Life Science Entrepreneurs: Embrace the Risks

By John M. Armstrong, PhD, Managing Director

Benjamin Franklin once said that the only certainties in life are death and taxes, but for biotech CEO’s there are three more.

The third certainty is that you will achieve little to nothing by avoiding risk and playing it safe.  That may sound appealing but recall Teddy Roosevelt’s famous ‘Man in the Arena’ speech – “…if you do fail, at least your place will never be among those cold and timid souls who know neither victory nor defeat.”  You may fear failure, but if your goal is worthwhile, consider what the world will be like if you don’t try.  Your place at the helm of a biotech company is not supposed to be a safe place. It is not the Hobbits’ Shire. It is a place of ultimate importance entrusted to you by your shareholders and their belief that you will do your utmost to ensure they get a return on their investments.  If you choose to accept that leadership role, then you must make a commitment to be the best at your craft, regardless of the journey’s dangers.

The fourth certainty for a biotech CEO is that you may fail, and you’ll do so because no one accomplishes anything great without risking failing. Failure should be accepted as a potential outcome. Consider American basketball legend Michael Jordan’s career, in which he led the Chicago Bulls to six NBA championships.  Combining his five MVP awards from regular season and three more from All-Star play, Michael Jordan became the most decorated player in the NBA.  And yet he failed often.  In his own words, “I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. Twenty-six times I’ve been trusted to take the game-winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed.” Nobody goes into a challenge or risky enterprise expecting to fail.  We do so because we expect to win against the odds. We are optimists, and as such, we are the only ones who actually win against the odds.

Notice that the certainties of biotech entrepreneurship do not include success. Anyone who assures you of success in your entrepreneurial journey is not being straight with you, and that goes for your bankers as well.  It may seem counterintuitive, but the most important principle to keep in mind when embarking on the entrepreneurial journey might well be your likelihood of failure, because when you combine your acceptance of that fact with the fire in your belly to succeed, you will be more receptive to professional help.  The success rate for biotech entrepreneurs is very low, so your response to facing that likelihood needs to be “I don’t care about the odds. I need to win. Help me.”

At Outcome Capital, when we hear that response from CEOs, we know they are coachable, and coachability is a character trait that we require if we are to engage with a client. We want you to win, and if you have a coachable persona, we know that you will be open to professional strategic guidance.  Our strategic advice is steeped in data, i.e., on market-driven feedback, and we use it alongside other tools  to maximize chances of reaching a liquidity or financing event.  When we engage , we will walk with our clients through the entire journey.  And that is the 5th certainty – Outcome Capital stands allied with our clients no matter how challenging the journey.

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