Episode 3: Money Meets Molecules: What Biotech Investors Actually Care About

Armon: [00:00:00] Thanks, Eliana, for joining us on Boba and Biotech. That's what we're calling it. 

Ileana: Nice. Did you just make that up? 

Armon: Uh, not right now, like two days ago. 

Ileana: Okay. 

Armon: But importantly, we need to judge your dreams, so I would've expected you to get something with bubbles. But you got, what is that?

Ileana: Oh, there 

Armon: are 

Ileana: no bubbles. 

Armon: Huh? 

Ileana: There's no bubbles in it. 

Armon: I don't know. You've been drinking it? What did 

you 

Ileana: know? I thought that was implied. I guess I didn't realize that. 

Armon: Oh, 

Ileana: there are no bubbles. 

Armon: Our, our crew failed. [00:01:00] Um, 

Ileana: but it's great actually. It's really good. 

Armon: The at stuff is pretty good. Good. Thank. And they suggested I get this like coconut mango sgo thing.

It's awesome. I only wish Julie didn't tell me it's 510 calories. So now I'm gonna dive. Don't poison poison name. Yeah. Uh, all right. 

So can you tell us a little bit about your backstory? 

Ileana: Yeah. 

Armon: How you got involved in venture? 

Ileana: Yes. Um, well, I'm originally from Italy. 

Armon: Yeah. 

Ileana: Uh, I grew up in a small town outside of Rome.

No 

Armon: Boba there. 

Ileana: No Boba, definitely no, still no boba to this day. I actually, my dad is retiring soon, uh, from the Dalian army and I, uh, told him that he should bring Boba 

Armon: Yeah. 

Ileana: To the region. Big business 

Armon: opportunity. 

Yeah. 

Ileana: I think it's gonna be a big opportunity. 

Armon: Yeah. The Italians adopted pasta from the, from Asia and now Boba iss the next thing.

Ileana: Yes. No, but I mean, if you had to open a sushi place in Rome like [00:02:00] 20 years ago, you'd be rich now. So I think Boba is next, but um, yeah, my, um, parents, parents were actually tobacco farmers in Southern Italy, so my parents moved to Rome because they thought they. You know, give me more opportunities and, um, open up possibilities for, especially in education.

They always, always believed in education a lot as a force to sort of elevate. People out of poverty. And the irony was that I actually didn't get much education in Rome at all, because I left very young. The first chance I got, um, I won a scholarship and went to the Netherlands to never come back again.

Speaker 3: Mm-hmm. 

Ileana: That was not the original plan, but, uh, one thing led to another and it led me to the United States. I came here for college. Um. Didn't really know what I wanted to study, but I liked math, chemistry, biology, science, physics, little less than, yeah, biology and chemistry. [00:03:00] Um, but I ended up studying biomedical engineering as a way to sort of bring all those, uh, disciplines together and do something for, um, good.

Armon: Yeah. 

Ileana: Um, and got into research really early. Tried my hands at academic research. Um, research would be big industry, um, national labs. I worked at NASA for some time. Mm-hmm. Um, the pace of research, um, was a little, um, slow, but I liked the creativity of it. So I, I ended up going to get a PhD at Stanford and studied again, medical engineering.

Applied to robotics and the cardiovascular system, which was my fascination. 

Speaker 3: Mm-hmm. 

Ileana: Um, and I think I got into a PhD, not with the intention to go into academia, but with the intention to, you know, get rigorous scientific training and [00:04:00] ideally find a problem that I thought was really worth dedicating. The next 10, 15 years of my life too.

Armon: Yeah. 

Ileana: Um, and I had a little bit of an identity crisis when halfway through I realized that that was probably not gonna happen for me. 

Armon: Mm-hmm. 

Ileana: And I didn't wanna force it. And if anything, my biggest pet peeve when I was there, when I was at Stanford is that it felt like every Stanford student and their mom had to start a company.

And I, yeah. I didn't wanna start a company for the sake of starting a company. 

Speaker 3: Mm-hmm. 

Ileana: Um, but I did like hanging out with founders and I thought, um. It was really energizing to be thinking about the future and about, um, getting the opportunity to shape it. 

And so the next best thing was, uh, venture. 

Armon: Yeah.

Ileana: And, uh, I, I mean frankly, I, I got into venture originally to pay the bills because the PhD programs, uh, are, are barely enough to. Pay for life in the Bay Area. 

Armon: [00:05:00] Your boba habits are very expensive. 

Ileana: Boba habits are very expensive indeed. Um, and I, yeah, I got into venture following both curiosity, uh, an interest in sort of learning what was there outside of science and applications of science.

Yeah. Um, and also a way to pay bills. 

