
Draper Goren Holm Raises $25 Million Blockchain VC Fund
Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.
Draper Goren Holm, the Los Angeles-based venture studio focusing on early stage blockchain startups, has raised its first traditional venture fund with $25 million to bankroll seed and Series A rounds. The announcement was made at the firm's seventh annual Los Angeles Blockchain Summit, which was scheduled to take place at the L.A. Convention Center and offered attendees $100 worth of bitcoin each. Instead it's gone virtual.
The firm was founded in 2018 by Tim Draper – a prolific Bay Area VC whose early bets on unicorns like Tesla, SpaceX and Twitter paid off big before he became a leading proponent of crypto currency – along with serial entrepreneur Josef Holm and Alon Goren, co-founder of the Crypto Invest Summit.
The firm was founded in 2018 by Tim Draper (center)– a prolific Bay Area VC whose early bets on unicorns like Tesla, SpaceX and Twitter paid off big before he became a leading proponent of crypto currency – along with serial entrepreneur Josef Holm (right) and Alon Goren, co-founder of the Crypto In
As a venture studio, Draper Goren Holm has already backed 18 startups, carving out a niche in decentralized finance (DeFi) and the security token and digital securities sector. Portfolio companies include DeFi Money Market, Totle, Ownera, Innovesta, LunarCrush, Degens, Giftz, Vertalo, Coinsquad, CasperLabs and Jointer.
Southern California is not known as a crypto hotbed, but Goren, who was born and raised here, says by its nature crypto is decentralized so founders and investors might as well live somewhere that they desire.
"Have you ever lived somewhere you didn't actually want to be?" Goren asked. "It sucks. I don't want to invest in someone that isn't where they wanna be."
Goren added that he thinks Southern California can also nurture higher-quality startups.
"The startups here, for a long period of time, had to prove a little [more] than up in Silicon Valley their worth and I think it made for a more realistic and solid foundation for growth," Goren wrote in an email. "Companies seemed to always be a little further along and a little more established before they went out to raise a round."
Though it will still be based in Los Angeles, Draper Goren Holm will be opening an office in Vienna, Austria in December, led by Holm, who is Austrian and has been splitting his time between that country and Santa Monica.Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.
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Last year, pharmaceutical giant Gilead Sciences came under fire for testing its coronavirus vaccine on a sample of people that didn't accurately reflect those largely devastated by it — the elderly, the poor and Latino communities.
The scenario exposed a deeper trouble among drugmakers and is far from uncommon. A study last month from the medical journal JAMA Network found white people were overrepresented in vaccine clinical trials. This has dangerous implications for the outcome of drugs, according to researchers who issued the report from Harvard Medical School, the Fred Hutchinson Cancer Research Center in Seattle and the Emory University School of Medicine in Atlanta.
The problem is so rampant that the FDA last year revived its guidance on clinical trials, in part prompted by the travel restrictions COVID imposed.
In issuing the directive last fall, the former FDA commissioner Stephen Hahn directly cited the different health care outcomes different racial groups, older adults and pregnant women faced battling the deadly virus.
"This difference in impact illustrates why we must encourage developers of any medical product such as treatments or vaccines for COVID-19 – as well as medical products more broadly – to endeavor to include diverse populations to understand their risks or benefits across all groups."
The biggest hurdle for most clinical trials is convincing a wide-ranging sample of individuals to participate in them. The problem is especially acute in rural areas, where patients are unlikely to sign up because they are far from large universities or hospitals that often carry these out. But that is also true for people who don't drive a car or who cannot take time out of the work day. Black and Latino populations have lower participation rates. And clinical trials can also take years, which screens out patients with unpredictable livelihoods.
In other words, the very individuals that the health care industry often fails to reach also get locked out of clinical trials to medicines that could save their life.
El Segundo-based MedVector has created a device to make it easier for patients to participate in clinical trials, so companies can lock in more participants earlier and faster while getting the varied lifestyles needed to test drugs.
"We're not accelerating the study at all," Scott Stout, the CEO and co-founder of MedVector. "We're eliminating the delays that happen in the patient recruitment component."
The four-year-old startup one of several companies that are trying to novel approaches to patients to clinical trials virtually. MedVector has raised 630,000 via crowdsourcing, and Pitchbook valued the company at $10 million. Science 37, another Los Angeles-based company, raised $40 million last year to build up their system of at-home clinical trials. The company is also backed by some of the biggest names in pharma including Novartis, Amgen and Sanofi. Medable, Covance and a slew of other companies are stepping into the space as well.
MedVector coordinates with contract research organizations that are hired by sponsors to manage the clinical trial process to send the shoebox-sized touchscreen device to the participant's doctor. The patient and trial's principal investigator can essentially teleconference while the nurse at the doctor's office acts like the investigator's "hands," taking vitals or measuring height and weight. Most clinical trials document labs (like blood work), scans (MRI or CAT scans), verbal input from the patient about how they feel, and visual data like rashes or swelling.
