June 22, 2020 – As we all know, our world changed starting about 90 days ago. I salute the leaders who are working on saving lives and livelihoods and front-line workers who are keeping us safe and healthy. We are hoping that scientists, healthcare leaders, and small and large technology companies can help us innovate our way out of this crisis. Over the last decade, the Mayfield digital health and genomics investing team has partnered with over a dozen entrepreneurs, who join iconic founders of our companies from prior decades such as Genentech, Amgen, Millennium Pharmaceuticals, Heartstream and Intuitive Surgical. We typically join forces with entrepreneurs who are at the idea stage and work closely to help them build companies that last.
I believe that the pandemic has only increased the urgency of investing in innovative ideas in digital health, healthIT and genomics, including the role of biology as technology to improve human and planetary health. Here are three areas of opportunity for entrepreneurs to leverage behavior trends, scientific breakthroughs, and innovative business models to build big companies.
At-Home Experiences for Physical and Mental Health Will See Exponential Growth: Entrepreneurs who are building consumer offerings will need to meet their users where they are (at home or on their mobile devices) with delightful products and friction-free onboarding. The growth of Peloton vs the decline of gyms, the obsession with Nintendo’s Animal Crossing, and meditation apps such as Calm going mainstream are good examples of this trend. In our own portfolio, Tonal, a home strength training system and TRIPP, a VR-powered mindfulness and resilience building experience, have seen increased adoption over the last 90 days.
Hospitals Will Need to Leverage Technology to Deliver Better Outcomes: We have seen how hospitals are under siege with PPE shortages and limited beds to treat patients. While software has taken over on the input side (with EMR systems such as EPIC), there is still a huge gap in using technology to automate patient flow for better resource planning. One of our companies, Qventus, built a scenario planner for hospitals that uses AI to predict usage for COVID-19 patients. Another which is still in stealth mode is bringing precision medicine with genomics based diagnostics, machine learning and new treatments for complications like sepsis and acute respiratory distress that is the top cause of death in hospitals including most fatalities from Covid-19.
Scientific Breakthroughs Will Accelerate the Public Health Response: For life to get back to normal, we know we need a vaccine. A great example of a leader using cutting-edge science is Moderna whose mRNA-based vaccine candidate has been fast-tracked by the FDA. The urgent need for rapid testing exposed the limits of the PCR model which requires laboratory settings and specialized supplies. Our company Mammoth Biosciences has leveraged CRISPR technology to deliver a test that is as easy to administer as an at-home pregnancy test, uses off-the-shelf reagents and disposable strips, and can deliver a result in 45 minutes.
There will be many examples of innovative start-ups that will leverage these trends and others to grow into the giants of the post-pandemic age. However, building a platform company is fundamentally different from a build-to-sell value proposition. A good example is Moderna, where the founding team decided early on that they would not be a one drug company. This approach profoundly shaped company strategy, how they managed risk, their culture, and the kinds of investors they partnered with. A company with a long-term view has to manage a product portfolio, and be willing to deal with multiple technologies for different products. It has to have patient investors, which Moderna did by staying private for eight years, as that let them pick investors who were aligned with their views. By following a strategy of maximizing the shots on goal vs going after the drug for the largest opportunity, and mitigating risk to prove the platform out, today they are our best hope for a vaccine and a way out of the pandemic.