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.
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..."
ANGEL INVEST BOSTON IS SPONSORED BY:
Transcript of “The Microbiome of Babies”
Guest: Leen Kawas, PhD
Sal Daher: I'm really proud to say that the Angel Invest Boston podcast is sponsored by Purdue University entrepreneurship and Peter Fasse, patent attorney at Fish & Richardson. Purdue is exceptional in its support of its faculty for its top five engineering school, in helping them get their technology from the lab, out to the market, out to industry, out to the clinic. Peter Fasse is also a great support to entrepreneurs. He is a patent attorney specializing in microfluidics and has been tremendously helpful to some of the startups, which I'm involved, including a startup that came out of Purdue, Savran Technologies. I'm proud to have these two sponsors for my podcast.
Sal Daher Introduces Leen Kawas
Welcome to Angel Invest Boston, conversations with Boston's most interesting angels and founders. Today, we are really privileged to have with us Leen Kawas, PhD, Managing General Partner at Propel Bio Partners, a venture fund that invests in drug discovery. Welcome, Leen.
Leen Kawas: Thank you, Sal. I'm excited about the conversation that we're going to have.
Sal Daher: I'm really excited about this because Leen is doing very interesting work. She is in Los Angeles, California, and her group is looking at some companies that are very promising and very interesting. I'm going to ask Leen to just explain the thesis of the investing at Propel and then let's talk about some particular companies that exemplify that thesis that you have.
What Propel Bio Partners Does
Leen Kawas: Thank you, Sal. Basically, Propel Bio Partners is a life science investment firm. We invest in both private companies and public companies where we see their significant upside and management teams and science that we believe in. We evaluate probability of success for upcoming catalysts or long-term success of the company and the programs that they're running.
It's an interesting moment for life sciences, and we have a lot of opportunities out there, and we're excited about a few companies that are both in the public and the private company ecosystem, and I'm happy to discuss some of these companies with you today, Sal.
Sal Daher: Yes, well, let's start with the private companies because you can get a little bit more specific, because public companies, there's a lot of regulations surrounding it. We can talk in general terms, but let's talk about some of the companies in your portfolio that you think exemplify the proposition that Propel is looking for.
Leen Kawas: Just to clarify, we are a new fund. I was a CEO of a public company, and I transitioned into the investment world with the idea that we want to help entrepreneurs be successful. We've invested in a few private companies, some of them that are already public, a few that will be announced soon. I will mention a couple of companies.
Persephone Biosciences
Persephone Biosciences, it's a company that is working on gut microbiome health. The thing that attracted us about Persephone is their scientific approach, thoughtful development plan, and an opportunity to invest in a therapeutic platform, but at the same time, consumer platform, I think Persephone exemplified the type of companies that were looking for. They have very strong scientific founders that are very pragmatic and focused on creating value for the patients and for the investors.
I really enjoyed working with a team because, as I say, they have a consumer pipeline, or platform as well as a therapeutic platform. Why I want to highlight this because when you think about a consumer platform or a pathway in the life science industry, it's a much faster pathway to market and revenue. Therapeutic, there's a significant upside, but it's higher risk. This is like a company that brings the best in the two worlds, faster access to market and revenue with their consumer pipeline and therapeutic pipeline. What I also like about Persephone is they directly acknowledge the market conditions, and they are laser-focused on creating-- advancing their lead program in the consumer space, infant probiotics.
Sal Daher: Yes, we're speaking at a time to the beginning of 2023 when public markets for life science companies are in turmoil, particularly smaller life science companies that have done-- pre-revenue life science companies are really suffering. 2020, there was a tremendous boom, and lot of people, a lot of money went into these companies. Beginning-- the start of '21, there was a mass exodus away from -- [chuckles]
Leen Kawas: [chuckles] A lot of science projects went public. Yes.
Sal Daher: A lot of science projects went public too early. Now, perhaps there are some opportunities. We can talk about the public markets later. Anyway, explain to me what is the consumer product that Persephone is working on.
"... It's a pipeline for probiotics. They're starting with infant probiotics..."
Leen Kawas: It's a pipeline for probiotics. They're starting with infant probiotics. As we look at the probiotics market, there's no products that are in the marketplace that is based on science and data that addresses the true gap and changes and architecture of our microbiome. What I love about Persephone is before they even start going into designing their product, they've conducted clinical trials to understand the baseline of the human gut microbiome.
