American Chemical Society Entrepreneurial Showcase 2015

The American Chemical Society held its annual Entrepreneurial Showcase in San Diego at Jannsen Labs (J&J Research Labs) in April 2015. ACS holds the biannual event, showcasing entrants from across the U.S., at Boston, Washington D.C., or San Diego.

The Showcase was a pitch event for emerging companies to present their technology, business plans, and answer some brief questions in front of angel investors, venture capitalists, corporate scouts, and at least one patent attorney. While not as exhilarating as “Shark Tank”, the event highlighted the entrepreneurial spirit of chemists seeking to commercialize their inventions. The pitches were also judged by a group of angel investors for non-dilutive cash prizes.

The judges indicated these take-aways for putting together a promising pitch:

  • Financial analysis of the addressable target market: using comparables was deemed insufficient in assessing the market value of a startup. Better metrics included the maturity of the product, timeline to market, and previous funding rounds.
  • Explanation of the funding sought: companies deemed more valuable included an explanation of the funding amount sought, the funding type (convertible debt, equity, etc.), and very granular explanation of the purpose of the funds.
  • Explanation of the maturity of the product: Ph.D. thesis projects seeking first commercial applications were given very little value. Yet, SBIR-funded projects with animal testing data was deemed somewhat more valuable. For pharmaceuticals, testing in multiple species was deemed very valuable. For medical devices, working prototypes with pre-clinical data was deemed somewhat valuable, whereas “ideas on paper” were deemed of little value. Also, for medical devices entry into crowded fields with unproven technology was deemed of little value. Any company with significant (>$1M) revenue and projected future revenue increases was deemed of highest value.
  • Experienced and proven management: focused (1-2 principals) management teams with a history of prior success (exits) were deemed far more valuable than broad management teams (>10 principals), some of whom had prior business experience.

The winner of the event and the $10,000 first prize was PHD Biosciences, an emerging pharmaceutical company which is in preparation of filing its IND for MTDIA, a treatment of Triple Negative Breast Cancer. Steve Isaacson, CEO of PHD Biosciences, discussed the efficacy of their lead candidate, MTDIA, in mouse models demonstrating an inhibition constant around picomolar concentration levels. PHD Biosciences, headquartered in New York, NY, has currently raised over $1.8 million in non-dilutive grant funding from various entities, and is currently seeking $8 million in VC-stage funding to secure financing for Phase I clinical trials.

Second place (and the $5,000 2nd place award) was Mango Materials, a San Francisco, CA company focused on converting waste methane into biodegradable polymers using microbes. Molly Morse, CEO of Mango Materials, discussed the role of bio-sourced methane in the production of polyhydroxyalcanoates. Mango Materials has currently raised over $1.7 million in non-dilutive grant funding and is currently seeking $5 million in seed-stage funding to scale its field facility to deliver commercial product.

The event also featured a networking symposium where investors, corporate scouts, entrepreneurs, attorneys, and representatives from the American Chemical Society were able to discuss opportunities for chemists to advance their ideas as new companies. Companies interested in participating in the Fall 2015 Showcase in Boston,MA can look for information about next year’s competition on the ACS website.

© 2009- Duane Morris LLP. Duane Morris is a registered service mark of Duane Morris LLP.

The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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