Transcriptic, a startup trying to bring the concepts from the cloud and collaborative consumption to biology has raised a $1.2 million seed round from a broad group of investors including Google Ventures and FF Angel, and private investors Mark Cuban and Naval Ravikant, the founder of AngelList. The round includes more than 60 individuals and $150,000 brought on via SecondMarket.
Transcriptic, which was founded earlier this year, has built out a biological testing lab using robotic equipment that researchers use to prepare samples. What’s cool about this is Max Hodak, the company’s founder, is trying to take expensive and proprietary equipment, hack it so people can program the machines via the web and then offer the results as a service to academia.
Building a bio-cloud
In biology labs around the country graduate students spend their days filling test tubes and testing samples. It’s boring work and something that well-funded companies in the pharmaceutical industry automate or outsource. But the equipment used in automating those processes are hundreds of thousands of dollars and generally out of range for biology departments. So are the services of outsourcers that sometimes work on behalf of the industry.
So Hodak created what he calls a cloud for biology, but what is really more of a collaborative consumption model aided by open source software and robotics, than an on-demand cloud. In a Menlo Park, Calif. lab Transcriptics owns several large pieces of used testing equipment such as centrifuges, incubators and high-powered microscopes that it purchased for roughly 10 cents on the dollar whose software it has reverse engineered. The company then wrote new software that controls the machines and can run common biological operations such as closing plasmids with other options coming later.
Customers pay for the process and the materials they use on a pay-as-you-go basis, much like you only pay for an Amazon EC2 instance when you are running it. Hodak’s goal is to continue buying gear and building better software for job scheduling to keep the equipment running as often as possible. Of course, that type of scheduling software is a tough problem, since there are so many variables and an unpredictable number of jobs coming in. But for now, he can’t really over-provision at the costs that Amazon has.
For the researchers who use the service, they spend less time doing hundreds of tests by hand, because they can instead pay Transcriptic to run a synchronous process. And because it’s robotic the idea is that it is more repeatable and less prone to human error. As for the potential customers, Hodak estimates that it gets grad students away from grunt work and into real research. They control the robotics and design their experiments over the Internet.
“We think of ourselves as a very long pipette over the internet,” Hodak told me in an interview earlier this year.
Man, that’s a lot of investors!
As for the relatively rare step of bringing in more than 60 investors for a seed round, Hodak explained that he probably wouldn’t do it for the next round, but it made sense for the current one. In general having a huge number of seed investors can leave an entrepreneur with too many people to appease when negotiating future rounds. Additionally with so many investors it can be hard for someone to take a leadership role in shepherding the company to new opportunities or providing good advice.
Hodak however stressed those investors don’t have the full rights of a larger investor, so can’t cause troubles in later funding rounds. He also said via an email exchange last night that he hasn’t seen a lack of leadership with so many participants. “The major investors (Naval, Google, Founders Fund / FF Angel, etc) are being very helpful already, and the minor investors are dozens of cheerleaders for the company now,” he wrote.
Transcriptic is a really interesting company trying to apply lessons learned from cloud providers and taking advantage of better broadband and cheaper automation to deliver a unique service. Add to that the bold decision to bring on so many angels and I can’t wait to see how this one turns out.