They've done the baby biome, which they've had significant interest from mothers, which again, highlights how much interest there is in scientifically-based infant probiotics, where they understood the impact of C-section, vaginal birth, breastfeeding, formula, and they are creating infant probiotics that will help and empower mothers to make decisions that is the best for them and for the baby, whether it's like breastfeeding or formula because a lot of people think it's always a choice. Sometimes it's not a choice. It's a health condition.
I really appreciate that. For me, I'm a working mother and I understand the stress on mothers. This is the product that I think there is a significant value. There's market opportunity there. Acceleration, and getting a product from a company very early stage into the market, there's a very short timeframe, but this is the first product in a pipeline.
Sal Daher: Now, is this like a rational consortium of microorganisms that they're putting together?
Leen Kawas: Yes.
Sal Daher: This is what you mean by science-based in the sense that you identified specifically the function of each one of the organisms and you're able to grow them and so forth, and then to incorporate them.
Leen Kawas: Not only the microorganisms, it's also the cytokines. If you have this microorganism and it's not expressing or doing what you wanted to do, it's not going to help with anything. They actually enhance the microorganisms that are relevant to recover a normal gut microbiome to help with our autoimmune-- a magnitude of things. It's science-based. It's not just-- they're going through a methodical development plan, starting with understanding the architecture, the cytokines that are important in having a healthy gut microbiome for infants and adults, and even patients.
The other side of things, they have a partnership with J&J to run one of the biggest clinical trials in healthy adults and cancer patients to really understand the differences in the gut microbiome for a patient that responds to treatment versus a patient that doesn't, versus a patient that has recurrence colorectal cancer, this scientifically and methodically and logical product development is what's going to lead to a successful outcome for Persephone rather than just going out and say, "Those are the microorganisms that we think are involved," and put them in a mixture and deliver it.
"... is anybody else working in the space of microbiome for babies? I haven't seen this..."
Sal Daher: Yes. That unfortunately is a state of a lot of microbiome platforms. I am an investor in Vedanta Biosciences, and they have a pretty scientific approach to it, and they're working on a therapy for C. difficile in clinical trials. It looks promising, but we'll see. The approach to getting this data set on patients, people who have colon cancer, and so forth, and also, is anybody else working in the space of microbiome for babies? I haven't seen this.
Leen Kawas: It's very unique. There is strategic interest. I think a lot of people think, "Okay, probiotic supplement, it's an easier path, let's bypass science." I think now we have consumers that are looking for scientific-based evidence. For me, when I had my first child, I became like a walking encyclopedia about what's-- You read everything. It's not like before when you go and you ask the pharmacist and then you actually try and validate and look for the science behind it.
Regardless, yes, I have a PhD, I'm probably more paranoid, I don't want to say anything else, but I think my experience, because I also worked as a pharmacist, there is some neurons that are triggered for mothers or parents to be honest, that they want to make sure that they're providing the best thing for their patients-- for their-
Sal Daher: Oh, yes.
Leen Kawas: -babies, I mean, not patients.
Sal Daher: For babies, yes. They get incredibly mobilized. Parenthood transforms parents in a way that brings out the best in them. They start thinking about something other than themselves, [chuckles] which brings them out of that. Not every time, there are sad examples of people who can't make that journey, but the vast majority of people make that journey to caring about another creature when they see this creature that is completely helpless and is totally reliant.
Leen Kawas: That's why I appreciate Persephone. I think it's common knowledge right now that the gut microbiome is involved in several of the pathologies that we are experiencing at different ages, including Alzheimer's, diabetes, autoimmune diseases. Starting very early on, from the infant stages, building the normal architecture of the microbiome is very critical for us.
Sal Daher: Yes. This is really fascinating. I hadn't seen this before. The microbiome for babies. Fascinating. [chuckles]
Leen Kawas: [crosstalk] Unfortunately, a lot of people simplify these things with vaginal birth and breastfeeding. It's not. It's a much more-- We need to give mothers who do their best a break. There are health reasons that a parent make a decision.
Sal Daher: You're adding options, broadening the range of options that the parents have. I know people very close to me after giving birth battle thyroid cancer and breastfeeding had to be curtailed. There's only so much time that breastfeeding could occur. Then beyond that, you have to go into therapy. Thank God it's a cancer that's relatively treatable, but the ideal of breastfeeding, 18 months, two years, and so forth, is not possible sometimes. It's great to have options like this. This is tremendous. Are they working on something that will be looking for FDA approval?
