Podcast Transcript

David Brühlmann [00:00:29]:
Welcome back to our conversation with John Bonham-Carter. Building one successful biotools company is hard. Building several and knowing when to walk away or start again is harder still. In this second part of our conversation, John talks about fundraising as a two-way bet, why founders should obsess over the customer before the product, and what finally convinced him to launch his newest venture, Stellion Biosystems.

Another thing that scientists often struggle to understand is how fundraising works, and you need money to start a company. And we do know that raising capital has it’s been quite challenging the last couple of years. How do you go about structuring a deal, or how do you go and approach the right people to get the money you need?

John Bonham-Carter [00:02:32]:
It is difficult, and I would say for a lot of people, it’s a really horrible thing to do, like asking people for money in return for a promise. I don’t think many people feel comfortable doing that, and you get good at it by practicing and by repetition. The way I go about it and the way when I’m advising small companies is I go, If you are just promising money at the end of it, you gimme $100,000, I’ll give you a million in 5 years, or add the zeros appropriately to that equation. I think that’s boring. You might well convince somebody that that is a great business and they’re investing purely because they’re gonna make money. But these are high-risk ventures typically, which regularly fail.

The tool side are much less risky than say a therapeutic. But I think the way to get people on board is with a story. It’s like they’re not just investing in the product and the money, they’re investing in a team. They’re often investing in you, the person telling them. The question is, is why are you doing this?

And if the person can’t answer that question with commitment and enthusiasm, they’re gonna give up. It’s hard work ahead and you want someone who’s gonna commit. So if there isn’t a good story as why you’re doing it, then you are likely to fail. And so the story should not be a story which is fake. The story should be from the heart. You should want to do this. You should be believing it.

It could be because you’ve got a friend like I’ve had and many of us had who’s had cancer and you go, I want to do something about that. I’m not the scientist who can actually find the therapeutic molecule that will cure that, but I can contribute a small little cog in the wheel to make someone more effective and give bigger profits to Amgen or whatever.

Maybe it’s not bigger profits, allows them to invest those profits into new therapeutics. Without that story, which you believe, you’re not gonna get anywhere in fundraising. So that is step one. And the second thing is to understand how do I work with my investor? You take money from them, but you’re probably gonna be interacting with them a lot. So make sure you bring on investors who you like to talk to. If you don’t like to talk to them, don’t bring ’em on board. There’s plenty more other investors who are more engaged, who will help you on the journey, who have advice.

Most of them are old. Older people have more money on average. So you’re gonna be talking to lots of older people. And older people generally think know better. Talking with me now and my advice, I’m an older person. You know, some people think, oh my God, John, you think you know it all, don’t you? But you know, I don’t, but I have done it before and I have been successful. And that allows you some perspective. So hopefully investors give you perspective and they’re not quite drinking the Kool-Aid that you are drinking every single day, and they can give you a different viewpoint. They may not be right, but it forces you to think about it.

And the final point is you just make a lot of phone calls and a lot of emails. Because you’ve gotta find the person who likes you, who likes the company, likes the product, understands it, has money at that time, and that you are the right size company for their fit. So it’s just like selling products in the market. It’s hard work, but it can be quite fun too. I wouldn’t do it if it wasn’t fun, that’s for sure.

David Brühlmann [00:05:25]:
You have seen both sides. You have started a company. Now you’re investing in companies and you’re coaching. What is the thing you’re looking for? Is this what you just shared, or when you do it, is that different?

John Bonham-Carter [00:05:38]:
No, it’s identical. So I’m not sophisticated enough to sort of play several games at once. I’m exactly who I am. I’m a man. I can’t do 2 things at once. So what I say is what I give. And so the way I run my company is exactly the way I advise other people to do so, which sometimes means I should not be an advisor at some companies.

Companies that have a goal of growing from, say, $1 million sales to $200 million sales, I’m probably a really good advisor for them to get to $10 million. But after that, I’m probably not a good advisor for them because I don’t understand. I haven’t had that experience to take from $10 to $200 million. I’ve been in those companies, but I haven’t led those companies. And I found that I don’t find that interesting. So I don’t think that that’s the right place for me. And so the knowledge of where I’m good and the company I’m currently in, Stellion, if I was growing that and if at $10 million we decide, oh, we don’t wanna sell, we wanna keep going, we’re gonna find another CEO, we’re gonna find another head of sales, ’cause that’s not probably me. A younger person, more enthusiastic, who’s maybe got an MBA and has got the skill set to build systems for bigger companies that I don’t. Knowing who you are is very important as you’re growing a company.

David Brühlmann [00:06:43]:
Before we focus on your current endeavor at Stellion, I just would like to ask you 2 more questions. One is, how do you deal with this tension in a startup? Because everyone wears a dozen hats. And where do you see most founders spreading themselves too thin? And how should they focus, or what should they focus on to develop their company well.

