A conversation with Daria Mochly-Rosen, Founder and CSO of KAI Therapeutics and the George D. Smith Professor in Translational Medicine and Professor of Chemical and Systems Biology at Stanford University.
Daria Mochly-Rosen, Founder and CSO of KAI Pharmaceuticals. Professor Mochly-Rosen, a protein chemist, is the George D. Smith Professor in Translational Medicine and Professor of Chemical and Systems Biology at Stanford University. Her lab develops pharmacological agents and applies them to understand molecular and cellular events under basal and disease conditions using in vitro, in culture and in vivo models. Professor Mochly-Rosen cofounded two companies, KAI Pharmaceuticals in 2003 (acquired by Amgen in 2012) and ALDEA Pharmaceuticals in 2011.
Please tell us your background story on how you ended up starting KAI Pharmaceuticals.
Daria: On one of my first days at Stanford, Mona Wan, from the Office of Technology Licensing (OTL), invited me for coffee. During the meeting, she explained the patent process and its importance, which was the reason why, going forward, I was on the lookout for potential utilities of what my lab discovered.
When I joined Stanford, I was working on testing a theory that was quite against the current dogma. Talented postdoctoral fellows and graduate students in the lab obtained fantastic data using a compound that we designed which supported our theory. However, for the field to believe in it, we had to show that it matters. Therefore, we tested our compound in models of heart attack and found that the benefit is substantial; damage to the heart was reduced by 70%. If anyone in the field challenged the data, we sent them reagents with no strings attached, and the data were confirmed by others. With this validation, I knew we had to do something, so I tried to pitch the invention to big pharma. Nothing happened. A talented graduate student in my lab that worked on the project urged me to start a company. I promised him that once he graduates, if we have no licensee, then we will start a company.
I talked with a lot of people, always with my notebook in hand, flashing pictures of the heart before and after the treatment with our compound. Reception was not positive, I felt strongly that the compound could save lives, and so I persisted. When trying to convince others to take on and develop your project/drug, I had to let go of my ego; it wasn’t about me.
I spoke to more than 100 people; I talked to everyone who was willing to listen, even with fellow passengers on flights. As I was throwing out the garbage, one day, I showed the picture to my neighbor, who was in business development for interventional devices and this conversation led to the first effective meeting with a venture capitalist. I continued to try and engage someone to take the project on for eight months and received endless rejections from venture capital groups. The experience taught me that when pitching your life’s work, you cannot be upset if someone looks bored, looks at the phone, walks out, or asks questions that are not relevant. I learned to look at each opportunity as the one that may be successful.
At Skyline Venture, our lead investors, I met five venture capitalists who had already heard about me and our project. That taught me that ‘failed’ conversations with others weren’t in vain; they were ready to hear me because of my 100 prior conversations. In retrospect, it didn’t feel like perseverance - it just felt like another day.
At the time, I was teaching a drug design class and learned that filing an IND cost about $750K. Not knowing that an IND is not a very valuable milestone, I pitched to Skyline Venture that we needed $1.5M. With Skyline at the lead, we ended up raising $27M in 2003. I was clueless. Luckily the VCs saw the value of our program, and they knew what we needed.
This process taught me a great deal, especially to be very humble. Starting a company is a complicated process. Nothing that I learned in academia prepared me for becoming an entrepreneur.
What are the biggest differences between your role in academia and your role as an entrepreneur?
Daria: In academia, students are led by the professor who helps guide the direction of their research. Although working towards particular goals, we often find ourselves taking detours. When developing a drug in industry, everyone on the team is critical and focused on taking the shortest path to solve the problem; no curiosity-driven detours.
Do you have entrepreneurial mentors or sponsors? How did the relationship start, and what has it brought you?
Daria: I have had a very large number of mentors. When coming to Stanford, I looked for mentors in other departments to advise me. Professor Ken Melmon was one of these mentors. I would write a series of questions and come to him. He edited my questions, answered what he could, and made sure that I remember to follow every meeting with ‘is there anything else I should have asked?’ This is great advice, which I share with my students. It ensured that I would gain as much as possible from each meeting.
I had no knowledge of business. So, I looked for a mentor with leadership experience in industry. I emailed Martin Gerstel (who was the CEO of ALZA) and asked for his help. He remained my mentor for years. And Alan Mendelson, the corporate lawyer of our company, always had a quick bite to eat with me after each board meeting, to mentor me on legal issues. Another important mentor was our interim CEO, John Walker. When I was at KAI, for the last ten minutes of every day, we would stand at the entrance of our tiny offices, and John would give five minutes of business talk and I would give five minutes of science talk.
I reached out and approached many people; many, but not all, were happy to advise me. I knew that my knowledge was limited as an entrepreneur and so I found people who were willing to share their know-how.
In your opinion, what are the biggest challenges faced by women entrepreneurs and executives that aren’t typically faced by their male counterparts?
Daria: Women and men are not the same. One is not better or worse than the other; they are just different. People pass through life seeing every rock in their path, and others see the opportunity to make a sculpture with the rock. Discrimination is there, of course, but the trick is (if possible) not to let it weigh you down.
How do you achieve work-life balance to pursue entrepreneurship?
Daria: I am married to a great man, and we have a good relationship. We took turns giving time to our careers and also had four kids in six years. I don’t remember hard times; I am sure there were some. All I remember is that it was (and still is) fun.
What was your experience in fundraising?
Daria: The idea of pitching irked me in the beginning. You work on a project for 20 years and now need to distill it into a- three minute talk. It’s a challenge. I had a hook –my notebook with the picture – which was a good, strong visual. I spoke about it earlier – the trick is not to be too down when a VC firm turns you down – persevere and improve the pitch, until it clicks!
What was the best advice that you received? And to counter that, did you receive any advice that you would not pass along to another aspiring female academic entrepreneur?
Daria: Use each opportunity to learn as much as you can from the person you are meeting with. Know as much about them before meeting (their school, companies invested, sports of interest). Make sure you got all of it, including “what didn’t I ask you.” That initial meeting could be the most critical. Always take notes on what you learned from the meeting and how you will do better next time. Visual information is also critical to effectively share your story.
Bad advice I received: ‘lower your voice, speak more slowly, and don’t use your hands.’ No way! Be yourself. If you are taking a different persona as an entrepreneur, it will only last for a short time. Better to stay true to yourself.
What haven’t we asked you about that you think is important for women academics to know when delving into being involved in a startup company?
Daria: Just jump in; don’t worry about failure as it will happen. There is a great chance you will fail, but you will come out more knowledgeable and stronger, and do better next time.