Leen Kawas: Two parts. They have a therapeutics pipeline and they have a probiotics consumer pipeline. There are some-- they're doing it in the right way. They're trying to create an advantage compared to the other available probiotics that we believe. They did a lot of studies to show that not everything on the label is actually what's in the product.
Sal Daher: No. [laughs]
Leen Kawas: They're adding a level of regulations and the CEO is also a mother, so that's another unique thing for me to be in a position to be an investor. CEOs that are driven by the mission, not only for the return, it's magical. They can create so much value.
Sal Daher: Those are the only ones who succeed. The ones that are doing it just for the money usually don't succeed. The first difficulty they run into, they're off to something else because they're in it for the money. They're not in it for the pain. The pain is not redeeming for them. The pain has no value. Whereas if you're in for the mission, you put up with the pain and you continue and you continue until you reach-- I look for founders who really believe in what they're doing.
Leen Kawas: Driven by the mission and it's 24/7, she texts me, any time, and I don't mind it because I was in her place. Even if it's Sunday at 7:00 AM, I don't mind it at all. It just gives me comfort that this is a founder that is committed to the mission and the products that they're developing.
It's very smart because they have these two arms now with-- They're trying to create clear value with the consumer probiotic path, starting with infants, but I want to highlight they have adult, they have several additional products that will come into the pipeline from the consumer probiotic path, but they also have this significant upside with the therapeutic line that has to still go through FDA approval and all of that, but it's the best in both world with a founder that is extremely committed to the mission.
Sal Daher: Her name is Stephanie Culler?
Leen Kawas: Correct. Yes. CalTech graduate. Super smart person and has all of the leadership traits that you would be-- Empathy, strategic, and I think she has this energy that attracts people around her. We feel lucky to be partnering with Persephone.
Sal Daher: That is awesome. Is there another startup that you want to talk about or do you want to continue on Persephone?
Inherent Bio
Leen Kawas: There's Inherent Bio. It's another company that have been making a lot of progress.
Sal Daher: Excellent.
Leen Kawas: It's a company that is working on starting-- It's a platform for epigenetics. Just to explain what-- I'm sure you know, Sal. Epigenetics, it's-
Sal Daher: No, but unpack it for the audience.
Leen Kawas: It's the coding beyond the DNA. We all have a DNA. We're probably very similar, you and I, although born and grew up in very different places, but the standard DNA coding is very similar between humans. What makes things different is epigenetics. It's the coding beyond the DNA which controls how these genes within our DNA is expressed into hair color, diseases, multiple-- this is one area. Of course, there's other aspects, but we know right now that epigenetics is involved in a lot of phenotypics the way that we are expressing or presenting our gene coding as well as some pathologies.
One thing that they're starting with is male infertility, which I think historically a lot of the burden has been on women around infertility treatment. One thing that was really surprising for me when we first started talking to Inherent before we invested, is there's 30% of infertility cases that go undiagnosed. Of course, it's the data. I know people who were basically impacted by infertility. The woman goes through extensive hormonal treatment in utero fertilization, IVF. It costs the couple time, efforts, extensive physical demand on the woman in the relationship or the parent who is going to be carrying the baby. There's very few tools to diagnose male infertility.
Sal Daher: Yes. It is also a problem that has a dynamic. Sperm count is declining worldwide. It's not entirely clear why that's happening, but best guess that I've heard has to do with obesity but could be something as simple as just people being thicker and therefore less sterile. [chuckles] I don't want to get into the anatomy here, but [chuckles] heat has something to do with it, probably.
"... That's what Inherent is working on. They have identified an epigenetic signature that has the ability to better predict pregnancy outcome with men..."
Leen Kawas: Believe it or not, Sal, it's not the biggest risk factor. Sperm count or sperm shape or speed, those are the traditional, very old techniques, and they are not always predictive of successful pregnancy. Even if male has all of these things that are within the normal range, depends how normal is being defined, it's not confirmed that they're going to have successful pregnancies.
That's what Inherent is working on. They have identified an epigenetic signature that has the ability to better predict pregnancy outcome with men. I'm going to go back to some of the points that you've discussed. I talked to a few professors that work on male infertility and epigenetics. The one thing that they mentioned is weight, smoking, alcohol disrupt the epigenetic coding for male, which they like what Inherent is doing because it confirmed that once the epigenetic coding is disrupted, it would lead to potential, with high confidence, inability to get pregnant, but if you optimize your health, if you work on lifestyle modification and optimize your epigenetic coding, that could recover, but what they found is, it could save parents or people who are trying to have babies from going through two to three cycles in in utero fertilization which is significantly demanding-
Sal Daher: The burden is very high.
