What Does It Take to Create a Successful Lab Startup?
Three scientific leaders share their experiences of navigating the challenges of building a business from the ground up
In the last decade, the rate of entrepreneurship has soared. Among all the ventures, startups in the science industry have become hubs of innovation and global industry disruptors by offering cutting-edge sensing capabilities, curing diseases, enhancing environmental sustainability, and improving the quality of our lives. But, what does it take to create a successful startup lab?
This Q&A features insight from Catlin Mattheis (CM), Dr. Amir Azhari (AA), and Tan Rasab (TR), founders of Fracsun, AOMS Technologies, and Sigenex, respective successful startups in three of the “hottest” sectors of the science industry: solar technology, Internet of Things (IoT), and medical technology.
Q: What is your definition of a successful startup lab? What are its crucial components?
CM: Our team spent many years operating out of garages and home offices, which is a non-ideal reality of any startup. I would define a good startup lab as one that can navigate this time period well in order to identify needs and develop their lab when the timing is right. In the solar industry, trust is very crucial, and having lab capabilities to meet expectations is equally crucial. Thankfully, our team was able to develop our R&D and testing capabilities through an SBIR grant through the Department of Energy Solar Energy Technologies Office.
TR: Low error rates and reduced time to results are the benchmarks that clinical labs should be judged on. This requires sound processes; appropriate technology; skilled, motivated and trained staff; and zeal for maintaining quality.
Q: What was your mission to create the company? What need were you addressing?
AA: We are three co-founders from the same lab at the University of Waterloo. Our PhD research was patented, and we set out on a journey to commercialize it, receiving funding before we even got incorporated. We offer monitoring solutions for harsh environments. Industries that we serve include oil and gas, construction, environmental and structural health monitoring, and asset monitoring.
CM: As a young engineer in the solar industry, I identified a crucial data point in project development that was largely being guessed at but which carried substantial weight in a project’s future performance. Solar PV systems, like all things, collect natural and anthropogenic particulate matters when stationed outside. This is a fancy way of saying: things outside get dirty. The solar industry refers to energy generation losses due to this particulate accumulation as “soiling loss.” This soiling loss can create energy losses anywhere between five percent to 25 percent (or even higher in outliers) for a PV system, dramatically changing the effectiveness, and financial soundness, of these assets. Our team set out to develop a way to measure this data point in the field, in real time, to inform the solar industry throughout the entire development chain.
TR: I have spent a decade working in developing countries, and in that time, I saw first hand the very limited clinical testing many laboratories were able to offer. Anything that required more sophisticated diagnostics, such as genetic tests, the samples were shipped abroad. Due to the costly nature of these tests, only those who could afford to pay would elect to have these tests done. This experience lit a spark in me and my co-founder to develop a small footprint fully automated benchtop lab that could be used at the point of care for a range of molecular diagnostics and genetic tests. We plan to offer these labs to hospitals and medical centers in resource-constrained areas of the world.
Q: What was your journey like getting the company up and running?
AA: We have developed our minimum viable product for a year and a half, but after one year of being incorporated, we received a big project. And things got moving!
TR: Not coming from life sciences background was both an initial negative and a positive. Negative: it required a lot of rapid learning and research. Many of the industry experts that I solicited advice from were very forthcoming with advice and support. However, there were others who were very judgmental and negative as I was an outsider. One positive: not coming from the industry, I could look at things with a fresh pair of eyes and question everything to understand why things are done in a particular way. I read, reviewed, and analyzed over a thousand papers, and I gained an understanding of the inefficiencies and identified potential solutions.
CM: The journey to operation has definitely been a long one. We have been developing our soiling monitoring station for over nine years and have recently reached a milestone of 100 stations installed inside a single year. One thing I would mention for anyone looking to do something similar is to keep at it. Perseverance has been a valuable force through it all.
Q: What were the key three lessons you learned along the way?
AA: The first and biggest key lesson is having the right partners and team in place. The second one is to forgive each other and not take things personally. And the third is having the right attitude. Even if your idea is terrific, is it the right product? You need to deep dive into the market and learn if there is an actual need for your product.
TR: The three key things that I learned were: 1) the laboratories are full of very passionate people who want to make a difference; these people have many ideas that gave me fuel for thought; 2) it is better to focus on a narrow market segment than attempt to offer a universal one-size-fits-all solution for a large and often complex market, and 3) labs use different processes and equipment that can potentially yield different results.
Q: What were your biggest challenges?
CM: The two major challenges for us, and I imagine many startups, are time and resources in the early stages. Our team all maintained their full-time careers while building this company for nearly seven years. In order to pay for materials and other work that needed to be done, we bootstrapped it all from the beginning. This may not be the quickest path to success, but it allowed us to maintain a steady course toward exactly what we wanted to develop. The final challenge is filling gaps in skills. Our team is largely technical, so one challenge we faced was bringing in people who could help with sales and marketing because we had to realize that we will not often be communicating with engineers and scientists. To this end, building out a strong advisory board can be a massive help.
AA: It might be challenging at times, but you need to learn to be forgiving, have patience and perseverance, and manage stress well. Despite all your degrees, you also need to be prepared to learn that you know nothing.
Q: What advice do you have for a potential startup?
AA: Make sure you can work with your team members. There is a difference between friendship and business.
CM: Engage with your future end-users and customers as soon as possible. Early input can adjust your trajectory as soon as possible, and we all know what happens down the line if your trajectory is only off by a small amount from the start.
TR: You will need a lot of positive emotional and mental reserves to get you through the hard times if you want to create anything that could change the world for the better.
Based on the experiences of Rasab, Azhari, and Mattheis, there are three key takeaways that any potential entrepreneur should consider before launching a startup. The first is the importance of having the right team in place. For example, in academia, you (sort of) inherit the team, as your department does the hiring. In a startup, you, as founder(s), handpick your team. Why? Because it is the team that will take your product through the challenging journey to market. The second is the need for your product in the market. In an established industrial lab, you just need your experiment to work. For a successful startup lab, also need to know the answer to the question, "does anyone actually need it?" This requires knowing your market and customers inside and out, and actively seeking to iterate your product to make a good fit. The third is that the question, “What does it take to create a successful startup lab?” is not adequate. A better question might be: "What doesn’t it take?" Timelines, resources, markets, and people are just a few of the variables in the complex formula of success in a startup lab.
About the founders
Catlin Mattheis is the CEO and co-founder of Fracsun. Fracsun specializes in local measurements of soiling loss in solar panels using its patented ARES soiling station. The company provides the site operator with real-time data and intelligent recommendations to optimize array performance.
Amir Azhari, PhD, MBA, is the co-founder and chief commercialization officer at AOMS Technologies. AOMS’ end-to-end IoT sensing solutions combine the most cutting-edge hardware, software, and connectivity technologies to expand the bounds of innovation among industries.
Tan Rasab is the CEO and co-founder of Sigenex. Sigenex’s mission is to provide point-of-care access for a range of genetic and molecular diagnostic tests that would allow rapid time to results and lower costs. Sigenex is particularly focused on resource-constrained areas of the world.
