Nestegg Biotech is a US biotech startup who felt that the European market was the right environment for them to shine. We had the pleasure to talk to their Co Managing Director, Tim Gauldin who shared with us the team’s experience, funding expectations and goals for the future.
Interview with Tim Gaulding from Nestegg Biotech
1. Hi Tim, congrats on your success thus far! Please tell us about Nestegg Biotech, your team and what you’re hoping to achieve in the biotech industry. How did your team choose Sittard, Netherlands as the company’s starting point?
Nestegg Biotech was the brainchild of Tanner Carden, a biology student at the University of Alabama in Huntsville. In early 2013 he became very interested in 3d printing for biological applications. He recruited an engineering friend, Devon Bane, to help him with the mechanical and design aspects of his ideas. The product that was created from their efforts was the CarmAl extruder, a custom part for printing with dissolvable substances with a 3d printer. When they moved to create a startup with their new idea they recruited Gavon Carden, a chemical engineering student, and Tim Gauldin, a finance student. From 2013 through early 2015 the team participated in multiple entrepreneurship competitions and one prototyping accelerator program.
The team noticed that there were several key players developing various types of tissue products for research but no one was creating a product for the actual implementation and testing of these products. End users are required to make something up in their own labs to be able to run a test with tissues. The team began looking into developing a device to manage the life cycle of these experiments. They located a partially complete base platform and began building off of this system. This new product is the Obruza Cell system, an automated cell culturing and testing system that can handle complex tissue products.
In the spring of 2015, the team was contacted by representatives of Startupbootcamp Smart Materials, a business accelerator in the Netherlands, and asked to participate in their accelerator program. The team has had an amazing experience in Europe and has decided to make Europe, specifically Limburg, the starting point and home of their primary operations. The team is passionate about “Creating the New Research Standard” and hopes to have a direct impact on pushing the world of pharmaceutical and medical research to whole new levels. We are just getting started and hope to achieve great things with Nestegg Biotech.
2. Do you feel that as a biotech company, there are additional challenges when seeking funding? For investors involved in other industries, what are the unique benefits and potential for return when investing in Nestegg Biotech?
Most biotech startups face a great challenge when it comes to raising funds. Not only do they require specialized investors for larger investments but also face much longer timelines to achieve their milestones and reach the market. Biotechnology companies carry a great deal of risk, in addition to customer adoption and market approval of their products they also face regulatory approval, clinical trials, and extensive validation work.
Our company is not your average biotech startup. We acquired our current product while it was in the mid to late stages of development. The product, the Obruza, is already certified for sale in both Europe and the US. Our other product, the vascularized tissue, is going to undergo extensive validation testing and research throughout the fall under the supervision of Dr. Mark Post. With these two unique products we have a very strong value proposition for our customers and feel this puts us in a very good position for serious investors to consider.
There are many unique benefits for investors looking to participate in the biotech space. Investors get a chance to participate in ideas and innovation that are changing the world of research and medicine. In addition to the large returns on their investment they have made it possible for these startups to push the boundaries of research and open doors to new exciting possibilities.
3. As a team originally from the United States, how do the American and Dutch markets compare? Have you noticed any additional challenges and what are the benefits of starting up in the European market?
The two markets are very different but thanks to the amazing team and mentors at Startupbootcamp Smart Materials, Brightlands Chemelot campus, and EY we were able to build an extensive network within the first few months of coming to the Netherlands. Limburg is quickly becoming a world class hub for innovation in the biotechnology sector and we are excited to be a part of it. One of the biggest challenges we have faced is the learning curve associated with conducting business in Europe. However, the team learns fast and things are going very well.
We have identified a number of benefits that make Europe extremely attractive to new startups such as a friendlier and more efficient regulatory environment, enthusiastic European partners, extensive tax and grant incentives, and regional help from local economic development programs. We continue to find strong supporters and our network is growing every single day. We love the horizontal corporate structure of most European businesses and have used this to our advantage. The business environment is much more relaxed in Europe than in the United States and the pacing and timeframe to accomplish things are much more realistic. We see the value in doing business this way and feel this is an environment in which we can thrive.
4. In the US, convertible notes are the effective standard for seed-funding startups. What are your thoughts on that? Why did you choose Leapfunder as your funding platform and how has your experience been with convertible notes?
There is much more innovation happening in the startup world and not just from the startups themselves but also in the way they are funded. Being aware of traditional valuation techniques and the lack of support for assigning realistic valuations to early stage startups makes the convertible note the perfect investment tool for our startup at this stage. The convertible note is an amazing product to avoid assigning a valuation before it is realistic to do so and is such a great tool to both the startups and investors.
As a company, this is our first experience using a convertible note. We chose Leapfunder thanks to your amazing cofounder and CEO, Tienko Rasker. He came out and taught an investment class at Startupbootcamp and introduced us to the Leapfunder platform. We feel that this is the cleanest and best designed equity based network funding platform available and have been extremely satisfied with launching our campaign on Leapfunder.
5. What do you have planned for your innovative technology and the future of Nestegg Biotech? Please share with us how you’re planning to utilize the funding received from your Leapfunder round.
We have many exciting things in the works for this fall and coming spring. Throughout the second half of 2015, we will be announcing many exciting partnerships and deals that have been in development over the past several months. Several global players, universities, research institutions, and individuals have seen the value in our products and are very enthusiastic in making this a reality. With the funds from this current round we intend to open offices in Limburg at the Brightlands Chemelot campus and continue working in this amazing collaborative environment. We will also be covering some additional IP that we are developing, finalizing software on the Obruza, finalizing the hardware, and running validation testing on our vascularized tissue products. We plan to start shipping Obruza’s by the spring of 2016 and a lot of time and effort will be spent on working with future customers to ensure their needs are met with our planned products.
We have one final word to our supporters and interested parties. We are a young and energetic team and encourage you to reach out to us if you have any questions, comments, feedback, or just want to hear more about the technology. Please contact us, we would love to speak with you!
Sound Interesting? You can get introduced to their team here: