Angel Scale Biotech: Learn More

Fiza Shaukat founded Patient First.AI to make a difference in the healthcare systems in areas outside the US, such as Pakistan. She decided to create a platform which would allow patients to keep their healthcare data on a digital health card. This card would make the check-in process much faster and efficient.

Sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish and Richardson.

Highlights:

• Sal Daher Introduces Fiza Shaukat
• "...How PatientFirst.AI is creating value for patients in places where right now there's no really easy way except for a wad of notes, a notebook, to keep track from visit to visit..."
• "... You see all the digitization happening over there, but why don't you have the same seamless experience within healthcare? That's what we want to enable with this digital health card. They'll go at a clinic and they scan their digital health card or a QR code, and as soon as they scan that in, they basically are checked in..."
• The Patient First Business Model
• Next Steps for Patient  First
• Fiza's Entrepreneurial Journey
• Familial Role Models for Entrepreneurship
• "... Somehow a brother and sister you have known each other for your whole life, so chances are you're going to get along more or less. Whereas husband and wife sometimes it can be you've known each other for three years and the stress of founding a company together can be very painful..."

Topics: discovering entrepreneurship, robotics/AI, founding story

Angel Scale Biotech: Learn More

Yousof Naderi, professor at Northeastern University, is co-founder of DeepCharge, which is commercializing a new technology for charging batteries without cables. Intriguing look at how our lives could change as our devices are untethered.

Sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish and Richardson.

Highlights:

• Sal Daher Introduces Yousof Naderi
• What DeepCharge is Solving
• "... In a case of the wireless charging, DeepCharge has selected and carefully from the beginning are working in a non-radiative technology, which means it's just coil by coil..."
• How DeepCharge Came About
• "... Also, there is this piece of sustainability that we can't go through all that, but we think that working with enterprise is really going to help us in our mission, also, to build a wire-free sustainable future..."
• "... Now, to go to the next level, we feel that this is a right timing to look at the strategic investor and partner that can stay, share our vision, and be able to provide resources and help to make this success for everybody..."
• The Future of DeepCharge
• Yousof's Immigrant Story
• Why Yousof Started DeepCharge
• Advice to the Audience
• "... I think one of the biggest pivots was just that type of technology that they use..."

Topics: discovering entrepreneurship, founding story, product

Angel Scale Biotech: Learn More

The deep experience Carolina Alarco has gained in the biotech industry now informs her work as an advisor to startups and as an angel investor. Her incisive contributions at Walnut Ventures made me eager to learn more about her story and approach. 

Sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish and Richardson.

Highlights:

• Sal Daher Introduces Carolina Alarco
• SYTE.bio and What it is Solving
• SYTE.bio Founders' Backgrounds
• Why Invest in SYTE.bio?
• Verbina
• Latinos in Bio
• "... I do want to say that Latinos in Bio will be raising awareness of some lack of representation of Latinos in the industry..."
• Carolina's Background
• "... I came up in the '90s. I came to study a graduate degree in International Management Harvard..."
• Advice to the Audience

Topics: angel investing strategies, biotech, discovering entrepreneurship

Angel Scale Biotech: Learn More

Chris Selland works at Squark.AI, a startup company that uses AI and machine learning with customer data from things such as games and delivery services to help with predictions of delivery time.

Sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish and Richardson.

Highlights:

• Sal Daher Introduces Chris Selland

• Squark AI and What It's Solving

• "... All of those types of predictions is essentially what we do with the model. Now, we do have some other customers using us for other purposes. For instance, a very large package delivery firm is using us, actually, for prediction of packages that might be late..."

• "... This, I think, highlights really the importance of networking and staying in touch with people that you've worked with successfully. Make sure that you stay in touch with them because you will have that twice annual conversation that you might have with someone that you worked two companies back with..."

• Squark in the Gaming Industry

• The Future of Squark

• Advice to the Audience

Topics: discovering entrepreneurship, founding story, robotics/AI

Angel Scale Biotech: Learn More

Mike Nolan is an angel investor specializing in machine learning. As an officer in the Air Force he trained fighter pilots on F-15s. Mike relates the opportunities offered by graduate work at MIT both professionally and in investing. Fun chat with a buddy from Walnut and a listener to the podcast.

Highlights:

• Sal Daher Introduces Mike Nolan
• Piction Health and Machine Learning
• "... we don't frequently see companies that are on the bleeding edge of the academic research or the bleeding edge of what's going on and the top presentations at conferences and so forth, but that's okay..."
• The Capabilities of Machine Learning In the Health Field
• Mike Nolan's Background
• "... You got to picture this beautiful country, the White Sands, New Mexico, close by, and so forth, and here's this chimp running away from this 10-mile-long sled track..."
• "... They're highly creative people in a highly regimented situation. They are people who think in very creative ways, and so forth, and they have big personalities ... I suspect that there is a lot of room for creativity with fighter pilots..."
• "... Yes, things can go wrong, whether you're a founder or a pilot..."
• Advice to the Audience

Topics: angel investing strategies, biotech, robotics/AI

What founders and investors in startups need to know about the history of bankruns and how to protect themselves from them in the future.

