Startup Life: Unscripted is a TNG Media newsletter, as part of The Nudge Group, where we feature candid conversations with startup operators about their career journeys and experiences. If you received this email as a forward, you can read all our past interviews and subscribe right here.

From Neuroscience to Venture Capital: Harikesh's Unique Path to the VC World

Welcome back to Startup Life: Unscripted! Today, we're chatting with Harikesh Pushpapathan, an Investor at Stoic VC, a venture firm focused on investing in deep tech and life-sciences.

From being captivated by the intricacies of the brain to navigating the nuanced landscape of venture capital, Harikesh's path underscores the value of staying curious and flexible. At Stoic VC, his diverse experiences—like launching a telehealth startup and diving deep into neuroscience and finance—equip him with a distinct perspective when scouting the next big thing in medical devices, biotech, and the wider healthcare realm.

In our conversation, he takes us on a tour of his multifaceted career path, shedding light on the pillars that guide his investment decisions and the nuances of working in venture capital.

For anyone intrigued by the world of venture capital, and particularly the rapidly evolving domains of deep tech and life sciences, this conversation is a must-read. Dive in!

Key interview takeaways:

💼 Transitioning into Venture Capital: Harikesh talks about his unexpected transition from neuroscience and music to the pulse of venture capital, highlighting the unpredictable but rewarding trajectory of his career.

🔍 Daily Life at Stoic VC: From meetings with founders to strategic planning, Harikesh offers a peek into what his typical day looks like.

🧬 Criteria for Investing: He lays out the core principles that guide his decisions when looking at potential investments in the deep tech space.

🚀 Interacting with Founders: Harikesh touches upon the profound impact of genuine, passionate founders and the challenges and rewards of working closely with them in the unpredictable startup landscape.

Hey Harikesh, thanks for joining us today, it's great to have you. I'm curious about your startup journey - how did you find yourself working in venture capital, and particularly at Stoic VC?

Breaking into venture, was far from premeditated. For me, the story began in childhood. When I was 9 years old, my dad brought home a golden piecemeal model of the brain. Ten years later, I began studying Neuroscience at University. Last year, I led my first investment in Neurotech.

I believe the most formative life experiences occur when you’re very young. The outcomes of these preliminary interactions with the world might just not surface for years. In my case - fourteen years. The time in between, was spent figuring out what those outcomes might be. This involved lots and lots of trial and error.

In my last year of schooling I studied Legal Studies, Music and Chemistry. In University I studied Neuroscience and Finance. During this time I coached Tennis, founded my own telehealth startup, worked part-time for a startup accelerator in Melbourne, interned at an early stage Venture fund, worked in sell-side finance alongside the founder of Pedestrian TV and released three singles on Spotify.

Last year, I started full time at an early stage venture fund called Stoic VC. We’re a life-sciences and deep tech investor, meaning we invest in high R&D intensive companies from first-class therapeutics to high speed wifi HaLow chips.

I’m fortunate enough to work with people crazy enough to tackle the world’s most pressing problems. It’s not exactly the career my parents first envisioned, but it might even be better. That’s the magic of serendipity.

I imagine a day in your life is never quite the same. Could you walk us through a typical day at Stoic VC? What are some of the key tasks you handle on a regular basis?

Most days I spend around 9 or 10 hours at work. One or two nights a week I may clock on a extra couple of hours after dinner or gym. Work lifestyle is fluid - some days I'm bouncing between universities, other days I'm at the office. Wherever our founders or investors are, I'm there. That might mean being in Adelaide one week and Melbourne the next.

There is an enormous amount of context switching - which makes this job both challenging and rewarding. But at a high level, my time is usually split across three buckets:

1. Deal management

   • Sourcing, screening investments, building a relationship with founders and conviction in their vision. Most importantly, getting that conviction across the line and transacting.

2. Portfolio Management

   • Supporting and working closely with our existing founders. This may entail full day strategy sessions, board meetings or 'tic tacing' with them.

3. Business Management

   • Helping the fund raise money, better productise internal workflows and market presence.

