize your cost of entry?

And it shows that there's two points in the journey of a company.

One is at the beginning, because when you create a company, your price of entry is effectively free.

It's not exactly free, but it's effectively free.

And then there's a point in the middle of a company because all companies tend to have these value curves that go up and then they dip and then they go up again.

And those two represent kind of those really interesting points.

And often, depending on the market, that middle point can be what we call growth investing.

So a big part of the way I've thought about investing is getting at those right entry points, but then partner closely with companies to try to drive paths to be able to get value to be created, right?

And value increasing sales, it can be created by advancing through clinical trials, it could be through business development partnerships, it could be through IPOs, it could be through helping to achieve M and A events.

All of those can be opportunities, but you got to think about the entry point.

And then most importantly, that partnership of driving value.

And then the derivative that comes out of that, that's super important, is a really tight alignment on the plan, right?

It's one thing for an investor to put money into a company, think they're going in this direction, management's going that way, and then everyone gets upset at each other.

And so getting that alignment before you put money in is a great way to be able to generate the sorts of outcomes that you're looking for.

Why would there be misalignment?

Is it a risk appetite difference?

Or is it I believe X, you believe Y?

It's the latter often.

And so it may be, you can find companies, for example, we've seen lots of these, where they may be selling, for example, B2C, but it turns out the fundamentals of the B2C business aren't as strong.

The underlying product might be very strong, and what they really need to do is to evolve their model to a B2B or B2B2C.

And those kinds of shifts, if you want to sit there and hope that a CEO is going to make that kind of shift passively, that's not going to happen.

But if you align on that decision ahead of time, and in fact, you're then underwriting the CEO, taking the step that you jointly agree is going to unlock value, that's very powerful.

One way that I look at what you're talking about, specifically in biotech, is there are essentially two universes.

There's the business universe where you're working on the biotech, there's different scientific risk, different discovery, FDA feedback, and then there's the financial universe where you have seed, series A, who's leading, who's all this memetic behavior, and you want to be able to trade between these two different universes with full information.

So essentially insider trading in the private markets, understanding the science on a basic level, while the non scientific investors and the less sophisticated investors are just kind of using memetic behavior and looking at each other to gain conviction.

It's a really good way of putting it.

I mean, if you take it in the therapeutic development world, right?

Part of what's interesting about the therapeutic development world is there's a lot of just binary decisions and binary outcomes along the journey.

And so for example, you would say we're going to take drug A and treat disease B.

And there is a moment in time where that selection gets made, and then the clinical trial or clinical trials get done.

And the alignment that we're gonna do A in B is incredibly important.

Now, you might say that's a pure science decision.

The science is really a big part of it, but it's not the only decision.

I've been told in my career many, many times, there's no such thing as product market fit in drug development, but that's simply not true.

Because when you look at approved drugs, approved drugs, I think the statistic is only 40% of them ever return the capital that was actually invested to get the drug approved, which is a crazy statistic.

Now we could come up with a number of different reasons.

Maybe the pricing wasn't right, maybe the patient population wasn't right, maybe the sales wasn't done right, but all of those are things that we would say in the rest of the world, which we would call it wasn't product market fit.

And that product market fit starts all the way back with drug A to treat disease B.

Again, so if you get that wrong, you've messed up that back end, you just don't have the opportunity to do this kind of live testing that you might have in other places of being able to say, try selling to a customer.

You can sell surrogates through BD, but you can't sell to the actual customer until you get it approved.

From the outside, it seems that biotech is an industry where you get your drug approved, everyone makes a lot of money, 40% of the time that you get it approved, you don't get your money back.

What's a way to ascertain product market fit on a drug before spending hundreds of millions of dollars to get it approved?

It's difficult.

I mean, the industry obviously has not 100% solved this as an issue.

But I think what one looks for, and this is the way I've tended to think about it, is you really want to find a drug that has a set of features that a patient population is gonna look for, or is gonna benefit from, and I'll double click on that in a second.

You want a disease where a drug that meets certain standards, will benefit from it, and you wanna be able to do it in a price framework where, you think the market is going to frankly care.

But some of the things that are really important that go into that is you need in that indication to be able to design and execute a clinical trial that will be able to show a significant benefit in that patient population, one that payers and patients both care about, and you need it to be able to be done in a way that regulators also care about.

And I've seen very often, for example, you would see someone who might do some studies on a rat, right?

And they'll show that they treated brain cancer in like three rats and the brain cancer disappeared.

Disappeared.

Great, very exciting.

And then they'll say, you know what, we're going to pivot this whole company to go after brain cancer.

And while it's a very laudable goal, because brain cancer has obviously taken many lives and it's a very tragic course when you see people go through it.

Part of the challenge on it is there's a reason it's been very difficult to treat.

One is the models aren't very predictive, I.

E.

What you see in an animal is not what goes on.

The diversity of a tumor is not the diversity that you get or the lack of diversity that you get in an animal.

And all of these lead to features that make it very difficult to get your clinical trial to actually work.

And so you see these companies then making a decision, which where they might have great technology, it's taking them down a path where they're not going to be successful.

And again, so a lot of this, when it comes to therapeutic investing, you need the specialized knowledge to be able to understand this.

You ask the question of how do I draw surrogate information from fact patterns I've already seen to help me make a best guess?

And then you test that best guess in the ways that you can.

Thank you for listening.

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This actually reminds me of skill stacking, which is this underappreciated concept of if you're very good at something, let's say you're very good you're a very good scientist, and then you learn venture, that's valuable and could be very valuable even if you're not the best venture investor or the best scientist.

But as you start to stack more skills, if you learn regular product market fit and regular kind of venture strategy on top of the biotech venture strategy, you start to get these unusual stacks of skills that allows you to be world class in what you're doing even if and this is not you.

But even if you're not the world class at your your core skill, you could actually stack skills long enough to be really good.

A good example of that is Elon.

He stacked being an engineer, then being good at fundraising, then being a good writer, being good at media.

And nobody would really say he's like the best writer in the world or the best on media, but stacking these skills together has made him extremely formidable.

I think it's a great observation.

And I think that the more you can bring various forms of expertise together, of course you get the benefit of pattern recognition that transcends fields.

And I think that's exactly what's occurring here.

I mean, to me, part of the difference between health and not health is that health has all this jargon that often people will pay $100,000 in order to get a plaque that goes on the wall.

And what is it?

It's a vocabulary list.

Okay, that's a little bit more diminishing than I intend.

But at some level, that's part of what creates that into a specialty is understanding that jargon, understanding that nuance, but the same business rules are effectively applying over time.

There's also a very unusual skill, which is extreme domain expertise and ability to explain it on a very simple term.

So this, like, PhD understanding with seventh grade communications.

That's exactly right.

When you find people who can do that, it's amazing.

So biotech over the last decade has underperformed and has not done great as a venture class for LPs.

What has been the reason for that?

We can look at it on a couple of different levels.

When you look back at biotech 2019 to 2021, things went smashingly well.

We'd say the same in most domains, I think we all know the basis for that.

An unusual amount of money was printed in a ero interest rate environment.

So where were people going to put money for growth?

They were going to put it in tech and biotech names.

And we saw a massive amount of money move into the markets.

And of course, a massive amount of value appreciation in the markets.

So I think that's, if I can put it simply, it incredibly exciting.

I think what happened, of course, course is as the world changed, the companies weren't as caught up to their valuation as they wanted to be.

And so more recently, we've seen a very strong, I think the word is correction that people like to use, where of course a lot of that value and then some has been erased.

And so when you look at where the biotech world is and the health world is, I tend to think of it as being in two different environments.

One is when you have generalist investors who are in, and one is where you don't.

So in 2019, 2020, 2021, a lot of generalist investors were going into biotech.

In 'twenty two through present, they're simply put, are not.

But the interesting thing is, I think when one is focused, whether it's on drugs or whether it's on health associated technologies, when you're really focused on high quality companies that have that product market fit, have that moat, right?

In that case, it might be patents or something along those lines, have a great team.

Even in markets like this, they are doing great things and they're creating tremendous amounts of value.

And so I think it really becomes that question of making sure you can find those great companies that can continue to outperform when generally is a bad environment.

Is there a supply and demand aspect where there's less capital now in biotech VC so that should increase theoretically, at least returns?

Or are there other dynamics driving the markets and valuations today?

Today versus last year are very interesting questions.

If we look at the biotech world versus the health large world, I'll give you two different frameworks.

Biotech today is incredibly complicated, because not only do you have to deal with science and regulatory and commercial and all of those framings, And then you have decisions around the cost to be able to move from A to B, and whether you can actually generate real value that comes out of that, which is typical biotech.

But now on top of this, we have the questions around what things like the impact of negotiations secondary to the Inflation Reduction Act are going to mean, what this potential most favored nation is going to mean, what some of the tariffs are going to mean.

And so if I oversimplify it, it's very hard to calculate an NPV or a DCF in biotech today.

It's very hard to be able to do that.

In health, when you look at it, right, I think what's really interesting is you look at the health world, there are four major drivers that are leading to a foundational transformation of 20% of our GDP.

And it's happening incredibly quickly.

And these are things like AI, things like decentralization, A progressive shift from things done in a hospital to things being done by a specialist, from a specialist to a generalist, from a generalist to a consumer, consumers seeking an unusual interest in their own health, and frankly, change in the way that payments are being done across the entirety of the health system.

Again, all of this is happening incredibly quickly.

And so part of what's exciting from my perspective is, sure, some of this requires that specialized knowledge, but I think what's happening is amazing companies are getting created.

And these companies when they're created and they're growing, are unlocking tremendous amounts of value.

