Redefining Biotech: Building Enduring Value Beyond Acquisition | Rabia Khan (Part 4/4)

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Intro - 00:00:55: Welcome to The Biotech Startups Podcast by Excedr. Join us as we speak with first-time founders, serial entrepreneurs, and experienced investors about the challenges and triumphs of running a biotech startup, from pre-seed to IPO, with your host, Jon Chee. In our last episode, Rabia Khan shared how her experiences at BenevolentAI and Sensyne Health shaped her thinking on data, drug discovery, and leadership. If you missed it, be sure to check out part three. In part four, Rabia shares how she founded Serna Bio, why she bet early on RNA-targeting small molecules, and how she raised her first round at Y Combinator while building a data-first platform that challenges traditional drug discovery models. She also talks about staying lean, setting culture intentionally, and what it takes to build a company designed to endure, not just exit. 

Jon - 00:02:01: And so, you know, you're drinking out of the fire hose at Sensyne. It sounded like a sweet gig, but I know you eventually leave. When did you know it was time? And when was it time to start, you know, go on, embark on the startup journey?  

Rabia - 00:02:16: It's so interesting, right? So there's an incredible team. So the company was 100 people, 50 of them reported into me. I'm managing this team. I'm making good money, which was very new as an experience. And you're learning so much. You're dealing with NHS, a very unique infrastructure. The conversation around the value of NHS patient data, you're pitching to pharma, pandemic hits, boom. All of our data was stored on-prem because it had to be, because we're dealing with, even if it's anonymized, it's very important to keep it secure. How are you going to overnight create a cloud solution and send everyone home? This was 100% on-prem roll. And I built the team. And now it was just about doing more deals, more deals, more deals. And I was like, well, I've done four, I'll do five, six. And in the back of my head now, at this point, I've gone way away from drug discovery, right? I'm selling virtual control arms to pharma companies. That's what I'm doing. And part of me was like, but drug discovery, what about drug discovery? And so I started thinking about this idea that I had. And the pandemic had hit. I moved back to Toronto to be with my mother. I don't know if you remember, Iran was the first country where they shut down the flights. And I remember thinking that they're going to start shutting down flights everywhere. And if I am away from my family, I will never forgive myself. You know, those are the moments where you figure out what really matters to you. And being close to my parents was what really mattered to me. So I got on up, I sent my team home. I said, everyone go home. We're going remote. Not on a plane, went to Toronto, ran the team remotely from there. We did some incredible things. Like we ran a weekend hackathon and deployed algorithms into hospitals to be able to predict whether someone was going to get intubated or not using their patient data. It was the most fulfilling experience. That was one weekend of a hackathon that we ran, but I was still selling a product and working remotely in Toronto. By this point, I had formed this idea that the majority of the human genome encodes RNA. We have no way of drugging RNA other than ASOs and siRNA, but I come from a country where when we were going through the pandemic, we were injecting the vaccine at 40 degrees Celsius, 35 degrees Celsius. That stuff is not traveling. I wanted to find a way to target the majority of the human genome, which is where the majority of genetic variation lies with a modality that is accessible to my home. Which is small molecules. Not ASOs, not siRNA, not gene therapy, not CAR-T, really simple pills, you know, the stuff you can put in a pack and take. That's the stuff that travels. That's the stuff that can have an impact to the country that I was from. And so I said, okay, why has no one done this? Well, there's no data. There was about 1,700 data points in the public domain. I'm not building any models on that. And so I said, if the premise is we can generate large enough data sets, then we can train machines to learn how to define the features of small molecules that drive those interactions. And we can rapidly accelerate our ability to discover small molecules that target RNA instead of proteins. Because the entire industry has been focused on proteins. We've just kind of ignored RNA for a little while. And so I started thinking about this problem. And, you know, it's hard to do that and run a team in a different time zone. And so I said, guys, you're good. You just need to hire a BD person and they're going to do more sales. Like, you do that. I'm going to try and think about this problem. You know, it was the pandemic. I thought it's probably not going to go anywhere, but it's okay. It's fine with my mother. Applied to YC the first time, got rejected completely. And then Abe, who was a friend of mine, he said apply again with a more formed idea. Got into YC. And then I was like, no one's going to give me money, solo founder. Like, this is not going to work. But it'll be an experience. And we raised $4 million before Demo Day, didn't even do Demo Day, and then very rapidly raised another $7 million. And it was the premise, which is the majority of the human genome remains untapped for drug discovery. If we can build a toolkit that enables us to modulate it, think about the opportunities. And so I left Sensyne thinking, we'll generate some data, we'll build a model, and we'll be able to develop small molecules that target RNA. I think you were saying earlier, if you understood what you were getting into, sometimes you might not do it. We did that the first year. We built the model. We were done. And then we realized that's not a drug. And so then you have to start, you know, like, well, let's think about which indication are we going after and where do we have a competitive advantage and how do you build a team and all of those things? And how do you raise money? You need more money, $4 million. And I knew that $4 million was never going to be enough. You know a lot of this intellectually. You know that you're going to build a drug intellectually. But the pieces and peeling the layers along the way, one of the things they tell you in YC is that, you know, do the job before you hand the job to someone else. So just, you know, doing the various pieces has been so much fun because. You'll generate the data sets. You'll develop the models. Then you have to do target selection. You have to find the right experienced people and put all of that together. But to answer your question, I left because I felt like my job was done. I had this idea. I was curious. And it just really bothered me. I still remember walking over to Matt at Benevolent and saying, hey, these are the targets. And he's like, these are undruggable. I'm like, this is ridiculous. That's not a thing. Like, I don't buy it. I don't agree. And not only do I not agree that the majority of the protein is undruggable, I think it's ridiculous that as an industry, we cannot modulate the majority of the genome, which transcribes RNA. Like, we need to do better. And so that was the premise. And four years later, here we are.  

Jon - 00:08:57: Freaking awesome. That is like the big, hairy, audacious goal. Like, I love that. Like, he's like, I think I was talking to Barry Ticho at Stoke. 

Rabia - 00:09:05: Oh, yes. Incredible company. 

Jon - 00:09:07: It's kind of that thing where he's like, go big or go home. Like, frankly, like go big or go home. Like, and, you know, and I think you're going big. Absolutely. And I think it's like finding worthwhile problems to solve. And so, you know, you're out of YC. You have this kind of base layer of capital to kind of get this thing going. You said you built the model, I guess, like give us the landscape of your your space. What is the status quo? Like, what is the current status quo? I realize the finite amount of druggable targets is one aspect of it. What is the status quo? And how is Serna like really just like bucking the status quo with your approach?

Rabia - 00:09:46: Drug discovery as a whole, 10 years, at least $2 to $3 billion, 10% of drugs make it. Right? It's a bad math. So it's very difficult to get a drug approved. But the other thing is the majority of drugs target proteins. And so all of a sudden, you have 100% pie chart, 2% is encoding proteins, 70% is encoding RNA. The 2% is 20,000 proteins, and we drug 4,000 of them. And so you look at this target space and you think, well, that's interesting. And so that's the lay of the land. The majority of drug discovery targets the proteome. Well, let's target RNA. Think about the opportunity and how you can open that up. Now, when you want to target RNA, you can do what Stoke does, which is ASOs. You can do siRNA, or you can do what we want to do, which is small molecules. And in the small molecule RNA space, What you need to do is you need to find a pocket of the RNA to put the small molecule and modulate that, right? And so I said, in our industry, how have we learned what small molecules would match what pocket, right? So the industry has done this before by developing an understanding of all the proteins and then defining the chemical space. And so as an example, I always give you the story of kinases, right? So if you think about 15 years ago, this target class kinases was undruggable. And as an industry, we developed an understanding of what a kinase looked like. We developed chemical theories that drug these kinases. And then we developed off-target mapping tools to understand how to study this. And as a result of this, so many kinase drugs have come onto the market. And so when I looked at that, I said, if we apply the same logic to RNA, the play of the land at the time was. 1,700 data points of RNA-small molecule interactions, not a lot of data. Very little known about RNA structure. So I can give you an example of what that means. If I showed up today and I said, I'm a company that does small molecule targeting proteins, you would think I'm crazy because no one says that, right? I mean, that doesn't make any sense. You target GPCRs, you target kinases, right? Or you're doing allosteric binding. But I show up and I tell you small molecules targeting RNA and you don't think I'm crazy. But RNA is just a class, just like proteins is a class. And so when I started the company and to this date, there's no ontological framework that has broken RNA down. Like we've broken proteins down, right? Proteins are kinases, they're GPCRs, they have structure function relationship. I spent five years of my life working in companies that have ontologies as their backend. Ontologies is a classification system. How you think about a problem defines how you speak about it and how you solve it. And so I said, well, no one's targeting RNA. We have to figure out what we're targeting. And so the lay of the land was 1700 data points, RNA-small molecule interactions. People think that you're a small molecule RNA targeting company, which again, makes no sense to me because no one is a small molecule protein targeting company. And so we started by saying, we're just gonna do away with everything that we know. And we're gonna start from scratch. We're gonna write the rules. We're going to think from first principles. And so if we start from first principles, what worked for kinases, we're gonna try and make it work for RNA. So we first want to subdivide RNA into structural classes that are functional. We want to take those and we wanna generate our own data of what chemistry binds to those. And then we want to build tools to study those interactions. And that's what we did over two years, which is we went and built what I call the toolkit because I wanted to just put aside what we know, put aside what you know for the protein world and just start from scratch. So we built the world's largest database of RNA structure function relationships. We generated 2.5 million data points of interaction so we can train our own models and get the models to learn what a compound needs to look like. And so now our machine learning generative models generate compounds that we test that are driving our medicinal chemistry campaigns. And then we built our own assays. And so the lay of the land was basically people tried to take the protein rule book and apply it to RNA. And we said, no, we're gonna not do that. We're gonna write our own rule book. 

