Dealflow Process

Recruitment of Applicants

The sustainability of the DAO will in part be determined by its investment strategy and successes. A key element of that equation is the attraction of strong applications with real potential for return on investment (ROI). Once the mission of the DAO has been well-established, the next phase will be to recruit relevant applications that will seed future ROI and thus long-term stability.

Mechanisms by which applications can be attracted include:

By involving a few key players in the field of emphasis (e.g. aging health sciences) from the beginning, one will quickly establish credibility and identity within your domain.

Once money is distributed and identity is more broadly established, scientists will seek the funding opportunities. The transition from application to funding needs to be considered carefully though. While funding projects should be a priority early in the process to gain international notoriety and to demonstrate internal progress, these ambitions need to be weighed against the real potential for ROI. Bottom line, not all projects are worth funding, and it is worth exercising a little patience until a strong and promising application is received.

Scientific Working Group (SWG)

Before accepting applications and distributing funding, it is important to establish a working body (i.e. the SWG) that will be responsible for vetting submitted applications. Expertise on this panel should include topic experts (scientists), business developers, intellectual property (IP) and dealflow specialists, clinicians, pharmaceutical researchers, biotech investigators, etc. While a natural hierarchy will be established over time, it is useful to designate one person as the SWG Lead. That person should have some background in the relevant science, but most importantly, should be able to commit the time necessary, open minded to different ideas, seasoned in managing diverse personalities, skilled in relationship building and interpersonal communication, balancing personality with ability for decision-making, skilled in relationship building and interpersonal communication, possess a balanced personality with ability for decision-making, etc.

Once the Lead has been identified, it will be his/her responsibility in building out the SWG team and organizing regular SWG online meetings for discussion of various topics related to dealflow. Again, the emphasis should be on identifying individuals with diverse backgrounds that have experience in the relevant science and/or the commercialization of such science. The main objective is to support research or clinical studies that have the greatest potential to bring back a return to the community. That return can be measured in many ways: awareness, improved therapies, financial gain, etc. The emphasis should be on building long-term sustainability for the DAO and its contributing members with the permission to recycle capital from realized returns for new project funding (“evergreen fund structure”) .

The mission of the SWG will be to (i) seek and recruit applicants/applications, (ii) review and decide on which applications to decline or advance and ultimately fund, (iii) maintain dialogue and a working relationship with the applicant and his/her team; a symbiotic relationship is most advantageous, (iv) inform the wider community of their activities and accomplishments through online presentations, Q&A sessions, emails, website reports and contribution to DAO newsletters, and contributions to a DAO newsletter (to be established separately).

The Application

Based on experience, it is recommended that applications should be received at a few dedicated time points throughout the year (“batch application”) (“batch application”). Such organization allows the SWG to plan and coordinate the review process accordingly, as well as to compare the quality and complementarity of received submissions. This permits community decisions around preferred emphases and diversity within the portfolio. At the beginning, when application numbers might be low, having an open submission policy is an option. The application itself might look something like the following:

  • Website based (simple), which includes:

    • Project name

    • Project lead

    • Contact email

    • Website (if available)

    • Describe product in 50 words or less

    • List key personnel (plus contact information and website), with emphasis on domain expertise

    • List competitive advantages over research and people in your space over research and people in your space

    • Expand upon the description of the project (include primary goal, objectives, and experimental approaches)

    • Summarize the stage of the project (exploratory, preclinical, clinical, IP ready, etc.)

    • UPLOAD Supporting documentation of a research plan with preliminary data of a research plan with preliminary data (including budget request and breakdown, duration or project and duration of project)

  • In cases where IP is a concern, limited information can be provided. However, to instill consistency throughout the system and to provide full automation, it is recommended that every submission have a formal application (even if abbreviated).

  • That said, there will be instances where an applicant just does not (want to) complete the online application. In these cases, one will need to build a separate dealflow spreadsheet within the community (with restricted access).

The application process should be minimally intrusive. The idea is to find a balance where application submission is simple, and therefore not a deterrent, and sufficient information about the project and potential is obtained. Once that is accomplished, the next phase (i.e. the review process), will be able to flush out essential details to make an informed final decision on how to proceed.

Application Tracking

Establishment of a single site location that records and tracks all applications received is paramount to an effective system (“dealflow spreadsheet”). While initially application numbers might be low, these totals can change quickly, with large numbers being received in a relatively short period after kickoff. It is therefore strongly recommended that someone with good organizational skills would be in charge of recording submissions, assigning responsible members, and facilitating all downstream steps (see next sections). Applications can be recorded in a dealflow spreadsheet and divided based on priority, subject matter, etc. after an initial assessment and/or based on community preferences. Molecule and bio.xyz can provide a custom AirTable template on request.

Review Process

Phase I

Before the review process is initiated, it is recommended that someone takes the lead of handling the process (from here on, the Shepherd). The Shepherd, a member of the SWG, is in charge of gathering 3 reviews from community (likely SWG) members with varying and relevant expertise around the science, commercialization potential, etc. The full review team is from here on referred to as the Flock.

