Entrepreneurship comes in all shapes and sizes – for some, the formula to success is a little trickier than others.
Dr. Sumedh Surwade says he found a good mix in the bioscience sector by combining his passions and talents with scientific needs, specifically, through biodegradable materials which he crafts into microcapsules for a variety of usages. But the path to owning his two businesses, SAS Technologies and Anvigen, wasn’t always easy.
Both
businesses focus on microcapsule development while Anvigen specializes in biodegradable microcapsules. They are both incorporated in Delaware, as well, and required a lot of legwork to not only get them off the ground but to keep them there and profitable. He told the Delaware Business Times that it might not have been possible without the supportive entrepreneurship environment found in the First State.
“The state of Delaware has been awesome. Anvigen got the EDGE grant last year and that was a significant boost for us that helped with technology, testing and getting a lot of verification done,” he said.
Without it, the price tag for any one of those items, along with the cost of the talent and business planning, could put a company under, ranging anywhere from hundreds of thousands of dollars to millions or billions depending on the bioscience business and its needs.
Although
Surwade now writes grants for both of his companies, hoping to find additional funding throughout the year along with investors and other sources, he said it’s unparalleled to the support he received by the First State.
The EDGE Grant, or the Encouraging Development, Growth and Expansion Grant, is run through the Delaware Division of Small Business. All told, it has been the sole provider of $7.25 million in funds to more than 110 newer businesses in Delaware, although not all were STEM or bioscience related.
Governor Matt Meyer even allocated $3 million to the fund in the upcoming state budget, doubling the number previously offered.
The financial support is necessary, Surwade said. Start-ups in Delaware tend to be at a disadvantage because mechanisms for funding and investments relating to startups simply aren’t as structured for newer businesses in the First State compared to what exists in other parts of the country such as California.
To make ends meet, the scientist has shifted his focus recently from his first business, SAS Technologies, to Anvigen which crafts biodegradable microcapsules. He said there was a quicker commercialization process which will help the company generate a profit sooner rather than later.
“Bioscience businesses are harder [to start], especially in Delaware where we’re trying to raise capital and raise money. When I started, there were not many angel investors or investment firms who were interested in investing in chemical companies. That’s a big hurdle,” he said. “I wish there was more money available for us to raise and work with in the Delaware region.”
The evolution of an industry
Surwade’s entrepreneurial experience is not all that unique, according to Delaware BioScience Association (DelawareBio) President and CEO Michael Fleming.
As of 2021, more than 7,000 people were employed in Delaware’s bioscience industry with a higher than national average of such employees, according to the
Biotechnology Innovation Organization, showcasing the First State’s strong scientific presence.
“There are a host of challenges in bringing a bioscience business and its services and products to the market,” he told DBT. “A lot of these businesses tend to be founded by scientists who have a particular expertise in a particular area, and they may not be as knowledgeable in the ins and outs of running or financing a business in the ways they will need it to run.”
Like Surwade, Fleming cited a variety of needs newer bioscience businesses have, such as talent, management expertise, marketing experience, human resources and the ability to connect to partners who may have complimentary technologies, capabilities or skills. Funding, however, is a “very, very big factor” for many bioscience startups in Delaware.
“When it comes to bioscience businesses, you’re talking about end products that are oftentimes regulated by the [Food and Drug Administration]. In order to support that pipeline, you’re going to be doing a lot of testing. And, appropriately so, it’s a very rigorous testing of products and technologies to ensure they’re safe and effective,” Fleming said. “It could be 10 to 12 years in some cases to bring a life science product to market because these are products that are literally designed to save lives.”
Even in the recent past, some
Delaware businesses have found themselves caught up in the pipeline that can take years before products reach profitability, such as Incyte’s drug Jafaki, also known as ruxolitinib, which is used to treat some cancers and graft-versus-host-disease. DuPont’s anti-clotting agent Coumadin and anti-HIV drug Sustiva both took years of research and trials before they could finally hit the market.
Fleming added that those concerns alone make the timeline to profitability for entrepreneurs in the bioscience sector significantly longer than those running new businesses in other industries.
“Most businesses really can be shingles out on day one. They might not be profitable right away, that will take a while. But the timelines in our sector [bioscience] are vastly longer. It could take years and years to develop, receive approvals and finally commercialize a product or service,” he said.
But while business owners like Surwade wait for those approvals to come through, payroll, rents and other expenses must be paid and sometimes for years before the products can finally hit the market and generate that long awaited revenue.
“We have to be able to find early, non-diluted funding and grant programs that help with the lab work and science. That’s an area that helps these companies get off the ground,” Fleming told DBT. “Our founders are incredibly passionate people who really bring scientific acumen to the table knowing that the risks are quite high that you’re going to fail. When you’re trying to cure cancer, the odds are you’re going to fail, and investors are more risk averse now. You’re putting capital away that you’re not going to see for many years. That’s always been the trade off.”
Balancing solutions
While the new era of scientific discoveries continues to be challenging, both from the business and scientific perspectives, and politically, Surwade said he knows he can fall back on Delaware’s ecosystem of entrepreneurship support to help his businesses find a path through the uncertainties.
“Delaware really does a fantastic job through the association, the Small Business Development Center and other resources. There’s a lot here. I also know if I get to where I need lab space, I can contact the Delaware Prosperity Partnership (DPP) for support; they’re available. All of those things are good,” he told DBT.
The DPP frequently helps connect businesses, bioscience and those in other industries alike, to resources, funding initiatives, tax credits and properties, including lab space at facilities like the STAR Campus at the University of Delaware. The support helps Delaware-based bioscience businesses remain competitive in an ever-evolving industry.
Just last year, the
Philadelphia region ranked fourth in life sciences in Colliers’ annual life sciences report with Delaware taking responsibility for a portion of those efforts and funds generated, according to DelawareBio.
But funding and future space isn’t the only concern business owners like Surwade have when it comes to running their own businesses.
“What a lot of people don’t talk about is the other side like the challenges you face as an entrepreneur. You’re trying to do a lot of things all by yourself. It’s very challenging and lonely. It looks very glamorous from the other side – like, oh, he owns his own business. But it’s a lot of work,” Surwade said. “Think about it. It’s not as glamorous from the inside. We need to learn how to balance the work life and the personal life.”
After years of entrepreneurship, Surwade still maintains those words of advice for newer entrepreneurs, adding that finding a mentor is also key to running a successful entrepreneurial venture.
“I work a lot, don’t get me wrong. But at the same time, I make sure I’m spending time with my kids and family. When I go home in the evening, I don’t look at my computer or phone or nothing,” he said. “And by next year, I’m looking to commercialize a product, that’s the goal. Once that product is out, based on that revenue, we want to grow more and build here in Delaware.”
