We founded REMUS with the goal of enabling and supporting young, scrappy founders. We ourselves were founded out of a college dorm room, and we value the relationships we’ve built over the years with top-tier research institutions, such as MIT, Stanford, Harvard, Cambridge, and others. These relationships have been built in part through our longstanding Campus Associates program. Founded in 2009, this first-of-its-kind program gave PhD and undergraduate students the unique opportunity to join our core investment team and dive into early-stage technology investing.
The Campus Fund
Today, we announce the next step in our journey of supporting top talent at institutions across North America and Europe with the launch of the REMUS Campus Fund. This fund will enable our campus investment team to allocate capital into young, pre-seed stage founders whose nascent companies are tackling bold new ideas that will define the largest industries over the next decade. It will exist as a part of our early stage fund but will have its own management structure.
Our goal with this initiative is simple: to support sharp technical founders that we can bring into the REMUS family. We see this fund as an opportunity to get our hands dirty with a promising new generation of founders and build a lasting relationship with them.
The Campus Investment Team
The campus fund would not be possible without our all-star team of campus fellows. It’s a highly selective program: we will only bring 2–3 students at top research universities on board. As a part of the REMUS campus investment team, fellows will be personally mentored by our team to identify promising startups across the world and investigate if companies are worthy of multi-million dollar investment. Fellows will represent the firm’s interests in their regions and will receive our full support in working on any projects they deem beneficial for the firm and, more importantly, for their own personal development. Excitingly, the launch of the new campus fund gives our campus fellows the unique opportunity to lead deals and allocate capital.
The relationship will span far beyond your academic years. REMUS fellowship alumni have been well positioned to start companies and land positions across venture capital, technology, investment banking, and consulting.
Our goal is to continue supporting the institutions on which we’ve built our foundation while building massive, enduring value with the next generation of founders. If this vision resonates with you, apply below.
I recently previewed a new travel documentary about a pair of best friends traveling 10,000 miles from Patagonia to LA…entirely on all-electric Harley motorcycles. Hard to imagine, and it seems that they are the first do it — recharging the whole way! That such a journey is even possible reminds us just how far energy hardware has come in the last decade.
The next decade of our Renewables journey, however, has the potential to be much more software-led than the last. Ever more tech startups are breaking new ground by applying approaches like machine learning or sensor-enabled software to create gains that hardware alone can no longer attain.
Another new first?
Renewable power is set to outstrip coal in its share of US electricity production in 2020. Such a dramatic energy transition would have seemed unthinkable in the dark days of our last energy crisis, in 2008. It’s hard to fathom, but at the time coal powered nearly half of the US energy grid! As the stakes grow higher for Renewables, so too does the potential for software-led technology to accelerate its productivity gains.
So how exactly did this shift even happen, and what new tech is coming down the line ?
How did we get here?
Back in ’08, when oil prices surged to an all-time high of $147.30, a friend asked me if Peak Oil was arriving. I shared that the energy industry has historically innovated its way out of shortfalls—and it was often entrepreneurs and engineers who made that innovation possible. Each time, new technology bent the cost curve down. Yesterday’s uneconomic resource becomes today’s new supply.
And so it did again! But not entirely how we expected…
While natural gas from shale discoveries pushed coal to the non-economic brink, the true tipping point has come from solar and wind. The transition to Renewables in the US has been building for a decade: in 2008, R&D and tax incentives sowed the seeds for lower costs in solar, wind, and battery hardware. For example, since 2010, solar alone has seen costs decline by more than 80%.
Energy in a time of COVID
In the first half of this year — even as COVID unfolded — solar made up a wild 40% of all new US grid capacity. While Renewables’ growth will sustain to likely 3X over the next decade, it has seen some headwinds. Just as COVID has been the shock that’s finally accelerated many industrial transformations, its effects have cascaded across the entire Energy sector.
Many of the adaptations COVID has prompted in the energy sector, whether for its constrained workers (see DTE & other utilities’ NBA-bubble approach) or its heightened need to control costs, have involved cloud-based solutions that are poised to become long-term features of the energy industry. In the end, it is coal’s expensiveness in uncertain times that has it set for retirement.
At the same time, forecasters are also asking how long Renewables’ cost reductions will be sustained. As experience gains and lower capital costs (e.g., ever-cheaper solar panels) begin to taper, what new technology will keep advancing the state of the art in Renewables?
What’s coming?
Part of what drives the rise of Renewables is love from institutional investors like Goldman and Brookfield Asset Management. But this comes with real expectations for predictable returns. If we think about capital costs as having been the first part of the Renewables journey, then this next leg may be much more about operational costs — where software can play more of a leading role.
From what I’ve seen and heard in talking to many utility companies, service providers, and startups, the Renewables industry — not unlike its energy sector siblings—will have some pressing needs in the coming years:
Greater need for remote monitoring & operations
Technicians and other staff can’t operate — in offices or in the field — the way they did before. What’s more, inspections of assets in-person to is both time consuming and often not without some safety risks.
There are companies like Tagup and Raptor Maps (both out of MIT, I might add) that use cloud-based analytics for power generation and the grid infrastructure, respectively, to ensure maximum up-time and productivity. COVID is accelerating the vision of a more efficient, and remote, future.
Increasing demands for grid flexibility
Today’s grid can still have issues. With a lot of Renewables, the system can seem more fragile — we can take California’s electricity shortages as an example now. Today, network and system operators need more visibility into energy assets to efficiently coordinate across an ever more complex web of Renewables, “baseload” power, and energy storage.
One company working on these issues is Electron, started out of London, which is building a market platform to enable better coordination. Form Energy, out of San Francisco, is focusing it efforts on battery tech to drive unprecedentedly long-duration energy storage. More agility could make our future grid more resilient and efficient than ever.
Other services
Access to capital is also one of the long-running issues that renewables have increasingly overcome. A good friend of mine, Rich Matsui, who helped found McKinsey’s solar practice, has long highlighted the imperative of bringing down the cost of capital for Renewables to feed such growth in utility-scale projects.
In his case, he started KwH Analytics to provide an insurtech solution to this problem: creating more transparency in the chain of custody from investors to assets, increasing predictability of returns, and thereby lower insurance risk on those power projects.
In summary, it’s clear to me that there will be many layers and corners for software and connected hardware to drive further productivity gains and accelerate the energy transition. What’s more, the combination of innovations like these will make our grid look dramatically different from today’s in another decade.
Across all of these opportunities the theme is relatively clear: controlling costs and building in more agility. While it remains scrappier than its big Utility and O&G cousins, the Renewables industry is coming along well and is poised to move from more pen and paper operations toward a more digital future.
At least twice, when I’ve asked customers what a system of record might mean for them in managing their business I’ve heard, “Well, that’s the dream!” It’s not enough to try to adapt clunkier last-age software, either. What’s more, folks inside these companies—experienced operators and engineers—know such advances should be possible … though they’ll never claim it’ll be easy!
That is, such advances are possible as long as we have enough grit and engineering, as well as empathy for what’s truly grinding customers’ gears. At REMUS, this sort of vertical software is exactly the kind of thing that excites us. If you’re a founder (or the friend of one!) working on attacking these big problems, I’d love to hear about what you’re doing. Reach out to [email protected].
If the Renewable industry is able to tap into just a fraction of tech’s potential to improve its operations, they will combine with other hard work in energy hardware like battery storage to reshape the face of our grid for the better.
Plus, given what we thought in ’08, who knows what else is around the corner!
Also: If you’d like to take a peek at some of the latest in what’s next, this week’s Energy Venture Forum at Rice just wrapped up last week! Go check it out.
Growing up as a kid, I spent summers with my grandparents in a leafy suburb of Detroit, Michigan. Driving around town, my Dad would point out places like the old Ford factory at Highland Park. There, Henry Ford and his engineers iterated the first principles of mass production, stopwatches in hand!
Our family worked in the auto industry for most of the 20th century. When my Dad rebelled after college by instead venturing into Oil & Gas, he was joining another of the many industrial booms that are uniquely American and have created vast swaths of the modern economy.
Throughout my career in first banking and now venture capital, I’ve often been struck by the common threads that run through much of heavy industry, whether in semiconductor manufacturing or energy exploration. These industries are often:
high-stakes and capitally intensive
composed of highly technical teams
comparatively under-digitalized
Most of these sectors saw their greatest upheavals in the 1970s & 80s. Sure, there have been substantial innovations since then — but nothing so dramatic as the introduction of automotive automation, the adoption of digital recorders in the oilfield, or the first Manufacturing Execution System.
Now, as we look at the dramatic impacts of COVID on the ways we live and work, one of the knock-on effects is to pull forward the next phase of the industrial economy. Whether through our founders or on calls of my own, I keep hearing the voice of the customer telling us: it’s coming.
The era of industrial digitalization is just starting
Even if they call themselves “old-school” or “old-fashioned,” customers are all saying the same thing right now — that these times are forcing them to do things differently. In some cases, this means production floors where every shift now looks like the Third Shift —lightly staffed either due to safety or other commercial impacts post-COVID. Elsewhere, it means operating when in-person hand-offs—whether OEM field support, bills of lading, or back office payments—are no longer sensible.
One such customer noted that while he believed most work still ought to be done in-person, his service team’s travel budget didn’t need to be quite so large in an era when digital tools can connect you with the customer in hours, not days.
In nearly all cases, management expects that many of the changes unfolding right now will become permanent ways of doing business.
What does this mean for us in tech?
Ultimately, this means that the era of pen and paper systems of record, of purely “in your head” operations are waning. COVID has acted as a catalyst for organizations to realize the long-term value of leaner, more adaptable processes using technology. Many of these opportunities fall into two categories:
Augmentation — Whether it’s Connected Worker technologies that empower industrial workforces to do more better/faster/safer or Field Support technologies that enable customers to get better value out of their products, augmentation provides a lot of room to run.
Automation — Software solutions that enable more seamless and flexible robotics operations are in higher demand than ever. Tools that elevate production or asset management with superhuman awareness of their health and productivity will grow.
While we’d already begun to see the early innings of digital transformation unfolding at the early adopters, now we’ll get to see these players really start to swing hard for the fences.
I believe that we in tech, as partners to those working in industry, can do the above if we focus on:
Solving for major pain points that are truly urgent
Bringing great empathy mixed with domain understanding or expertise
Becoming the system of record
Our long view at REMUS
As a newly reborn firm, REMUS is well suited to help founders going after these goals. Whether we’re tackling a commercialization of science play or a startup driven by a deep technical or domain edge, we know what it takes to help build category-leaders of every stripe. It’s what we’ve been doing for the last decade, and we’re now even better positioned to seize enormous opportunity.
At REMUS, tech for the industrial enterprise is an arena we’ve tracked for the last decade and began investing into these past few years, including with companies like Scope AR here in the US and Flexciton in London. Peering back in my inbox tells me that I joined one of the first accelerators, started by my friend Kirk, back in 2011! Even then, it was clear that market timing wasn’t trivial.
Tech adoption often takes both a compelling event and sufficient conditions to sustain itself. With the increasing validation of Industry 4.0 use-cases, growing interest in the C-suite, and this phase shift at a macro level, the time feels right more than ever. While 2020 didn’t kick off the decade in a way any of us would’ve wanted, it’s given us all a tremendous opportunity to change and adopt new technology.
Personally, it means I’m excited to find entrepreneurs who are passionate about bringing unique products to these heavy industries looking for the “better way” of doing what they do. One of my favorite bits of customer feedback was hearing that a startup’s products are so good they keep people from retiring early. That means you must be doing something right! As others have noted, software-izing these verticals will create billions in value that should improve people’s lives.
If you’re someone who also is interested in this nexus of tech and industry, feel free to reach out to me at [email protected].
We’re excited to announce the launch of our new podcast, Tales from the Trenches: One VC’s quest to illuminate how early-stage companies can survive and thrive during recession.
Click play below to listen
In this show, Remus founder Krishna K. Gupta will have authentic, honest conversations with the visionary entrepreneurs who have built companies during wartime, and he’ll share the lesson he learned launching Remus during the Great Recession and building the firm and dozens of market-leaders over the past decade-plus.
