Founder Focus

Hi everyone, welcome to another episode of Founder Focus. I'm your host Jade Wang and I run the Startup Program and today our guest is Rachael Craig from Motion Hall. Thanks for joining us. So just for everyone who has a question for Rachael, you can email in your question or call it in if you'd like and if we have time at the end of the episode I will ask Rachael your questions. So thank you for joining us. For those who aren't familiar, can you tell us very briefly what Motion Hall is? Sure, so I think the best place to start is that Motion Hall is a deal enablement platform for biopharma licensing mergers and acquisitions and so that's gonna mean something to maybe 1 in 50 people and very little to everybody else. So if you're in the everybody else camp you can imagine what that looks like is sort of a vertical AI enterprise software so fairly full -stock and then we've got a lot of richly data-enabled workflows that sit behind pharmaceutical executives to help enable licensing and M&A processes. Can you tell us about how you, so you have done some consulting in the past, right? Can you tell us about how this originated and perhaps you know how you zeroed in on the problem? Yeah, a little bit of my story. So I think it's the easiest way to tell us to go back even further in my roots. So important to Motion Hall is that I started coding at a very young age. I wasn't particularly great at it but I had a really nerdy father who would bring home computers and he'd you know put a book of basic in front of me by the time I was five and I was like here Rachael play and so I did and so I grew up coding and then had different little entrepreneurial projects along the way. So I was running my own little businesses and I was in grade school and then paying for my university in part by doing that and so when I got to school I guess everybody said Rachael go to Silicon Valley and go into tech which jokes on me because eventually I did but at the time I was like well if everybody says that I'm gonna do something different and I went into neuroscience and did that instead and so then I thought I'd be a computational neuroscientist and bring it together but what really struck me as I was moving through my degree was watching some of the scientists I really respect and admired trying to spin out startup companies in the biotechnology space and really struggling with the business aspects and so I got curious about well how is science financed how is it commercialized and so I took my entrepreneurial practices and moved into management consulting and somehow because I had no experience and I didn't know what I was doing somehow I managed to convince beginning with high net worth individuals to let me start brokering their money into these little life sciences companies and I'd work with the management team and boards and so that's kind of where the genesis for motion hall came together looking at the management and business piece looking at the technology piece and looking at the life sciences and saying oh these transactions problems in the life sciences are kind of a really unloved baby nobody's thinking about them from all these different angles and yeah we can solve a lot of these problems by stringing together data and using modern machine learning and natural language processing and so uh you know and then there's the classic question right what uh what valuable business is nobody building and that you're uniquely suited to build so I said okay there it is and I've got the business the life sciences and the tech and so I'm gonna start pulling threads here to see if it really is the right business yeah so the North Star here is that there there's research that has been done but isn't impacting people's lives that's right and I think I think anyone who cares about science and trying to accelerate science spend some time gnashing their teeth over like why is it so hard to mobilize science and why is tech transfer so hard why is it hard to mobilize that knowledge and why is it hard to finance right and so there's a lot of different answers to that question and the one that we've kind of really focused in on was licensing transactions in the biopharmaceutical space so most people don't know but to get a single drug to market it usually has to change hands four times before it hits a single commercial patient and so drugs get transferred through these licensing agreements originally from universities from biotech to biotech that specialize in different risk profiles in the drug development value chain this is probably a little too deep for we want to get educated on I think it's really important most people think the cost of developing a drug is the manufacturing cost and you hear that a lot in public discourse but actually the cost of a drug isn't it's risk and it's R&D so usually 12 years to develop a new drug from patent to patients right only one in 4,000 make it so it's extremely high risk and then you know 10 billion dollars in development cost is not an unusual number to pay to get a single functional drug out of that process and so probably we're on a cloud player TV people are familiar with venture investors playing at different risk profiles and a startup and value development chain drug developments really similar that you have biotax and intermediaries before pharmas playing in different profiles and the drug development chain and different specializations and so drugs have to get developed through that and people have to be compensated for their R&D risk along the way and that's why people is the entire industry and so then we said these these transaction points are really choke points for drug commercialization and for companies right it's hard for the buyer to see just like it's hard I think for a venture investor to see well what's going to be the next unicorn and I think