John Bonham-Carter [00:07:06]:
This sounds weird, but do you have kids?

David Brühlmann [00:07:08]:
No, I don’t.

John Bonham-Carter [00:07:09]:
You don’t. So anyone who’s had kids wears many hats in the household.

David Brühlmann [00:07:13]:
Yes.

John Bonham-Carter [00:07:13]:
You see it. You start out as single. You get a partner. You get kids, whether it’s your own or adopted, or they come with the partner. Well, life is complicated now. And suddenly, your world is a little different. You’re still doing what you used to do, but now you’re managing many things, whether that’s football/soccer activities or anything else. And you know what? There is no training course. There is no parent’s hand guide. But you know what? It works itself out mostly. Most people do a pretty decent job at the end of it with no training at all. I think that’s just like a company.

Just because you don’t really know what it is, if you’ve got the attitude, you’re probably gonna be all right. Yes, you’ll make some mistakes. They may not kill the companies. I don’t ever think that’s too much of a worry for that. And conversely, if you’ve done your MBA and you’ve done all the theory, that doesn’t in no way means you’re gonna be excellent at running a company.

The theory, that doesn’t mean you’re good at the practice. Ideally, a combination of everything is important. But if I was to sort of pin it down to one area where founders make mistakes more often than not is they focus on the technology. And what often means is they have a technology, it kind of works at a proof of concept stage and they go, right, now we’ll make version 1, which would be kind of cool. That’ll be exactly what people want. And they find, oh, it’s not exactly what people want, or it’s not at the quite right price, or they haven’t got the full feature set, so they go, oh, I’ll make version 2.

And all you’re doing then is raising more and more money, spending on a better and better product, but it’s time to stop and just sell what you have. Maybe the customers you’re talking to don’t want the product you’ve got because it doesn’t do everything they need. Go and find another customer. Some other customers will have a need for that product and they’ll pay for it, and that will allow you to grow the company. And you can work with that customer together and make a great partnership as you grow the business. But trying to make a perfect product, that’s a nightmare. That’s fool’s gold. You will run out of money very quickly.

David Brühlmann [00:08:59]:
Someone once said that everything you touch turns to gold. What do you think has really been behind that track record?

John Bonham-Carter [00:09:10]:
OK, so that guy, Scott—I won’t give a second name—Scott on the West Coast, he made me laugh. He’s a hilarious guy. I love him. I don’t think it’s true to start with. But I’ve been lucky. To have chosen people to work with who are very inventive. And also, I have chosen companies at very high risk that most people wouldn’t take.

Although I’m not the inventor, a company that’s an MIT spin-out that’s been having no revenue for 12 years is not the obvious candidate to say, hey, I can build that up and sell it for $100 million to somebody else. But because I realize they’ve got all the skills I don’t have, they’ve got the technical skills, they’ve got a brain which is like working 7 times as fast as mine. But what they’re lacking is the ability to pick up a phone or the ability to say, sure, I’ll work on that with you, customer. We’ll get there eventually in the next year, the product you need. And so realizing how do you sort of make a marriage?

Company’s a bit like a marriage of the team, the product, the customer. So you’re gonna make some compromises and I can make some compromises. Probably before I was married, I was probably less good at making compromises. People who’ve had long-term partners will know, yeah, you gotta make some compromises to stay happy. You have to work on the relationship. It’s the same with a business. It’s never quite perfect, but work on it together and eventually you’ll get there. And the ability to do that and the ability to work with your team and solve those problems. Maybe I’ve chosen well, certainly chose my wife well. That’s brilliant. But I’ve also chosen some very good people to work with. None of us are perfect. Definitely not.

David Brühlmann [00:10:43]:
So it comes down to working or surrounding yourself with great people.

John Bonham-Carter [00:10:50]:
I think that’s a great phrase. I don’t like the phrase. I surround people who I think I work well with.

David Brühlmann [00:10:56]:
Oh, okay.

John Bonham-Carter [00:10:56]:
Maybe it’s a British understatement. I wanna say they’re great people because no one’s perfect. Everyone’s got some flaws and just have to not get angry at the flaws every day. You have to grin your teeth and bear it is another British phrase. But you’ve each gotta contribute something unique in a small company because everyone’s, as you said at the beginning, everyone’s wearing many different hats.

And no one’s perfect at wearing every hat, but understanding that it’s okay. They’re not brilliant at accountancy, but that’s okay. We will get a bookkeeper and we’ll solve it. We’re not very good at marketing. Don’t worry, we’ll do a little bit. And when we’ve got some more money, we’ll employ a great person. We’ll get someone who’s perfectly good at marketing. So understanding all your failings and accepting it, and then trying to work together best. It’s the acceptance of maybe mediocrity allows you to be, as a team, fantastic at the end.