Leen Kawas: -and costly and time, and it takes a couple of years. To go directly to-- not the traditional IVF, it's a more sophisticated IVF. There has been a higher success of pregnancy rates when they are-- Inherent gives direction. You have healthy sperm epigenetic signature. You have a high probability of getting pregnant with the normal path of pregnancy. You have this pathological or unhealthy epigenetic signature, and to save you time and money and effort and emotions and hormonal treatment, to go directly to IVF treatment, which leads to pregnancy and successful pregnancy and healthy deliveries long-term.
I think that that's the-- Unfortunately, male health and male infertility, we haven't seen much happen in the last couple of decades, so this could be something that could transform how physicians think about couple infertility because the demand and the focus has been all-- because there's more tools, has been more advancement on the female side of things, but now this is an added tool that give guidance, save money, save time, and faster path towards a successful pregnancy.
Sal Daher: Yes. There's another factor. That is men notoriously reluctant to seek medical care. It's really tragic. I learned this very early on in my invested career. Back in the '90s, I invested in a company founded by a group of people, physicians here in Boston called Men's Health Center. Their idea was to create a clinic that would address men's health concerns. It was going to be located in a very posh area in Florida where retired men-- the theory was they'll be concerned about their health and so forth. [laughs] Absolutely, it was crickets. The only malady that men there cared about in those days was ED.
Leen Kawas: Oh.
Sal Daher: I don't want to get into details here because this is family--
Leen Kawas: That's an important point as you think about the market, they've done a lot of market research. This trend is changing, especially with the millennials, the newer generation where they're trying to delay having a family. Males are becoming more conscious, especially if they want to have a family, to continue to monitor the-- and this is very different than speed, size, and motility. This is epigenetics. There is nothing that is related to the count, the typical things that connect to the men's mind. It's something that is very clear, it's epigenetics. A lot of the time it's not even anything. You have very healthy sperm counts, sperm motility, but your epigenetic code is not matching, so we can provide you a faster path to getting pregnant.
Sal Daher: What are the markers that you're looking-- are you at liberty to discuss the specific markers that you're looking for?
Leen Kawas: This is all patented or they're working on patenting it, which is very specific primers within the genes that they've identified. They looked at 1,400 males with different pregnancy outcomes. Again, if you see the trend with Propel, we are super heavily dependent on data. We're not going to go into something if we don't believe the data. They have captured beautiful data retrospectively and now they're running other trials prospectively to confirm the same results, but they're data-oriented. They've published multiple publications in both medical conferences as well as papers.
Again, it's a team that are refreshing, resourceful, we have a change in the market, they're still creating value, they're still selling their product, they're going-- and they're being very creative. They have interest from fertility clinics across the US both virtual and physical. They're not trying direct-to-customer, although there is interest. There's a group that reached out to them direct-to-customer. There's strategic interest because this is also huge.
This is the first product, by the way, I just want to clarify something, Sal. They're starting with a clear product. Semen samples are non-invasive. It's the easiest sample that you can get. That's why they're starting-- there's a very clear marker. They've already started-- they've soft launched their product.
Sal Daher: Okay. I was wondering which serum that we're looking at, if they're looking at blood--
Leen Kawas: Sperm.
Sal Daher: The sperm. Okay.
Leen Kawas: Sperm sample. The same sample that patients would give or individuals would give to look at motility, the other traditional classical, old, I'd say ancient. It's the same sample for the sperms and they look at the epigenetic changes. The nice thing about Inherent, they also have a pipeline because now we know that there's a lot of chronic diseases that have an epigenetic component. The current platform can also be used to much larger markets if that makes sense.
There is strategic interest, companies that are developing products, therapies that are looking for diagnostics tools that gives them confidence in the epigenetic markers and changes in epigenetic markers based on lifestyle modification or therapy treatment. Again, in this, I think that investors need to not only evaluate the technology but also evaluate the team.
This is a team that is very resourceful, shifted significantly, and have a very focused effort. I keep telling Andy, he's the CEO, the first thing he does-- "I don't want a payment," he's like, "No, I want to make sure that you're comfortable, that you're doing well and we are going to be fine. You have a runway, you have a product, you're doing very well," but that's, again, the founder's mentality that you have where they're super passionate about what they're doing. I think that those are the two companies that I feel that they have the strong mix of management, resourcefulness, innovation, science, and products that address true market needs.
"...What is the profile of the kind of company that you find attractive in public markets now...?"
