On average I see over 1,000 deals per year, DD in more significant detail 10-15, and invest in 2-4. This means there is quite a bit of time spent on deals that didn't make it. But, whether I invest or pass on deals, there is always learning. This post is part of a series on learnings from (un)successful DDs.
True expert advice is indispensable in Deep Tech
I was very keen on a computational biotech deal that was recommended by a friendly VC. Personally, I liked the space so much that even my own daughter was excited about investing (and she was 9 at the time). She even explained the deal to my wife over dinner much better than I could have:
Mummy, Company X uses data and mathematics to shorten the period of time to make drugs and save lives!
As part of the DD, a reputable investor friend (thanks Carl!) joined the call and brought along a few experts in the computational biotech space - a heavy-weight who backed multiple biotech unicorns plus the CEO of a listed computational biotech business. It was astonishing to observe the depth of the conversation, quickly uncovering layers that are specific to the field that an outsider (even with commercial and investing expertise) cannot.
Learning: Do your work properly, recognise what you don’t know, and bring in the experts.
I will continue to ensure that *True* experts vet each and every deep tech opportunity that crosses my desk - decades of experience allows them to cut to the chase in a way that non-specialists (like me) cannot.