Interview with Avik Arakelian from BOLD Longevity Growth Fund
Hello everyone, hope all is well. Continuing with our interview series, this week I had the chance to interview Avik Arakelian who is General Partner & Head of Investments at BOLD Longevity Growth Fund, a venture capital firm focused on frontier technologies including longevity, biotech and artificial intelligence. For a bit more infomation on BLG, here is their website: www.blg.vc.
Avik has been investing in biotech for over 10 years now. We met a couple years back via a mutual friend Zack Armen, who is also involved in the biotech space. Avik has been a great resource to the Hye Combinator ecosystem and we look forward to continuing our partnership with him.
My interview with Avik below…
HC: Thanks for taking the time. Maybe first please introduce yourself Avik.
AA: I was born in 1989 in Yerevan. As you know, the early nineties were challenging years in Armenia, marked by the aftermath of the devastating 1988 earthquake, the first Karabakh war, and the overall implications of the USSR’s collapse. My father is a physicist, which instilled in me an early inclination towards physics and mathematics. However, instead of pursuing an engineering degree, I chose to study Economics. My professional career began at international consulting firms like KPMG and PwC, where I was involved in significant mergers and acquisitions deals. Nevertheless, I have always been keen into technical subjects, and dreamed of being at the forefront of technological progress. I realized that venture capital was my only chance to achieve this.
HC: How did you get into venture capital, and how did you become interested in biotech and health tech?
AA: Initially, I didn’t have a specific plan to enter the biotech field. However, I realized that biotech is among the three or four key technological trends poised to significantly change humanity in the foreseeable future. I began my biotech venture career at an early-stage venture firm back in 2014. Despite the challenge of not having a relevant technical background, and the difficulty in understanding all the biological nuances, my daily interactions with scientists, biologists, and medical doctors gradually enhanced my expertise. My interest only grew as new technologies emerged such as gene editing, organ and tissue regenerations, and integration of AI into the more traditional pharma. We are now living in an era where major trends in biotechnology, longevity, artificial intelligence and big data are converging. This environment is markedly different from the one I encountered when I first ventured into biotech over 10 years ago. I believe that the developments we are witnessing now represent an inflection point, not just for the biotech industry, but for humanity as a whole.
HC: What are the major trends happening in those industries? What is going on under the hood?
AA: I would highlight two significant trends that are reshaping the industry.
First, there's a growing emphasis on understanding the biological mechanisms of aging. This research goes beyond merely extending lifespan; it's about enhancing the quality of life as we age. Innovations in regenerative medicine, such as organ and tissue engineering, as well as gene editing, are at the forefront of this trend. They hold the potential to repair or replace tissues and organs damaged by age, correct genetic mutation to treat devastating diseases or even completely prevent diseases thereby transforming how we approach human biology. The implications of this trend are vast, affecting not just healthcare but also societal structures and economies, as we adapt to a progressively aging population.
Second, the integration of artificial intelligence in drug discovery and development is revolutionizing the field. AI and machine learning are not just speeding up the process but also bringing a new level of precision to it. By employing algorithms that can predict the behavior of molecules and assess their potential as effective drugs, we're seeing a significant reduction in both the time and cost associated with bringing new drugs to market. Furthermore, this technology paves the way for more personalized medicine, allowing for treatments that are tailored to the individual's unique genetic makeup and beyond, thus improving efficacy and reducing side effects.
These trends represent a transformative phase in biotech, driving both innovation and efficiency in ways that could have profound impacts on healthcare and society at large.
HC: It’s pretty amazing how AI and ML are having some a profound impact on so many different industries. Maybe talk about a specific investment. Which one of your more successful investments or projects you were involved with you are most excited about? Why?
AA: I think there are many exciting developments across broader biotech, but as an investor, I see big potential in the field of genetic engineering. While technologies such as gene therapy and editing were initially targeted to rare diseases, today, therapeutic applications are moving to more widespread chronic diseases, such as cancer and cardiovascular diseases, which in total account for more than 50% of deaths over the age 50.
One of the most interesting companies I have been involved with is Tessera, a company founded by Flagship Pioneering (the VC fund behind Moderna and multiple other successful biotech ventures). Tessera is pioneering a gene-writing technology that can edit the human genome with unprecedented precision and safety. You may be aware of the previous generation of gene editing called CRISPR. Well, Tessera has advanced gene editing in a number of dimensions compared to CRISPR. Its technology can precisely write entire genes into the human genome.
Another great example is Life Biosciences, co-founded by a Harvard Professor, David Sinclair. Last year they demonstrated ability to restore vision in monkeys with irreversible blindness. They have developed an innovative cellular rejuvenation technology that is advancing into human trials in the coming couple of years.
I think technologies such as Tessera’s and Life Biosciences’ prove that we are at an inflection point in the longevity and biotech space. Until recently, we have seen great research and results small animals, in the best case, it was in mice, but not much that would be close to humans in the foreseeable future. Now we are much closer to those breakthroughs in humans, which are reasonably expected in the next five to seven years.
HC: Interesting. How about one that did not work out? What were the key learnings?