Sal Daher: Excellent. Unless you want to continue on the private companies, let's shift a little bit and talk about the kinds of things that you're seeing and doing in public markets. Of course, here you can't mention names and it can't be specific, but just in general terms, what is the profile of the kind of company that you find attractive in public markets now?
Leen Kawas: I just want to highlight to investors and people in general, there is a very unique opportunity in life sciences right now. There has been a disruption in valuation. As you highlighted earlier, Sal, there have been a lot of capital injected into this space and not necessarily always in companies that can deliver or will deliver, but a good number of companies out there are advancing technologies, therapies, or diagnostics or devices that are at a later stage of product development.
Very clear regulatory interactions with the FDA as well as clinical strategy and very clear catalyst inflection points. Again, we're not going into areas where it's very busy, it's product number 10. No, it has to be first-in-class or best-in-class. Platform companies, we've been really--
Sal Daher: Forget Alzheimer's, forget diabetes. You're not in the Semaglutide business. [chuckles]
Leen Kawas: My company that I founded Athira Pharma was an Alzheimer's and neurodegenerative company, but that brings extensive experience in how we evaluate public companies and private companies, and public companies, what we look for is, again, product development that de-risks-- Honestly, sometimes you could have a product that is so clear, and from the outside, it could appear that, "Okay, this is an indication, this is a product that is de-risked," know it should get approved, but you're not only approving the product and the mechanism of action of how the product is working.
You're also evaluating the clinical strategy, clinical development, execution. Do you believe that this management can execute? Sometimes you look at indications that are very tough, like Alzheimer's, and you see that there's significant innovation in the way that these companies are thinking about their product development.
One thing about Alzheimer's, I have to say, there hasn't been a lot of advancement of how the drugs are being tested in the clinical space. We've done a lot of new things. When I was the CEO, we introduced new global endpoints that I know now the company is going to follow with the plan to go and negotiate with the FDA as a potential primary endpoint.
Just to give you an idea, the main endpoint that people care about, ADAS-Cog, which is the measure of cognition, it has first been developed in 1984. I was there in 1985, so you can imagine my mindset--
Sal Daher: [chuckles] Your entire life, yes.
Leen Kawas: I was like, "I can't be okay with using a tool on its own when it's older than me. There has to be more innovation." From my experience with the FDA and the regulators, they're actually very open to-- as long as you're showing in your plans that you are going to deliver a therapy that is, one, safe, second, improves quality of life, the FDA will be very receptive. That's exactly what we look for in companies, whether it's public and private.
We put a lot of effort in the public since they're typically later-stage, close to approval or phase two, three, and we look at the clinical operation, regulatory strategy, interaction with the FDA, financial position, health, cash, and then we actually spend a lot of time with management and we want to make sure that whenever they're making-- The unique thing about life science industry is you cannot make decisions in isolation. If you're making a financial or a corporate decision, you have to think about the product development, the science. It's always multifactorial decision-making.
When we talk to management, we want to see, do we believe that this CEO or this management group are going to be able to make effective decisions with shifts in the financial environment, with shifts in the regulatory environment, taking advantage of opportunities that are out there? Of course, we want to see dislocation in value. This is what we look for with this environment. There is 221 companies with negative enterprise value, at least the last time I looked. I don't know if it's a larger number or slightly smaller, but there is a large number of companies that are cash rich with significant undervaluations.
Sal Daher: Valuation for-- it's like 200 companies whose market capitalization is less than their cash on their balance sheet.
Leen Kawas: Exactly.
Sal Daher: Negative enterprise value. There's also an aspect to this in a sense that if you have a technology and you are thinking of developing it with the promise that you're going to have funding from public markets, you're going to approach that very differently from if you have a technology that you have to develop with very limited funding, you have to look for strategic partners, you have to be really, really capital efficient.
This path dependency-- and I think a lot of these public companies are hysteresis loop in material science. I come from an engineering background. You load a material and then you unload it. When you load it again, it doesn't respond the same way. It has a history, and the same thing here, if a company has gone down a certain technological development path, has gotten-- raised the stakes, unless there's a complete restructuring of the company, of the management and so forth, there's really no way to do it over. The technology might have worked in a different setting, so there are hundreds of these companies who are just-- they went public at the wrong time, but the technologies might be valuable.
Very good. Any other thoughts you want to have on this? Because what I wanted to do is I wanted to do a brief promo for this podcast, and then I wanted to get into your journey to what you're doing now. Is there something that you want to say to wrap up the first part of our interview?
