AI Is Coming to Medicine

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  Speaker 1:

  Imagine what medicine will be like in 10 years. It’ll be very different and a lot better. And imagine you participated in that changed future by investing in some of these transformative technologies. Today what I’m going to talk about is a little bit about our view of the future. I’ve been in venture capital a long time, and I think for the first time ever we’re going to see the kind of disruption that we’ve all been hoping for. Healthcare needs to get a lot better, it’s going to get a lot better, and we’re going to talk a little bit about that today. Thanks for joining.

  Before we dig in, just the legal disclosures. The opinions are mine and it’s a view of the investment landscape from Alumni Ventures. This is not an offer to buy or sell any securities which are made pursuant to legal documents. So just a little bit about myself. I’ve been in the venture industry a long time. I love the intersection of technology, innovation, entrepreneurship, and investing. AV was developed to bring community-based, smart, simple venture investing to retail investors, and we’ve had some success. We’ve raised almost 1.5 billion. We have just about 11,000 customers. We’re one of the most active venture capital firms in the world. We have a hundred employees with our back office in Southern New Hampshire, but our investing offices in Boston, Silicon Valley, Chicago, and New York City.

  We’re well respected as one of the leading co-investing firms in the United States and really abroad. We encourage people to check out some of the amazing companies we’ve invested in, and we’re really here to serve and build our community, which we think is our secret sauce. Part of our strategy is we co-invest alongside these kinds of venture capital firms. So I think we have a front-row seat to what’s going on. Many of these players are very active in health tech, so I’m going to talk a little bit about nine breakthrough areas. These are just tentpole areas. Obviously every investment we make is very context-specific. We think there’s things going on in healthcare, drug discovery, just across the board in the whole space. Some of this being powered by AI technology, hugely powerful disruptive force, robotics, and just an entrepreneurial spirit that is driving the demand for quicker, safer, more effective healthcare.

  So we’re going to talk about nine specific areas. I’m going to cover these pretty briefly. One is data, individual personalized. We’re seeing this in wearables right now. Again, a few of our portfolio companies listed below—Apple Watch or Oura Ring. We’re going to continue to see more data from the human body being fed into the system. So a lot of innovation going on there. This is becoming a major trend that we think is going to do nothing but continue and get better to the benefit of everybody.

  The second one we’re going to talk about today is really the idea of disruptively simple technologies moving from the hospital to the local facility to the home. So this is again kind of a cousin to the wearables, but it’s just more data. We’re starting to see full-body scans, new kinds of high-technology things coming down, an order of magnitude more inexpensively.

  I think we’re going to see this trend continue. Again, a couple of our portfolio companies are pretty active in this space. Related to that, I just mentioned a little bit, is using software to model expectations. So the idea of digital twins I think is something that we’re just starting to see—where you can create in software things that used to be only available in the physical world. And when we see the digitization of anything—and a good example of this would be kind of wind tunnels—the ability to move faster and cheaper and more effectively really takes off. And I think we’re going to see a lot of those kinds of things in human health.

  This is a big secular trend, which is just the area of personalized healthcare where we’re really talking about individuals taking more control of their health using tools in partnership with their physician, as opposed to being reliant on a hierarchical system. I think we’re seeing this trend unevenly distributed where individuals are taking control of their healthcare and using the entire system to really control their own health future. This is leading to a greater emphasis on prevention and health as opposed to the existing system, which basically waits till you break and then tries to fix you.

  Things are getting smaller. This is a trend as well where we’re starting to see things that used to be the size of a room go to the desktop and now are becoming very small. And so again, I think we’re at the beginning of the nano phase where we’re looking at a whole spectrum of solutions now that are either in the body or close to the body. Again, classic disruption theory of get it small, get it cheaper, broadens the market, broadens the accessibility.

  And when you combine this data—and that’s a lot of what we’ve talked about so far—with AI, I think you’re talking a whole new ballgame in healthcare. Because if you combine the data with AI, you can really be a much more informed individual healthcare consumer, if you will. And that’s really what’s needed in this business—much more innovation, technology, and market forces at work.