Armon: Cool. 

Ileana: Sorry if that's not very inspiring. 

Armon: No, no. I mean, people have to pay bills. And what are the, some of the things that, uh, now that you've been in the venture side for a while, you feel like operators often misunderstand about the venture side, like all those founders you were dealing with and the complaints they would have about VCs or, or things they liked about VCs.

Now that you're, you've been one, what are some of the things you think they misunderstood? Big misunderstandings, not little ones. 

Ileana: Um, well, I think,[00:06:00] 

I think it's a really bad habit that VCs have of sometimes of not being very responsive or not being ghosting founders or not being, uh, definitive with. The responses that, um, they might give or with the milestones that they might set. 

Armon: Yeah. 

Ileana: Um, but I think something that is misunderstood is that it's actually, you know, not to give, this is too much love.

Yeah. But it's actually a very hard job mm-hmm. To have to say no that much. 

Armon: Yeah. 

Ileana: Um, particularly because there's a lot of times when I personally really believed in what the. Company was doing, and maybe I believed in the science, I believed in, in the merit. I believed in even in the market opportunity.

Speaker 3: Yeah. 

Ileana: In the founder's ability to execute. And even when you check all those boxes, sometimes it's not enough. 

Speaker 3: Mm-hmm. 

Ileana: Because there might be mechanisms in the fund that, um, you know, the master is not privy to and certainly the founder cannot be privy [00:07:00] to. Um, but with relation to funding cycles with. LP commitments with, um, the allocation of the fund to a certain industry rather than another internal fund politics.

And sometimes those are dynamics that are not explainable. 

Armon: Mm-hmm. 

Ileana: Um, and it can lead to a known answer as to why it's a no. 

Armon: Yeah. 

Ileana: Um, so. It's, 

Armon: and, and you think they ghost because they don't wanna explain the No. Is that what you mean? 

Ileana: Because they don't wanna explain the No. Or because they can't or because they're overwhelmed because it's, you know, it's 

Armon: too many nos to give too many 

Speaker 3: nos.

Ileana: Or, because sometimes, you know, perhaps they hope that, um, the, the answer may change and they don't wanna close the door on that founder. Um, just yet. 

Armon: So it's the sympathetically awkward No, 

Ileana: it's, yeah, 

Armon: it's the ghosting. 

Ileana: Yeah. It, I, I guess what I'm saying is that there's a lot of depth Yeah. [00:08:00] Sometimes to the ghosting and, you know, maybe some people are just bad people and they, 

Armon: and they're just lazy.

Ileana: Are lazy. 

Armon: Yeah. 

Ileana: I'm sure there's some of that too. 

Armon: All right. I, I, I mean, related to those pieces that the, uh, founders may not see, what are the dynamics like with LPs, because I, I do think that's a. World that's invisible to most of the founder side. Like what are some of the dynamics there that you think are, were interesting to learn and like you kind of wish founders at least conceptually understood more.

Like, I know within a fund you can't explain it too much, but in general. 

Ileana: Yeah. Um, I think there's LPs and LPs, right? There's individuals, uh, that invest in funds. Mm-hmm. There's family offices. There's. Um, all the way to large institutional fund of funds, mutual funds, pension funds. Mm-hmm. So, um, different categories of LPs, um, are optimizing for different things, different metrics.

Um, 

Armon: is it mostly all [00:09:00] financial metrics or do you feel like some of them it's more their version of philanthropy, for example, 'cause it's healthcare. 

Ileana: Yeah. I'd say it's, it's more financial metrics than it is for VCs. 

Armon: Yeah. 

Ileana: Um, but. There's definitely also a class of LPs that, um, invests in venture because they are curious.

Yeah. Or because they're techno optimists or because they wanna hang around the venture crowds and, you know, it's, uh, there's a lot. Of venture that is intangible. Mm-hmm. And it's not necessarily the best asset class for Yeah. Um, certainly for liquidity and for long-term outcomes that the average venture fund doesn't outperform the stock market.

Armon: Yeah. 

Ileana: Um, in fact, even the better than average ones don't. 

Armon: Yeah. 

Ileana: Um, but there's, there's intangible value that comes with, um, being part of what's next, being part of the future. [00:10:00] And, um. I think in any, any type of investor is also a talent scout. It's a talent business. 

Speaker 3: Mm-hmm. 

Ileana: So the LPs, it, they like the best are the ones that are sort of making their craft to identify emerging managers.

And perhaps those are also the riskiest managers. 

Armon: Yeah. 

Ileana: Uh, but it turns out that statistically, uh, people do really well on their first fund. And sometimes it's, there's confounding variables, right? Smaller, smaller funds. And, um. More niche unpenetrated areas, 

Armon: the market. How many LPs would it, I'll make it up like a hundred million dollar fund typically have.