Advice to the Audience
Leen Kawas: I just want to highlight on some of the points that you just-- I think the ending was perfect, Sal, thank you for mentioning these points. Management need to be very creative right now around their financial strategies. Pharma has a lot of capital, there's $500 billion on their balance sheets in the largest 18. There is capital out there, they need to be resilient, they need to create value, and they need to be very thoughtful in their product development because this is what's going to create value.
One thing that I want to tell CEOs out there, it's a big turn-off when you're talking to a CEO that is trying to create short-term value and misses out on the long-term value. Work for your main stakeholders, the patients, create value for the patients, very clear, everything that-- they are the market. If you understand your market, you understand and you continue to create value, especially in these environments. Going up and down 10-20% is very normal, it's very volatile. It's really shortsighted when CEOs are trying to create these illusionary value-creating events versus focus on what's important.
Sal Daher: Gimmicks. One of the many problems of being in public markets is that there's a temptation to start juking the markets so to speak. Banging a jukebox.
Leen Kawas: I was the CEO of a public company, and you want to have smart investors around you that understand the timeframe, and appreciate the value that you're trying to create. If you're making decisions for short term, that is going to go away immediately. It's just not the right thing for your product, for your company, for your investors. Actually, it's very clear when you talk to CEOs, CEOs that have this vision, clarity on what they need to focus on, and what are the steps.
Sal Daher: Yes, build the value of your company.
Leen Kawas: True value.
Sal Daher: Build your technology, build your knowledge, patient interaction, and so forth, and that is what's going to get you to where you want to go. Not gimmicks that make it look flashy in the short term. That doesn't take you anywhere. It's basically a lot of cycles of testing a lot of patients, a lot of studies, a lot of clinical studies and data.
Leen Kawas: I do think that investors that have the technical background and operational background will have an advantage in these markets. They're going to be able to select or have a potential ability to select management companies, development plans, clinical plans that have a higher probability of success.
Sal Daher: Excellent. Okay. Now, let's shift our conversation to how you got here, but first, I want to do a plug for the podcast. If you're a listener and you're finding this conversation with Leen Kawas, PhD, Managing General Partner of Propel Bio Partners, you could really enhance the impact of this conversation that we're having by first following us on your podcasting app, so that the podcast shows up in your feed every week, Also, consider leaving a rating, and a written review. Tremendously powerful.
If you listen to an episode, and you find that really compelling. "Oh, I love what Leen Kawas was saying about this or that," get on there and express that because that helps the algorithm understand that this is the type of podcast that a listener like you likes to hear, and then a lot of people like you will also be shown the episode.
It's sad to say, but we live by the algorithms. We dance to the tune of the algorithms, it really makes a huge difference. One or two or three reviews after a podcast was launched makes an order of magnitude in the number of downloads of a podcast sometimes, but anyway, you were born in Jordan, and you came to the States back in 2008. There's a venture capitalist here at Boston, founded a company called One Way Ventures.
Leen Kawas: I heard of them. Yes.
Sal Daher: Semyon Dukach is his name. He's Russian. By the way, he's done really wonderful work trying to help out Ukrainians, but anyway, Semyon founded this venture firm, specifically to invest in immigrant founders. One Way Venture, meaning people who come here with one-way tickets, because people like that are just tremendously driven to found companies, to be entrepreneurial. In light of that, I just want you to explain to me what your experience was coming to this country as an immigrant, and how you got to where you are now.
Leen Kawas' Immigrant Story
Leen Kawas: Absolutely. First of all, before I start, I think the United States is a special place for entrepreneurship and for promoting talent. I was a pharmacist in Jordan. Actually, when I came to the US, I was contemplating on continuing my career as a pharmacist versus going into research and academia. Being a pharmacist was not exciting for me, I think it's a great career for people that don't have my genotype.
I decided I'm going to go into academia, and it's going to be a fun environment, dynamic environment. Then when I finished my PhD, I had a job at the University of Pittsburgh. Again, in the line of academia because I had my Excel sheets that clearly showed when I'm going to retire, when I'm going to get married, when I will have my first child.
Sal Daher: Presumably, you're going to get married before you retire.
[laughter]
Leen Kawas: I'm actually happily married with two children. I have an amazing husband.
Sal Daher: Awesome.
