The California Institute of Quantitative Biosciences (QB3) is collaborating with a newly launched $7.5 million fund to provide startup capital for University of California bioscience entrepreneurs and a long-term endowment for QB3.
The Mission Bay Capital Fund will be a key element of QB3 efforts to help UC scientists translate their research into products and biomedical therapies for the public good.
This is the first fund for Mission Bay Capital LLC., a San Francisco-based firm that was created in August to make pivotal, early-stage investments in bioscience companies. The firm is independent of both QB3 and the UC system, but will invest in bioscience companies stemming from UC research.
The current fund has a three-fold goal: to kick-start 15 companies with an average of $500,000 in seed funding, bring public attention to the caliber of UC science, and attract the attention of other venture capital firms to participate in this process.
Companies will be considered based on both their likelihood of commercial success and potential benefit to society, according to QB3 Executive Director Regis Kelly, PhD, who had the initial vision for an outside philanthropic fund to support QB3 and serves as an unpaid director of Mission Bay Capital.
"American taxpayers provide billions of dollars per year for scientific research in the hopes of having it pay off to society by creating the technologies and medicines of the future," said Kelly, citing funding for basic research through the National Institutes of Health and other organizations. "This funding is absolutely critical for the entrepreneurs who are trying to do that."
UC scientists have founded one in three biotechnology companies in California, including five of the world's largest biopharmaceutical companies: Amgen Inc., Applied Biosystems Inc., Chiron Corp. (now part of Novartis International AG), Genentech Inc. (now part of Roche Group), and IDEC Pharmaceuticals Corp. (now Biogen-Idec Inc.).
Since those companies began, however, much has changed in the funding world, especially for bioscience and bio-technology companies, Kelly said. The combination of limited federal funding for later-stage research and the recent trend of investors retreating from early funding has made it increasingly difficult for entrepreneurial scientists to bridge the two funding sources and translate their research into products and therapies.
The new fund builds upon ongoing QB3 efforts to help bioscience entrepreneurs create new companies based on their research. Those efforts include the QB3 "Garage" and QB3 Mission Bay Incubator Network, both of which provide micro-amounts of laboratory space for entrepreneurs. The institute also has created the QB3 Innovation Toolkit, which provides access to the legal, management and investment expertise critical to avoiding many of the initial mistakes that often derail startups.
Since QB3 created the Garage in 2003, it has helped launch 21 startup bioscience companies on the UCSF Mission Bay campus and its surrounding neighborhood, including four that have successfully landed follow-on funding or were purchased by larger companies. Twelve of those companies were launched in the past year.