Ileana: Mm. It really depends. Uh, you can have single lp. 

Armon: Yeah. 

Ileana: A hundred million dollar funds. 

Armon: Yeah. 

Ileana: Um, or you can have, you know, usually more diversification is, is really better. Mm-hmm. But just like in, in a funding round for a company, you'd have an anchor. 

Armon: Yeah. 

Ileana: Um, a lead. Yeah. Someone that believes in you first introduce you to their friends.

Um, [00:11:00] and it sort of goes from there. 

Armon: now that you've been, you know, on the VC side for a while, how have you changed how you judge the founders over time? 

Ileana: How have I changed 

Armon: how you judge the founders over time? 

Ileana: How I judge the founders, um, I think it's really humbling to remember that there's a whole life behind the founder.

Armon: Mm-hmm. 

Ileana: Um, you know, I think there's some parts of the venture ecosystem that push this narrative that founders are, you know, the nine to nine, six days a week and yeah, sleep in the office and you can't pay yourself and, um, probably don't have kids or a wife or a date in five years. And I think that's just not, um, real, but yeah.

But the more we paint that narrative, the more. We create these archetypes in our mind of, [00:12:00] um, these founders for whom the company is literally all they have. 

Armon: Yeah. 

Ileana: And I think that's a little bit hyperbolic in It is in, in a way taking up a lot of their mind share. 

Armon: Yeah. 

Ileana: Uh, but there's so much that a founder has going on and that doesn't transpire.

Mm-hmm. Obviously through the fundraising process, but really even to the company, and it's just, it just stays. Um, 

Armon: I mean, in light of that, did it change what kinds of founders you thought would be more successful and more investible? 

Ileana: Um, it definitely makes me, it has made me wanna learn a lot more about what they've done before starting the company.

Armon: Mm-hmm. 

Ileana: Um, and I, in, in the least. In the most positive way possible. I like people that have gone through some sort of struggle. 

Armon: Yeah. 

Ileana: Um, whether it's a personal struggle, financial [00:13:00] struggle, family struggle, um, but building that ability to, you know, develop resilience and, um, found oneself on, uh, well on yourself, on building networks that are supportive and maintaining that optimism through.

Serious life struggles. 

Armon: Yeah. 

Ileana: I think is almost a prerequisite, um, to 

Armon: 20 VCs. Ghosting them. Doesn't count that. 

Ileana: No, 

Armon: that's not enough struggle. 

Ileana: I don't think. So. 

Armon: That's just par for the course. Uh, and, and I guess as a, as you think about 

Ileana: struggle and shitty jobs 

Armon: that they've had. Shitty jobs. 

Ileana: Yeah. 

Armon: Oh, okay. So if they were like born with a silver spoon, you're like, Hmm.

Ileana: I mean, you can be born with a silver spoon and. Two, so they got a shitty job. 

Armon: Okay. Okay. What if they just did it to entertain themselves and be with the That's fine. Okay. 

Ileana: That's counts. 

Armon: All right. Uh, [00:14:00] and like related to that, I guess this intersection of how do you find a good founder and dealing with internal dynamics, with LPs and stuff, I feel like a lot of VCs will say they'll lead rounds, but.

Oftentimes when it comes down to it, you get, if they're not gonna go see you, they'll often give the answer of like, oh, that's great. Let us know when you have a lead and we'll come in. Uh, what do you think drives those dynamics of people? Very few seem to be willing to build up the conviction to actually lead and do the work of pricing and putting in a term sheet.

Uh, whereas like often a default answer is they'll just follow. 'cause I think especially when people are newer to this, they don't realize how often they might get that. We're like, oh, they didn't ghost me. Great. They said they'd be in, uh, but they're not gonna price it. So do I count them? Do I not count them?

But anyway, like why do you think a lot of VCs, uh, fall back to, even if they're interested, they'll have a follow position as opposed to actually lead something? [00:15:00] 

Ileana: Yeah. Um, I think there's a lot that goes into that. 

Armon: Mm-hmm. 

Ileana: And some of it is internal. Some of it is external perception driven. Um, but I think leading a round for a company is a very serious endeavor.

I think it's a very serious responsibility. 

Armon: Mm-hmm. 

Ileana: And in most cases, it's good if a fund that is not really set up to lead, chooses to not, 

Armon: yeah. 

Ileana: Lead. 

Armon: What do you view as like, set up to lead? 

Ileana: Setup to lead to me means, um, have investors on staff that have experience operating companies or being on boards.

Armon: Yeah. 