Leen Kawas: It was not following that Excel sheet, that plan. When I was going to leave to Pittsburgh, my PhD advisor, Joe Harding, he said, "No, I don't see you as an academician. You have a unique talent. Why don't you stay and start with me a company?" M3 at that point, now Athira, it's a public company. I told him, "What do you mean 'start the company'?" Because people need to understand how unique entrepreneurship is to the US.
I've been exposed to European culture, Middle Eastern culture, it's not as dynamic and real as it is here in the US. I emailed their people in Pittsburgh, I said, "I have this opportunity." They said, "Stay for a year. If it works out, it'll be the best decision that you've made. If not, you will get a lot of expertise that will be relevant for us, and you can come back in a year."
I don't know, Sal, if I would have ever got this response in any other country. It wasn't my dream since I was seven to be an entrepreneur. I had some entrepreneurial sense when I was young, but not in the context of understanding what I was doing. It was the best decision. I started Athira from a single person and then took it public. It's developing-- heavily involved in the whole clinical development plan. Everything about it was innovative, and it takes a lot of grit, resilience. The other thing I told my husband-- I'm like an expert in dating before we got married because rejection does not mean anything to me.
Sal Daher: That's learning sales. [laughs]
"... I want to tell entrepreneurs that are out there, no is typically not no. Just keep that in mind..."
Leen Kawas: It's like you get a lot of investors that-- I want to tell entrepreneurs that are out there, no is typically not no. Just keep that in mind.
Sal Daher: That is so true. Leen, that is very true. As an angel investor, I've invested in over 70 startups, there are seasons to things. There are times when people are writing checks, when they're not. It depends how you strike the person, how you connect or don't connect. It makes a lot of difference. That's very wise.
See, that's the thing. Immigrants in the United States, they're people who have to swim really hard upstream to get here. I'm on the board of a company called Savran Technologies. The founder is Çağrı Savran, he's from Turkey, and he was an undergrad at Purdue, did his PhD at MIT, is on the faculty at Purdue University, which by the way, is very supportive of entrepreneurs. It's remarkable. It's really remarkable. They're sponsors of the podcast [chuckles] I should mention, but put it this way, I'd be praising their approach to entrepreneurship even if they were not sponsors because it's so impressive because I see how much support Çağrı gets from his university.
He's still a faculty member, and he is the CEO of his startup. It's a platform technology. He's been on the podcast before. People who want to know, they could look up Savran, and he's working with extremely rare cells in all types of serums, but the thing that's striking about it is the maturity, the flexibility. If you are an academic who was born and grew up in the US, you tend to be very specialized. Your environment is pure academics. Your father was an academic, your mother's an academic, all your friends became academics. You're optimized to be an academic. It happens a lot.
This guy came back, his father was an engineer, was in business. His grandfather barely had a very minimal education and they overcame a lot. People like that say, "I'm up to starting a company. I can do it. If I can come all this way here, America's so easy. Everything--" it's like you're being Superman. You come from Krypton.
Leen Kawas: I have to say--
Sal Daher: Everything is light here. Gravity is nothing.
Leen Kawas: It's not easy, but I think people, entrepreneurs, understand that you're not alone. There's a lot of dreamy feel around entrepreneurship. Remember that the media is going to put out whatever is mesmerizing.
Sal Daher: America's also the country of hype. There's a lot of hype. This is the country of P. T. Barnum. [laughs]
Leen Kawas: There's a lot of people. Oh my God. Everything I worked hard for, I see the entrepreneurs we're working with, how hard they're working, it's not easy. There's a lot-- I remember the best advice that I got when I started Athira, they're like, "Leen, there's going to be a lot of highs, but there's going to be way more lows. You just need to know that you need to survive the lows to make it."
Entrepreneurs, you need to wake up, get punched in the gut three, four times, and know that you're not the only one, and keep going because it's so rewarding. If there is a clear why-- for me, my passion is patient-centricity, delivering treatment for patients. I have been impacted by multiple diseases that no treatments-- not me personally, but in my family. For me, because I have a very clear why, the how is easier, if that makes sense.
Sal Daher: Yes. There's a reason for this. It gives meaning to the suffering. It's suffering with no purpose. People avoid it, but if you have a goal, you put up with the pain to get to your goal.
"... 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..."
Leen Kawas: When I left Athira, it was not what I wanted. There was a lot of turmoil around it. Some people would say it was unfair. There wasn't the level of appreciation that someone that worked as hard as I did. It was a heavy period of my time. I didn't get the support of the board, or management, it was very interesting, but for me, after that was done, it's like, "I still have my mission."
