When Accelerator first opened its doors in 2003, the conventional wisdom held that incubators--investment firms that help bring young companies to market--would never work in the capital-intensive biotech sector.
But don't mistake Accelerator for an incubator. On the company's website, the "I word" is nowhere to be found.
The reason for the name has to do with speed. In five years, Accelerator has launched nine startups and raised more than $148 million from investors, such as Amgen Ventures, Arch Venture Partners, OVP Venture Partners, WRF Capital and, most recently, PPD Inc. Three of the startups have gone on to raise $114 million in Series B venture capital. In an act of emulation (or desperation), other business incubators from New York to San Francisco began calling themselves "accelerators."
"We went from being an impossible thing to now having our name used as a brand," says Accelerator's president and CEO Carl Weismann, who calls his firm a "one-stop shop" for getting a biotech started.
The company owes much of its success to a first-of-its-kind business model that includes leading scientific advisors and a tested infrastructure that promises venture capitalists quick returns on their investments. At its heart is a partnership with the Institute for Systems Biology (ISB), which provides startups with the core facilities and support needed to get their companies up and running.
"Biotech incubators in the past and present have never combined all of these resources, which has been their demise," Weismann says. Along with being a vital part of Weismann's sales pitch to potential investors, the ISB helps startups to allocate nearly all seed money toward product development instead of paying for expensive laboratory equipment, testing facilities and staff. Startups are given approximately three years' worth of funding and a slick laboratory space at Accelerator's Eastlake digs in Seattle.
Because most of the development costs are handled through ISB, Accelerator startups don't have any business employees; they only have scientists. Weismann and his executive team manage each business from the start, doing everything from making coffee to closing deals. "The premise is that scientists are best at doing science," Weismann explains.
While Weismann focuses on pure science for his startups, ISB is also on a mission to help scientists become better businesspeople. Through its Venture Capital Fellow Program, founded by ISB faculty member Tim Galitski, the institute chooses one bench scientist to be part of an executive boardroom with Weismann and his management team at Accelerator, where he or she is taught how to evaluate biotech proposals for commercial opportunities.
The first "graduate" of the fellowship, Alok Srivastava, joined a venture capital firm prior to launching a stem-cell research company. Joshua McBee, the program's second fellow, graduated from the program this fall and has similar lofty aspirations. "I'm talking to several groups to make the next step," he says.