In our years working with life science startup founders, we have come across a fairly common scenario. A principal investigator, often coming from academia, has finally received their long-sought after SBIR or STTR grant to take their promising technology from their lab into a standalone company in hopes of someday commercializing that technology. Understandably, they celebrate, breathe a sigh of relief, and then, finally, start paying team members a salary.

But at that point, quite often, progress slows to a crawl. With a limited budget, mostly from the grant but perhaps from one or a few angel investors, the principal investigator is hesitant to commit to spending out of a fear that it will drastically reduce the company’s runway and they will be back in the same situation as before – toiling to advance their technology but unable to compensate the team for the effort.

And so, the PI becomes remarkably cautious once the grant money arrives. The important questions that justified the grant in the first place (the whole reason NIH or NSF gave them money was to take on riskier projects with good commercial opportunities that companies or investors wouldn’t underwrite themselves) get pushed down the road. Many times, investigators need to change their mindset from, “I can’t afford to do this now” to “I can’t afford not to do this now.”

In the startup world, “fail fast” is a necessary discipline, and antithetical to the typical academic way of thinking. Take on the single biggest risk to the project as soon as possible. If you can’t overcome that risk, the project was never going to succeed, so you’ve saved a ton of money. If you succeed, you’ve just removed the greatest existing risk (and added significant value).

We try to get new PIs to think about spending grant money like they are trying to launch a product, and not like they are trying to keep their job as long as possible. We try to remind them that the goal was never the grant. The goal is the therapy, device, or diagnostic that works in the real world to help real patients. And while taking the leap to spend a substantial portion of the grant budget on answering the riskiest question can be scary, not taking the leap almost certainly dooms the project to failure.

3EA partners with research teams to accelerate the path from benchtop to bedside. If you are navigating the gap between funding and commercialization, we would love to talk to see how we can help you in that journey.