Here's the text on which my talk was based:

Historical Perspective on SVB’s Failure for Investors & Founders 

This is Sal Daher of the Angel Invest Boston podcast. Prior to becoming an investor in tech startups, I spent decades as a banker and trader involved with the distressed debt of countries. My experience came in handy recently in allowing me to reassure the startups in my portfolio with deposits at SVB that the FDIC would have no option but to make all depositors whole. 

This piece aims to explain why the business model of banks and past government decisions precluded any other options. It also points to ways that founders can manage deposit risk. While it bothers me to see well-off people bailed out by the taxpayer, it is the necessary if imperfect course of action until we make structural changes to hold bank management more accountable.

Why was I so certain in my assurances? Because financial authorities in the US and other countries had learned a hard lesson back when Lehman Brothers (not a deposit-taking bank) was allowed to fail in September of 2008. Lehman’s bankruptcy set off an inevitable chain of events that led to the meltdown of the market for credit risk insurance.  This revealed pervasive rot in financial instruments widely held by institutions starved for yields. Thus began the Sub-Prime Crisis that ruined millions and blighted the career of so many of my colleagues in finance for nearly a decade. 

The hard lesson learned was that when a financial panic gets going it’s impossible to tell where it will stop. The term contagion is apt. Financial authorities understood the need to take prompt steps to reassure investors not to make irrational moves that could impoverish us all. Back in 2008 they ended up taking over banks which created lasting distortions, some of which are still with us today. 

While the circumstances of SVB’s failure are different from Lehman’s, the fundamental lesson of maintaining the orderly functioning of financial markets still applies. If the FDIC had stuck strictly to its $250K deposit insurance limit (which BTW had been $100K until the Lehman event) chaos would have ensued. Depositors everywhere would have immediately started spreading any holding in excess of $250K to other banks to avoid the possibility of loss and could have melted down the entire banking system. An impaired banking system would have resulted in hundreds of thousands of companies going under and millions of people losing their jobs. So, preventing financial panic is a public service for the entire population. It’s comparable to the fire department. Fire brigades were set up to prevent individual house fires from spreading and burning down entire neighborhoods.

There is a fundamental flaw in the business model of banks. Banks lend long and borrow short. Borrowers want to repay banks months or years into the future. Depositors usually are not willing to tie up their money for more than a few months. This creates a mismatch between the maturity of loans made by banks (assets) and deposits taken by banks (liabilities). The delicate balance between assets and liabilities is hard to achieve. This is why banks keep cash reserves on hand, i.e., they don’t lend out all their deposits. They also have short-term borrowing lines with other banks or the Federal Reserve to make sure they have cash meet all their obligations. 

But if enough depositors decide that a bank is impaired, even the soundest bank would not be able to meet the demand for immediate payment without outside help. This is the role the FDIC has come to play. A role with which I am not entirely comfortable, but as we have seen, is essential as things stand. 

Many argue that unlimited deposit guarantee removes the incentive from depositors to vet a banks’ books. In the absence of this vetting there is a natural temptation for banks to take all the risk possible with depositor’s money because if things go well the bank’s shares will go up and the management will get bonuses. This moral hazard of deposit guarantees is supposedly mitigated by regulations that limit how much a bank can lend and impose minimum capital requirements.  

Unfortunately, the regulations failed in the case of SVB. The bank appeared to meet its capital requirements but when depositors started to draw out money, it started to sell its reserves. This prompted changes as to how assets were valued and put it suddenly in default of capital requirements. This led to a failed attempt to raise more equity in the stock market.

One moment SVB seemed fine, the next moment it was on the rocks. Bank books are complicated beyond the ability of even the most sophisticated depositor to figure out. The idea of savvy depositors keeping banks honest is fanciful. The only parties who have any hope of knowing enough about what’s going on in the bank are its management and its board of directors. I support making bank directors and senior management personally liable if a federal rescue is needed. 

So, what’s a founder to do when holding more than $250,000 in cash? One thing to consider is to have the funds in more than one bank, if only to avoid a sleepless weekend as so many founders experienced recently. But that only gets you up to protecting $500,000 or $750,000. Another option to consider is putting funds into money market funds held by Fidelity, Schwab or Vanguard. Funds held in custody for a beneficiary are legally protected from claims against the entity. This does not mean that there is no risk. Even safe money market instruments may lose value in times of stress, but the exposure to any one entity is much less concentrated. There’s always the risk of fraud or unauthorized trades but those are not usually system-wide and the entities usually make good on those.

Founders are in the business of sailing in uncharted waters. However, many of the risks that threaten a startup are known to accountants and board members. My advice is to bring up the matter of risk with your CFO and your board. If you don’t have one it’s time you found at least a fractional CFO and functioning board. 

If found this brief piece useful I invite you to follow Angel Invest Boston on your podcast app. Thanks for listening. This is Sal Daher.