And I think what's been interesting is you can see these companies in an environment where couple outstanding outstanding management, outstanding ideas with, frankly, leadership that's associated on the financial side.

And these companies, I think, still have the sky as the limit in an environment that might otherwise be Tell me about Avren Capital.

I launched recently a firm called Avren Capital that I'm very excited about.

I launched it with my brother.

It's basically we took the benefit of our backgrounds and we looked forward and we said, look, what is the single biggest GDP growth opportunity and wealth creation opportunity over the next handful of decades?

As we step back and did that, much like what Avista would have done back decades ago in picking enterprise software, we saw it as that intersection of health and tech.

If you will, watching how tech is transforming health and doing it incredibly quickly.

And so we said, what we wanted to do is to focus very specifically on that transformation and help to usher in the next generation of great companies.

So we've built a team that's focused on finding and partnering with outstanding companies and helping them to grow and get into that exponential phase, which we're incredibly excited by.

Where we decided to focus is on later stage companies.

And part of this is when you look at what's happened over the last handful of years, we've seen this massive bifurcation of financing into early stage and late stage, leaving the middle, if you will, of company growth as something that is more devoid of capital than it otherwise should be.

And now when we've had public markets come down 50 to 90% on a certain company basis since 2021, at the same time, with fewer and fewer funds supporting in that area, we found a tremendous opportunity to find great companies that we can partner with, and help them take their outstanding visions and make them into realities as they go forward.

So what we're very excited about doing is taking the company building experience that Eric and I have, as well as the team around us.

The team as a whole has been involved in about 22 unicorns.

And putting that together has given us an opportunity to partner closely with entrepreneurs, with management teams, to help us collectively see visions that we think can help to drive to really, really interesting growth points, growth trajectories and outcomes for these companies.

Give me a type of deal that you would do in a company that's neither early stage nor late stage.

We tend to like companies that have not just product market fit already established, but they've taken the product, they've developed the product, it's on or close to market.

And they have a very clear view of how this thing is going to be able to have a real impact.

So for example, we've partnered with companies in the context, actually of what I was describing earlier, where they might have had a B2C model, and we saw an opportunity that by going to more of a B2B2C model, they would actually be able to unlock dramatically more value and do it durably.

And we worked very closely with them during that transition.

And they've been, if I can put it bluntly, on a tear, and that's been incredibly exciting.

Tell me about your thesis on Alzheimer's.

A lot of people are concerned about family members getting Alzheimer's.

Tell me about your thesis there.

Alzheimer's is a particularly scary disease, right?

And I think people are scared of it, not just because of what they see it doing to their family or friends, but what they think of that it could do to them, right?

Watching people become almost mental shadows of themselves, right?

Losing memories, forgetting their loved ones, all of that, it's incredibly scary.

And it's incredibly scary, in deeply personal ways.

One of the things that's been happening in the biotech world, which has been exciting for frankly, decades, has been the world of precision medicine.

So what does precision medicine mean?

Well, often what's done is you can find something that allows you to know you're putting the right drug in the right patient at the right time.

And that was done, for example, for rare disease, rare genetic disease, and that's unlocked treatments for things like Gaucher's disease, Pompe's disease.

These are, of course, devastating children who instead of having a death sentence can actually live a mostly normal life, which is incredibly exciting.

That same logic was brought into cancer, and has been, tremendously impactful impactful there where untreatable cancers now have treatments.

People who would have again had a death sentence have now survived cancer.

It was then moved into inflammation and immunology, and we've been seeing some tremendous value created there for patients.

But what's exciting to me is I think we're now at the beginning of an era where personalized medicine is possible for Alzheimer's.

So we can take this incredibly complicated disease and start understanding definable domains within it, and using that where we can make sure we're designing very specific treatments for that specific patient population.

And I think that can open up a completely new era in this disease.

And so it's something we're very excited about.

What would you like our audience to know about you, about Avarin Capital, or anything else you'd like to share?

We at Avarin are really driven by a future of health and a future of medicine that we're incredibly excited about.

We think that we're at the precipice of an opportunity to bring a new way that we can think about our journey through life from a health perspective.

And we see that as something that's going to be a really important part of people's lives, but also an important part of the economy.

And we want to play a major role in that.

We love to partner with people in this journey, and anyone who wants to partner with us, feel free to reach out.

And how should people keep up with everything David Barry?

You can find me on LinkedIn.

I'm on Twitter.

I'm probably the worst Twitter person or sorry, ex person.

You see how bad I am, on the face of the universe.

We also have regular webinars.

We just, had one recently, and we're very happy to share the content that that we've been producing.

No TikTok skits yet?

Not yet.

Not yet.

Okay.

My my my TikTok ability is worse than my ex.

Well, David, thanks for jumping on, and I look forward to continuing conversation in person.

Well, thank you for having me.

Really appreciate it.

Thanks for listening to my conversation.

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