Strateos: Accelerating Drug Discovery
July 9, 2021 | Ashley Brindamour
One of the toughest challenges facing the preclinical pharmaceutical and biotech industries is identifying novel therapeutics. Current methods are unsustainable for the future development of new disease treatments, with significant time and capital requirements (~ $2.5 billion towards R&D) and a high failure rate.
Alumni Ventures portfolio company Strateos is solving these problems through a cloud laboratory for pharma and biotech companies that makes drug discovery better, faster, and cheaper. The company’s robotic laboratories can be accessed remotely via a cloud-based system to help streamline laboratory workflows.
A Massive Market Solution
Strateos was created in April 2019 through the merger of Transcriptic and 3Scan. By combining Transcriptic’s platform for faster drug discovery with 3Scan’s unique tissue analysis capabilities, Strateos can perform various experiments via the cloud and deploy software to improve operations in existing labs.
- Cloud Lab: Cloud lab charges for the experiments Strateos runs.
- Cloud OS: Cloud OS charges for the software Strateos provides that connects scientists with their lab remotely.
- Tissue Technology: Currently still in the developmental stages.
The global lab market — including the cell-based assay market, global gene therapy market, and synthetic biology market — is about ~$24 billion, growing at an impressive CAGR of 24% over the next four years. When combined with the lab OS and tissue technology market, the TAM represents another $5 billion.
What We Liked About Strateos
Strong Traction and Customer Demand: Strateos has proven demand for their Cloud Lab and OS across multiple customer sizes, sectors, and regions. The company already has established strategic partnerships with large pharma companies, including Eli Lilly. Other significant customers using Strateos include labs at NIH, MIT, DARPA, and GILEAD.
Deep Value Proposition: 80-90% of work in life sciences is rote, routine, and should be automated to enable scientists to focus on ideas, data, and results. Strateos is providing a compelling value proposition by turning science into software through using protocols and logic to uncouple proximity and to sequence instruments across the lab.
Valuable Team: The Strateos team is highly experienced in life sciences and successfully growing and exiting companies. The CEO has a relevant background, with three IPOs under his belt and the acquisition of his company Labcyte for $300 million. He is backed by a strong bench of more than 80 individuals, including 27 PhD scientists in various technical disciplines.
How We Are Involved
Castor Ventures (Alumni Ventures’ fund for the MIT community) and sibling funds deployed capital in Strateos’ $56.1 million Series B led by DCVC and Lux Capital. The company is also part of Alumni Ventures’ Post-COVID Fund portfolio and was a Syndication opportunity.