We’re kicking things off with a conversation between Krishna and Bob Langer, co-founder of Moderna and Chair of the Scientific Advisory Board of Remus portfolio company Allurion Technologies. In this episode, you’ll learn:
How Bob couldn’t get a job in chemical engineering and had to settle for the nutrition department
How he dealt with naysayers who criticized his spinouts for never reaching patients
What made Moderna a game-changing success and BIND Biosciences a failure
About Bob’s exercise routine
Listen above, and/or read the transcript below.
KKG: The past decade has been Disneyland for venture capitalists and company-builders alike. Momentum-driven investors and entrepreneurs have enabled this froth, driving valuations higher and higher, everything completely divorced from fundamentals. Startups have pursued more – more capital, more autonomy, and more growth – at all costs.
Now, everything has changed. We are in wartime, and most of those high-flying adventures are crashing and burning. In that wreckage, capital is expensive, customers are hard to attract, and having founder on your Instagram profile ain’t as cool as it used to be.
But, what if I told you this is the BEST time to be an entrepreneur and an investor? That the companies launched and scaled right now will be at a huge advantage for the coming decade? I know because I started our firm in 2008, one month before Lehman Brothers crashed and set off the Great Recession.
This is Tales from the Trenches, a show where I’ll share what I’ve learned – and what other entrepreneurs have learned – from building companies since the last recession. The idea is to have very real, authentic discussion about what it’s actually like to be in the trenches – to struggle, survive, and thrive during the hardest of times; to be audacious during a time like now.
Our first guest is Bob Langer and we’ll be talking about his journey starting companies over the past few decades.
Bob needs no introduction, as he is a legend. He’s one of 12 institute professors at MIT, a cofounder of Moderna, which hopefully half of you have heard of, and I’m very happy to welcome him as Chair of the Scientific Advisory Board at our portfolio company Allurion Technologies. Thanks for being here with us, Bob.
Bob: It’s a pleasure to be here.
KKG: Our firm Remus Capital prides itself on tenacity and resilience in the trenches alongside our business partners. I started my firm out of an MIT dorm room and built it while living in a basement. This sort of trench warfare mindset I cultivated from the beginning is going to be very useful in the coming years for many entrepreneurs and creators, and that’s what we want to talk to Bob about.
So let’s start with a simple question: what was the most challenging time in your career, and how did you deal with it, Bob? Can you describe the struggle?
Bob: Well, really, I suppose the most challenging time in my career was when I just got started. I wasn’t sure what I wanted to do when I got done with being a graduate student, and all my friends went into oil companies, and I decided I didn’t want to do that. I was looking for some way to make an impact that I felt would be more than increasing the yield of certain chemicals by a tiny percentage. And I tried to get jobs in education, and then in medicine, and nobody would hire me. And finally a man named Judah Folkman at Boston Children’s hired me, and I worked there for three years, and it was to me fantastic.
I learned so much about biology and engineering and medicine, and I did make some discoveries. We published papers in Science on isolating the very first substances that could stop blood vessels from growing, which would 28 years later lead to drugs like Avastin, and of course the other thing that partly permitted that was we developed the very first nano or micro particles that could deliver large molecules like RNA or DNA, or peptides or proteins or anything else.
And I was very excited about it, but the work…even though we did publish in Nature, many people ridiculed it and said it was not possible. The consequence of that for me was that I got my first nine research grants turned down, I got no chemical engineering department in the country — I’m an academic — and no chemical engineering department in the country would hire for me for a job. They offered me interviews, but I didn’t get any jobs, and I don’t think I interviewed that bad. They all said, ‘this bio stuff you’re doing doesn’t make any sense for a chemical engineer.’
And finally I got a job in a nutrition department, but the guy who hired me, he was also an institute professor — Nevin Scrimshaw. He was a visionary nutritionist. But he was what I’ll call a benevolent dictator kind of department head, meaning that he offered me job because he liked me, but he didn’t ask anybody else in the department what they thought. That might have been ok, but the year after I joined the department they left, so a lot of the senior faculty told me I should leave too. So it was a real struggle.
How did I deal with it? I mean, there wasn’t any real good way to deal with it. I had good friends in Alex Klibanoff and Mike Barletta also in that department, and we would have yogurt lunches every Saturday and talk about work and other things. But I just kept trying. I believed in what I was doing, and I just kept trying and to me I believed in it, and I just kept at it, and eventually things worked out.
KKG: You know, I think every great story starts with a struggle. I first heard of you at MIT, where I was a materials science major. And I was amazed, honestly, by the entrepreneurial output your lab was achieving. I actually chose to come to MIT because I wanted to started a company, and a lot of what you were doing was inspiring to me, so thank you. But there were also a lot of these people who would say, you know, oh, none of the inventions have ever reached a patient or impacted a patient, which I always felt was unfair. How did you feel about these voices and these sort of detractors? And how did it feel at a very human, personal level when Moderna became such a massive success both commercially and in terms of global impact?
Bob: Well you know, I guess the first point is whenever you do something in medicine, it takes a really long time. We did get…I think it took, the first product that we got approved that was based on work in our lab, it wasn’t a company I started but it was a license that was a new treatment for brain cancer called Gliadel, that got approved actually in 1996, which was still 20 years after that Nature paper that we did. And that felt great, but that obviously affects a limited number of people. After that we got others approved too.
And some of the companies we started I think did pretty well — certainly not Moderna well, but they were multi-billion dollar exits. But that being said…and Moderna was also criticized a lot. The news media, stock analysts, clinicians…a lot of people criticized it a lot. Personally I think they did because they were jealous, but I mean, that’s life.
But nonetheless, people may not realize this, but when we announced the first phase 1 clinical trials, this was in May of 2020, the Boston Globe interviewed a bunch of people, and just like I said, they criticized it. They said “this is not how you do science.” So the front page headline — I have a slide of this, actually — on May 19th, 2020 I believe was “this is not how you do science” and talked about Moderna. My picture is right underneath it on the very front page. That was pretty disappointing.