Yes, Athira was my first child, my first adventure. I did so well. Then I'm now into the next thing. Rick Kain, who is the one of the partners on the fund called me up immediately, "We need to start a fund. The market environment. You have the technical expertise. You have commercial expertise from your pharmacy background. You have everything."
I just want to tell people, you're going to go through a lot of adventures. I love the US. I would've not been able to achieve what I achieved at Athira and what I'm achieving today in Propel if I was not in the US. I love the diversity and the background that we bring at Propel, and just in general, it has been amazing. 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.
Sal Daher: That is tremendous. What you said before about the United States, there's a history in the US of valuing human capital. With all the imperfections and all the flaws, and so forth, I mean, you could go back to colonial times, the labor was always scarce in America because the environment that America had was one that allowed people to utilize human capital very efficiently compared to Europe. Europe was very stratified, very ossified society, capable people, couldn't work in certain things because of the social structures and all this stuff.
America dissolved all that and became very efficient. Therefore, America has always been a place where people earn a lot. There's a famous conversation of Milton Friedman with this Swedish economist who said to him, "Well, socialism really works in Sweden because we have no poor Swedes," and Milton Friedman replied, "Well, we don't have any poor Swedes in America, either." The Swedes have a lot of social capital, and so forth, high trust, culture, and so forth. They do very well in almost any place, but there's another data point that I've read more recently, that Swedes in America make something like 35% more than Swedes in Sweden.
Leen Kawas: Oh, wow.
Sal Daher: Because America is a place that amps up the productivity of people from wherever you are.
Leen Kawas: I 100% agree.
Sal Daher: That's the thing about the place. With all the imperfections, all the problems and the headaches, and all the--
Leen Kawas: There are enough people that are in this country that value the human capital, value talent, have amazing work ethics that makes this country special. I just think that-- and people who were born here and grew up here, I think they don't have the same--
Sal Daher: They don't see it. It's a little bit jaded.
Leen Kawas: One of my -- it highlights how amazing this country is.
Sal Daher: I'm an angel investor, but my other business is renting apartments. A lot of my tenants are Brazilians who are coming here, walking across the border, whatever way they can get here, and they are so glad to be here because Brazil is a great place. If you go on vacation in Brazil, you think it's a beautiful place and everything, but it's really, really tough to make a living in Brazil, especially if you're not someone from the elite. Even for the elite, life is tough. High crime, lots of problems.
It's a beautiful place, the lots of wonderful things about it, but when they get to America, despite the cold weather, despite all the problems, and so forth, they're like, "Oh, this is amazing, I can do it here."
Leen Kawas: Even if it's challenging, it's not impossible.
Sal Daher: There are challenges, there are always challenges. I mean, we're human beings, we're always going to have challenges. This immigrant experience is really fascinating. I love the combination of immigrants and entrepreneurs.
Leen Kawas: Also, I just want to tell entrepreneurs out there, founders, especially that you took on a big responsibility, and that's the first step and changing the world, so keep going. Some days, it seems that it's the end, but you make that decision, just keep going.
Sal Daher: That's right. That's right. In my experience, startups don't run out of money. The reason they fail is because the founders give up. The pain is just too much and they just say that it's not worth it. These are very talented people, they can find very, very attractive jobs elsewhere or other things to do, so they just throw in the towel.
Leen Kawas: This is an important point. If you're a leader of a team in a startup or a company that is mid-size, I think when you are open with your team-- I remember one incident when we were going to run out of money, and we were working towards the Series B. We had, I think, three or four-- I don't-- It was a very short period of time. For me, I could tolerate that type of risk, but others on the team, I felt like they need to know, they need to plan their life.
I kid you not, every person I talked to said, "We're in it. We understand that. Thank you for sharing with us." Of course, we made it, we raised the money and all of that, but this type of openness and honesty with your team, it actually gives you the belief that you're not making decisions for them. You're allowing them to make the decision, but also it creates that level of trust.
Sal Daher: Extremely valuable. Well said. Well, Leen Kawas, PhD, Managing General Partner of Propel Bio Partners, I'm very grateful to you for making the time to be on the Angel Invest Boston podcast and to share your tremendous experiences and wisdom. Thank you.
Leen Kawas: Thank you, Sal, for having me.
Sal Daher: This is tremendous. This is Angel Invest Boston. Thanks for listening. I'm Sal Daher.
I'm glad you were able to join us. Our engineer is Raul Rosa. Our theme is composed by John McKusick. Our graphic design is by Katharine Woodman-Maynard. Our host is coached by Grace Daher.
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