Company: Gates Foundation Venture Capital
In 2008, Charlotte Hubbert was coming to the end of a stem cell and regenerative medicine postdoc at Randall Moon’s laboratory at the University of Washington. She had no plans to get into venture capital. Yet, just six years later, Hubbert found herself not only deeply entrenched in the VC world, but shaping the world’s largest charitable foundation’s move into venture investing.
That charitable foundation is the Bill & Melinda Gates Foundation, which, at the time of Hubbert’s appointment early in 2014, was just starting to flesh out a VC strategy to complement its grant-based funding activities. The pre-existing team had made some equity investments in biotech to prove they could do so in a charitable fashion, but had yet to recruit venture capitalists to professionalize the initiative. That changed with Hubbert.
She joined former Frazier Healthcare Ventures and Domain Associates partner Bob More among the early appointments at Gates Foundation Venture Capital, and quickly set about establishing what the VC wing of a foundation with a $40 billion endowment looks like.
“The first conversation we have is how is your technology going to fit with our strategy in the developing world. Markets don't serve the poor, so when people build their business model they're not classically thinking about the issues that affect the poor,” Hubbert told FierceBiotech.
That is where the Gates Foundation comes in, she said: “We do a lot of the epidemiology and support a lot of the work that gets done to understand these issues.”
Some people may have been overawed by the prospect of professionalizing venture investing at the biggest of big-name foundations, but, as Hubbert tells it, she has gone through life without a self-imposed cap, or the perception of an externally-imposed cap, on what she could and couldn’t achieve.
“When I was growing up, a kid of the 80s, Ms. magazine and all that, it never occurred to me that I couldn’t do exactly what I wanted to do with my life,” Hubbert told Life Science Washington earlier this year. “I was judged on the content of my character and the value of my work.”
After a little more than two years at Gates Foundation Venture Capital, Hubbert holds the title of partner and is a board observer at several of the startups the foundation has invested in. That list of companies offers a window into how Gates Foundation Venture Capital straddles the worlds of VC and philanthropy.
Lodo Therapeutics, for example, looks like a typical venture-backed biotech startup. The company was set up to commercialize research carried out by Sean Brady at Rockefeller University. And, with Brady pitching the platform as a rich source of small molecules, groups including AbbVie ($ABBV), Eli Lilly ($LLY), Johnson & Johnson ($JNJ) and the VC wing of Pfizer ($PFE) backed Lodo’s $17 million Series A.
Among Lodo’s long list of financial and strategic investors, the Gates Foundation sticks out as an oddity. But, with the foundation being just as interested in discovering drugs as Big Pharma is, while also having very different therapeutic priorities, it sees value in investing in companies with the potential to tackle diseases such as tuberculosis. Hubbert has thought hard about how to make such collaborations work.
“We have to find that match where we’re not distracting a company, but we're actually emboldening and supporting a company by becoming their partner and considering the whole world, not just one sector of the market,” she said.
Aside from focus on diseases of the developing world, the Lodo investment wouldn’t look out of place at any point in Hubbert’s brief-but-eventful VC career. The pivot from Ph.D. to VC began in 2009 when Hubbert was appointed as associate at Seattle-based Accelerator.
That position gave Hubbert hands-on experience in identifying promising technologies and setting up startups to advance them--skills that landed her the position of vice president at H.I.G. BioVentures. Hubbert joined H.I.G. in 2013, one year after it closed a $268 million life sciences fund and four years after she first entered the VC world.
Having risen quickly, Hubbert is keen to send the elevator back down for someone else by sharing the experience she has gained along the way. Hubbert sees the lessons she and other women have learned in life sciences helping not just to address the gender gap, but the issue of diversity and inclusion more broadly.
With her VC cap on, diversity is about more than just what is right to Hubbert. It is also a way to improve the process of developing and profiting from innovations.
“Variety of ideas leads to great problem-solving, which leads to great products, which leads to better returns,” Hubbert said.