A common sports injury left Rick McMullen incapacitated. His search for recovery led to the founding of Alleviate, a platform for physical therapy that is finding a lot of satisfied users. Thanks to Bryanne Leeming for introducing Rick to me.

• ·      Sal Daher Explains Why He Came Off the Sidelines to Invest in Alleviate
• ·      Rick McMullen, Co-Founder of Alleviate, Has the Ideal Background to Build Such a Company
• ·      Investing from a Self-Directed IRA Is High-Burden
• ·      The Problem Alleviate Is Solving
• ·      People Often Quit Before Physical Therapy Begins to Work
• ·      College Athletes Have a Lot of Support; When They Graduate There’s Nobody to Advise them on Recovering from Injuries
• ·      Alleviate Aims to Fill the Gap in the Delivery of Physical Therapy in the US
• ·      “With all of these conditions, you’ve got to do the work [to get better].”
• ·      Atomic Habits by James Clear
• ·      Alleviate Is Getting Traction
• ·      Alleviate’s Revenue Is Cash-Flow Positive
• ·      Product Returns Are Learning Opportunities
• ·      Clayton Christensen’s The Innovator's Dilemma
• ·      “...the specific subset of musculoskeletal pathologies that we serve. You can call it a niche, but it's like a $10 billion niche.”
• ·      Rick McMullen’s Journey to Founding a Startup
• ·      “...this central idea that the golden rule is the most economically rational thing.”
• ·      Why Rick McMullen Is Focused on Capital Efficiency
• ·      Parting Thought from Rick McMullen

Topics: product, management, discovering entrepreneurship

Title: Physical Therapy That Works

Fintech founder and angel Aidan Yeaw discusses building and investing in companies such as NODE40 and Unruly Studios. Great chat with a Walnut colleague.

Highlights:

●      Sal Daher Introduces Aidan Yeaw

●      NODE40

●      NODE40 Founding Story

●      Unruly Studios

●      "... The other component to it is that they're programming, but they're doing physical movement, physical exercise, large motor, physical exercise, running around, jumping up and down, and so forth because kids are too sedentary..."

●      How Aidan Came to Angel Investing

●      "... There's an ecosystem of small-scale venture capitalists that are growing, but the opportunities are so numerous, and the venture capitalists are so few, that they're an excess of opportunities, and a lack of funding, a lack of capacity to address this..."

●      CoolSculpting

●      Aidan's Career Journey in Fintech

●      Advice to the Audience

Topics: fin tech, angel investing strategies, crypto

Title: Founder & Angel

Angel Scale Biotech: Learn More

Jay DeVivo’s angel investing ranges far from his insurance background. Here we discuss his involvement with startups such as Hubly Surgical, FleetNurse, and ApprentiScope. Fun chat with a lively guest.

Sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish and Richardson.

Highlights:

• Sal Daher Introduces Jay DeVivo
• Hubly Surgical
• "... The advantage for Hubly is that doctors don't need to learn any new skills. It's pressing a button and in fact, there'll be a wider swath of clinicians that'll be able to use it than can use the current hand crank drill..."
• FleetNurse
• "... See, that's the thing with Angel investors. They may be new to Angel Investing, they're not new to business..."
• ApprentiScope
• How Jay DeVivo Came to Angel Investing
• "... It's really tough as an investor because you're not controlling things. You're along for the ride..."
• Jay's Career Journey
• "... Later on, I did some strategy work for larger companies as well. I started that business right before business school and then I consulted all through business school and things were good, so I did it for two years after business school..."
• "... It's like in the third ring out from there is where the jobs live. Basically, what you need to do is talk to a lot of people and do informational conversations, low pressure, just talk and you say, 'Hey, this is what I used to do. This is what I'm interested in'..."
• Advice to the Audience

Topics: angel investing strategies, biotech, product

Angel Scale Biotech: Learn More

Leen Kawas PhD, managing general partner at Propel Bio Partners, invests in life science companies such as Persephone Biosciences and Inherent Bio that promise immediate benefits for humanity. An uplifting chat with a dynamic VC and founder.

Sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish and Richardson.

Highlights:

• Sal Daher Introduces Leen Kawas
• What Propel Bio Partners Does
• Persephone Biosciences
• "... It's a pipeline for probiotics. They're starting with infant probiotics..."
• "... is anybody else working in the space of microbiome for babies? I haven't seen this..."
• Inherent Bio
• "... That's what Inherent is working on. They have identified an epigenetic signature that has the ability to better predict pregnancy outcome with men..."
• "...What is the profile of the kind of company that you find attractive in public markets now...?"
• Advice to the Audience
• Leen Kawas' Immigrant Story
• "... I want to tell entrepreneurs that are out there, no is typically not no. Just keep that in mind..."
• "... I just want to tell the entrepreneurs out there, you tell your own story, you work on your mission, you define your why. Keep going and you'll be successful..."

Topics: building wealth, management, raising money