Founder-CEO Interview Series

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Lorenzo Leoni

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Lorenzo is a serial entrepreneur and founder of 6 biomedical companies in the US and in Europe. He has an extensive network at the academic, financial and industrial level in biotech and medtech.

Lorenzo was the first managing director of the innovation agency of southern Switzerland (Agire) where he started Agire Invest, now TiVenture.

He holds a Ph.D. in biochemistry from University of Lausanne and was Assistant Professor at the department of Medicine of UCSD, San Diego, working in immunology and oncology.

Founder-CEO Interview Series

With: Lorenzo Leoni

Congratulations on the recent IPO with Gain Therapeutics!

Thank you. When we closed the last round of financing in July 2020, we were not expecting we would file for an IPO in less than a year, especially during Covid times. We have had good momentum and are lucky to have good investors who are well-networked and respected.

I am one of the co-Founders of Gain Therapeutics and was the first CEO of the company. It’s a “distributed” company because we have discovery and research activities in Barcelona, while the development, clinical and financial activities are done from Lugano and the CEO and investor’s relations are in the USA. We had the headquarters moved to the United States due to the IPO.

My first company that I started in California went through the same process with the same timeline. We started in 2000 from zero and were ready to file for an IPO within 4 years in 2004 but were acquired by a larger company before the IPO. Interestingly enough, this scenario repeated itself again with Gain Therapeutics which I started in 2017.

Is it common for companies to go public in an IPO before the clinical trial phase?

The situation is moving very fast in the US and going public on the NASDAQ before the clinical trial phase is becoming more common. This would not be possible in Switzerland because our market mainly rewards execution – investors and banks prefer revenue generating companies.

In the case of Gain Therapeutics, we have a platform technology which is really powerful. Several of our projects have clearly shown proof-of-concept in a number of different preclinical models, which we hope will be predictive. On top of that, we also had validation through partnerships and collaborations with leading academic groups and other companies.

The US market responds favorably when your technology is validated by larger Pharma deals as you are considered to be a very attractive low-valuation company that has a lot of room to grow fast. The US market, especially in the technology sector, mainly looks at the potential of companies, and not just the revenues. 

If you have a valuation of $130 million, which is not a lot by US standards, and you have the possibility to sign partnerships agreements with established companies in big indications, then all of a sudden, your market capitalisation can grow very fast.

We need to understand that NASDAQ is led by the potential of financial return on investment. Just take a look at the mRNA vaccine, during several years Moderna was struggling because they had no data but obtained funding on the public markets and today, they are going extremely strong and provided huge ROI.

For a company like Gain, a strong news-flow is essential. By periodically updating the public market on your milestones and achievements, investors can understand the risks and rewards involved, and they may choose you as an investment opportunity.

It is also important to have a good relationship between the management team and a strong and well-known Board of Directors, which can provide increased credibility and reduce the market’s perceived risks. You need to provide the market a “full package”.

What are you active in currently?

I am currently managing several other companies of the fund, continuously looking at new investments and I am also managing my own companies. I am currently running another fund in Luxembourg, while also being an entrepreneur myself. I am often part of the board of the companies we invest in. I help to resolve daily issues and problems, support fundraising activities and help them in their business development activities.

I am always looking for new opportunities and am currently in advanced due diligence process on two projects. This is what I love the most because I get to talk to new people, and they show you new opportunities or problems, allowing me to bring my 20 years of experience to the table.

Tell us more about the two funds that you mentioned.

The first is a seed fund called TiVenture that was started in Lugano in 2012. The objective of the fund is to find new companies in the very early stage, seed or pre-seed, and let them expand or consolidate by testing the market with products or in other cases, build products and find partnerships.

We have done about 20 investments in the last eight years, and some of them are growing very well. We actively manage around 13 investments, with roughly 2 to 3 new investments a year.

The second fund is more focused on Healthcare and is funded by family offices. This fund is structured in Luxembourg, and we have invested in three companies until now.

Tell us more about the other companies that you are currently a part of.

I am currently a co-Founder and CEO of Elion Oncology, a US-based company which I started with two friends. We developed an asset in oncology that we licensed to a US based company that went to NASDAQ last October. It was very successful as the price per share rose from $4 to $12-13 today. The company plans to start clinical trials for our product by the end of 2021.

Being able to follow the clinical development of projects you have been involved in from the beginning and hopefully impact the life of the patients positively is truly priceless.

I am also the Chairman of the Board of IBI SA, a company that is active in regenerative medicine, which has developed and commercialized a substitute bone for dental and orthopedic indications, with demonstrated activity in tens of thousands of patients and is looking at international expansion.

What makes a company interesting?

It’s a mix of things. You need to have an excellent relationship with the people at the very start and learn to trust them, knowing that you will work with them for several years – a little bit like dating or getting married… If there is respect and trust, then you know that you can work together to achieve something. If the initial interactions are not positive, then I would rather pass on the opportunity.