Ileana: I think it can be really destructive for a company to have a tourist mm-hmm. On, on their board, even if the person is well-meaning. 

Armon: Yeah. 

Ileana: Um, I also think there's some signaling elements to it. [00:16:00] You know, in tech there's. You'll have maybe several funds sort of crowding to lead the same company. But in biotech it's a lot more common to have syndicates.

Armon: Yeah. 

Ileana: And if your lead is not a well-known logo, it might be difficult for that round to come together. Yeah. In the way that you want it to. So sometimes when the investor sort of recognizes that themselves, they, they might be thinking it's actually better for the company. To find a lead that's more, um, recognized.

Armon: Yeah. 

Ileana: In the industry. Now, what I think is very good for those kinds of funds is to offer per, for example, to co-lead. 

Armon: Yeah. 

Ileana: And that can help them both demonstrate their conviction, demonstrate their, um, you know, alliance mm-hmm. And partnership to the founder and go together, hand in hand. Yeah. In a [00:17:00] market and identify.

That more recognizable lead, um, that could be a better signal for the company. Now signal is not everything, but Yeah. Um, it's, uh, it can help. 

Speaker 3: Mm-hmm. 

Ileana: Um, that is not to say that, you know, leads from more, more recognized funds are always better board members. I, I actually think that's, it's very variable.

Armon: Yeah. 

Ileana: Um, but I think that's some of the dynamics maybe that go into it. 

Armon: Do you think like when there is a fund that could lead or they have a history of leading, but they choose to follow, does that, is that basically their way of saying no? You think? 

Ileana: Um, I think again, it depends if they, different funds feel different ways about competitive dynamics in their portfolio.

Um, I think the best policy is [00:18:00] to go. To your existing portfolio company? Yeah. That might have a competitive, uh, that might be competitive with this prospective investment. Yeah, so sometimes it might actually have been the company that has asked the fund to act a certain way and say that they saw you prospective investment as a competitor.

Um, there could be sort of invisible internal politics between partners because. Someone else wants to do a different deal. 

Armon: Mm-hmm. 

Ileana: Um, and they have worked on that deal for longer or they've, you know, built more internal conviction for it. 

Armon: Yeah. 

Ileana: Um, so I, I, I know that, that it's hard not to read into why.

Yeah. Um, you know, you are stating maybe on social media that you're investing in this space, but, and you want to invest, but you don't want to lead. And what does that mean? Um, but again, sometimes there's invisible things that, um. Are worth giving the benefit of the doubt for. 

Armon: Yeah. I can see that.

Ileana: [00:19:00] Ultimately it's all about how much trust you have with the partner that you're working with. 

Armon: Yeah. 

Ileana: Um, and there's a lot of intuition involved 

Armon: mm-hmm. 

Ileana: In that as well. 

Armon: What, what's your view of, um, the more generalist investors that play across spaces versus the biotech specialists? Like what behavioral differences do you feel like you normally see or any other.

Hot takes you have on those groups. 

Ileana: Ooh. Um, I think there's definitely a lot of, um, snow bism going on mutual in mutual directions. 

Armon: Uhhuh, 

Ileana: um, I, I 

Armon: was gonna ask about that, but I'm glad you went there. What's the drama there? 

Ileana: Well, I am. I've always been a, uh, more generalist funds, but 

Armon: yeah, 

Ileana: as an individual I'm more of a specialist.

Um, but I, I really like the [00:20:00] generalist mindset. I think it's helped me see, uh, sort of outside of the box. Yeah. And, um, try to bring the elements of venture capital that have made the industry what it is, which come from really technology. 

Speaker 3: Mm-hmm. 

Ileana: Um, and connect the dots with. Biotech and, um, and med tech. I think it's, it's very helpful to have that different perspective.

Armon: Yeah. 

Ileana: Um, I have found that. 

Armon: What, what kind of perspectives are they different on though? Like what, what would be a made up example of how they would view something differently than the biotech would've? 

Ileana: Um, well, maybe one good example is business models. 

Armon: Mm-hmm. 

Ileana: A generalist investor is a lot more open-minded about what business models.

Might work out Yeah. For a given company, whereas especially investor might, um, you know, have more, um, might be more set in their ways. They've seen the full spectrum of what works and what doesn't. And they [00:21:00] might be less willing to Right. Try creative things. But I mean, for example, I think, um, there's a lot of.

New business models that are emerging mm-hmm. For biotech companies, um, especially to sort of hedge against the volatility that we see in public markets and the, um, challenge of raising private capital, especially in later round. Um, but you're seeing companies that are monetizing software companies that are.