it's even harder for pharma companies to understand what's going to be a good drug that makes it and then on the other side of the fence you've got biotech companies well who can help me carry this out to patients who can help me develop it and who can I even trust to do that work because it's not just a financial transfer it's a long-term sort of marriage or collaboration I imagine you know a lot of the the working the workings and the dynamics of the pharmaceutical industry is in the spotlight in the whole year of 2020 and 2021 can you tell us about how that landscape has evolved in this past year yeah let me think about that so I think um you know there's certainly a lot of optimism within the life sciences space I mean them most people in the biopharmaceutical industry are acutely aware of how unpopular their industry is and you know what I believe is that a lot of that reputation is is not fair some of its fair but most of its not and I think that sentiments one that people in the life sciences really feel and so there's been a lot of optimism to hope that people are starting to understand what does it really take to develop something we're talking about developing multiple vaccines I think people have become a lot more educated about okay well you know we know that bio and tech had to license to Pfizer that's the type of transaction motion hall helps with right so and we also know if you look at the bio and tech story that that technology was around for a while and the woman who developed it I believe was struggling to keep financing for her project at the University and was at risk of losing tenure because people didn't believe in her science right so science is hard to see novel things are hard for the world to understand by virtue of their novelty right so that had to move the licensing transaction had to happen between bio and tech and Pfizer Pfizer still had to go through a massive process and then collaboratively sharing with other folks in the industry and then trying to figure out how to manufacture and I think we've all learned to that vaccine manufacture is extremely hard I know Bill Gates has been really outspoken about this over the past year and then taking on personal finance risk and making sure those manufacturing facilities are available but the long-winded way of saying I think there's a lot more awareness that somebody just doesn't have an idea at a university that it pops out a manufacturing plant on the other side and nobody thinks about it much more than that but there's just a tremendous amount of efforting and you know what I wonder about is the fact that we got multiple vaccines seemed highly unlikely a year ago and I remember being on calls with senior industry leaders clenching their fists saying oh gosh like we still don't have a vaccine for HIV so how are we going to be able to do this and coronaviruses are very tricky and so it's a real testament I think to what the industry can do and it's a willingness to collaborate around impact that we got multiple vaccines I think that's reason for optimism for humanity I think so I think it's really exciting and I think it's always good when more of us understand what it takes to make progress in any sort of impactful field right and health care is one of them and then the next big change that we have to manage together I think is an energy and climate I'm optimistic cautiously optimistic for that I think cautiously optimistic with call to action right so yeah I always want more builders more people who are willing to to stand up and try to make it happen so um let's dive a little bit into the story of how you met your co-founder sure I think there's a couple cute pieces here so I'm meeting my co-founder should there's a couple because I want to tell so I met him originally through friends he hosted a not tonight they invited me and maybe something I haven't shared with you before Jade is that he actually blew me off the first time I met him he was trying to coach my boyfriend at the time to go build video games with him he had a video game project in mind and so I went up to him I said hey I heard you're trying to poach my boyfriend off to Montreal and he just kind of looked at me I was really offended and then we have a slack community that we're all a part of with a lot of folks in gaming engineering community that we shared and I think it's kind of fun and important for Women's Empowerment Month that I decided Jessica Livingston she'd written me back on some sort of comments on Facebook when YC used to have the female founders group and I posted it and I can't remember why but Matt saw that and something went off in his head and we started chatting more and I started sharing about some of the foundations of what would become motion haul and he started talking about some of his interests around rust and then I think the piece I didn't want to miss in this call is that actually I don't know the right way to introduce this but actually been living at a place that's right cuz we go way back yeah so you know back in the day I rented houses and and rented out bunk beds and built a community of hackers and makers and thinkers and people who want to do cool interesting work and so uh you're part of my so you were one of our residents I was one of the residents and I am I don't remember exactly how I found JJJ but I remember doing my work and I was like okay I want to check out one of these Bay Area hacker houses I knew that it was in Mountain View I was like okay that feels really good and nerdy to me I like that about the location I think there was a couple maybe like a TechCrunch article or something I'd seen about JJJ so I went there I lived in the bunk beds for a while which I loved actually I made a lot of friends that continue to be in touch with and one of which has just written me about their new company so that's that's exciting that's definitely facilitated by you Jade and then I think the kind of fun bit of my story with Matt is there was this platform for putting a tent in the backyard at Jade's place JJJ and I had asked if I could put a tent there not because I needed to live in a tent but Matt and I had this stupid sort of romantic Silicon Valley startup idea that living in a tent was cool and so as we got talking to each other about ideas we said we should really test the co-founder fit and for anybody who's thinking about starting a company who's listening I think doing something like this with your potential co-founder is like you should you should definitely do it. Specifically living in a tent together. We almost had a third co-founder we were talking about living in a living room in Iceland together so like but the idea between the tent and the living room is similar like let's make ourselves really uncomfortable we're gonna spend a lot of space together like it's not gonna be comfortable it's gonna be confined it was designed to make us fight even though it was very nice to be in the backyard right it was still like not an ideal way for two adult humans to live especially who aren't romantically engaged right and and then at the same time we Matt's team previously had built the Signal iOS version as a contractor to open whisper systems and Russ was just kind of thinking about the 1.0 launch so we said okay let's rebuild the rust or let's rebuild the signal ax model cryptographic rockets in rust we called it racks a lot all you can find it online and I get have it's all free and and let's you know see if we can hustle that into Mozilla presented at the 1.0 launch and see what else we can hustle in terms of funding and press Jade was also helpful because I'd met her through shade a day at that point and helping me find some tech press contacts so helping me build my network and and so we did all of that we were really successful right we did present at the launch they put me on the community team we lined up some money through open technology funds and others and I think they were quite heartbroken because at the end of that Matt and I sat down together said okay we lived in a month and tent in a month we lived in a tent for a month we did fight we built all this stuff it all worked it went well and we think we are the right people to work together right because survive that that's a pretty good foundation for surviving what it's going to be like to build a company together for you know potentially more than a decade right it's a lot like getting married and potentially less fun right so if your co-founder your job isn't always to tell them things are okay sometimes your job is to be like you got to work harder like this has been okay right and so yeah I suppose um I just really love thinking about talking today that a lot of our roots were not just kind of testing each other in the backyard of Jade's place shade JJ but also eventually kind of making our founder initial founder commitments like okay we are gonna work together the idea we're gonna pursue is motion haul and you know this is gonna be our first set of success metrics so we'll get to this benchmark and then we'll see if we're gonna keep building it from there yeah yeah and I'm really glad that um that the the female founders forum was instrumental and it's it's funny like it's it was a small little role but it was it was a role and so when I was thinking back like shade JJ is an important part of my story even though I spoke to Jessica Livingston very very briefly I think several things that she did and was a part of are also part of our story and so yeah nice roots for Women's Empowerment Month. Speaking of Women's Empowerment Month, I think you had mentioned that you had that your team has gender parity yeah all along can keep like did that happen intentionally was it by accident it just happens yeah and sometimes we worry about having too many women on the team like when we look at candidates and our pools of strong candidates it's like oh are we gonna tip and be actually like 70% women or 80% women you know and our team is fairly diverse beyond gender right and I think there's a couple interesting pieces there you know one is that I think being a female CEO is a really strong signal to other women who want to be recognized and valued in their career that's unfortunate that we're still working on that but it's true and so we get a lot of really talented people coming inbound who are looking for you know real leadership being fully appreciated and yes I'm very happy to hire everybody talented but everybody else is too foolish to fully to fully value you know I think along those lines and share to my kind of notes as I was thinking about chatting today that I think you know women are really time-limited arbitrage opportunity and talent right I think there's still arbitrage opportunity there for investing and there's an opportunity there for hiring I feel like perceptions and understanding are moving so fast that that arbitrage is not going to last a lot longer but it's still there right now and so sometimes when we look at our pipeline of candidates we're like oh we're gonna hire another woman we're like well it's a pipeline problem you know we just look at the shape of our hiring pipeline and where a lot of that talent is and we find it in women and other people with them I think classic broken resumes or things that are just not fully appreciated yet by the market and so you know we are always kind of laughing to ourselves again like for as long as everyone else is willing to be foolish about not seeing that talent yes we will hire all of them it would seem that anytime society has some kind of unfair bias that there is an arbitrage opportunity in the opposite direction no I mean that's right I think our team is