Playing The Waiting Game: A Tactical & Spiritual Guide

Posted June 2nd, 2015 by Ankit Mahadevia, in Biotech startup advice, From The Trenches

This blog was written by Ankit Mahadevia, co-founder of Spero, Synlogic, and Rodin Therapeutics, as part of the “From the Trenches” feature of LifeSciVC.

The concept of “getting s#it done” is central to our lives as entrepreneurs. With time and capital always in short supply, we have to jam all of the seminal events in a company’s growth into as short a time as possible to ensure growth and survival.

As such, it’s easy to run into a logistical and spiritual wall when one needs the cooperation of institutions that are burdened more time-consuming process . Whether it’s your new lead investor going through a seemingly endless number of steps to close a financing round while the rest of your syndicate waits impatiently, or an academic institution that’s taken months to complete a (boilerplate) license agreement for your core technology, the frustration of waiting for others can wear on you in a uniquely painful kind of way.  “Hurry up and wait” is never very fulfilling.

Unfortunately, institutional processes are like the weather. Simply wishing them away will not help, as those processes are there for a reason as we in startupland often forget. For all of my fellow Vladmirs and Estragons waiting for Godot, a few lessons learned: Godot

Don’t plan for miracles; plan for Plan B: If a financing or a partnership are part of critical path for your startup, incorporate expected process time into your projections and then double it. Underestimating the time institutions need to move can have disastrous consequences. For example, I have observed multiple entrepreneurs who have underestimated the time for a venture financing or pharma deal to close in their cash projections, and are stuck running on fumes or needing to raise expensive bridge capital while anxiously pushing their deals to completion.

Along with long timelines, a backup plan or two is imperative. Parallel process other avenues to accomplish your goal to hedge against possible delays. If you want to close a financing, keep your Pharma and multiple investor discussions going full bore. If a deal is in your future, work with your investors to ensure you are amply capitalized to maintain leverage and momentum regardless of others’ time tables.

Set expectations with your stake holders: We’ve been fortunate to have great investors and advisors that have been hugely supportive in helping us catalyze big financings and collaborations, and I’ve appreciated how tuned in they are to the company’s success. I have been on both sides of situations where the team has had to communicate continuously revised timelines from a counterparty. An experienced Board will understand the grind of process, but you can help the group’s collective psyche by making realistic/pessimistic projections of a process and compartmentalizing your enthusiasm for a close.

It’s not (all) beyond your control: All this being said, there are always ways to help accelerate a slow institutional process. The best processes I have been a part of have set a mutually agreeable timeline at the start of a process such that expectations are clear for all members of all sides that give us a place to aim. In addition, working with ones’ Board and advisors to identify key decisionmakers in an organization, who, in the case of a logjam, can work within institutional processes to accelerate can be invaluable. Finally, competition breeds speed. Having multiple active processes seems to breed ingenuity and speed in institutional process – it has always amazed me how competitive major acquisitions are closed at light speed relative to discovery collaborations around an early stage new program tailored to a specific partner.

Have empathy! It is critical to have empathy as one plays the waiting game. Over a number of startups I’ve worked with dozens of hardworking, brilliant professionals within Pharma, venture, and university as we’ve built transformative transactions collaboratively. While the overall processes we’ve navigated have always felt long, it’s universally been evident to me that my counterparties also want to move quickly and are working countless hours behind the scenes within their institution’s constraints to make this happen. As the companies I have worked with have grown rapidly, I have appreciated firsthand where a little process is absolutely mandatory as an organization grows. Your counterparty likely has just a few more hurdles than you to cross to get to the finish line. This can help (a little) as you progress on the long, methodical path to the finish line.

Ankit Mahadevia

CEO of Spero Therapeutics
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