David Brühlmann [00:11:41]:
Now you’ve decided to start yet another venture. You are now working for Stellion. Tell us, the reason behind and what you guys are doing?

John Bonham-Carter [00:11:50]:
I’ve been looking for a while since Erbi. I took sort of time off and I sort of thought, oh, I’m going to retire, which is maybe my second or third time I’ve retired. But you know what you do when you’ve retired, David? Nothing.

David Brühlmann [00:12:02]:
Nothing.

John Bonham-Carter [00:12:03]:
It’s really boring. It’s really boring. I’m rubbish at that. Can’t do that at all. So I realized, okay, so I started advising companies like how to grow, and that was quite fun. But eventually I realized invested in some of them. I’ve probably got a portfolio of 20 companies that I’ve now invested in with my proceeds. So I still live like I did 20 years ago with my wife. We still, although we’ve got a very nice house, we live really, really cheaply. And all the money I’ve got has either gone to charity or invested in other companies.

But I just realized, no, I want to get my hands dirty. I want to get down in the coal mine and get busy. Way more fun than advising people who on average are very polite and listen, but don’t always act like I would do. They may be correct. They maybe they shouldn’t follow my advice. Maybe they’re more intelligent than me. They know, John, no, no, thank you, boomer. I’m good. But either way, I realized I wanted to get involved again. And a couple of companies I was talking to, but you know, I would’ve been a 1% owner or something. It wasn’t gonna work out.

So I’ve been looking around for a company or technology or group of people to do a business with. And Stefan Pollesche, who’s been working on this particular technology for like 5, 6 years, it developed, it’s spent a fortune. It built up some debts. The product was all good. And most importantly, it wasn’t in cell and gene therapy. I thought, that’s not exactly the industry I want to be in right now. So I thought, great, we’re going to be in proteins, we’re going to be in CHO, we can do into gene therapy. That’s okay. It’s still bioreactors. It’s still HEK cells. It’s an area I know well, and the products are ready. But he is exactly like many of the other inventors I’ve worked with. He’s not commercial. And so I went, brilliant. Don’t worry. That problem is solved.

So a friend of mine, Alan, and I, who I’ve known for 25 years, said, right, we’ll set up the commercial team, I’ll go and raise money, and we’ll launch. On some level, another boring product like many others. But of course, it’s not that boring. It does count cells, which is utterly critical. Everyone in process development and cell culture, they count cells every single day. And instead of having things like manual dilution, which introduces errors of 10% or more, it’s automated, fully automated, and it’s high throughput with a robot. Doing 96-well plates. And it’s like, oh, that’s so easy. I literally loaded in there, I pushed the button, it’s got an NFC tag, it remembers everything. Next-generation optics, next-generation liquid handling. So it’s just a little better than everyone else out there in our view. I’m sure all our competitors will disagree with me and that’s fine. See you in the market.

So it’s just a little better and saves everyone a little bit more time and gives people a little bit more confidence that machine to machine, It’s gonna be more right more of the time. A little bit of British understatement. I’m not gonna oversell it. And the fact that I don’t need to support it very much ’cause it runs itself and it doesn’t get blocked and you don’t need to calibrate it very often because it’s better built to start with. That’s the kind of machine I really like. If I was in a lab, that’s the machine I would like to have. It’s not the one causing you headaches where you have to call a service engineer every couple of months. It’s not the machine like, I won’t mention the name, but you know, you have to buy packs of reagents. And I’ve only used half of one of the bottles, but I’ve got to throw the others away. It’s like, sure, I know that’s how you make money in printers and in reagent packs. That’s not what I want as a customer. And so we allow a little bit more flexibility in the lab. That’s what attracted me very much to that series of products.

David Brühlmann [00:15:06]:
When we met a couple of months ago at ESACT in Salzburg, you were running around with your little cute mascot, Stellie. So tell us, where did this name come from, and where does the name Stellion come from?

John Bonham-Carter [00:15:19]:
So I’m sorry I don’t have Stellie with me. People who are listening on the radio or Spotify, wherever you listen to your podcasts, right? I got a blow-up lizard. That’s all I’ve got. And of course, it’s like a little cute cartoon character, and I like to have fun. So why the lizard? Well, you know, when you think of a new name, there’s various—Mark Bamforth, who’s run Gallus and Brammer and various other CMOs in the area, been rather successful. He’s Scottish, I’m English. We both live in Boston, about a mile from each other. And he’s always got a history to his names of companies due to sort of Scottish folklore or something like that, or an interesting Celtic connection.