A typical scientific review will consider the following elements:

Impact

If successful, will the work move the field significantly forward? Will the work have measurable impact on societal needs?

Feasibility

Is the work justified based on published or unpublished (preliminary) data? Are the experimental plans appropriate to address the aims/objectives? Can the work be executed based on the resources and scientific expertise on hand? Will the study conclude with a definitive result?

Scientific Team

Does the team possess relevant expertise and sufficient passion to oversee the proposed studies? Has the team demonstrated past success in project execution and/or business development?

Relevance to DAO Mission

Is the proposed work relevant to the community’s interests and goals?

Market Advantage

Where does the project stand with respect to the competition? Is the scientific team sufficiently positioned to guide commercialization? Is the end product novel and fulfilling a market need?

  • Is there potential for an IP-NFT?

  • Is there potential for commercialization? What is the target population? What is the financial opportunity?

A brief summary of “the problem” and “the solution”, as well as a bulleted synopsis of strengths and weaknesses, should be included as part of the review document. This permits easy understanding from others of the potential significance and realistic possibilities of the project. Space for comments or questions can also be included in the reviewer form.

A recommendation should also be made by the reviewer:

  • Proceed to community review (see next), with support of funding for the project.

  • Follow-up with the applicant to get clarification or redirect project goals, before deciding on proceed or reject.

  • Reject in its current form but provide recommendations to applicants for consideration and possible resubmission.

In principle, a firm rejection should be avoided, except in cases where the project does not meet essential criteria established by the DAO. The idea is to engage in communication with applicants (on a priority basis), such that the community can always return to a project if there becomes interest at a later time point or the applicants make certain changes or advances that require reconsideration.

Phase II

Once the Flock review process has been completed, it is reasonable to seek additional input on and support for the project and application. This can be achieved in several different formats:

Follow-Up

In the case of follow-up, the Shepherd, along with Flock (and additional experts identified as necessary or interested), would schedule a time to meet and discuss the strengths and weaknesses of the proposal with the applicant(s). Here, further clarification will be sought on unaddressed issues, and new directions for the project, likely with more potential upside (i.e. ROI), might be recommended. This interaction will help shape a revised application that fulfills the specific interests and goals of the community, while simultaneously establishing a (hopefully) healthy and open dialogue with the applicant and his/her team that can be advantageous going forward. Once the follow-up stage has been completed, the next step would be an open project pitch to the SWG.

Project Pitch at SWG Meeting

Subsequent to the maturation of the project application, the applicant(s) will be asked to present their proposal in a 20 minutes pitch to the SWG with 15 min QA as part of the weekly SWG meeting to continue and extend the dialogue of the applicant and his/her team with the DAO and prepare the SWG for backing discussion of the project application.

Project Pitch

Subsequent to the maturation of the project application, the applicant(s) will be asked to present the proposal in a 20 minutes (min) pitch to the SWG with a 15 min Q&A as part of the regular SWG meetings. This step continues and extends critical dialogue between the applicant and his/her team with the DAO and prepares the SWG for backing the project and application.

SWG Backing

For the completion of Phase II, the Shepherd/Flock should produce a summary of the application (in its revised, “final” form, ideally), with the reviewers’ sentiments including the identified strengths and weaknesses. This material will be placed online for open discussion within the SWG and will serve as the template for the community-wide project vote at the end of the process (see “Towards a Community Vote and Funding”). SWG members can raise additional concerns or identify new avenues to pursue with the applicant(s). After some final back-and-forth, the Shepherd would modify the online material for a SWG vote and subsequent advancement (if approved) to the community. To advance the application, it is recommended that at least X number of votes of support are mandatory (X would depend on the SWG size), along with a >50% approval rating.

Expert Reviewer Approval

It is not unrealistic that a small number of “expert advisers” within the SWG will be identified that can provide a stamp of approval for advancing the application. If expert advisers are easily identifiable and deemed advantageous, in addition to the processes noted above, the community might wish to require the support of, say, at least 3 of 5 experts. At what stage these advisers might interject is something the SWG and community would need to decide, as the experts might identify more subtle problems early on with the project that might exclude further consideration. Of course, operating in this format would also impart significant power on a small number of SWG members. While a subset of individuals will almost certainly have a deeper and broader expertise than others, and thus will be able to provide more informed insights on the quality and impact of most projects, establishing a formal hierarchy within the SWG and community can also be problematic and goes against some of the core principles of a DAO.

Community Vote & Funding

Community Engagement

At the completion of Phase II, or potentially earlier depending on enthusiasm within the Flock and SWG for the project, it is recommended that various mechanisms be used to inform the wider community of the pending application. This engagement can occur in various on-line, open formats, such as a high-level presentation by the applicant and SWG members, followed by a Q&A session. The idea is to (a) introduce the applicant(s) to and initiate dialogue with the many DAO members, (b) make the broader community aware of the effort and its importance, and (c) provide an opportunity for the community to ask questions to understand and eventually submit an informed vote on the project.

Community Vote

At the completion of Phase II and the community engagement step, the finalized proposal (see Phase II, with potential amendments following community engagement) is brought online for a token-based vote.

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