Secondly, I need to understand the technology and its potential. We all know that medicine is going to go through huge changes, and if I can contribute to the evolution of medicine in terms of precision, accuracy and costs, then I’m in.

Thirdly is how straightforward the execution programme is. I can fall in love with the people, I can understand the technology, but I have to take that plane down, it has to land. I need to help ensure that the frequently disconnected elements at the beginning become concrete and practical with a convincing and realistic execution plan.

Where do you invest?

With TiVenture, we restrict most of our investments in Ticino as I need to be hands-on with the companies and cannot afford to spend my time travelling.

I am an old school guy. I like to sit down with people, look at them in the eyes and read their body language. Very often, when you have an open discussion, things that were unplanned before may emerge. That is much more difficult to achieve in a virtual setting. That is why proximity is important.

What is your view on failure?

Failure is essential. There are a lot of analogies between entrepreneurship and sports. The first is their competitive nature. The second one is training and learning. You have to beat the competition, train and get ready for a certain objective. You will eventually fail as you cannot win all the time.

If you fail, and understand why you failed, you can then train correctly and fix your weakness or mistakes. You get better, and better, and better. There are plenty of examples of tennis players that are not naturally gifted but became incredibly effective, and eventually reached the top. Companies can learn a lot from sports.

In my opinion, a good investor should also be a good teacher or trainer. Of course, the difference here is that in my fund I can choose my own “students”, which is nice. Every student is different, just as every company or entrepreneur is different. That is why I need to adapt myself by not just looking at quantitative objectives, but also the style of management, leadership, and empathy.

Good teachers also motivate, by pushing their students go to their limits and improve. I come from a family of teachers, and teaching is in my DNA to some degree. Even though I have never played in competitive sports, I like the attitude of the top sportsmen and sportswomen in the way they manage pressure and motivate themselves, especially in individual sports.

Team sports are also a perfect model for the management of companies, especially in their early stages when each member of the team is essential, and everybody needs to play with the others.

Who or what has shaped who you are?

As I’ve mentioned earlier, I come from a family of teachers, where my mom and dad played a very important role in shaping the person I am today. Although they were not entrepreneurs, they taught me about relationships with other people, respect and a comprehensive view of life.

The move to San Diego after my PhD in Lausanne, where the academic environment was completely different, made me realise that I could really make a difference if I wanted to. The energy, enthusiasm and willingness to get things done in California was infectious.

As a researcher during my postdoc and as an assistant professor, I always looked for collaborations and ways where I could work with others – something that is not frequently found in biologists that tend to be more individualistic.

I worked closely with the Head of the Institute at UCSD, Dennis A. Carson, who was very smart and entrepreneurial and started multiple successful companies. He is a “legend” in biotech, and I saw him as a role model. We interacted extremely well and eventually started my first company together in San Diego.

In the United States, the concept of mentorship is very important. Supporting young collaborators and allowing them to grow and become progressively more independent is a key element of true leadership.

I find that this is missing in Switzerland and in Europe in general, where professors or businessman tend to be frequently egoistic, jealous, or often threatened by the younger collaborators. This very often limits their growth, and most of the time, this problem is even more frequent for women.

In my experience, if you correctly mentor young people and help them grow, you will always benefit, especially in the mid and long-term. This concept of emotionally investing and then getting a return, is very similar to the spiritual concept of positive Karma. It is something that I’ve lived and learnt in California and try to apply in Europe.

This approach has allowed me to build a strong network of friends, and that helps a lot when starting new companies as it gives me access to a collective and distributed “brain” that can provide answers or suggestions to the new companies. This is an important element that we bring to the young start-ups that we finance.

How do you do everything that you do with only 24 hours in a day?

I am a natural multitasker. My brain is wired in a way that it requires multiple things to do simultaneously. I divide each problem into smaller elements, and I try to apply my experience one-at-a-time to each of these small elements.

I also find that many companies may be in different sectors with different technologies, but often there are a number of common critical elements. Having faced these issues first as a founder, then as a CEO, these problems on the operational side becomes much easier for me to intervene as an investor.

I probably will not be very good at managing massive investments in large superfunds, but I think I am uniquely skilled at managing smaller investments by bringing those companies to a level in which they can access the market or find larger funds.

Any advice that you can share?

Try to do your best at work, but don’t make the mistake to let the work dominate your personal life – a good balance is essential in the long term.

At the end of the day, the company is just a company – it’s not your life. Even if it’s something that you believe in and where you have invested a lot of your energy, sometimes a company works, and sometimes it doesn’t.

Don’t let failure affect your friendships, relationships and family. The company is just a legal entity. You’ve created it, and you can also dissolve it at the end of the day.

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