We work closely with our partner, Uniseed on deals that directly spin out of UniMelb, UniSyd, UNSW, CSIRO, UQ. Thus we've developed a strong rapport with the team and the institutions themselves. A privilege and a responsibility.

Your investment focus is on medical devices, biotech, and the broader healthcare space. What's your personal approach or philosophy to evaluating potential investments?

Regardless of what comes across my desk, there are three things that cornerstone my playbook to due diligence:

1. The unmet need is hair on fire. 

There exists a significant market pull i.e. a strong WTP (Willingness to Pay). You can’t afford to spend years building a high fidelity prototype only to then figure out if a business will pay for it.

2. The technology represents a leap in the SOC (Standard of Care) or best practice. Not an increment.

In deep tech or life sciences, you’ll have the benefit of a green field opportunity. However sometimes the solution might look like a business instead of a startup. That doesn’t necessarily mean the business model is poor, it's just not positioned for venture scale returns. Either because the technology offers a minimal step change in value creation or the problem isn't big enough.

3. The opportunity isn’t caught in the middle.

Being first into a new wave is good. It’s fine to be last, in some cases, due to the benefits of being a fast follower. An easy example is a device that has a predicate (prior art), and can fast track the FDA process. Being in the middle rarely works.

Because there are so many moving parts involved in the success of a deep tech startup, my job is to retire the most important risks as fast as possible. I will spend most of my time wrestling with regulatory risk, IP risk, technical risk and execution risk. The rest shouldn't be a material concern.

Deep tech investors aren’t purely talent investors. There are simply more things out of our control. This is why Stoicism provides the perfect playbook for deep tech and life science investing.

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Let's talk about the people behind the innovations. What's been your most memorable interaction with a founder, and why did it leave such a lasting impression on you?

Too many to count. But there’s one that really sticks. I met a medical device founder earlier this year over a Zoom call. After a minute of conversation, I could tell this person really gave a sh*t. His responses were passionate but equally articulate. Above all, he didn’t need a 30 page deck to illustrate the unmet need.

At the conclusion of the call, I told him it was a ‘No’ for now. One of the hardest passes I’ve had to make. Why? Because this founder had been paralysed from a motorcycle accident almost ten years ago.

What I’ve learned over time is that venture investing is LP first, startup second. No matter how brilliant a founder may be, the opportunity cost should dictate the investment. Sometimes at the expense of truly amazing people.

I'm sure our readers would be interested to know: what's the most challenging part of your role? And on the flip side, what's the most rewarding aspect?

Most challenging - Passing on amazing founders.

Most rewarding - Backing founders, early and when nobody else will. And seeing extraordinary success.

Let's go back to the beginning of your career. If you could give your younger self one piece of advice, what would it be and why?

Pain is inevitable, misery is a choice.

Most five year olds grow out of speech impediments or stutters, I unfortunately didn't. For most of my upbringing, I was caught in a state of learned helplessness. Today, this 'disability' is my third eye. It took me a little while to realise this. I wish my younger self had known sooner.

How do you see your role evolving in the future? Are there any new challenges or opportunities on the horizon that you're particularly excited about?

Who knows, I like to let the pendulum swing. As long as I continue contributing to the net positive advancement of human health and economy.

LLMs are indeed a platform shift. But I’m particularly excited about the rise of fourth generation therapeutics i.e CRISPR, gene therapies. Biological scissors that can directly edit our genetic code - wow. Whilst it costs in excess of $1.5m/infusion at the moment, that will drop with more established reimbursement protocols and scaled use.

To wrap up, if someone reading this was interested in following a similar career path, what steps would you recommend they take? Any key skills or experiences you think they should focus on?

I’m currently in the process of hiring for an Analyst at Stoic. I can tell you that candidates with founding or operating experience in startups or an area they can deeply articulate a relevancy, have an infinitely greater chance of being hired. Pure play backgrounds are becoming less and less attractive.

In regards to skills, there's not one I’d really pin down. However at a high level, my number one advice is to learn to be creatively and confidently maladjusted - stolen partly from Stephen Mallaby’s The Power Law.

From the Startup Life team

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