In this interview, I speak to Dr. Rob Carlson, a Principal at Biodesic, an engineering and strategic consulting firm in Seattle that provides services to governments and corporations around the globe. At the broadest level, Dr. Carlson is interested in the future role of biology as a human technology. He is the author of the book Biology is Technology: The Promise, Peril, and New Business of Engineering Life, published in 2010 by Harvard University Press; it received the PROSE award for the Best Engineering and Technology Book of 2010 and was named to the Best Books of 2010 lists by writers at both The Economist and ForeignPolicy.com. Carlson is a frequent international speaker and has served as an advisor to such diverse organisations as The Hastings Center, the PICNIC Design Festival, the UN, the OECD, the US Government, and companies ranging in size from start-ups to members of the Fortune 100. Carlson earned a doctorate in Physics from Princeton University in 1997.
How did you move into the industrial world of biotech?
I followed my nose. My formal education is in physics, with some neurobiology and electrical engineering thrown in. I spent a number of years labouring under the expectations of my professors that I would eventually become a professor, too. Then I bumped into the Nobel laureate Sydney Brenner on a train and wound up working with him for a while, then later spent time as a Senior Scientist in an academic Electrical Engineering department. The main themes all along have been interests in biology, and in building things, and also in how we got where we are and in where we are going.
Because I followed my nose, I wound up pursuing those things that I was interested in, and learning things that helped me ask better questions. Over the years, particularly after graduate school, my interests became increasingly divided between 1) academic questions about biological systems, and developing tools and methods to answer those questions, and 2) how we use biological technologies in the economy. Eventually, I shifted more and more toward trying to understand the bigger picture, how all the pieces fit together, and this led me to economics and to developing metrics to quantify how fast biotechnology is improving.
I was fortunate to be invited to join a consulting firm that was interested in my technical analyses. That job taught me a huge amount about how money and resources flow around the world, and why. I was lucky to work on projects where I briefed CEOs (or CIOs — Chief Investment Officers) of massive investment funds back to back with briefing traders who work commodities desks: another unparalleled education in what a wide swath of the international private sector is worried about and in how they think.
The detour through my garage biology start-up was extremely educational in this regard, and has contributed a great deal to my understanding of how biological technologies can be, and will be, developed outside of traditional environments. At the moment, I spend most of my time with start-up companies and governments working on strategy and security. I am also starting a new non-profit that will focus on describing and analysing the broader bioeconomy in an open and transparent way.
Was it difficult to move into industry?
At times, it has been very difficult. If an academic experiment doesn’t work, you can find another one that does. Your rent doesn’t depend on the outcome of a particular experiment. But, any time you start a business, you are gambling everything. Sometimes you succeed, but most new businesses fail, often for reasons outside your control. Your job as an entrepreneur is to manage risk, and to minimise it as best you can. These are not skills that are taught in academic science and engineering programs. Fortunately, in the US just trying to start a business is seen as a badge of honour, whatever the outcome. Success is great, but failure is just another merit badge. Some people accumulate a lot of those, and that is okay. In other countries, you only get one shot. I am very cognisant of this, and I am reminded of it every day, when I work abroad.
How has the biotech industry changed since you started flirting with it?
When I started, the definition of “biotechnology” depended on which room you walked into. It could mean either drugs (biologics), or it could mean GM crops.
Sometime in the mid-2000’s, industrial biotech started generating substantial revenues. As of 2012, biotechnology (genetically modified stuff) generated more than $350 billion in revenues in the US alone, which is the equivalent of about 2.5% of GDP. This is up from $300 billion in 2010. That $50 billion increase amounted to about 7% of total GDP growth over those two years. The $350 billion is divided roughly equally between drugs, crops and industrial products (fuels, materials and enzymes). Biotech is now very big business and it is among the fastest growing sectors of the economy. It’s worth pondering those numbers for a moment; biotech is now about 2.5% of US GDP, but it contributes an outsized 7% of GDP growth.