Jon - 00:14:44: First off, badass. That's super rad. And I guess my next question is, you put everything aside, we're starting from first principles, kind of like nuts and bolts of this thing. How did you just generate data sets like such a robust data set operationally? 

Rabia - 00:14:59: When you raise money. Two, find someone to generate data set. Three, generate data set. Literally that simple. 

Jon - 00:15:06: Who are the type of organizations that you guys work like in terms of these external collaborations? Are these like healthcare systems? Are these like- 

Rabia - 00:15:14: No, they're contract research organizations, right? And, you know, I make it sound much simpler than it is, obviously. I spent a bunch of time reading papers trying to figure out how do people study RNA-small molecule interactions? What are the experimental methods that they use? Then I had to go find organizations, universities or contract research organizations that had these machines. Then we had to go negotiate contracts with them. And, you know, what's really interesting is that these CROs are not set up to do what we wanted them to do, which was run a many by many experiment, right? So drug discovery is very target centric. I want to drug this target. And so I'm going to show up. I'm going to give you this gene. And we're going to talk about this gene. We're going to screen like 300,000 compounds. And here I was being like, I'd like to screen 100 targets, please.

Jon - 00:16:05: I'm sure they love that. 

Rabia - 00:16:06: So they did, but then they gave me a prize. 

Jon - 00:16:09: Yeah.

Rabia - 00:16:10: Which was like running 100 programs, which no one does, by the way. And I'd be like, but no, like I need one experiment. And they're like, but you can't run one experiment. You have to do all of these down. I'm like, I don't have to do anything. I just have you have to do the thing I'm asking you to do. Right. And so it was a lot of learning that the industry is builds, in a worldview of one target at a time. And if you want to build a company that is generating large data sets with a many by many, so many targets by many compounds, it is non-trivial because you are breaking business models of CROs. And so then eventually we had to say, this is not working for us. We got to set up our own labs and started doing that in-house. And I think fundamentally these tech bio companies, this new generation of companies, we're challenging norms in a very weird way. We're challenging business models. We're challenging data storage norms. Like you go to some of the standard companies that are storing data sets and you say, well, we want to store like many targets by many compounds. And they're like, well, you can't do that. You have to do it target by target. And I'm like, no. 

Jon - 00:17:22: Why? 

Rabia - 00:17:24: Why? Why? Right. And so I think the operationalizing of it scientifically is not hard. Once you go read the papers and develop the plan, it's how do you translate that into something that is fiscally intelligent, fiscally conservative, a good use of investor money, because let's not forget at the end of the day, they need a return in about eight years, ideally a return on their fund. You want to be the company that returns the fund. And you're not going to do that by spending a bunch of money and generating tons of data. You're going to do that by building a drug. And you need to spend a little bit of money on platform, a lot of money on program.

Jon - 00:18:04: I love that. And I think that is exactly what I found too, is like, I got deeper into the industry is that it's inertia. There's like a business model inertia. It really is just inertia. People have been doing a thing a certain way for a long time. So when you come in with these like kind of different out of the box approaches, it just sometimes square peg round hole issue. And sometimes it almost feels like. There is, it's like an immune system just like rejecting. It's like, no, I don't like this. Like it's like, don't like this. And I, it was interesting. You brought up like, you know, kind of like the matrix. I was like talking to Stavros at TileDB and their whole thing is like the database of like multimodal databases that are not just like tabular in nature. And you can like store a bunch of different things. And it's like, that's just like a pair. It's almost like a paradigm shift or just like a shift in thinking, but if you can get it, like if you can shake free of whatever it is, that is like the ball and chain of business model or whatever, the unlock could be massive. But again, it's hard stuff because there's like a lot of organizational unpacking that needs to be done. 

Rabia - 00:19:06: And you're not the big fish, right? There's like Pfizer over here and you're talking to the CRO and you're like this nobody. And they're going to say no and not give you the time of day. And so you got to convince them that like, I appreciate I'm asking you for something weird, but you do got to give me the time of day because my tiny little contract may be important later to you, right?

Jon - 00:19:26: Yeah, it could be a mess. And I've always thought about that. It's just like these opportunities that may seem a bit out of box might be your next big revenue line or product line.

Rabia - 00:19:37: AWS for Amazon, right? That is the story.

Jon - 00:19:40: Yeah, it could be that it could just go from this thing where you think is a cost center just to a massive growth area for you. And that's why like, I always encourage people like, you have your breadwinner, I get it, like, working with Big Pharma pays bills. Like, I get that. That's like, pretty easy. That's the easy math. But like, sometimes like the stuff that like this hard math stuff, it's like, there might be something there because like, especially when opportunity lies where the complexity is.

Rabia - 00:20:07: Yes. 

Jon - 00:20:08: Right. 

Rabia - 00:20:08: I think so. 

Jon - 00:20:09: Yeah. Because if it was easy, it would have been solved. 

Rabia - 00:20:12: And also, like, I don't find that fun. 

Jon - 00:20:15: Yeah, exactly. It is also the same for me. I was like, I'm just getting bored. I'm getting bored. And it's something too, to think about for listeners out there. It's just like, I still remember when like, even engaging with the CRO was like almost near impossible. Like with these constraints of a startup, you can actually get a lot done on these kind of finite resources nowadays. There are CROs who will engage. Like you can do it lean. And obviously there is time to bring in your own lab and where you need to do it in-house. But for the most part, there's like a lot of ways you can keep it lean in the early days. You get some conviction and then you're like, okay, like let's start doubling down here, bring things in-house, back up the truck in terms of like time, money, and resources. Because sometimes I think people think you're like, especially everything in the news right now, it's just like these rounds, like coming out with a seed that is like a hundred million. And you're like, dude, that's not how every company has to operate. One of our teammates' fathers was like employee 13 at Genentech. 

Rabia - 00:21:17: Wow. 

Jon - 00:21:18: Yeah. And so I grew up with him and I was like, always would talk to him. And he was like, dude, we were in a warehouse in South San Francisco. I kid you not. We barely had a lab and we created Genentech. He's like, I don't know. When he looks at, like, he looks out there, he's like, we had no money. Like, we had no money and we created Genentech. So I was like, I don't know what is the precedent that we're setting here. And look, you know, perhaps Genentech is like this, like the... Lightning in a bottle, kind of perfect everything, right? Maybe it was just like problems are harder now and require more capital, whatever. But I think it is still absolutely a possibility to run an effective organization on a smaller, more lean, more nimble format.

 Rabia - 00:22:03: Forces creativity, I think. Two leaders that I really admire, Ray Dalio, principles, Bridgewater's CEO, XEO, Jeff Bezos, Amazon. And not because he built Amazon, and I think Amazon's an incredible company, but because of his principles. And there's the six-pager, right? We do that. We like written communication. But he also has this frugality is a big part of what they do, right? Like customers first, frugality. So you're always thinking about how do you be lean? I think it becomes very comfortable to say I have $100 million and spend a bunch of money. It's very easy to spend money. And so I almost believe like, if you gave me $100 million, I got a 10x that, that's a different problem set from I've raised, you know, 100 total over the life of the company. And I'm going to 10x that as opposed to I started with 100, then I'm going to go to 200 and 300, right? Different problem sets. But I think frugality is a powerful thing. I think it breeds creativity. I think it breeds the ability to think outside the box. And one should always have some level of thinking about how do you really use money creatively? I always say like, the people that are investing in venture funds or pension funds. So people sometimes forget that you're playing with pension money. And so this is a teacher in Toronto whose pension I am gambling with. And so use it carefully, right? Don't just spend it. Think carefully. Is this really the best use of the money?

Jon - 00:23:38: I think also like having too much capital just builds bad habits. 

Rabia - 00:23:42: iDifferent habits. 

Jon - 00:23:43: Different habits. Yeah, different habits, different habits. But like, there's a reason why like Buffett talked about like you have a punch card, you got to think about the punch card. Like, if you can make only five investments, is this the one that you would make? If we carry that over to like how much capital you have, you have now infinite punch cards. Now you have a problem, right? You're like, everything is worth solving.

Rabia - 00:24:04: It's exciting.

Jon - 00:24:04: Yeah, everything is worth solving. You don't have this filter in which you have to actually you have only five. It's like five bullets in the chamber. 

Rabia - 00:24:13: But this is your idea of you have X number of hours in the day. 

Jon - 00:24:16: Yeah. 

Rabia - 00:24:17: Choose wisely where you spend it. Because opportunity cost of decision making, right?

Jon - 00:24:22: Yeah, I congratulate people who get a lot of money, but sometimes it's like a blessing and a curse. 

Rabia - 00:24:28: I mean, I'm jealous. 

Jon - 00:24:29: Yeah, for sure. Yeah, yeah. Like, look, there's a lot of problems that become easier when you have capital.

Rabia - 00:24:35: That's right.

Jon - 00:24:35: For sure.

Rabia - 00:24:35: Right. I will take capital any day of the week. But I also think, you know, even if you do have capital, this is why I like Amazon, I maintain a culture of frugality.

Jon - 00:24:45: Yeah, exactly. That's exactly it. Right. That's when you have superpowers. It's if you have that kind of gritty frugality, and then you have the resources. Oh, like the amazing things you can do, like the amazing things you can do. That's where magic happens. But if you don't, if you don't have that muscle, and it truly is kind of I always whenever I think about Amazon. It's like, because the margins were so slim, for so long. It was like survival, like truly survival. And then eventually they started cash flowing like crazy, but that you don't shake like that. Now you basically every dollar invested is just like to the moon.