AA: Well, biotech venture investing is a dynamic landscape marked by both significant gains and inevitable losses, with each presenting unique opportunities for learning and growth. In this high-risk, high-reward sector, investors encounter the inherent unpredictability of clinical trials, regulatory hurdles, and scientific uncertainties. Understanding the nuanced interplay between scientific innovation, market dynamics, and regulatory environments becomes extremely important. Our strategy has always relied on three key pillars, which has helped us avoid many common mistakes seen in longevity and biotech investing:
1. We invest in technologies that address the root causes of aging and diseases rather than treating symptoms or downstream factors. They do not necessarily target aging itself as part of their R&D plan, given that aging is not officially considered a disease indication in the US and global regulatory systems. But we understand that they have fundamental impact on aging biology.
2. We invest in platform technologies that can generate multiple assets within one company. These companies sometimes have diversified and uncorrelated risks, made up of a collection of assets targeting different disease indications. I think the broader biotech VC market is now moving in this direction avoiding the binary risk outcomes of single asset companies.
3. Over 80% of our companies use AI as the core technology or enabler for their R&D. This not only expedites R&D timelines but also enhances the probability of success in clinical trials, mitigating risks associated with traditional trial-and-error approaches. In the realm of innovation in longevity, where the complexity of biological processes is immense, AI applications are driving breakthroughs that were once inconceivable.
HC: Very insightful. Switching gears, how would you describe the health of Armenia’s startup ecosystem? How about specifically biotech and health tech? What excited you the most?
AA: The health of Armenia's startup ecosystem, including its biotech and health tech sectors, is developing but faces certain challenges. While there is a growing interest and some notable advancements, particularly in leveraging Armenia's strong foundation in science and technology, the ecosystem is still relatively nascent. Access to funding, international partnerships, and market reach remain areas that need more development. What excites me most, however, is the potential for growth. Despite these challenges, there's a clear willingness among entrepreneurs and researchers to innovate and drive progress, which is a good starting point although there is still significant lack of infrastructure, relevant equipment, and human resources. This determination, coupled with strategic support and investment, could enhance Armenia's position in the biotech and health tech landscapes.
HC: Where can it improve? What is lacking in the ecosystem?
AA: One of the biggest challenges is the limited availability of funding. Startups often face difficulties in securing sufficient capital for research, development, and scaling, because biotech is a capital-intensive field.
Another primary challenge is establishing stronger ties with international organizations, research institutions, and industry players that could enhance the ecosystem's global reach. Collaborations can bring in diverse expertise, open new markets, and provide valuable networking opportunities for startups.
Another notable point is talent development. Investing in education and training programs to cultivate a skilled workforce is essential. A great example is Armenian Bioinformatics Institute, a recently established scientific-educational foundation aimed at advancing bioinformatics research, education and facilities.
Additionally, raising awareness about the potential of the biotech and health tech sectors in Armenia is important for attracting talent, investors, and strategic partners.
HC: From your perspective, what are the 2-3 most common reasons why entrepreneurs fail at scaling their ventures in biotech? And how do you recommend they overcome or avoid those?
AA: Biotech ventures typically require significant capital investment, and the development cycle can be lengthy due to rigorous testing and approval processes. This can lead to funding challenges, especially when the companies need to scale their research from preclinical (in vitro and animal) studies to human trials.
To mitigate this, startups should explore a range of funding options, including venture capital, grants, and strategic partnerships. Building a strong case for the potential impact and viability of the technology is essential to attract investment. Moreover, phased development strategies, where milestones are used to secure ongoing funding, have proved to be effective in biotech.
HC: What advice do you have for aspiring and current Armenian entrepreneurs?
AA: The business landscape is constantly evolving, especially in technology-driven sectors. Staying flexible, continuously learning, and being open to pivoting your business model in response to market changes are key traits for success.
Given Armenia's relatively small domestic market, entrepreneurs should adopt a global mindset from the outset. Designing products and services with an international audience in mind can greatly expand market opportunities and potential for growth.
And finally, building relationships with other entrepreneurs, investors, and mentors both within and outside Armenia is crucial. Engaging with the Armenian diaspora, which is widespread and often influential, can provide valuable connections, insights, and opportunities, but more importantly exposure to strategic thinking, business ethics, communication skills and expertise from the developed world.
HC: Completely agree. What resources do you think are most helpful to help aspiring entrepreneurs get their ideas off the ground? How about for more established companies that are scaling?
AA: For aspiring entrepreneurs, key resources should include access to a global entrepreneurial community for networking and mentorship, and acceleration platforms for continuous learning and skill development. Leveraging these can help transform innovative ideas into viable business ventures.
For established companies, scaling up to strategic partnerships, advanced market analysis tools, and investment in cutting-edge technology are crucial. These resources enable established companies to scale effectively, adapt to market changes, and maintain a competitive edge.
HC: This was fascinating. Thank you very much Avik for your time. How can people get in touch with you if they are interested in learning more?
AA: I am always happy to meet likeminded people, investors interested in biotech and happy to contribute as well where possible to support Armenia’s and global tech ecosystem. You can find me on LinkedIn: https://www.linkedin.com/in/avik-arakelyan-cfa/?originalSubdomain=am.