Virtualized or decentralized clinical trials haven't always been embraced by the industry. While more physicians have moved towards telehealth and telemedicine, the control and standardization of in-person trials are considered the gold standard in clinical trials.
"Different drugs metabolize differently. It's not like one size fits all," said Dr. Eunjoo Pacifici, a professor at the USC School of Pharmacy. "So if you don't include a diverse population in your clinical trial, you cannot confirm that, yes, everybody responds similarly and everyone demonstrates a similar safety and efficacy profile when they take this medicine."
But that's exactly what happens. A 2019 study that reviewed 10 years of cancer drug clinical trials and 112,293 participants found that 3.1% of trial participants were Black and 6.1% Latino. Researchers from the University of British Columbia, the University of Texas, the Fred Hutchinson Cancer Center and Baylor University found that a major risk assessment test for breast cancer had only been validated for white women.
"Scientists ignore the impact of cancer drug efficacy on..three major race groups," they concluded, a fact that could "prove detrimental to survival rates" for all other women.
Another well known example of a clinical trial that failed to be representative is Zoldpidem (or Ambien), a sleep drug developed in the 90s. When the drug went to market, it became clear it stayed in women's bloodstream longer than men's, and women were prone to lingering daytime drowsiness, making driving more dangerous. In 2013, the FDA halved its standard dosage for women.
Pacifici says the efficacy of a drug doesn't depend solely on biologic factors. Extrinsic factors — like one's job, geographic environment, age and lifestyle — can prevent people from taking otherwise-effective high-maintenance drugs.
"You want to make sure that the makeup of a clinical trial, as much as you can, mirrors the makeup of the target population who will need this medication," she said.
Part of the newfound appeal of virtual clinical trials comes from the pharma industry. Clinical trials are notoriously long — the longest part of at least a 10-year journey from drug discovery to FDA approval and marketing. Finding hundreds of people to participate in clinical trials can stall the already long process of getting a drug to market, eating into a pharmaceutical patent's 20 year lifespan and the pharmaceutical company's profit margins.
"We are getting medicines to market more quickly with better data, which means that it is safer." Stout said. "It means that you've got less waste. It means that you've got less people dying while waiting for a new drug to come down the pipeline."
Keerthi Vedantam is a bioscience reporter at dot.LA. She cut her teeth covering everything from cloud computing to 5G in San Francisco and Seattle. Before she covered tech, Keerthi reported on tribal lands and congressional policy in Washington, D.C. Connect with her on Twitter, Clubhouse (@keerthivedantam) or Signal at 408-470-0776.
On this week's episode of the L.A. Venture podcast, hear from Chang Xu, partner at Basis Set Ventures, a $140 million fund focused on AI and automation - technology that transforms the way people work.
Basis Set Ventures focuses on four pieces: infrastructure, collaboration, automation and autonomy. Chang spends a lot of time on infrastructure, and she breaks it down into four themes: raise the ceiling, lower the floor, open space and data privacy.
By raise the ceiling, Chang says there's "always going to be better and more secure and faster fundamental building blocks for infrastructure to the tune of database systems and streaming data and...infrastructure as code."
Lower the floor is about no code and low code, which, for example, could allow for not-trained people to build their own apps without relying on software developers. Chang predicts a proliferation of tools that she says will enable "people to create regardless of their technical abilities and their starting point."
When I heard "open source" I figured she meant "free." But, Chang says, open source "is almost table stakes for how infrastructure is discovered, bought and sold today."
Lastly, Chang says they see "data privacy as a really large tailwind and emerging space" because it is tackling the challenge of adhering to privacy regulations, but at the same time innovating fast, while taking advantage of the growing amounts of data companies are amassing.
Chang and her partners aren't just stuck on tech, they're also keenly interested in what makes a lasting and impactful founder. She says her firm's research has revealed that "successful founders are humble operators, agile visionaries and seasoned executives. And the less successful founders...are passionate outsiders, overconfident storytellers and stubborn individuals."
This interview goes deep into machine learning optimization (ML Ops), what Chang learned from her many years at Upfront, like how to craft a good narrative and practical advice for startups on how to form a board.
Not incidentally, Chang is L.A.-based, though the Basis Set operates out of San Francisco.
Chang Xu is a partner at Basis Set Ventures. Previously, she was a principal at Upfront Ventures, the oldest and largest SoCal-based early stage venture capital firm. Prior to joining Upfront, she was a founder and operator. She was the first product manager at the Minerva Project. She co-founded and was the COO of Onion Math, an edtech startup in China that has raised $90 million to date. She started her career at BCG where she advised clients across technology, retail, healthcare and private equity. She holds an MBA and AB in Applied Math and Computer Science, both from Harvard. (bio from Basis Set).
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