Rabia - 00:25:27: The culture is set, right? That is the other aspect of that. Like you set the culture by the time that that's taken over. You can go back, ways back and read some of his investor updates and the way he talks about the customer and the culture. I just think it's really powerful.

Jon - 00:25:43: Exactly. And that's why the written word is so important. And even conversations like this, I think are like really important for anyone, you know, thinking about like setting a culture. It's like, you gotta like, you gotta document this and live it and breathe it. And like, and you know, I always think about it like, as you know, I try my best to do that. Like we have like a notion that just like, is this like mind hive of like information and videos and everything. It's an easy way for your team to just get quickly up to speed. New hires of like, it reduces the ramp.

Rabia - 00:26:13: I wrote our operating system. It's called our operating system. And I wrote it. And it says, you know, we model after Ray Dalio and Jeff Bezos. And here's our five principles. And like we send that to people before they join the company, because if they don't like those, shouldn't join us.

Jon - 00:26:30: Yeah. And that's okay, by the way.

Rabia - 00:26:32: That's amazing. Like, don't come here if you disagree with this, because you'll be unhappy and I'll be unhappy, right? Like, I don't get offended, thick skin. It's okay. I mean, Ray Dalio is heavily controversial, right? Like, Bridgewater is known to have a culture that was a little bit weird and cultish. But I think what he built was really incredible. And you don't have to agree with me, you don't have to like it. But like, that's what we model after.

Jon - 00:26:57: Yeah. And that's the thing. It's kind of a, there is no one right culture. It's just what the right culture is for you and your team and defining it like, and being super deliberate about it. 

Rabia - 00:27:07: 100%.

Jon - 00:27:08: You got to be. It's not just this thing that you slap on the wall and then you're like, you know, you're just like, all right, that's the culture. It's like, no, no, no, no. It is far more intentional than that. It has to be. And if you're not intentional about it, that's when you like people come into the company that don't fit the mold. And then you just like, it's always death, like indigestion. You're just going to die from the inside. It's not the outside anymore.

Rabia - 00:27:31: And it's uncomfortable for everyone involved. And I don't like uncomfortable. That's just not fun. I'm like, you got to have fun. If all you're doing is thinking about this company day in, day out, it better be fun. And so I like our culture to be a place where like everyone's bought into the same thing. And if everyone's bought into the same thing, then you're all working in the same direction, rowing in the same direction. But if someone's like, hey, I think Bridgewater is a really stupid company. And you're like, yeah, I love this transparent culture. And then someone over here is like, no. I mean, that's not going to work. 

Jon - 00:28:06: Yeah, life's too short for it too. It's just like, it is.

Rabia - 00:28:10: It's going back to my mother's like, no.

Jon - 00:28:11: Yeah, yeah, no. Yeah, yeah, just no. It's okay, we're moving on. And so, you know, it sounds like you've now generated this data via internal and external. We talked a little bit about the external. You're working with CROs. It sounds like, you know, there are other externals that you're interfacing with too. Well, how was the experience building the internal wet lab? How was that? 

Rabia - 00:28:35: Oh my, oh my. So we started the labs in the UK. We've subsequently shut down the labs in the UK and are moving them to San Francisco. This is probably a three-hour conversation in its own right. So I won't bore you with that. But one of the things I will say is that building a lab is much easier in my experience now in places where you have critical mass of people that are like you. And so why we are choosing to move the labs to San Francisco is because there are so many versions of us floating around that it is easier. We chose to build the labs in the UK because I had networks here. It was hugely beneficial. It meant that we could hire cheaper. Our raise lasted much longer. We've stayed alive past all of the turmoil because we've been able to be exceptionally lean. I think if we had started in San Francisco, we would have been dead by now because salaries are much higher. Everything is more expensive. So there's different times for a company, but building the lab, one has to be really, really, really lean. It adds up really quickly. And there are moments where you need it. And then there are moments where you don't. We are now going into heavy duty chemistry for our programs. We don't need labs anymore. And so we're shrinking them down and moving them to centralize with our programs teams. 

Jon - 00:30:09: Very cool. And something that stood out to me when you're talking about is like being able to weather the storm. That is like something in company building that I believe is like. One of the most like top, like you got to live to another day. Yeah, don't die. 

Rabia - 00:30:23: Rule number one, don't die, right? When I started this company, someone said to me, your only job, Rabia Khan, is to keep the company alive. That's it. That's your number one job. Everything else is irrelevant. And then the other thing someone said to me when the markets first started going like this is make sure the whole company and the people on it are on a dial. Unless you really need someone, they need to be a contractor. I thought that was really powerful because then all of a sudden, the numbers are under your control. Labs, infrastructure don't fit in that category. Actually. 

Jon - 00:30:57: Yep. It's like you just have these fixed costs that just like will follow you. Like they will follow you. 

Rabia - 00:31:02: Drain you. 