Biotech has also become the province of garage start-ups and hobbyists. Costs have fallen while access to tools and skills has improved. That is important for a number of reasons, not least of which are conversations about security and safety. But no matter how we attempt to deal with security issues, people and governments around the world see the economic potential of biotech, and they are pursuing the technology with enthusiasm.
Where do you see biotech going in the future?
I see it going everywhere. I used to say that we probably aren’t going to grow rocket engines using biology, but that the rest of the rocket is fair game, including the fuel. I learned recently that a new solar science satellite contains thermal coatings derived from bone, so we are further along than one might think. Obviously we have a long way to go before we can grow arbitrary objects from arbitrary materials, but the sky has no limit.
If you look across all the materials and applications in our economy, there are relatively few things that biology doesn’t touch, or cannot replace. That doesn’t mean biotech will always offer the highest performing solution, or will always be the most economical, but it is becoming clear that we can at least give it a try.
In the nearer term, I think we are going to see biotech produce many compounds we now derive from petroleum. We will have to deal with the consequent resource issues, but I think those are manageable over time.
What challenges are there to setting up a business in biotech?
Among the greatest is that academic scientific training is almost entirely divorced from really worrying about the bottom line. Writing grants is often annoying and difficult — increasingly so, in some environments — and managing a lab budget can be tricky. However, your salary and healthcare are basically covered, and you usually have an institutional buffer if your funding hits a rough patch. Your job is to educate and to push the boundaries of knowledge; it’s a sweet gig. Yet I don’t think most professors appreciate how lucky they are. Consulting for companies while on an academic salary doesn’t compare to living in the private sector, and just doesn’t provide the same experience of risk. In the private sector, your rent depends on making money every month. And if you hire people, you are responsible for their rent, too, which may be keeping a roof over the heads of their family. Moreover, the difference between demonstrating a technology within a university and putting that technology in a box that people actually want to buy is absolutely enormous. Across all the technologies I have looked at, the R part of R&D usually amounts to only about 1% of the final cost; the rest of the cost — the D — is in creating a product and selling it.
The first requirement for innovation is the opportunity to fail. You may fail; you will probably fail at some point at least once. But you have to be able to use that failure to build the next thing, whatever it is.
What advice would you give to those looking to move into biotech?
If you are a student, then you must join, or start, an iGEM team. You also have to at least be familiar, if not fluent, in quantitative techniques, both modelling and experimental. The “tech” part of biotech means you are making stuff that works in the real world and that can be sold, which means biotech is going to look ever more like engineering.
If you aren’t a student, or if iGEM isn’t an option, then I think you need to spend time at the bench. Find a lab to work in, or a community lab to join, or set a lab up in your garage or kitchen. Just get started.
My own path has been pretty indirect. I started in physics, then neurobiology, then blood cells mashed up with microfabrication and microfluidics, then economics, then electrical engineering, followed by a detour through my garage lab, which led me into security, and now strategy and finance. I’ve just followed my nose, but all that means I can only tell you how I got here, rather than how to repeat it.
What advice would you give to those wanting to start their own biotech business?
First, you need to understand which part of biotech you are going into, because biotech is now as varied as the rest of the economy. Who is your customer? A patient? A farmer? Someone at the fuel pump? These markets exist in very different regulatory environments, and consequently come with very different costs and times to market.
Next, you are going to need resources. Where do those come from? R&D always costs more and takes longer than you think it will. The final product development is an entirely different game, requiring communication with customers. Who handles your marketing? Running a business requires many skills, and no one person is expert in all of them, and in any event you will not have time to take care of everything yourself. Who is on your team? Who has connections to money? Who understands operations? Do you know anybody who has ever taken an idea from a napkin all the way to a product?
In general, I think that academic training is quite far removed from understanding what it takes to make a company work. The technical training is critical, but it is also insufficient. Many people are confused about how little publishing a paper has to do with shipping a product. So gaining as much real world business experience as possible, as soon as possible, can only help.