by Y Combinator10/17/2018
We put together a list of the top YC companies by valuation as of October 2018. You can see that list at https://ycombinator.com/topcompanies.
Here’s a Q&A with Elizabeth Iorns and Dan Knox, Cofounders of Science Exchange, one of the companies featured on the list.
What does Science Exchange make/do?
Science Exchange is a B2B marketplace for outsourced research and development. We work with R&D companies, mostly in the pharma and biotech space, to provide a software platform for securely working with external partners that conduct various aspects of their research and development projects. We have over 1200 companies that use the Science Exchange marketplace and ~50 enterprise implementations where our clients use Science Exchange as their central system for outsourcing, integrated into their procurement platform. We’re essentially bringing e-commerce functionality to a massive market (outsourced R&D) that has remained almost entirely offline until now.
How many employees does Science Exchange have?
What is the larger impact / societal impact of your product in the space you work within?
Our mission with Science Exchange has always been to improve the quality and efficiency of scientific research and development. By using our platform, R&D-focused organizations can dramatically speed up the process of making scientific breakthroughs. This means faster cures for major diseases, faster development of new medical devices, faster discovery of new materials. Our platform has been used to discover the blackest material ever measured and has been involved with the majority of new therapeutics that have come to market over the last few years.
What’s an interesting element of Science Exchange’s company culture?
We’ve had a consistent set of company values since 2013. We came up with the values—Fearless, Open, Respectful, Curious, Entrepreneurial (or FORCE for short)—when the team was still very small (~5 people). We wanted to be deliberate about the sort of work environment we were creating and wanted to focus on making Science Exchange a place where we would want to work for the rest of our careers. The FORCE values guide hiring (and firing), recognition, advancement etc., and have been crucial in the evolution of our culture as we’ve scaled.
Looking back, what motivated you to start Science Exchange?
We were actually an example of YC’s advice to build a company that solves a problem that you have personal experience with, since we started Science Exchange based on Elizabeth’s experience as an academic professor working in the field of cancer biology research. The original idea for Science Exchange came from a very real problem that Elizabeth experienced as a researcher: that outsourcing R&D was hard because it was difficult to discover, compare, and purchase scientific services. Looking back, we feel that working on a problem that at least one of us was very familiar with was important for two reasons. First, it meant we had a deep understanding of the problem itself and therefore we were able to create a good solution. And second, it meant we cared deeply about solving the problem. Creating a company is very hard – so caring deeply about the problem you are solving is critical to having the resiliency to persevere through the inevitable hard times.
Is what you’re working on now the original idea or did you pivot?
The core idea behind Science Exchange today is still the same as the original idea we had back in 2011. Our YC application described Science Exchange as “An online marketplace for scientific tasks (think eLance for experiments)”, and while the specific language has changed that is still pretty consistent with Science Exchange now. That said, the product has changed significantly since our original MVP. And we actually view the market opportunity for Science Exchange very differently than we did back in 2011. We understand our space more, we understand our users more, and as a result we see more clearly how much need—and therefore potential—there is for Science Exchange across the entire R&D landscape.
Were there moments where you thought the company might die? Describe one of those and anything you learned from it.
In late 2012 we were having trouble raising our Series A and were at risk of running out of cash. Probably one of the lowest points was Christmas Eve 2012 when one of our investors sent us an email that included lines like “I worry that you guys are in denial if you’re even spending time talking to investors, because in its current state this company doesn’t sound fundable” and “I would be surprised if you can raise money. At this stage investors are looking for something that is taking off, and this isn’t.” Merry Christmas Science Exchange! We obviously survived (we raised a Series A from Union Square Ventures in early 2013) but that period of adversity taught us the importance of resiliency.
What was a particularly important insight you had about your market that made your product work?
We recognized that, for the researchers who use the Science Exchange platform, the primary value proposition was speed. Speed is so important because the key competitive advantage in R&D is how quickly you can advance a research project towards a breakthrough discovery. Because we recognized the importance of speed, we built our product and processes to optimize for the speed of connections between scientists and service providers. And that meant we have been able to make the platform sticky even for people who work with the same service provider repeatedly over years and years.
What’s one piece of advice you’d share with a young founder?
We’ll share two pieces of advice since there’s two of us writing this:
“Don’t be a dick”
Building a successful company takes years of work, and Silicon Valley is a surprisingly small place. People remember you; they remember the way you conduct yourself; they remember the way you treat them. So — as a general philosophy — be kind to people… 1) it’s just the right thing to do; but 2) it will serve you well as people will want to help you succeed.
“Focus on your own journey”
In tech it is easy to get caught up with what everyone around you is doing. E.g. the other companies in your YC batch, your competitors, the general tech industry. I’m not saying ignore things happening around you… but don’t get fixated on who is raising money and at what valuation etc.
Y Combinator created a new model for funding early stage startups. Twice a year we invest a small amount of money ($150k) in a large number of startups (recently 200). The startups move to Silicon