Jon - 00:31:03: Yeah. And like, like it's exactly what you said, there's like phases to it. It's like in those early days, you need to have like that flexibility. And then as you start to get that kind of product market fit, that traction, that conviction, exactly that move to San Francisco actually started to make sense for you.

Rabia - 00:31:20: MVP built, right? We've understood, we've built these really complex assays. We've done it in a quite a cheap way. And for us now, we want to centralize the team, have everyone in one geography. So I think one of the things around a company, I actually think about it as a living being, right? And you have to mold it and grow it in the direction, given the externalities. It was a pandemic. Everything was remote. It didn't matter where everyone was. The world has changed. We need to change and you just need to constantly be evolving. 

Jon - 00:31:55: Absolutely. And I feel like our industry, like Life Sciences, like are kind of late to this concept. It's always just like out the gate, do the San Francisco thing, scale up as quickly as possible, burn the candle at both ends. And it always never really sat right with me. Rule number one is don't die. You're just accelerating the pace in which you could potentially die. 

Rabia - 00:32:19: You know, there's value in that, though. Someone said to me, so I think you and I are aligned in that, you know, be very diligent, be very frugal, be cautious about how you build, but dream big. Whereas what I love about San Francisco, and someone said this to me, is that's the wrong approach. You need to go raise more money and be bigger so you can spend more money. And I was like, hats off to you. I mean, and he's built a very successful company. And so I was like... Okay, also true, right? Like both can be true.

Jon - 00:32:52: Yeah, exactly. It's just a different way of company building. But I think it's at least that method of company building, it's just like, at least get a lot more mind share, because it's something that you can you can write a headline about. 

Rabia - 00:33:05: And hats off to those guys that can do it, right? Like the guy that can raise $100 million, like kudos to you. That's amazing. 

Jon - 00:33:12: Yeah. And I've always thought there's like always like a million ways to make a million bucks. I think it's what Howard Marks talks about the investors. It's like, what is your style of investing? And it's stylistically just different. Just like a culture is different. Like the hyper growth, massive scale. That's just like kind of just like hockey sticking. That's just a different way of company building. It doesn't, for me, in my style of company building, it doesn't really vibe well with me. I'm not saying it's wrong. It's just different. And that's another thing that you need to recognize, listeners, as a founder. Like, what is the style? Like, when you embark on that journey of I'm working towards the hockey stick as quickly as possible, it's hard to get off that treadmill. I would say almost impossible. You kind of take it, you know what you're getting into, and there's no going back, really. 

Rabia - 00:34:06: I think one of the hardest things I've had to do is figure out what's okay for you, even if it's not okay for everyone else around you. As a scientist, one is used to having rules. You have a set of rules, you design an experiment and you do the thing, right? And so I've made this mistake and I don't make it anymore, which is if I have a problem, I go externally seeking a solution. What is the right way to do this? And frankly, there is no right way. There is your way. And getting very comfortable in that, like, this is my way and this is the way I'm going to do it. As Abe said to me, is that it would be really sad if something failed because it was a decision that you took someone else's advice. You'd be a lot more comfortable if it failed because it was your decision. And so like, get comfortable in this, like, there's no right way to do this. And there's things that are wrong, like fundamentally. But a lot of these things, there's no like, here's the cookie cutter approach. There's many ways to get it right. And just getting very comfortable with the, you can go raise 100 million and be successful. And I'm going to raise much less and do the exact same thing. And we'll both coexist and succeed simultaneously. 

Jon - 00:35:20: Absolutely. It's funny. So like my co-founder, long history in the legal practice and my other co-founders in private equity. So it's kind of like this. Those are the opposite worlds of venture. Like we're in credit. Also, credit is also seen as this is an unfamiliar thing to Life Sciences. So I was always kind of like. Perhaps, you know, in the book, I was kind of like, kind of lit stewed in that, kind of in this weird, like, I never felt like I fit in. I was always like this weird, like, duckling. 

Rabia - 00:35:53: But it's a superpower, right?

Jon - 00:35:55: Yeah, it didn't feel like that initially. 

Rabia - 00:35:57: It doesn't, right? One of the things is like, you know, training yourself that the second you start feeling uncomfortable, you're like, Ooh, this is the place I need to be. Right? Because if you're not growing, it's not great. And so if you feel uncomfortable, initially, you kind of want to recoil and be like, this feels awkward. Part of what I've been trying to do, and actually now very happy with it, which is like, how do I constantly feel uncomfortable? Like, where is the area where I now need to get better at? Like, and the only way you know that is you're now in an uncomfortable situation and you need to think about what about this is making me uncomfortable. Excellent. How do I learn? How do I build a framework? So next time this is wrote. 

Jon - 00:36:39: Yep, absolutely. Again, it's like this muscle that you can develop. You just have to be proactive about it. And so big move for Serna from your moving to San Francisco. As you're looking forward one year, two years, what's in store for Serna? What's in store for you? 