But the way I always tell the story is, well, six months later — I’m on the board of Moderna, I’ve been on since the beginning and I’m still on — you know, we broke the code of what’s called the phase 3 clinical trial. You know, you have 30K patients, 15K get the placebo, 15K get treated, and it’s double-blind, so nobody knows. Well they broke the code in the middle of November of 2020, and I mean the results were remarkable. Of the 15K who were treated, not a single one died, not a single one went to the hospitable, and it was 94-95% effective, which was, you know, unprecedented.
And I mean, Pfizer and BioNTech, also using nanoparticles, in fact going back in part to the discoveries I made in the 70s, also using mRNA and nanoparticles, and they also had over 90% effectiveness.
KKG: I’m sure building Moderna has been quite a journey, and so to that point, tell us how you work in trench mode. You know, when you have felt like you were under attack, and sometimes when you felt like you just needed to get through it, needed to survive, a lot of stress — what are the things you do day to day, what are the kinds of habits that you’ve adopted as an innovator and an entrepreneur.
Bob: Well there’s a variety of things. I mean one thing I do every day, and I’ve done for a long time, is exercise a lot. I used to run a lot, now I walk a lot.
KKG: How often do you exercise?
Bob: Oh, all the time. I mean, my goal…in fact, if I look even this year, and I’m 74, if I do my iPhone, I’ve averaged 13 miles a day walking and running.
KKG: Wow.
Bob: And I lift weights three times a week too.
KKG: Well you look like it.
Bob: Well I don’t know about that, but I mean part of the reason I do it is my dad died of a heart attack at 61, and it scares me. I want to be there for my kids, my wife, and the people in the lab and so forth. So I do that no matter what, and I think that exercise definitely helps me on anything I do.
KKG: I can relate to that. I have been working out for now 1500 days straight, and I just force myself no matter what. And it helps in everything.
Bob: So I think that’s one thing that’s good. But you know sometimes you have to sort of look at the specific thing that causes stress. And sometimes, like I’ve been fortunate like I mentioned to have good friends over the years. And they still are, and sometimes I ask them for advice, or ask my wife for advice, and you know I think getting advice is always good — sort of when you look at something with your own eyes, it’s very easy to take things personally and hard to sort of step aside. So I think having people who I’m close to, who are willing to give me advice and give good advice — that’s always meant something. I try to do that for my students and my friends and my family too. So I think it’s all those things.
KKG: You have an incredible reputation for being very responsive, helpful to everyone in the community, so that’s probably partially a result of some good advice you’ve gotten along the way as well.
Bob: Well you know I don’t know that…that that’s why I do…it’s interesting. I feel that I like helping people. I’ve always gotten a lot of satisfaction out of helping people, going back to even when I was a graduate student, in fact I spent most of my graduate student days helping to build a school for disadvantaged kids, you know working class kids in Cambridge, and I loved that, and one of the reasons I became a professor rather than do anything else is because I really have enjoyed working with students and teaching, and so I think that it’s more…I mean maybe it’s something I got from my mom or my dad, I don’t know. And it’s not like I do it for any other reason other than that I enjoy…
KKG: It’s your utility function. Your utility function spikes when other people do well and you’re supporting them.
Bob: Yeah. I…
KKG: Have you done a Myers-Briggs test?
Bob: Actually I have done that. The only thing…and I don’t remember the letters I get. The only thing I know for sure, it’s kind of funny — my wife is outgoing, and all 3 of my kids are outgoing, and I’ve always been super shy. So I know all of them, the first letter was “E.” And my first letter was “I.” Other than that, I guess, I’m pretty similar to them. But I always have noticed that I would get an I, and I really — when I was a young guy, I was super shy. I still am pretty shy. So I think that…so I have taken that test, yeah.
KKG: Well I was asking just because you know there are certain types that are empathetic and really get a joy out of helping others achieve their potential. And you may be somewhere related to that type.
Bob: Yeah, I think that’s right. I mean I still…even now, with all the people who have gone through the lab and all the companies, gee, when one of my students gets a great job or gets an award or we get a paper accepted in a top journal…you know, makes me really happy. And we’ve had that happen a lot, but it doesn’t change the fact that it makes you happy.
KKG: Yeah, well it’s good. Being happy is good, it’s important and drives a lot of success. So I think it’s great that you’ve figured out how to make other people successful and in the process you’ve been very successful yourself.
So, speaking of success: what in your experience has kind of distinguished a successful outcome from an unsuccessful outcome? When I was at MIT, as I mentioned earlier, I was completely enamored with your work on functionalizing gold nanoparticles, particularly as a drug delivery mechanism. I remember my favorite exam at MIT was one on organic biomaterials, where one of the exam questions was functionalizing gold nanoparticles to achieve a particular goal. And I in fact tried several times to intern at Bind Biosciences, but clearly I wasn’t qualified. So let’s take Moderna…
Bob: You should have written me.
KKG: I should have written you. I think in fact maybe I got the intro through you. So let’s take like a Moderna and a Bind Biosciences. Both of them based on highly compelling, cutting-edge technology and vision. And what do you think was determinative of semi-determinative for Moderna to be such a successful outcome, in your opinion, vs. say a Bind not quite making it, and how long do you think that outcome was kind of in doubt?
Bob: Yeah, well I actually thought Bind would be successful, and it’s interesting — not only was I there from the beginning with Bind, but Noubar Afeyan, who was at Flagship was also there from the beginning, and he was also there from the beginning at Moderna. So there are a number of sort of control things. So what was the big difference?
To me, by far the biggest difference…I mean the technologies were somewhat different, although both involved nanoparticle drug delivery systems, to me by far the biggest difference was the CEOs. And at Bind, we went through 3 CEOs. And part of it was they just didn’t believe.
One was a venture capitalist, and you’d talk to him and he’d say, well we can’t ask company X for more than $1M, they’ll never do it. And Omid Farokhzad, who was the fellow with me who really developed a lot of that technology, said how could you not think that? And people, you know, they criticized Omid, saying, well, you’re wrong, nobody will do more than $1M. Anyhow, they kept talking like that, and Omid eventually got involved in firing several of these. But they kept thinking like that: thinking small.
In contrast, Stephane Bancel, who is the CEO of Moderna doesn’t think small. He thinks big, which is the right way to think in every way. And so he would try to, whether it was raise a lot of money or think of grand visions. And I think Noubar and I tried to do that in both cases, but there are enough people when you’re doing this thing, and investors come in, and sometimes people don’t think that way, and they’re very conservative.