Um, and, and using that revenue to then fund drug development activities. Yeah. What years? I mean, I've even seen companies that are leveraging AI and predictive algorithms, uh, to build financial products and then, you know, sell those on Wall Street and then fund their drug development activities. Okay. Uh, you've seen a lot of spinoffs and, uh, you know, trying to keep the, the internal development as light as possible, and then, [00:22:00] uh, spinoff entities too.

Armon: Mm-hmm. 

Ileana: Partners that can take on the, the more sort of extensive development. So I think the generalists are more open to doing funky things like that. 

Armon: Yeah. 

Ileana: Um, but the trade off is that it's, I guess, less likely to work out by definition. 

Armon: Yeah. Yeah. 

Ileana: So, 

Armon: all right. What else have you, is there anything else you've noticed that's like significantly different between them?

Ileana: Uh, between generalists and, 

Armon: and the biotech specialists 

Ileana: and specialists, I think, uh, the generalists have access to different pools of talent. 

Armon: Yeah. 

Ileana: Which can also be, um, really interesting. Um, I, I think a lot of biotech and MedTech networks stagnate. It's always the same people, literally that sort of recycle from company to company.

Um, and it's funny because to the specialists, that's a good signal. It's like, oh, I know that person. They came from X, Y, Z company. 

Armon: [00:23:00] Yeah. 

Ileana: Um, but. For the generalists, it's maybe it's, oh yeah, they came from x, Y, Z company and that was a mediocre outcome. Yeah. 

Armon: Yeah. 

Ileana: Compared to the standards of tech. 

Armon: Yeah. 

Ileana: Um, and so I think the cross pollination from a talent standpoint is, um, a big opportunity for, for biotech and um, and MedTech, especially as the sector is starting to draw more people from, you 

Armon: know, 

Ileana: that may be trained.

Um, outside of bio and are coming in looking for something more meaningful to do after their big AI exits. 

After 

Armon: their little app, 

Ileana: their little map, 

Armon: their little app. 

Ileana: Oh, okay. 

Armon: That made a big, like, I made an addictive game. Might as well go cure addiction in the biotech realm.

 are there any examples of companies or deals that taught you a, a hard lesson over the years? 

Ileana: it kind of goes back to that question that you asked me earlier about leading and not leading. Yeah. Um, [00:24:00] I. I did have a very hard situation with a company that I loved.

Yeah. And, um, I thought, you know, the world didn't get it. And I knew they had been out in the market. It wasn't a surprise, but 

Speaker 3: yeah. 

Ileana: I was like, okay, the all they need is a term sheet. 

Speaker 3: Mm-hmm. 

Ileana: We'll give them this term sheet and um, and it will colorize around. 

Armon: Yeah. 

Ileana: You tell their story to your partners and you tell the, I mean, the founder believes it.

You don't have to tell them the story, 

Armon: but I guess term sheet. Love 

Ileana: that. Yeah. They're like, yeah. They tell you the story. 

Armon: Yeah. 

Ileana: Uh, and then we, we couldn't put the round together and it was, um, mm-hmm. During the Christmas break and um, I guess it was also one of my first deals ever. Mm-hmm. So I also, as an investor, didn't have a reputation.

I didn't have that many people to call. Or like friends that, you know, 

Armon: like, Hey, give my company money 

Ileana: knew me. Yeah, yeah, exactly. [00:25:00] Um, and it turned out to be yeah, a, a difficult situation because, uh, you know, we had a minimum raise requirement to raise around and, and we couldn't raise it. 

Armon: Yeah. 

Ileana: So, 

Armon: and, and is that part of what, like drives your, like, I guess you were Yeah.

Reinforcing that view earlier that. If you worry your name isn't good enough to catalyze the round, better to not try. 

Ileana: Um, I, I think it depends. 

Armon: Yeah. 

Ileana: I mean, at you some point you have to try because the only way you can make a reputation in venture is take a bet when it's Right. Not obvious. 

Armon: Yeah. 

Ileana: Um, so I've, I've learned to do that.

Armon: Mm-hmm. 

Ileana: Um, but there's ways to de-risk Yeah. The process, um, than just, you know. Riding the impetus of the momentum and um, going for it without much evidence that the round can in fact come together on those terms. 

Armon: Yeah. All right. 

Ileana: And it's also [00:26:00] a matter of like, did you have the right pricing? Did you have the right, um, sort of structure for the round?

And 

Armon: do you think venture, at least for early biotech stuff, is actually that price sensitive? 

Ileana: Uh, yes. 

Armon: Okay. 

Ileana: It can be is biotech. Yeah. 

Armon: Well, I guess I meant like if it's a big name lead, they kind of don't care what the price is and if it's a, you know, up and comer haven't heard of them before, it also may not matter what the price is.

They just won't come in. I 

Ileana: think it really depends on the fund strategy. 

Armon: Okay. 

Ileana: There's strategies that have to be very price sensitive. There's strategies I can afford not to be. 

Armon: Okay. Fair enough. 

What do you think are some overrated trends in biotech right now? And then we'll get to underrated. 

Ileana: Um, 

Armon: if shorting private biotechs was possible, what kinds of things would you be shorting?

Ileana: Well, I don't, I don't know if it's overrated, but [00:27:00] I have definitely seen a little bit of a decline in the.

Broadly tech bio. Mm-hmm. It's hard to find differentiation. 

Armon: Yeah. 

Ileana: I've also seen a decline in the use of the term tech bio. Mm-hmm. I think now it's the new term is AI X bio. 

Armon: Mm. Good. A good rebrand. 

Ileana: I dunno if it's a rebrand. I, I mean, to be clear, I think it's a, there's a huge opportunity to, um, apply AI to, yeah.

Drug discovery and to biology more broadly. I think we. You know, the reason that it's so hard is in part because it's so immensely difficult to decode and really mechanistically understand biology at the multi-scale level that we need to understand it to the, yeah, to develop effective drugs. So it's obviously a very good application of ai, um, but it's challenging for [00:28:00] startup companies with limited funding to create end to end.

Processes and propositions and get it all right basically from, you know, the target selection to manufacturing and, um, build the right teams and do it all on time and with enough differentiation. So, 

Armon: yeah. Okay. What do you think is underrated right now? 

Ileana: Um,

I think manufacturing. Is underrated. 

Armon: Okay. 

Ileana: Um, I think, well, I was just reading the ARPA h um, program. 

Armon: Mm-hmm. 

Ileana: Uh, announcements from a couple of weeks ago, and there's a lot of emphasis on, okay, like we're gonna discover all these drugs, how we actually gonna make them, and how do we align? Um. The technologies that we've [00:29:00] developed.

Armon: Yeah. 

Ileana: In the earlier stages to the scale up that we're gonna need, 

Armon: but if their margins are so good. Do you think manufacturing is still a problem? Just like where they'll price in the US versus what their cogs actually are? 

Ileana: Yeah. I think it's also a big topic about bringing back the manufacturing to the us 

Armon: Yeah.

Ileana: Itself. 

Armon: Oh, okay. 

Ileana: So manufacturing broadly, I think of drugs, but of anything really. 

Armon: Oh, okay. Okay. That's fair. Um, 

Ileana: maybe not, not, maybe not underrated. 

Armon: Just 'cause the government cares about it doesn't mean that the investors are after it. 

Ileana: No, 

Armon: those don't necessarily go hand in hand. Um, all right. 

And a lot of investors often think about jumping into operational roles at some point, uh, or they get tempted by it.

What do you think drives that interest in them?

Ileana: Um, I think every investor, [00:30:00] after doing the job for more than a few months 

Armon: mm-hmm. 

Ileana: Expresses this feeling of being on the sidelines. 

Armon: Yeah. 

Ileana: And that's really a reflection of the fact that, you know, you get to be a part of a story and. I mean, I personally don't love the investors that publicly take a lot of credit for Yeah.

Success stories. But I think if 

Armon: it weren't for them, I Psych never 

Ileana: psychologically. Yeah. I think psychologically you kind of have to believe that you play the role. Yeah. Otherwise it feels like your contribution amounted to nothing. Yeah. Like if you believe that the best founders would've gotten funded anyway.

Armon: Mm-hmm. 

Ileana: Which is probably true. Um. Pretty quickly, you are gonna feel like you don't have much purpose. And I think that's what drives maybe a lot of investors to think that they want to start companies. 

Armon: Yeah. 

Ileana: Um, and that's the generous, uh, interpretation. [00:31:00] The less generous one is that, um, they might believe they're better than all the founders they need.

Armon: Yeah. Or both. 

Ileana: And that they would've done it better. 

Armon: Yeah, yeah, yeah. 

Ileana: Because it's always much better. Said than done. 

Armon: Yeah. Yeah. 

Ileana: Um, but I think the former is, is a better interpretation of it. 

Armon: And then why do you think some of them do end up jumping versus some of them don't? Like what stops the ones that, it sounds like many of them will think this way, but some, but some of them won't, will never jump to the operational side.

What do you think stops them? 

Ileana: Um, the reality of it? 

Armon: Okay. Yeah. So they all try and they're like, eh. 

Ileana: I don't know if they all try, but my rule has always been as long as I can find people that are clearly better than me for the problem at hand Yeah. Then I should fund them. 

Armon: Yeah. Yeah. 

Ileana: And so maybe they're just always finding people that are better than them.

Armon: Hmm. That goes against your like earlier answer for sure. I think it might be like, eh, you take the chance of it [00:32:00] going poorly. Well, 'cause I think that's one of the benefits of. Being on that side is they, they feel the flexibility to take credit when it goes well. But if it goes poorly, they're like, oh, 

Ileana: well, okay.

I guess I, if I can give you a more real answer, I think you can play around with the thought of wanting to be a founder. 

Armon: Mm-hmm. 

Ileana: But when you're seriously like, okay, I think I have to go build a company. 

Armon: Yeah. 

Ileana: At some point you start doing the math. 

Armon: Mm-hmm. 

Ileana: Right? Like at some point you talk to your partner and you're like, okay, let's.

Draw this out. Like what would it actually look like if I went and built this company if I left my job? 

Armon: Yeah. 

Ileana: Um, in venture capital. 

Armon: Mm-hmm. 

Ileana: And the answer is just purely irrational. 

Armon: Mm-hmm. 

Ileana: It just doesn't make sense to leave your VC job. Yeah. To go and start a company unless you have this. Inevitable belief that you have to go do it.

Yeah. And, and you know that [00:33:00] it's irrational and you know that you're unlikely to end up in a better financial situation than you currently are. 

Armon: Yeah. 

Ileana: And you have to beat it out of yourself that it's a good idea, and you are usually very successful at beating it out of yourself because it's not a good idea.

Armon: Yeah. 

Ileana: And yeah, 

Armon: I, I think that definitely makes sense. I could see that. 

Ileana: So the, the industry has figured out the right retention incentives. 

Armon: I, I mean, so all that being said, you are now jumping to the startup side. What, what made you kind of not listen to the logical side of yourself?

Ileana: Um,

I, 

Armon: I obviously think our side is great. 'cause walking through hellfire every day is amazing. You get a nice tan out of it. 

Ileana: Yeah. I was like less looking forward to the tan. Um, but more, 

Armon: I'm more superficial than you. 

Ileana: I sort of, [00:34:00] um, took a trip into the future. 

Armon: Mm-hmm. 

Ileana: And I 

Armon: drug assisted or you had like a time traveling machine.

Ileana: I'm not answering that question. Okay. 

Armon: Time travel. 

Ileana: Yes. And I frankly didn't want to be to wake up 40. 45 years old. Mm-hmm. I hopeless. I had a number that's age. No way. I'm not 40 yet. Age older than your age. That's okay. Age and, and realized that I had been on the sidelines Yeah. For all that time. And when I was a freshman in college, I, I had a, um,

close up, uh, experience with disease. Mm-hmm. That, um, you know, made me. Um, sort of dreamy and wishful of all these future plans and all these things that I would get to do 

Armon: mm-hmm. 

Ileana: Um, after college if I had the chance. Yeah. And so when [00:35:00] I had sort of a, a 10 year anniversary from that, I was in bc 

Armon: Yeah. 

Ileana: Um, and I felt extremely privileged to be in that position.

And it's in many ways the best job in the world. I mean, when I describe it to people back home. They're like, that's a job. 

Armon: Mm-hmm. 

Ileana: You can really get 

Armon: people, bring you boba, 

Ileana: people'll, bring you boba, and 

Armon: you just ghost 

Ileana: people all day in a fancy office on Bryan Park. Um, but it, it wasn't a good enough answer for the college.

Armon: Mm-hmm. 

Ileana: Um, Eliana. 

Armon: Yeah. 

Ileana: And I, I knew I had to try to do something more authentic and. I don't think VC is gonna collapse as an industry. So if I really need to come back to it. Yeah. Find a way. 

Armon: Yeah. And, and as, that's why. All right. And as you've taken this step kind of across the line, are there already things you're seeing that were different from what you thought it would be?

Or [00:36:00] like you thought you understood this part of being a founder or starting something and then now you're on this say like, oh shit, I really underestimated that part. 

Ileana: Um, yeah, everything. 

Armon: Okay. 

Ileana: I think I just didn't get a job description. 

Armon: Yeah. So 

Ileana: I didn't know. Um, yeah, I think the most, um, unexpected part is the content context switching.

Armon: Mm-hmm. 

Ileana: Um, and just sort of being ready on the fly for everything. 

Armon: Yeah. 

Ileana: When I. Was in venture. I took pride in going to meetings. Prepared. Yeah. I thought it was the least I could do for the founders that, you know, to have studied their company, studied their market, come with questions, not presumption, hopefully.

Yeah. But questions and interest and now I can't do that. I don't have. The [00:37:00] ability to prepare for my meetings or to prepare for podcasts. Yeah. So I just feel, uh, constantly unprepared and being comfortable with that is very difficult for me. Um, and that's probably the part that I exp didn't expect to, um, hit me as much.

I mean, there's many others, but this is the answer that I thought of right now. 

Armon: I, I can see that. Um, 

Ileana: for me specifically, you can see that 

Armon: No, just in general. I, I could totally see people not expecting how many fire drills they have to deal with on a daily basis. Yeah. They're like walking into an interview and they gotta be all smiley and stuff.

In the back of their head, they're like, God. Damnit that like terrible thing just happened, I really need to go solve it. But over here we're gonna sit, smile, and act calm. 

Ileana: That's what I'm doing right now. 

Armon: Yeah. And then tomorrow it'll be something else. Yeah. Uh, what's something that's common in startup world that you like strongly disagree with?

That you feel like this is a common dynamic on our side, but you strongly disagree with it? [00:38:00] 

Ileana: Um, I think probably what I hinted at earlier, this idea that, you know. I mean, again, choosing to start a company is already an extreme decision. 

Armon: Mm-hmm. 

Ileana: I don't think that there's anything else to prove other than the actual operational execution of your company.

Armon: Yeah. 

Ileana: And the strength of your team and the, you know, cohesion of it and of the vision of the mission that you have. I think the other. Stuff is unnecessary. 

Speaker 3: Mm-hmm. 

Ileana: Of, you know, don't pay yourself sleep on the floor. I know founders that tell me that that's what I should be doing at this stage. 

Speaker 3: Oh 

Ileana: really?

Yeah. And I mean, you know, I, granted it's difficult to raise capital and this is, I'm not, I'm not trying to be, um, disrespectful of that. Yeah. Or, or [00:39:00] not acknowledge that. And I actually have a lot of respect for people that. Self-fund or you know mm-hmm. Go through hell and back because they believe so much in that idea.

But I'm more talking about the narrative extending to well-funded companies. 

Armon: Yeah. Yeah. Yeah. 

Ileana: And uh, I think that just draws people out of entrepreneurship mm-hmm. That cannot afford that. 

Armon: Yeah. 

Ileana: Financial strain. Um, and at the same time, it's probably. True that your life is going to be rather extreme for 

Armon: Yeah.

Ileana: Um, that period of time. 

Armon: So don't make it worse than it has to be. 

Ileana: Yeah. 

Armon: Okay. Uh, don't worry, we're in the home stretch. If you could wave a magic wand, what would you change about our sector, 

Ileana: our sector, 

Armon: biotech. This is Boba and biotech, not Bob.

Ileana: Is it cheesy to [00:40:00] say that if I could wave a magic wand, I'd want

good science and good medicine to not have too many external? Barriers. 

Armon: What do you view as the external barriers? 

Ileana: Um, well, I mean, of course as any business we have to pay for product. There's always someone that pays for the products that we develop. Yeah. But sometimes it just feels unfair that, um, you know, if you build something that's valuable and that actually meaningfully drives the needle forward 

Armon: mm-hmm.

Ileana: The company might still fail for a whole other host of reasons that have got nothing to do with. Is there how good the science actually was? Or 

Armon: is there like a structural element that you would wanna change with your magic wand that you think is the biggest cause of that? 

Ileana: Um, I mean, there's probably [00:41:00] many, the structure of, you know, the, the pharmaceutical industry of reimbursement, of prescribing behaviors, um, even.

Patient adherence. So, you know, it's not necessarily big evil pharma or big evil, uh, reimbursement processes and, and insurance companie. 

Armon: It's big, lazy patient not taking 

Ileana: their pills. It could be big, lazy patient. Exactly. But that's still just as frustrating. So 

Armon: just take your medicine down. All right. Uh, all right.

Last question. Where do you think the next big leap in clinical impact is gonna come from? 

Ileana: Ooh. Um.

I think clinical trials are never gonna go away. Mm-hmm. But I don't think they should look like what they look like today. 

Speaker 3: Mm-hmm. 

Ileana: Um, I wish we used clinical trials in a less exploratory way and in a more confirmatory way. Mm-hmm. Um, so I [00:42:00] don't know if that's, you know, n of one trials or if it's underwriting therapies based on.

Virtual trials. 

Armon: Yeah, 

Ileana: computational predictions. Okay. But in a way that is more reliable and acceptable. 

Armon: Yeah. I think your magic wand will come in handy for that part. 

Ileana: Yeah. 

Armon: Cool. Well, thanks for taking the time. Cheers. 

Ileana: Cheers. 

Armon: All right. We're done. 

Ileana: Cute.