you know diverse in terms of gender visually diverse racially diverse a lot of us are queer right and I just think it's funny because I get better talent and I can look at my friends companies I have so many friends I can benchmark with now that have you know teams that are less diverse than mine and the feedback that I always get is Rachel your team is a cut above right you guys have a culture that I've never seen before and you guys are so nice to each other right and you have a great team yeah it's really it's really lovely and I do feel very fortunate and privileged but I also know that it's not just that it is that other people are missing these opportunities where do we want to go next I know there's a few other pieces that were top of mind for me can I just yeah so um I don't know how many people watching today know that Jade used to live in this place called the land party house and there was a web presence for it and so when I again was first kind of like hanging in the Bay Area and maybe living in the tent or staying at JJG JJ and just really had like for me I had a golden age of experiencing tech romance the way I wanted to right so I went to the Tesla factory and I went to the Computer History Museum and I went to NASA and I went to Jade's land party house Kenton is responsible for the vision of that it was it was truly excellent it's a really beautiful home can you still find pictures of it on the Internet yeah in fact there was a 3d scan of it also so we sold it recently when we moved to Austin but we're going to build a new one nice so that was in Palo Alto and I thought that was also really felt Silicon Valley magical to me and then I remember you know pre-motion haul probably before I did that co-founder testing fit with Matt just kind of chatting with Jade about where I had ideas you know I didn't have the name for motion haul I was still figuring out where the sweet spot were and we were at the land party house and you were drawing on a chalkboard or a whiteboard you're like startups work on power laws like you've got to be over here and I was like oh yeah like you know it's hard to think with fresh eyes about the way that I thought about that then but I have this almost like snapshot memory of you doing that that kind of fits into where I see some of our roots and some of the sort of the startup magic that I think at least either is where I am right now or the world's changed but I find harder to tap into than I used to right like it seems like maybe we're more I know for more enterprising or more direct-to-consumer and Silicon Valley doesn't feel as nerdy to me as it used to although it is still pretty nerdy Back when we were young and excited to be strawling things on a board It's true, before I owned a couple suits Well you know what not a lot of people you know like keep that same sense of self when they transition between being a sort of a hoodie person and a suit person but you're I mean underneath that I see that you're still the same Rachel Yeah it's funny because it is I mean your code switching right yeah I think I've been able to keep that nerdiness particularly as part of our internal team culture which like we've got a great internal team culture and it's took me time but there's a way you know there's a translation of that that makes a lot of sense in pharma right so I mean different language maybe different norms but I mean we are working with the world's healthcare innovators they're usually pretty smart they're pretty curious people they really want to see their products get to patients and so so there's a way that that plays out there too and maybe another thought because I think Peter Teal did do a good job of this and one of his I don't know if it's in zero to one or in the notes that are on the web but he shows that you know it's not uncommon for a founder to make the transition from you know probably blue hair which I had when I met Jade and hoodies or green hair one of those to you know figuring out how to speak to your customers by adapting into something that resonates with them so the green hair was great when I was talking to rust developers and I love that but I'm not so relatable to a senior pharmaceutical executive right so at least it helps me a lot just to think about it as a form of kindness right like okay I'm gonna be easier for you to understand if I appear this way and this is how I'm gonna be kind to you and so let's like you've already got to understand the technology you've never conceived of before if you're gonna understand what I have to say to you let's uh let's not make it harder with green hair right so I mean basically conversing with them in their native language in their native culture that's right totally yeah which surprise surprise is it's an act of service but were you like what was the last piece of code you shipped and were you sad when your team told you you didn't have time to code I wasn't good enough at it either when we want to shift it last I think I don't know when I shipped my last bit of code but I do know that the team really likes to like tease out like some of Rachel's commits and our repo right some of my notes they've gotten rid of most of my code but I'm told that there's still 700 lines in production so what do I think I mean I'm coatings in my roots I think I do have a talent for it you know in another life maybe I didn't actually I probably would have preferred to be like you know a CTO and in the background more and thinking more about coding problems but I didn't get that life yeah I think it was it was sad and kind of fun right I guess the fun part of is you know meant the company was growing we had more people to help with code so nobody needed me to do it and it was like okay Rachel also you're the only person who can figure out how to crack the sales problem so you need to go there I think