So I really think if I was looking at the biggest difference, it was the CEO. There are certainly companies that have started…messenger RNA companies that have started sRNA companies that have done poorly. I was also involved from the beginning on the scientific advisory board of Alnylam. Many sRNA companies did very poorly. But John Maraganore, who was the CEO for many many years and the initial CEO of Alnylam, was also a terrific CEO, also a very big thinker. And I think that having a great CEO…I know the news media and different people criticize CEOs for getting paid a lot. I’ve always thought boy they’re worth every penny. You know, getting a great CEO to me, at every company I’ve ever seen, is absolutely the most important thing. And sadly, to your point, the opposite is true.
KKG: Yeah. Well I’ve certainly seen that across our portfolio. And at the end of the day a leader is a leader. And they set the tone. And I actually agree 100% with you that when the leader thinks very big, a lot of things follow from that. And conversely when a leader sort of can’t think big, there’s not much you can do to make up for that.
So look, finally, I think last question for us today is what fulfills you today? What prompts you to join companies like Allurion or Establishment Labs and help in such a meaningful way as we look to scale impact and viability across a larger base?
Bob: Well, there’s a lot of things. I think part of it’s the challenge of doing something new. Part of it’s the ability to make some impact. Part of it is the people. You know, working with smart people, young people, people that I think I’ll enjoy working with. A lot of different things.
I realized one other thing that I probably should have said too about the Bind and Moderna thing. And I think this is an important thing that a lot of people don’t necessarily think about.
At Bind, not only did the CEOs think small — they were very, very worried about competition. And I kept saying to them, you know, you shouldn’t worry so much about competition or somebody else doing well. You should worry about how well we do. And you know, they didn’t like that. They kept saying well, but this company’s competing with us, and that company’s doing nanotechnology, and I kept saying…and sometimes these were students of mine, and I had helped some of them, and this is terrible, you know. And my feeling is that all boats rise. If the technology works, then that’s really the key.
And you can look at, like, Moderna has done great. BioNtech’s done pretty well too. And I don’t think it’s hurt Moderna very much. Whereas Cerulean and others were working in this nanotechnology space similar to Bind, and some of the CEOs were so concerned about them.
So I just think in the medical area, most of the time people fail. So it’s much more important to worry about yourself than to worry about your competitors. KKG: Perfect. Well look, thanks for being here Bob, and thanks everyone for listening. And tune in next time.
We are ecstatic to announce that Allurion – in which we are the first and largest institutional investor – will be going public on the NYSE in partnership with Compute Health, run by ex-Medtronic CEO Omar Ishrak, entrepreneur Jean Nehme, and Josh Fink. Congratulations to my brother-in-arms Shantanu and the whole team on accomplishing a deal that is incredibly audacious in today’s market. Allurion is a company with significant presence (across 60+ countries), and it will soon have the reach, gravitas, and visibility that being public provides. I will stay involved as Chairman once the company formally lists; it has been a quite a ride since I first introduced Shantanu to Compute 2 years ago.
This transaction was easily the most complex I’ve been part of, partially thanks to the market but also due to the number of well-positioned individuals and firms involved. Fortunately, many of them will continue to be part of the Allurion story going forward; Omar will join our board as my co-Chairman, RTW Investments (a top healthcare crossover fund) will be a partner in the public markets, and Fortress will be a key source of financing. Nick Lewin, the Chairman of Establishment Labs ($ESTA), will also join our board.
Allurion, which started as an idea at Harvard Medical School, is tackling one of the biggest health issues the world has seen: 39% of the world is overweight. I’ve worked with Shantanu since the earliest days in 2011, at a time when the company was little more than an idea on a napkin – he is one of the sharpest and hardest-working individuals I’ve met. Our partnership has developed in what I believe is a high-growth, high-margin company with a digital DNA and significant TAM. Other weight loss solutions are either too challenging for consumers to adhere to (e.g., diet, exercise, etc.), are very involved and expensive (e.g., bariatric surgery), or can involve indefinite hormonal therapy (i.e., weight loss drugs). Allurion’s procedureless and holistic platform is the reason its growth has been so strong and why its product has grown around the world.
Allurion aligns firmly with both thematic pillars of our firm: healthcare and AI. It is a global medical device company and a scrappy digital health startup in one. There are many adjacent opportunities for the company to pursue as it continues expanding its balloon business, and these opportunities all generally live at the intersection of the two worlds of healthcare and AI. This duality is part of Allurion’s secret sauce and should help the business scale; I believe that certainly, the opportunity is unlimited.
Being public is not for the faint of heart, but Allurion is a company that has embraced our own firm’s core value of audacity. I’m supremely confident that Shantanu and his team are ready for the public markets and am excited to use what we’ve learned from recently taking Presto public to help Allurion on its journey. There is so much we can do in the coming years – here’s to many more parties with the team in Paris (and one at the NYSE in a few months)!
Chaaaaargezzzzzzzz
Krishna
Important Information About the Proposed Transaction and Where to Find It
This posting relates to a proposed business combination between Allurion Technologies, Inc. (“Allurion”), Compute Health Acquisition Corp. (“Compute Health”), and Allurion Technologies Holdings, Inc., a wholly-owned subsidiary of Allurion which will be the publicly-listed company following the consummation of the proposed transaction (“Pubco”). Pubco intends to file a registration statement on Form S-4 (the “Registration Statement”) with the Securities and Exchange Commission (“SEC”), which will include a document that serves as a proxy statement and prospectus of Compute Health and Pubco and a full description of the terms of the proposed transaction. The proxy statement/prospectus will be mailed to Compute Health’s stockholders as of a record date to be established for voting at the Compute Health stockholders’ meeting relating to the proposed transaction. Compute Health and Pubco may also file other documents regarding the proposed transaction with the SEC. This posting does not contain all of the information that should be considered concerning the proposed transaction and is not intended to form the basis of any investment decision or any other decision in respect of the proposed transaction. Compute Health’s stockholders and other interested persons are advised to read, when available, the Registration Statement and proxy statement/prospectus and any amendments thereto and all other relevant documents filed or that will be filed in connection with the proposed transaction, as these materials will contain important information about Allurion, Compute Health and the proposed transaction. The Registration Statement and the proxy statement/prospectus and other documents that are filed with the SEC, once available, may be obtained without charge at the SEC’s website at www.sec.gov, or by directing a written request to Compute Health, 1100 N Market Street 4th Floor, Wilmington, DE 19890.
