SciFounders, an accelerator program and fund launched back in January with $6 million in backing, has a new proposition for the scientist founders who it looks to help run their own companies. It plans to give some of the teams it funds the voting rights that would normally come with its investment.
Why does it matter? Well, it’s a sign of the times in many ways. While venture capitalists have long been known for the many demands they make on founders, entrepreneurs have been sitting comfortably in the driver’s seat in recent years, with VCs doing whatever they can to stay top of mind, from opening new offices and creating their own editorial arms, to offering term sheets in record time and waiving fresh checks at founders almost immediately after they close a funding round.
But SciFounders co-founder Matt Krisiloff argues that there’s much more to the thinking of SciFounders, which sprang up this year to cater to the growing number of PhDs for whom there are not enough spots in academia.
Krisiloff, who is himself a founder — he also runs a biotech company called Conception that’s trying to turn stem cells into human eggs — says he’s tired of watching biotech founders in particular lose control of their companies.
It happens “a lot of the time just because these startups are far more capital intensive,” Krisiloff notes. “You can start a software company with a couple thousand dollars in pre-seed funding, but a life science company probably needs a couple million dollars [to get started], so things can flip pretty quickly” against founders who can see their ownership and power diluted quickly.
What his outfit wants is to provide those scientists with more leverage, and if it has to come from SciFounders, that’s apparently fine. Says Krisiloff, “We think it would be great longer term for scientists to say, ‘We’re first-class citizens in charge of everything,’ as is often the case in the software world, where you have the Collison brothers in charge of Stripe, or the Airbnb founders in charge of their company. We want to make sure that happens more widely for scientist founders, as well.”
SciFounders — which has so far provided $400,000 and mentorship to seven companies in exchange for a 10% stake — knows there is only so much impact that an outfit of its size can make.
Krisiloff also sounds unsurprised when we push back on the idea that limited partners will broadly go along with VCs who give away one of the few tools left at their disposal right now: their voting rights, which give them at least some say over corporate matters.
But he suggests that movements have to start somewhere. Besides, SciFounders thinks it has already hit a nerve, simply by providing more guidance to academics than they’ve historically received. Krisiloff says while SciFounders is working with just seven teams right now — outfits that it expects to actively help for up to a year because their “iteration cycles can take a super long time” — it has meanwhile received more than 1,000 other applicants, many of whom reached out to the team after a simple Twitter announcement about the outfit’s launch.
In addition to Krisiloff, who earlier ran a portfolio of research projects affiliated with Y Combinator, SciFounders was co-founded by Alexander Schubert, a molecular biologist who was most recently a postdoctoral research fellow with Genentech, and Lucas Harrington, a co-founder and the chief scientific officer of Mammoth Biosciences. (Among Harrington’s three other co-founders, of course, is the CRISPR-Cas genome editing co-inventor Jennifer Doudna, who last year jointly won the Nobel Prize in Chemistry with longtime collaborator Emmanuelle Charpentier.)