you know aside from that I'm just glad that I got to do it for a little bit right I know a lot of business focused founders don't get to code at all and so if that was gonna be my last little chunk of code that's not a bad one I think I did think that I would build video games on the side of my hobby time for a while I've maintained this like illusion that I was gonna like make toy projects but it's completely impossible and there's no way that I have the brainpower time for that so that's completely understandable I mean it's so all-consuming yeah that's right that's right I think you know more illusions they had when I started they say that if you knew how hard it would be maybe you wouldn't have done it I'm glad that I did it but um yeah I definitely thought for a while that I could keep my green hair and that I could keep coding which no it doesn't work that way but yeah you know you're still green hair on the inside on the inside which is what counts right thank you for seeing the real the real me so yeah I think part of the fantasy is like or here's the existential crisis I have I'm like okay when I'm like 90 and don't care about anything anymore like do I wear avant-garde fashion do I dye my hair green again or I'll be will I be so used to dressing up for pharma that I'll be like actually I just feel more comfortable at a blazer now anyway there's a little bit of existential horror there well speaking of learning experiences in the last five minutes that we are on air I think you've read some there's a number of books that influenced you over time right can you recommend some of those to the to the audience sure let me think about that I mean for building a startup zero to one really is my number one you know it's unfortunate there's so much controversy around Peter Thiel that it's hard to talk about and then it used to be but there's just a lot that he gets right in that book and in terms of the shape of motion haul like really right and you know other books like maybe the learning startup might apply more to somebody else's company but that one really applies to us and other formative books go to Lesher Bach which actually have a copy behind me it's autographed too isn't it this one this one's not so I've got three copies which is really embarrassing but I do have an autographed copy and what's embarrassing about that I can't show it to you it is you can't see it on the web obviously you've seen it I received that autographed copy as a gift and from somebody who was trying to be very kind but didn't actually know me very well but knew that I loved that book and when they got it for me they presented on my birthday and I said well and Douglas Hofstadter sent me this email along with it and the email from Douglas was like you know I'm very old and this will probably be the last time I ever autograph a book you know at my age it's quite hard for me to go to the post office and pick it up and then I have to think about what to say to that person and make sure that I'm thoughtful and then I have to go back to the post office and send it again and as you can appreciate that's just a lot of time for somebody at my age and so I feel like I've got this like little soul fragment from Douglas Hofstadter that I should have never had in a book it almost feels like a little bit cursed I'm very grateful but I have a lot of guilt about it I was like you should have kept your little soul shirt Douglas Hofstadter there's not that much like you know he's been clear that he he doesn't want to be posthumously reconstructed you know if we you know in some post singularity future where we where we do things like that he doesn't want people to try to do that he would like to rest and just have his fragments be what they are so like that's that's a little last bit of Douglas's life just finding a book for me so I don't recommend that anybody ask him for an autograph but I do recommend the book if you haven't read it yet and what else has been really influential I think you know over the last year a lot of founders been thinking a lot more about broad-scale economics right it's become much more important I know I spent more time than I ever have thinking about what state is the world going to be in a year right what's gonna happen as this time plays out and then what are gonna be the long-term and continuing ramifications of that and so a lot a lot of reading about economics this year which I think has been influential and maybe one that's worth mentioning is reading Franco Milankovic's capitalism alone which is and the latest to kind of influence some of my thinking and there so which is in to endorse everything he says but he is a really thoughtful and rigorous scholar and you know the idea behind capitalism alone is that we've really got two forms of capitalism on the global stage right now we've got sort of a Western form of democratic capitalism and then we have a more political capitalism like we see in China for example and his theory is that only one of these systems will prevail and so the book is exploring where all those systems are going and what the natural consequences are and then how we should think about it and what to do about it oh yeah I feel like I want to read that book now it's a yeah it's a you know light bedtime reading what if there's other books for founders I mean um you know particularly if there's women founders watching right now I think Jessica Livingston's founders at work which is another classic and she does capture some interesting stories about the female founder experience that I haven't seen elsewhere that are worth worth people's time to look at thank you I hope everybody picks that up and I think that's a wrap thank you so much for being on our show it's thanks for having you on the air it's a lot of fun it's great memories of Shane JJ and emotional roots thank you