NEITHER THE SEC NOR ANY STATE SECURITIES REGULATORY AGENCY HAS APPROVED OR DISAPPROVED THE TRANSACTIONS DESCRIBED IN THIS POSTING PASSED UPON THE MERITS OR FAIRNESS OF THE PROPOSED TRANSACTION OR ANY RELATED TRANSACTIONS OR PASSED UPON THE ADEQUACY OR ACCURACY OF THE DISCLOSURE IN THIS POSTING. ANY REPRESENTATION TO THE CONTRARY CONSTITUTES A CRIMINAL OFFENSE.
Participants in the Solicitation
Compute Health, Allurion, Pubco, certain stockholders of Compute Health, and certain of Compute Health’s, Allurion’s and Pubco’s respective directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be participants in the solicitation of proxies from the stockholders of Compute Health with respect to the proposed transaction. A list of the names of such persons and information regarding their interests in the proposed transaction will be contained in the Registration Statement and proxy statement/prospectus, when available. Stockholders, potential investors and other interested persons should read the Registration Statement and proxy statement/prospectus carefully when they become available and before making any voting or investment decisions. Free copies of these documents may be obtained from the sources indicated above, when available.
Forward-looking Statements
This posting contains certain “forward-looking statements” within the meaning of the federal U.S. securities laws with respect to Compute Health, Allurion and the proposed transaction between them, the benefits of the proposed transaction, the expectations regarding future growth, results of operations, performance, future capital and other expenditures, competitive advantages, business prospects and opportunities, future plans and intentions, results, level of activities, performance, goals or achievements or other future events. These forward-looking statements generally are identified by words such as “anticipate,” “believe,” “expect,” “may,” “could,” “will,” “potential,” “intend,” “estimate,” “should,” “plan,” “predict,” or the negative or other variations of such statements. They reflect the current beliefs and assumptions of Compute Health’s management and Allurion’s management and are based on the information currently available to Compute Health’s management and Allurion’s management. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual results or developments to differ materially from those expressed or implied by such forward-looking statements, including but not limited to: (i) the risk that the proposed transaction may not be completed in a timely manner or at all, which may adversely affect the price of Compute Health’s securities; (ii) the risk that the proposed transaction may not be completed by Compute Health’s business combination deadline and the potential failure to obtain an extension of the business combination deadline if sought by Compute Health; (iii) the failure to satisfy the conditions to the consummation of the proposed transaction, including, but not limited to, the approval of the business combination agreement by the stockholders of Compute Health and the stockholders of Allurion, the satisfaction of the minimum cash amount and the receipt of certain governmental and regulatory approvals; (iv) changes to the proposed structure of the proposed transaction that may be required, or considered appropriate, as a result of applicable laws or regulations or as a condition to obtaining regulatory approval of the proposed transaction; (v) the occurrence of any event, change or other circumstance that could give rise to the termination of the business combination agreement; (vi) the ability to complete the PIPE investment, the senior secured term loan, the Chardan equity facility and the RTW Investments synthetic royalty financing in connection with the proposed transaction; (vii) the Company’s ability to acquire sufficient sources of funding if and when needed; (viii) the effect of the announcement or pendency of the proposed transaction on Allurion’s business relationships, operating results and business generally; (ix) risks that the proposed transaction disrupts current plans and operations of Allurion; (x) the ability of the Company to implement business plans, forecasts and other expectations after the completion of the proposed transaction, and identify and realize additional opportunities; (xi) significant risks, assumptions, estimates and uncertainties related to the projected financial information with respect to Allurion; (xii) the outcome of any legal proceedings that may be instituted against Allurion, Pubco or Compute Health following the announcement of the business combination agreement or the proposed transaction; (xiii) the Company’s ability to commercialize current and future products and services and create sufficient demand among health care providers and patients; (xiv) the Company’s ability to successfully complete current and future preclinical studies and clinical trials of the Allurion Balloon and any other future product candidates; (xv) the Company’s ability to obtain market acceptance of the Allurion Balloon as safe and effective; (xvi) the Company’s ability to cost-effectively sell existing and future products through existing distribution arrangements with distributors and/or successfully adopt a direct sales force as part of a hybrid sales model that includes both distributors and a direct sales effort; (xvii) the Company’s ability to obtain regulatory approval or clearance in the U.S. and certain non-U.S. jurisdictions for current and future products and maintain previously obtained approvals and/or clearances in those jurisdictions where Allurion’s products and services are currently offered; (xviii) the Company’s ability to accurately forecast customer demand and manufacture sufficient quantities of product that patients and health care providers request; (xix) the Company’s ability to successfully compete in the highly competitive and rapidly changing regulated industries in which Allurion operates, and effectively address changes in such industries, including changes in competitors’ products and services and changes in the laws and regulations that affect the Company; (xx) the Company’s ability to successfully manage future growth and any future international expansion of Allurion’s business and navigate the risks associated with doing business internationally; (xxi) the Company’s ability to obtain and maintain intellectual property protection for its products and technologies and acquire or license intellectual property from third parties; (xxii) the ability of the Company to retain key executives; (xxiii) the ability to obtain and maintain the listing of the Company’s securities on a national securities exchange; (xxiv) the Company’s ability to properly train physicians in the use of the Allurion Gastric Balloon and other services it offers in its practices; (xxv) the risk of downturns in the market and Allurion’s industry including, but not limited to, as a result of the COVID-19 pandemic; (xxvi) fees, costs and expenses related to the proposed transaction; (xxvii) the risk that the collaboration agreement with Medtronic will not be signed and that the parties will not achieve the expected benefits, incremental revenue and opportunities from such arrangement; (xxviii) the failure to realize anticipated benefits of the proposed transaction or to realize estimated pro forma results and underlying assumptions, including with respect to estimated redemptions by Compute Health’s public stockholders; and (xxix) sanctions against Russia, reductions in consumer confidence, heightened inflation, production disruptions in Europe, cyber disruptions or attacks, higher natural gas costs, higher manufacturing costs and higher supply chain costs. The foregoing list of factors is not exclusive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors” section of Compute Health’s Form S-1 (File No. 333-252245) and Annual Report on Form 10-K for the year ended December 31, 2021 and the proxy statement/prospectus, when available, and other documents filed by Compute Health and Pubco from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date on which they are made, and none of Allurion, Pubco or Compute Health assume any obligation to update or revise any forward-looking statements or other information contained herein, whether as a result of new information, future events or otherwise. You are cautioned not to put undue reliance on these forward-looking statements. None of Compute Health, Allurion or Pubco gives any assurance that Compute Health or Allurion, or the Company, will achieve its expectations.
Non-solicitation
This posting and the information contained herein is not a proxy statement/prospectus or solicitation of a proxy, consent or authorization with respect to any securities or in respect of the potential business combination or any other matter and shall not constitute an offer to sell or a solicitation of an offer to buy the securities of Compute Health, Allurion, Pubco or the Company, or a solicitation of any vote or approval, nor shall there be any sale of any such securities in any state or jurisdiction in which such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such state or jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, or an exemption therefrom.
At REMUS, I’m excited to collaboratively formulate our investment theses and partner closely with founders to help them build their companies. We are evolving as a firm to become more audacious and agile, which will drive our abilities to work with visionary companies.
I invest in early-stage enterprise software at REMUS, particularly those companies selling into large vertical US markets or commercializing research from top research labs. I approach investments by defaulting to a high degree of skepticism and attempt to gain conviction around the primary risks. This skepticism is rooted in our overarching intention to partner with companies that will have a massive impact on the world. Very few startups ever accomplish that.
I’m trained as an engineer, having studied computer science at MIT and built software at startups, which inclines me to examine investments partly through an engineering lens. I tend to focus on four key things when evaluating a startup: the founders, the story of the company, the path to getting really big, and the defensibility.
A certain intersection of characteristics will make me incredibly excited about a founder. It’s the combination of being deeply technical and able to solve hard engineering problems, the ability to tell a powerful story that’s often rooted in contrarian instincts, and the desire to create a massive business. This triad of traits is exceptionally rare.
I’m most interested in companies building software that will be the core infrastructure that large enterprise customers will rely on. Technology that’ll serve as the rails for the end-to-end services that these enterprise customers provide for the next decade or two.
I’m a generalist, but there are a few key verticals which I’m thematically focused on: healthcare, construction, agriculture, and financial services. These are all large, traditional industries where technological innovation is often painfully slow to penetrate. And although I concentrate on enterprise investing, I opportunistically invest in consumer software as well.
My investment interests are heterogeneous and suspect to change, but here’s a snapshot of what I’m currently spending most of my attention on.
Healthcare
Healthcare is one of the largest and most complex markets in the US with an intricate incentive structure including government and commercial payers, providers, and patients. Better software and novel technology can provide significant leverage to save lives by improving patient outcomes and decreasing costs.
I’m keen on the following areas:
Creating the technical infrastructure to facilitate digital medicine platforms
Improving revenue cycle management with software
Building clinical tools to drive pharmaceutical workflows
Augmenting provider abilities with AI, robotics, or augmented/virtual reality
Incentivizing care team members to optimize value-based care models
Allowing patient health data to be computed on in an efficient, privacy-preserving manner
Construction
Creating large, technically advanced buildings has always been a sign of the engineering prowess of a society and something that inspires people, but the industry as a whole is fraught with inefficiency. Some of the ideas I’m looking at are:
Managing payments among all the different parties involved in these massive, cost-intensive projects
Reality capture solutions to map out sites and perform analytics
Pre-construction software platforms to more efficiently start projects
Project management software to collaborate efficiently across different remote stakeholders
Agriculture
One of society’s most vital industries has historically experienced a slow pace of technological adoption. Today, fewer and fewer young Americans are becoming farmers and older knowledge workers are aging out. The labor problem is evident, expensive, and largely mechanical, positioning robotic solutions to play a powerful role in this market. Large scale consolidation has also been the trend giving rise to the opportunity for software to optimize on a large scale. I’m thinking about:
Agriculture-specific software solutions for robotic perception and movement
Analytics software to optimize farms and the agriculture supply chain
Financial Services
Companies that are building the API platforms that’ll serve as the financial infrastructure for banking, insurance, and payments – either for large traditional financial institutions or to integrate into other horizontal software products are becoming increasingly necessary. I’m keen on:
Banking software to modernize antiquated legacy systems and for stand-alone point solutions
Payments infrastructure software
Tech-enabled ways to price risk for more effective lending
The automation of capital allocation at the consumer, or personal finance level
If you’re a founder, investor, or customer and this resonates with you, please feel free to reach out. As an investor trying to figure out how technology will be shaping the future, the best thing I can do is listen, as carefully as I can.
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While the nature of the founder’s and VC’s jobs hasn’t changed over the past few months, the format of their interaction has changed a lot. Pre-COVID first meetings typically happened in person, including some small talk over coffee. Now, we meet as we’re sitting behind screens — if we were to pass one another on the street, we might not recognize each other. It is tricky to emulate in-person meetings and achieve a comparable level of familiarity without face-to-face interaction.
Beginning a conversation has become increasingly challenging, and that starts with getting each other’s attention. My inbox is filled with more emails than ever before, and I assume most founders are experiencing a similar issue. Moreover, as events have been cancelled and serendipitous meetings are unlikely, the default meeting medium has become email and video calls.
I admire how fast some founders reacted with creative strategies for communicating effectively with VCs, even when the world had gone virtual. I’ve found that the most successful founders understand what matters most to VCs in these early interactions. Here are some of the most useful strategies I’ve seen from founders seeking a conversation — I certainly intend to try some myself.
Standing out from the crowd
With geographic limitations disappearing, the range and target audience has increased for VCs and founders alike. In the last 6 months, almost every startup has suddenly gone into fundraising mode, which saturated the market and filled VCs’ deal funnels.
