By Jozef Krakora
Many of us think it would be great to start a new venture, but are often deterred. Why? Is it because its too risky, or one does not have the right background, or the opportunity just hasn’t presented itself yet? Certainly, there can many reasons. DukeGEN believes one great way to solve this mystery is to seek out successful entrepreneurs who started their own ventures, and share their story, in hopes of uncovering the secret ingredients to entrepreneurial success.
Affinergy, Inc., a very interesting RTP-based biotech company. Despite his non-biology background in economics, and several years of corporate strategy at Deutsche Bank, Jonathan somehow successfully broke into biotech with a startup. Lets find out how...
Was Jonathan always an entrepreneur?
Jonathan always knew he enjoyed entrepreneurial environments, where he was not pegged due to years of experience; he always liked the free form structure of an entrepreneur, but only after doing it a little bit, he found working with new ventures "addictive”, both personally and intellectually.
Even before Fuqua, Jonathan had the startup bug: Growing up in New Jersey, Jonathan had numerous “side businesses”. In winter months, he and his brother had a snow shoveling business, and often spent 15 hours a day shoveling snow. He also had a baseball card business, sold candy to kids when he was young, and even ran a food service operation at a summer camp (purchasing, buying, staff). Jonathan always liked where he could "set the rules" and have "freedom".
Even getting into Fuqua had an entrepreneurial twist. After being placed on the wait-list, Jonathan was not deterred; instead he was relentless. Jonathan said, "I became one of the most politely difficult individuals that Fuqua was working with... I was going to come into their office and just sit there until they let me in!!"
How did Affinergy get started?
In 2002, Jonathan joined the Duke New Ventures Clinic and began working with his scientific co-founders and inventors Mark Grinstaff and Daniel Kenan. Jonathan developed Affinergy's initial business plan, which went through numerous iterations and got better over time. He also negotiated the technology license from Duke.
Not having a background in biology or science was certainly a weakness early on for Jonathan. It made things a lot harder than they needed to be. He also views his background as a strength, as by not falling in love with the science, he has kept a valuably different perspective and focused more on the product and business. He fought through the learning curve and surrounded himself with experts early on, to “make important decisions and avoid dumb decisions.” A background in making medical devices is valuable. One needs to understand the industry, how products are sold, financed, how the market works, and the buying process, etc. Then you know how to ask the right questions, know who to ask what, how to ask.”
Jonathan has an interesting definition of “No”. At the onset, several times people told him “No”, he could not have something, yet Jonathan had a tendency to keep trying. "No means not now, not No", Jonathan insisted, and as a result, he never takes no for an answer. There were a handful of times when his company was starting, he wanted to get into an incubator; and got a No. Following his own advice, he persisted and got several things that the incubator was looking for; he was in 9 months later. "There is a fine line between being persistent and being an ass. Nothing wrong with being persistent; eventually you find the right interval, find a way.”
How do Jonathan and Affinergy keep the persistence going?
Jonathan absolutely loves how "it makes you feel when you can directly make an impact with your effort." He sees the progress month to month, and sees his labor paying off. For Jonathan, the association of outcomes from efforts, the feeling of creating something, and going from an idea to a company that deserves 27 people, is just great.
Jonathan has kept Affinergy pretty stable in the last six months, though it’s been a pretty trying time. They have diversified funding needs away from VCs, to some Angel capital, and then to partner funding and government grants. Without diversifying, they would have burned 100% of investor money, and would be in trouble by now. With this diversification, unlike many of their peers, Affinergy is not only stable, but, persistently seeking further high-growth, high-risk opportunities.
What has Jonathan learned along the way?
Jonathan believes a successful entrepreneur must possess at least these attributes:
Jonathan suggests it is key to figure out how to start your business with little or no money. He insists, one really needs to figure out a way to get started without any money. This can certainly be tricky: “how to NOT need money.” Once you begin to prove yourself, your business, and when you don't need it, its then that money comes to you, and you can get it at a rate you like. Jonathan stressed the importance of “doing everything you can to minimize dependence on capital.”
What about passion?
Jonathan feels “entrepreneurial passion” is certainly more good than bad. But one must avoid being blinded. A good Board of Advisors is key, where one can both solicit feedback and give feedback. It is important to step back at the appropriate interval, get good feedback and incorporate it into business.
A fan of Isaac Newton, Jonathan stated, “Once you get a company in motion, you don't need to push as hard, because you've got a lot of people helping you. The momentum is there. The hard part is building the momentum.”
How does Jonathan define success?
Five years from now, Jonathan hopes to build a pretty successful medical device company, with a couple approved products that are helping patients. Affinergy is not successful yet, and has no products approved yet while several are in later stages of development. "Ultimately we need to help improve patient outcomes to be labeled a success in the marketplace. Try not to stay fixed on the financial outcome, rather focus on the patient outcome, and if you do a good job the rest tends to take care of itself."
Read more profiles of Duke alumni entrepreneurs