Again, I’m not that sophisticated. So Stellion is a fun—it’s a real lizard, in fact. It’s a lizard which has a star on its back. And it’s not Stallion, if you think we’re pronouncing it wrong, everyone listening. No, it is with an E, Stellion. And it has a lizard. It looks really cute. And we went, sure, let’s take that. Why not? Right? So there’s no connection to our names or to some technology in the product. It’s a fun name and I loved it ’cause I went, ooh, I’m gonna run around ESACT with a blowup lizard and everyone’s gonna notice us. What great marketing. And I guess I was a little inspired by EasyJet. So for Americans out there, EasyJet is like Spirit Airlines and they’re all over Europe and they’re bright orange rather than bright yellow Spirit Airlines. I think Spirit Airlines doesn’t exist anymore. But anyway, EasyJet does exist and the Greek guy who started it up, he used to get dressed in orange jumpsuits. and like the team of, what, 10 of them or something, the whole C-suite would turn up to a British Airways press release where they were filming it live on the news and just start shouting and screaming. And all the cameras would turn around saying, what’s happening here? And they got free publicity paid for by British Airways. And I went, that’s brilliant. I’m gonna try and do that. And I’ve been waiting, what, 30 years? I finally get my chance at ESACT to run around with a lizard and a brightly colored shirt.

David Brühlmann [00:17:13]:
It is indeed great marketing. I noticed you, very well done. As we are wrapping up, John, what additional question should I have asked?

John Bonham-Carter [00:17:19]:
Ooh, that’s a great question. Maybe, when will I stop?

David Brühlmann [00:17:24]:
Yes, that’s a good question.

John Bonham-Carter [00:17:25]:
I’ve tried to stop several times. And many people that I know, my co-founder—well, it wasn’t really a co-founder, but my co-conspirator in Erbi, Mike Chiu, runs a company called Kytopen right now. And he blames me for like, John, you’re on a beach chilling out the last year and a half, having sold Erbi and having great fun, traveling different places while he had a new startup to go and raise money and go out there. And I said, but Mike, if you were with me on the beach, you would hate it. He goes, oh, I would absolutely hate it. I’m just trying to make you feel guilty.

So when to stop? Well, you stop at different ages. You want to do different things. I don’t want to be necessarily doing every job that I was doing previously in every startup, but right now I do. Right now I really, I love doing everything in it. A few of us there, we’re now hiring, we’re now going to be taking on more people, so I’ll have to be more of the manager. But I don’t know when I’m gonna stop. I don’t know what I’m gonna do in 3, 4, 5 years’ time. I never really knew what I was gonna do as a degree. I didn’t have a career plan. Don’t know what I’ll do in 5 years. Maybe I’ll be running this company, maybe someone else will. We’ll see how it goes.

I love living in Somerville in Boston. Brilliant place to be. Will I move back to Europe? Maybe. Life is full of surprises, and what I like to do is keep every door open and try and go through all of them simultaneously. So it’s a quantum life. I want to go through all the doors simultaneously and experience everything altogether. And that’s hopefully what I bring to my kids and my family and anyone I interact with as well. Always say yes if you can.

David Brühlmann [00:18:51]:
What a great way to conclude. It’s been wonderful, John. What is the number one takeaway from our conversation?

John Bonham-Carter [00:19:00]:
I think it’s a terrible cliché. It is try everything. And that, if anyone is into children’s films, you’ll know is from Zootopia. Which is a brilliant film. I absolutely love Zootopia, and I love Shakira’s song that is with it. But try everything. Can’t hurt. You’re taught it as a kid. Try this food, try that food. But do that in your work life as well, and do it with technologies. Try ’em out. They may help you, and you’ll help small companies, and those companies will make you more efficient, and you’re more likely to succeed in your own work. Collaborate and try everything.

David Brühlmann [00:19:33]:
Where can people get ahold of you, John?

John Bonham-Carter [00:19:37]:
LinkedIn is the best. I joined LinkedIn very early. So my LinkedIn is John BC, no dots, dashes, or anything else. I have no numbers after my name. So it shows you how old I am. Right back. I was using email in 1993. I was on the internet in 1992.

David Brühlmann [00:19:52]:
Wow.

John Bonham-Carter [00:19:52]:
So I’ve done a lot of things very early. You can find me on LinkedIn. I always reply to my messages. That’s probably the best. And happy to take any conversations, happy to give advice to startups. And definitely if you want to buy a cell count metabolite analyzer, hey, definitely get in contact. That’s what I’m all about nowadays.

David Brühlmann [00:20:07]:
There you got it, smart biotech scientists. You know where to reach John. You will find it in the show notes. And always a pleasure to connect, John. It was a wonderful conversation. Thank you so much for being on the show today.

John Bonham-Carter [00:20:19]:
David, thanks for having me. What a fun hour we’ve just had.

David Brühlmann [00:20:22]:
If there is one thread running through this conversation, it’s that lasting success as a startup founder comes from listening closely to customers, not from chasing the next shiny technology. Thank you for tuning in today. And if you enjoyed this episode, please leave a review on Apple Podcasts or your favorite platform, and we’ll see you next time.