*Warning: Investing in biotech is risky!
**None of this information should be taken as financial advice. It is for educational purposes only.
a16z is a venture capital firm founded by the legendary Marc Andreessen and Ben Horowitz. The firm invested in well-known tech and crypto entities like Twitter, Facebook, Coinbase, Stripe, Airbnb, MakerDAO, Compound, Ripple (big mistake!), among others.
Bio, in other words, is eating the world. And since we believe that biology is where information technology was 50 years ago on the precipice of changing everything, that’s why the name of the show is Bio Eats World.
Lately, a16z has increased its focus on biotech / bio-tech companies, funding companies like Asimov (programming cells), Insitro (digital biology w/ organoids), and BioAge Labs (aging biomarkers & drug discovery).
The company’s newest podcast series, “Bio Eats World”, features an inaugural episode chat with Laura Deming (founder @ Longevity Fund), Kristen Fortney (founder @ BioAge Labs), and Vijay Pande (founder @ Color Genomics, GP @ a16z).
Here are my notes and annotations on their discussion:
Cynthia Kenyon, when she was making these first studies [modulating aging in worms], was told you’ll fall off the face of the Earth, literally, if you pursue this research and you do the study.
And if you look at her first paper she was the lead author because no grad student was willing in her lab to do the work. That was such a controversial first step to take as a young principal investigator. That was how unexpected it was that people really thought that it would be the end of your career to kind of go into this field.
I think one thing that we feel really strongly is this is the critical decade. Patients are for the first time, receiving drugs were developed in the context of aging biology.
And when that first patient gets an actual clinical benefit, we’re going to see people actually affected by these kind of ideas that have percolated in the field for decades.
If we just make a fast, easy, cheap, reliable biomarker for aging. That’s really going to change the whole field in a way that is more than just getting one pathway to market.
20-year olds don’t get Alzheimer’s. We cannot cure Alzheimer’s today… therapeutically it’s been a disaster…
Alzheimer’s disease, cancer, heart disease and stroke. We have to study these diseases in the context of aging, and that I think is a new perspective.
We’re really focused right now on just getting more people to be longevity founders. … Early 2010’s, it was lack of capital… Right now the big bottleneck is founders.
Life-extending biotechnology is going to radically transform society. And a transformation of this magnitude represents the greatest investment opportunity in history.
My primary goal for starting LongevityMarketcap.com was to get people excited about longevity biotechnology so more money would pour into the space. Nothing drives progress like a good old fashioned bubble. Dot-com, crypto, cannabis, and EVs — all with conspicuous bubbles in their histories.
Billionaire investors like Jim Mellon and Peter Thiel know the longevity biotech bubble is coming. But when will it arrive?
The chart above is an (overused) illustration of the typical trajectory of an investing bubble. Many a fortune have been gained and lost on speculation on which phase a bubble is in at any time.
Let’s add fuel to the fire. My thoughts:
In my opinion, we are at the beginning of the Awareness Phase of the longevity biotech bubble. There are several longevity venture capital funds. Hundreds of companies. Many longevity conferences.
But the public is mostly unaware of the coming revolution. Only longevity nerds like you and me know about this stuff. And our early faith in the space will be rewarded.
There’s been very little mainstream media coverage. This will change once people start getting famously rich from investing or building companies in the space.
But the direction of growth is clear. When Laura Deming started the Longevity Fund in 2011, there were only a handful of companies to invest in. Almost a decade later, there are hundreds of startups in the longevity space.
Biotech in general is seeing remarkable growth in investor interest. And public investing opportunities are increasing too.
From January to August this year, 37 venture-backed biotech companies filed for IPO, raising ~$7 billion — on track to be the highest in 5 years.
Longevity stocks are also seeing some growing interest, despite their limited number.
In Newsletter #003 (August 3, 2020), I noted that the Google Trends search for “longevity stocks” yielded no data:
But if you search for “longevity stocks” in Google Trends today we can see there is some life. Another year of data will confirm whether this is just a passing spike or something more durable. I imagine a Juvenescence IPO could cause a major stir.
Note: The spikes in the chart during the 2000’s era were most certainly due to David Sinclair’s Sirtris Pharmaceuticals. It was acquired by GlaxoSmithKline in 2008 for $725 million only to be shut down a few years later.
The upcoming batches of public longevity companies are destined for meme stock glory. Anti-aging is simply too big and too relatable to escape the likes of Robinhood and /r/wallstreetbets.
I predict the hype will easily outpace the progress. The bubble will inflate and deflate well before any of these anti-aging therapeutics reach the mass market.
Clinical trials take time. Buying a stock takes a second.
Years from now, when CNBC and Bloomberg start reporting on longevity biotech on their front pages with increasing frequency. When your relatives start asking you about which longevity stocks to invest in. When you start wondering whether “this time could be different”.
That’s when you need to start taking profits.
But of course remember to keep a portion in your HOLL (Hold on for Long Life) account.
“No matter how sophisticated our choices, how good we are at dominating the odds, randomness will have the last word.”
– Nassim Taleb, Fooled By Randomness
Several weeks ago I noted this progenitor cell activation drug developer was getting close to hitting a TD sequential 9 Buy on the daily scale. The 9 was reached and the stock popped 30% several days later on positive Phase 2a data (sustained improvement in hearing in some patients).
The enthusiasm peaked (almost on a TD 9 sell) and we began to correct. It looks like a 1 – 4 candle correction could be finished since we bounced off the 200 day SMA.
The company has a valuation of almost $700 million — it’s certainly investible. I’m already invested but looking to slowly add more.
(For my in-depth analysis on Frequency Therapeutics read newsletter #010)
I’m not interested in investing in this company — they make nicotinamide riboside, a popular NAD+ “longevity” supplement. I know David Sinclair does research in this area but I am still skeptical.
As a trade it looks interesting.
The stock is down 30% from is peak a month ago and coming up what could be a double TD 9 Buy on the daily scale. Market cap is only ~ $250 million, but hey that’s higher than Unity Biotechnology! (Too soon?)
Generally, I prefer to trade assets that I wouldn’t mind to hold onto long term. ChromaDex does not fit this description. But readers may feel differently.
This hot computational chemistry and drug discovery company IPO’d early this year. The stock tripled before topping in July. Now it is down over 50% from the peak with a TD 9 Buy weekly already triggered.
I think this stock is in need of a relief rally at the very least — something more than the 3% it got two weeks ago. I’m interested but not committed to buying.
Not a longevity stock but worth mentioning. Compass Pathways has all the makings of a perfect meme stock:
I’m already invested in Compass Pathways, but interested to see if there is a trade opportunity — given the volatility.
The 1 hour chart seems pretty good at calling out the tops so far. I am interested to see how far this goes. The stock is already up ~ 90% from the first trading day close last week.
This is Jim Mellon’s holding company that acquired Deep Longevity, an Insilico Medicine spin out. The company is probably too small to make any meaningful investment in it (market cap is ~$27 million USD). Their main business is selling Fortacin, an OTC topical spray treatment for premature ejaculation.
We are coming up on a TD 9 buy on the daily scale after a massive run up and 50% pullback. Interesting.