Amid an inundated mailbox, one founder’s outreach caught my eye. Instead of a regular introductory email, this founder sent an email: “I know you’re busy — so here’s a 30-second video I made (VIDEO_LINK)”. If I were to receive such a message again, I would watch the video again — guaranteed. What’s more, using video is a way founders can target their messaging for the recipient with voice over and some strategic reorganization of pre-made snippets. This approach to communication is unique, much more personal, and such a stark contrast to yet another mail merge.
I took the personalization inherent in this video message as inspiration. While I always personalize slides I prepare for founders (which automatically gives an “I made this for YOU” feel), I’m now considering testing out a personalized video.
Saving time
It’s inevitable: as a founder pitching to a VC in the COVID era, you are going to have an introductory video meeting. Optimize the time you spend on the call itself by allowing VCs to digest key facts before (preferred) or after the call. When VCs can process the information on their own time, the conversation can be less structured and formal and instead will be more people-centred around the founder and team.
Clever ways to share helpful content and save time for you and your potential investor include sending:
A non-confidential teaser deck (I understand founders might not want to share a full-blown investor deck with everyone)
A recorded demo-day like live pitch
A continuously-updated Google Doc with investor FAQs.
Side note: FAQ-sharing remains relevant as diligence progresses. Founders who keep a record of all questions they’ve received from VCs and write out structured answers continue to learn others’ perception of the startup. Ideally, they only have to answer the same question once.
Hearing from customers
As a B2B-focused investor, hearing the “voice of the customer” is essential for me to build conviction. Getting customer feedback, though, has become increasingly difficult. After all, your customers have their hands full — now more than ever — with important business, and you can’t introduce every VC to them.
However, understanding your customers is increasingly important, because a lot of concepts and metrics no longer apply post-COVID. Some industries have benefited while others were abruptly shaken, and buying decisions have changed accordingly. Many such consequences did not result from logical, market-based triggers. How to bridge the gap?
An effective way of communicating that I have observed is to send VCs a video that includes testimonials from a number of customers. It is essential to note that this exercise is not about video quality or expensive editing; rather, the goal is a scalable, authentic, positive customer signal.
Across the VC industry, we are in a unique situation and grappling with new difficulties. We can reduce a lot of friction by helping each other as best as we can. Important to note is that effective interactions require mutual alignment of founders and VCs and both parties doing their part. For my part, VCs talk about value-add a lot, and one of my main resolutions is to add value myself. I want founders to consider every single conversation we have to be worth their time.
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While the nature of the founder’s and VC’s jobs hasn’t changed over the past few months, the format of their interaction has changed a lot. Pre-COVID first meetings typically happened in person, including some small talk over coffee. Now, we meet as we’re sitting behind screens — if we were to pass one another on the street, we might not recognize each other. It is tricky to emulate in-person meetings and achieve a comparable level of familiarity without face-to-face interaction.
Beginning a conversation has become increasingly challenging, and that starts with getting each other’s attention. My inbox is filled with more emails than ever before, and I assume most founders are experiencing a similar issue. Moreover, as events have been cancelled and serendipitous meetings are unlikely, the default meeting medium has become email and video calls.
I admire how fast some founders reacted with creative strategies for communicating effectively with VCs, even when the world had gone virtual. I’ve found that the most successful founders understand what matters most to VCs in these early interactions. Here are some of the most useful strategies I’ve seen from founders seeking a conversation — I certainly intend to try some myself.
Standing out from the crowd
With geographic limitations disappearing, the range and target audience has increased for VCs and founders alike. In the last 6 months, almost every startup has suddenly gone into fundraising mode, which saturated the market and filled VCs’ deal funnels.
Amid an inundated mailbox, one founder’s outreach caught my eye. Instead of a regular introductory email, this founder sent an email: “I know you’re busy — so here’s a 30-second video I made (VIDEO_LINK)”. If I were to receive such a message again, I would watch the video again — guaranteed. What’s more, using video is a way founders can target their messaging for the recipient with voice over and some strategic reorganization of pre-made snippets. This approach to communication is unique, much more personal, and such a stark contrast to yet another mail merge.
I took the personalization inherent in this video message as inspiration. While I always personalize slides I prepare for founders (which automatically gives an “I made this for YOU” feel), I’m now considering testing out a personalized video.
Saving time
It’s inevitable: as a founder pitching to a VC in the COVID era, you are going to have an introductory video meeting. Optimize the time you spend on the call itself by allowing VCs to digest key facts before (preferred) or after the call. When VCs can process the information on their own time, the conversation can be less structured and formal and instead will be more people-centred around the founder and team.
Clever ways to share helpful content and save time for you and your potential investor include sending:
A non-confidential teaser deck (I understand founders might not want to share a full-blown investor deck with everyone)
A recorded demo-day like live pitch
A continuously-updated Google Doc with investor FAQs.
Side note: FAQ-sharing remains relevant as diligence progresses. Founders who keep a record of all questions they’ve received from VCs and write out structured answers continue to learn others’ perception of the startup. Ideally, they only have to answer the same question once.
Hearing from customers
As a B2B-focused investor, hearing the “voice of the customer” is essential for me to build conviction. Getting customer feedback, though, has become increasingly difficult. After all, your customers have their hands full — now more than ever — with important business, and you can’t introduce every VC to them.
However, understanding your customers is increasingly important, because a lot of concepts and metrics no longer apply post-COVID. Some industries have benefited while others were abruptly shaken, and buying decisions have changed accordingly. Many such consequences did not result from logical, market-based triggers. How to bridge the gap?
An effective way of communicating that I have observed is to send VCs a video that includes testimonials from a number of customers. It is essential to note that this exercise is not about video quality or expensive editing; rather, the goal is a scalable, authentic, positive customer signal.
Across the VC industry, we are in a unique situation and grappling with new difficulties. We can reduce a lot of friction by helping each other as best as we can. Important to note is that effective interactions require mutual alignment of founders and VCs and both parties doing their part. For my part, VCs talk about value-add a lot, and one of my main resolutions is to add value myself. I want founders to consider every single conversation we have to be worth their time.