Rabia - 00:36:56: Ilook at a company like Regeneron and BioMarin as incredible companies. So why do I say that? Our industry is built on this idea of acquisition. You are built to be bought. We organized these dinners. And one of the questions was, what if there was no pharma acquisition strategy? How would you build a business then? And I love that question, right? What do I mean by that? BioMarin has built a $2 billion business. They're, I think, maybe larger now. They've built drugs. They've taken drugs to market. They've had an impact. Regeneron, like incredible organization. And the founding founders are still there, by the way. They're still in the science. How incredible is that? And so I want to build an organization that is actually going to take drugs, not to clinic, but to market. And build revenue, build a real company that has revenue where we can say what we do matters because these children didn't have treatments before. And they do have treatments because we are working at this BioMarin management team. 20 years they had that management team. That team built that company for 20 years. How powerful is that? And so that to me is, you know, the next two, three years, we want to raise more money. We want to get to clinic. We want to have our first positive clinical readout. We want to bring a number of other programs forward. But more than anything, rather than build to buy, how about we build a real company that makes real revenues? 

Jon - 00:38:31: That's super sick. And also I feel like I'm speaking to a kindred spirit because I talk about like Excedr. I'm like, my exit is death. Like I'm going to do this until I die. 

Rabia - 00:38:43: Yeah, like a company. 

Jon - 00:38:44: Yeah, from the womb to the tomb, I will be doing this. I will be doing this. And I always get that odd, an odd look like what? For me, they're like, I'm in my happy place. Like here one is incredibly refreshing to hear that from you, because I think that mindset and that model of like build to sell, or just like, there's this like exit, like right in the forefront of the mind is like so prevalent. And the large players, right? They were small at one point in time. 

Rabia - 00:39:16: Yes, Regeneron was not always Regeneron. 

Jon - 00:39:19: Yeah, exactly. Like, same with Vertex. And, like, same with, like, Alnylam. They were, like, small. And, like, it is possible. It is possible to create this standard. Yeah, by no means is it easy. But it is possible. Yeah.

Rabia - 00:39:36: And what's fascinating is, you know, my father's an entrepreneur. They build products. They build real things. And I told my dad, I was like, start a company. And he's like, oh, what are you going to build? And I was like, well, we're going to do drugs. And we're going to raise some money. And he's like, people are going to give you money, but you're not selling anything. And I was like, yeah, so venture. And he's like, this is ridiculous. You need to go generate revenue. He's like, I don't understand this world where you are constantly asking people for money. Like, why can't you build a product that someone wants to pay for? And it really resonated with me because I'm like, he's so right. Like, why don't we build a real business that has fundamentals, right? Revenue. And so revenue comes in multiple forms. You can sell the platform and generate revenue. You can build a drug and you can generate revenue by sales. And so that's how I think about it. I want to build a business. 

Jon - 00:40:31: Yep. I'm super pumped for you. That's like rad. It's honestly been a long time since I've heard that perspective. And again, there's nothing wrong with selling to large pharma. There's nothing wrong with that. It's just a different type of- 

Rabia - 00:40:44: It's incredible. Like a multi-billion dollar exit, not a bad thing.

Jon - 00:40:47: It's an amazing outcome, but I love hearing kind of different perspectives and different takes and just like different walks of life. And this is what I don't hear all too often. So it's really refreshing to kind of hear your perspective on that and kind of what you have in mind for Serna. So first off, this whole conversation has been super illuminating for me. I've learned a lot and you've been so generous with your time. So first, I just want to thank you for being willing to sit down with me for this long. It was like, I'm having a lot of fun and I can keep going on and on and on. And maybe the next time you're in San Francisco, we can meet up and grab coffee. 

Rabia - 00:41:22: That would be incredible. 

Jon - 00:41:23: I'd love to learn more about kind of what you have in your sights in San Francisco. But, you know, in traditional closing fashion for the podcast, we have two closing questions. First is if you can give any shout outs to anyone who supported you along the way. You know, would you like to give them? 

Rabia - 00:41:39: Such a long list. But I think first and foremost, that the people around me that enable me to do what I'm doing are the team that I have right now. They are the most incredible team. I wake up every day, we laugh together. We have really difficult days together. So shout out to the incredible team, especially the ones that joined very early on. Tim Harini, employee number one and two. They're just so great. Mom and dad that have supported me. There's actually very few immigrant South Asian female founders, CEOs. It's not normal in our culture. It's culturally very difficult to do this. Women in my culture don't necessarily go on to found companies. It's not what we're trained to do when we're young. And they've just been the most supportive, like, you know, go on, found this company and all of the mentors along the way, right? You never get to where you are without someone being the wind behind your back. It's fine. It was Nick Scott Rahman, Paul Driesen, Jackie Hunter at BenevolentAI, my PIs, and all of the investors that, you know, the Pablo who wrote the first check at Hummingbird. Why did he do that? You know, he took a risk. And so I think I always say, like, you never get to where you are without people being the power behind you. And there's just been so many. 