  So discovery, right? I think this is again getting a little more of the headlines, but we’re seeing just incredible model work with proteins and DNA, where we’re seeing scientific assistants being launched. Again, Google’s in this space, but ARC Labs and other players as well. But we’re going to see, I think, virtual scientific assistants. I think we’re already finding most scientists now are using AI increasingly in their day-to-day work. So not in replacement, but as an accelerant and a turbo boost to the work they’re doing. So we think that there is unbelievable potential here to understand health and human bodies and biology and disease. And I think we’re at the forefront of AI-powered discovery and research labs, and this is a very exciting space that I think we’re looking to invest a lot more in as are leading venture capital firms. I think this is a space where young talent is, and we’re seeing some of the most exciting startups right now in this space right here.

  Robots—again, Intuitive Surgical and others—I think we’re going to see more of this. There are obviously huge advantages of surgical robot AI-assisted robots. Really again, when you can combine robotics, AI, and the experience and judgment of healthcare providers and surgeons, the opportunities to do good are tremendous. In addition, it provides greater accessibility. It provides better safety. The number of people that can have access to these kinds of very complicated procedures grows. So again, I think robotics is reported less when it comes to healthcare, but I think the twin towers of AI and robotics are really profound. And again, Andromeda—one of our portfolio companies—in this space, the human systems and the physical world systems are beginning to break down.

  Obviously when you talk about wearables, we’re still talking about something largely exterior to the body. But I think we’re going to see more and more things kind of break barriers between these two worlds.

  The skin barrier—we’re seeing that with portfolio company Levels and blood glucose measurements. Our portfolio company Precision Neuroscience—really trying to work with the brain. Obviously some of the early applications are people with significant challenges, and we’re seeing enormous progress and miniaturization, AI, understanding the biology. I think again, merging, if you will, the physical world and the human biology is going to break down a lot over the next 10 years. So the brain is obviously one tremendous area of that.

  And then listen, we still live in a physical world, and we deal with the manufacturing of things, including drugs and sensors and tools. And I think both from a hardware and software standpoint, bringing technology to make that more efficient. Some of the hospital systems remind me of the air traffic control system, which is just old, slow, and bad. So I think we’re going to see disruption there and the ability to replace these big, clunky, expensive software systems—old world manufacturing process. I think again, over the next decade, one should be very encouraged about greater efficiency there.

  So really across the board, the opportunity for technology and innovation and improvement on what is just an enormous portion of the economy—and frankly beyond dollars and cents, just human health and wellness and reduction of pain and suffering—I think one can be very optimistic about the next generation of things coming down the pike.

  Yes, and then I talked about this one already, but just regenerative medicine, longevity tech, drug discovery, understanding how to fix things. Regenerative medicine where you’re actually growing human tissue, fixing tissue, things going on with genetic disorders, some things in vitro. Again, reducing the timeline for these things from 10 to 20 years to three to five years is really what we’re hoping for. So again, drug discovery, regenerative medicine, the ability to create brain tissue, organ tissue—if you can’t fix it, to replace it. So again, just another front on this war against disease and affliction where we can all live longer, healthier lives and a lot less tragedy.

  So for some of the viewers out there, we hope you become part of our community and join us in investing in some of these exciting companies. Imagine being part of a firm that cures the disease or develops a new treatment or a great improvement. It’s doing well and doing good. Obviously there’s huge value creation, but also great societal good that can take place from it. So we’d hope you strongly consider joining our community, attending our events, helping our startups, investing in our funds. We can do better together than any of us can do on our own. And this is a way to be active and we’d like to be your venture partner. Most people in this space don’t participate, and we have designed our firm to deal with a variety of different personas with different investment goals. We have people who just love the technology and want to stay informed.

   

  We have people that have never done venture investing. We call them the venture curious. They’re looking to get educated and take their first baby steps. We’d love to talk to you and help you get educated. We have people that have just made more money than they need and are now looking to pay it forward to the next generation of entrepreneurs and builders—trophy hunters, people that are really interested in this part of their portfolio, taking some risk in the hopes of big returns. And then there are just the analytical, logical people who just see this as such an important area of technology and innovation and they want an appropriate diversification into this part of this asset class. So we work with all kinds, is really the bottom line. And again, we’d like to be your venture partner. We’d like to talk to you, we encourage you.

