Founding one biotech company and making a success of it is difficult enough, but Mathias Uhlén has founded 20. Not only is he a successful entrepreneur, he is also a professor at the Royal Institute of Technology in Stockholm and has accumulated more than €135M in research funding during his career.
After doing a PhD in biochemistry and working in Germany, Uhlén was given the opportunity to set up his own lab back in Stockholm. Right from the beginning the lab had a focus on both basic research and how scientific advances could be applied in industry. This is a duality Uhlén maintains today.
In his academic life, Uhlén has spent the last 20 years building the largest database of human proteins in the world with €135M of external funding. Since 2012, he has also found time to be a part-time professor at the Danish Technical University near Copenhagen.
After experimenting with patenting and licensing the discoveries he and his colleagues made in the lab and becoming frustrated with how few of them actually reached the market, he began to found biotech companies. Twenty companies later he is still going strong.
Uhlén credits his double success, at least in part, to the unique intellectual property laws in Sweden — the so-called ‘teacher’s exception’ — and also the good relationship between the biotech industry and academia in the country. He believes these factors are helping Sweden build one of the most successful biotech industries in Europe.
What do you look for when starting a company?
When I give lectures about entrepreneurship – because I do that quite a lot for students – I usually say to them that each one of my 20 companies has been a rollercoaster ride. It’s been up and down, and it’s been very difficult. There has not been a single smooth ride. If you start a company, you have to be prepared for hard work.
You have to try to find a niche where you can be number one in the world. Otherwise, I don’t think it is worthwhile. If it’s a small niche, you can have a small company, but you can still have a profitable company. If it’s a large niche, you can then try to become a larger company.
What are your most successful companies to date?
One of the most successful ones is a company called Biotage. It started as a DNA analysis company and produced the first next-generation sequencing platform. That company now has about 500 people and has a market cap of about €500M.
We also have a privately-owned company called Affibody that is close to having 100 people. We are now in three different clinical trials and we just had a very nice strategic partnership with a pharmaceutical company in the States called Alexion. We’re also moving with other clinical trials, both in cancer and autoimmune diseases. I guess these are the two most successful companies so far.
Have you had any failures?
Out of the 20, four of them I would consider as failures. None of them has gone bankrupt, but they have been dismantled because the business idea didn’t work.
One of them, was a company trying to produce insulin factories in Russia… It was very hard with the political situation without going into too many details.
We had another company that was working on bioinformatics and data handling. It simply took too long for us to get to the market and the technology platform that we had in the company became obsolete.
We also had a couple of companies that we’ve been trying to generate knowledge from and then create value by having knowledge. I find that very, very hard because there is so much knowledge being produced.
Someone says we’re doubling the knowledge every two years in the world. If you’re doubling it every two years, the knowledge that was so valuable two years ago is no longer valuable. It’s much easier if you can define a tangible product that can be sold. This is what we are focusing on very much now.
What’s been your biggest learning experience from working with so many companies?
Not only have I worked and started companies, but I’ve also been on the board of directors for quite a lot of big multinational companies like Novozymes. I think that the most important things when you work with translational entrepreneurship are to be focused, know where you’re going and to make sure that the costs are not more than the income.
Every journey is a different journey… You have to try to find your niche; you have to be very clear in how you get to the market and develop your product. You also have to be very careful with how you spend your money.
I’m always very worried about what I call ‘the founder’s dilution’. That is that you found a company, you have a very nice idea, you take in venture capital, you start running at 100 km/h and then the money disappears. You then have to take in money on a very low valuation, and then, the founders have to leave.
What advice do you give entrepreneurs about starting and funding companies?
In Sweden, we have a very special situation. We are the only ones in Europe, I think, who have what we call ‘the teacher’s exception’, which means that all innovations, all intellectual property is owned by the researcher, not by the university. It’s also very easy to formally start companies with very little bureaucracy.
Therefore, my advice for people in Sweden is to start companies, but to try to be very lean in the beginning. Keep the development in the universities until you know that you have the winning formula. Then, you start to hire people and start to have costs that you can then balance with a sort of income from different alliances and so on.
It is not so easy to follow this advice if all the innovations are owned by the university, because you have to then start to talk to the administrators at the university in order to explore an innovation.
What is your preferred way of funding new companies?
There are three different ways that I see of funding innovations. All the innovations, about 80 patent families that I have been involved in, have come from university and been funded by research grants.
Then, of course, there is ‘soft’ funding, for taking an innovation and then exploring it further. It’s usually very little money and it’s not so easy, but it is nice to get.
Unfortunately, at some point you have to get real money. That can be from business angels, or it could be from venture capital, or even crowdfunding. We have not used crowdfunding at all, but we have used business angels a lot. Certainly, I’ve been my own business angel quite a lot, but I have also taken funding from business angels. I would also say that 60%, or maybe even 70% of the companies that I’ve founded have some sort of venture capital investment.
Do you advocate going public as a way of raising capital?
Four of my companies have gone public – two in Sweden, one in Norway and one in South Korea – but most of the companies have stayed private.
The nice thing about going public is that the founders get an exit, so you can start selling and you can use the money. Of course, for the company, it’s usually quite cumbersome. You get into this ‘trying to protect your share value’ all the time, every quarter.
I’ve been very fortunate to have very strong investors that have said they prefer to be outside the public market and it is good, but then of course the founders usually get locked in because there’s no way for them to exit. For some of the companies that I have now, I have been a shareholder for more than 20 years and there’s no possibility of exit so far. That is a little bit frustrating.
Are the Scandinavian markets stronger than elsewhere in Europe?
There is a very interesting statistic about the number of IPOs in life science from 2017. For many years, there were more IPOs in life science in the US than the rest of the world together, but in 2017, US was only second in the world after China.
Even more astonishingly is, I think, that the third country was Sweden. Sweden had more IPOs in life science than Germany, France and England together. It’s quite extraordinary actually. It’s become a little bit of the life science Silicon Valley in Europe actually, together with Denmark.
I think it’s a mixture of ‘the teacher’s exception’, but it’s also that there is a culture of innovations in Sweden. It’s a general trend of entrepreneurship. Then, I do think we have a very high level of competence in biotech and life science in Sweden. These three things together are the reason why it is such a vibrant scene right now in the north of Europe.
Do you consider yourself a scientist or an entrepreneur?
Absolutely both. Being a basic scientist, you still want to make a difference in the world and you can do that in two ways. One is to create knowledge that can be used by other people. This is what I’m doing. The second is to generate products that can benefit people and, certainly, that’s also what I’m doing. Both of these are very rewarding.
In England, Germany and France there is a very big difference between being an academic and being in the industry. Maybe a little bit of what has happened in Sweden and also in Denmark is that people are going in and out of the industry. Quite a lot of people in my academic group have actually worked in the industry and came back, and vice versa. That’s interesting. It’s not so common in other parts of Europe, I think.
What are the biggest changes you have seen in biotech over the last 20 years?
If you take it from a pharmaceutical point of view, there has been a revolution in pharmaceutical development in the last 20 years. It’s kind of a silent revolution because people in general don’t really know about it. This revolution is going from chemical drugs to biological drugs, so going from organic chemistry into biotechnology.
Last year, if you looked at the 10 most sold pharmaceuticals in the world, eight of them were biotech products and only two were chemicals. It has also meant that all the pharmaceutical companies in the world are moving from chemistry into biotechnology. I’m also working with antibodies and six of my companies are in this field. I think it’s a very exciting development.
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