Jon - 00:42:59: Thank you. Absolutely. And I think that is something that I reflect on, especially having these conversations. Talk about, you know, your PhD versus your MBA experience. It's like, it is a team effort. This is a team effort. You can't do this alone, for sure. And that completely resonates with me. And then if you can give any advice to your 21-year-old self, what would it be? 

Rabia - 00:43:19: Yeah, stop trying to fit in the box that the world wants to put you in. 

Jon - 00:43:23: Glad the Deloitte interview didn't go any farther because I think you would have been put into a very specific box.

Rabia - 00:43:29: I think I always was a bit weird with authority and so on, because if you think back to when he was like, oh, these are undruggable targets, I was like, no. 

Jon - 00:43:40: Yeah. 

Rabia - 00:43:41: Just know we're not playing this game. We're playing a different game. We're going to rewrite the game. Right. 

Jon - 00:43:46: Yeah. 

Rabia - 00:43:46: And so I think just accepting that that's your personality, accepting at the age of 20, if someone had told me you are going to be someone that challenges status quo, you like to ask questions and you're not going to necessarily accept something on face value, get comfortable with that and get better at it. I wish someone had told me that.

Jon - 00:44:05: I wish someone told me that too, because I felt like a weirdo. I just felt like this weirdo. And I think everyone was pointing at me and saying like, you're super weird. 

Rabia - 00:44:15: Stop asking questions. I remember someone being like, stop asking why all the time. I'm like, but why? Why can't I ask why? Right. And so I think just if you are that person, if you feel like you can't find your box and you're off doing these random things that no one else seems to find interesting, it's okay. Embrace it. It's who you are and it's going to be your superpower someday.

Jon - 00:44:36: Yep, that's spot on. And truly, I think for anyone listening out there, it's just like that kind of idiosyncratic thing about you, whatever it may be, is what is not reparable. Like people cannot copy that aspect because it's you. So like lean into that and own it rather than, you know, feeling like it's something that is, you know, you shouldn't be proud of. Cause I, I truly like, as I reflect on my journey too, it's like the weirdness is what really ends up shining, even though I was embarrassed of it early.

Rabia - 00:45:09: And actually, I'll say one other thing as a woman. So for all the women listening out there, I have had some fascinating experiences in life. But one of the things Jackie Hunter said to me, which is you don't have to be the man in the room. You can embrace your femininity, be a really powerful leader. And that's all OK. So like be yourself.  

Jon - 00:45:30: Spot on, spot on. Well, Rabia. Thank you so much again. This was super, super fun. You're super generous with your time. Next time you give me a shout when you're out here and I'm really looking forward to the next conversation and I'm rooting for you and Serna from the sidelines.  

Rabia - 00:45:47: Thanks so much for your time. Thanks for having me. It's been so much fun. 

Jon - 00:45:50: Yeah, thanks, Rabia.  

Outro - 00:45:53: That's all for this episode of The Biotech Startups Podcast. We hope you enjoyed our four-part series with Rabia Khan. If you did, consider subscribing, leaving us a review and sharing it with your friends. Be sure to join us for our next series featuring Bogdan Knezevic, co-founder and CEO at Kaleidoscope, the R&D operations platform for data-driven decisions and work planning. Kaleidoscope was built to give R&D a platform for easily understanding their data tracking projects and decisions and communicating key progress. By leveraging decades of experience spanning bio, engineering and design, Kaleidoscope created a powerful framework that brings the best of modern product principles into the hands of the innovators who need them the most. Bogdan is passionate about finding ways in which tech can be leveraged to push other fields forward, helping tackle some of the major issues we face in the world today. His background is in the sciences, first in neuroscience, followed by Big Data and genomics, and was also an internationally ranked competitive swimmer of many years. He holds a PhD in genomics and drug discovery from the University of Oxford, and was selected as a Rhodes Scholar. Prior to his PhD experience, he attended the University of Calgary. Where he graduated with a bachelor's in neuroscience and first authored multiple publications focusing on genetic and epigenetic factors in disease mechanisms. With deep expertise in neuroscience, Big Data, genomics, and R&D infrastructure, Bogdan brings a multidisciplinary perspective that listeners won't want to miss. The Biotech Startups Podcast is produced by Excedr. Don't want to miss an episode? Search for The Biotech Startups Podcast wherever you get your podcasts and click subscribe. Excedr provides research labs with equipment leases on founder-friendly terms to support paths to exceptional outcomes. To learn more, visit our website, www.excedr.com. On behalf of the team here at Excedr, thanks for listening. The Biotech Startups Podcast provides general insights into the Life Sciences sector through the experiences of its guests. The use of information on this podcast or materials linked from the podcast is at the user's own risk. The views expressed by the participants are their own and are not the views of Excedr or Sponsors. No reference to any product, service or company in the podcast is an endorsement by Excedr or its guests.