  We have a lot of people that are great listeners and understand where you are in your journey, and we want to understand what you want and if we can help you get that. So we obviously have a variety of funds—many alumni funds. We have a health tech fund, a deep tech fund. And then for those beginning, we have a foundation fund. So again, likely we have a good solution. Pick up the phone and call us. We’d love to chat. So with that, we’ve got a big audience today. I’ve seen a lot of questions come in, so I’ll just try to answer a few today.

  The first one is about the regulatory. The first couple are really on the regulatory environment. Obviously, this is a big dimension of innovating in healthcare, and so it’s appropriate that this is dealing with lives and health—that there are regulations and rules and processes in place. We think good technology can help move that along faster in a safe and responsible way. I think the nature of building great companies is always a long-term process. So as venture capitalists, we’re used to things that take five or 10 years to build. I think one of the things going on now within the investing world is the ability to realize returns along the way is better than it’s been in the past, and I think it will likely continue. So investing in a company and waiting for an IPO is not necessarily the only way to do really, really well in this asset class right now. But every industry has a combination of technical risk, market risk, competitive risk, team risk, regulatory risk. So this is just the nature of the beast.

  How do you lower the risk of investing in healthcare? I think it’s about the size of one’s portfolio. So I think if one plays in venture capital and just does a couple of deals a year, I think that is very risky. And that, to me, is more to be done for fun and education than it is to treat as a serious investment strategy. I think venture capital health tech investing is a power law business. You really should be looking to make 50 to 100 individual investments in a portfolio. It is a power law business where your home runs really are meant to cover everything. So again, if you’re just doing one or two deals, you’re buying a lottery ticket. People who do that and win think they’re geniuses, but usually that evens out over time. But again, big, high-quality diversified portfolio.

  The other trick to that, I think, is to really invest alongside top-tier VCs who are domain experts and understand the KPIs and how one builds value. And that’s not because they’re smarter or better or harder working. It is just because the great entrepreneurs, the great opportunities, the great companies make their way to the best investors. So we think there’s very strong correlation. So big portfolio, diversify over time as well—I think is an important consideration. Invest alongside top-tier VCs and then try to deploy more capital into the companies that are really getting traction. So the kind of “chase your winners” philosophy works really well in venture capital.

  AI is speeding up drug development, but is it really safer and more reliable than traditional methods? I think it is a new tool, and I am a tech optimist by nature, and I think the ability to do things with these new tools is a very important part. And I think what is not measured often in these situations is the cost of nothing, right? And let’s just get it out of healthcare and let’s talk about self-driving vehicles, for example. So obviously every time a Waymo in San Francisco bumps into a fire hydrant, the world freaks out and it’s headline news. But they don’t talk about 30 to 40,000 deaths on U.S. highways every year. So the real data one should look at is versus the alternative.

  So does AI make mistakes? Does AI drug discovery lead to some bad outcomes? I imagine with all technology that there are always unintended negative consequences. These things do not promise perfection. But what we should be looking at is: can this improve outcomes? Because every day people are suffering from Alzheimer’s disease, dying from cancer, dealing with the consequences of being obese. And if we could just make GLP-1 drugs cheaper, more widely accessible—are there zero side effects to GLP-1 drugs? No, of course not. Are there risks of taking any drug? Yes. But we know well the cost of obesity and heart disease, premature death from diabetes, quality of life, etc. It goes down. And we just have to look at these things not as perfection, but are they moving the ball down the road in a better way?

  I think that’s a flaw a lot of times we have in the way we talk about these things and the way we cover these things. And I think AI and disruption in health tech is really, really important. I mean, our health tech system is expensive. It is bureaucratic. It focuses way too much on remedial activity versus health. So yeah, I’m a little more in the camp of—we need some radical new approaches. And those tools are now at our disposal. And if you agree, again, we hope you reach out. We hope you participate in our community, in our funds. We want to invest in people building great new solutions. So thanks for your time today and we’ll see you down the road. Keep building. Thanks.