Thong Le Takes Over at Accelerator, With Eyes on Seattle and NYC
Seattle hasn’t cranked out many big-idea biotech startups in the last few years, and now it’s up to Thong Le to see whether he can provide a spark.
Le, 38, has taken over as the CEO of Accelerator, the venture-backed outfit that builds early-stage biotech startups with big aspirations. He joins the operation after more than a decade of venture investing at Seattle-based WRF Capital. He rose through the community ranks there to become chairman of the Washington Biotechnology & Biomedical Association.
Le (pictured above) replaces Carl Weissman, who is stepping down to serve as a senior advisor to Accelerator. Weissman, who co-founded the company with biotech legend Leroy Hood in 2003, has served as Accelerator’s CEO since the get-go.
Weissman, 50, said he left because of a chronic autoimmune disease that flared up during a particularly intense 18-month period when he traveled 193,000 air miles to raise money for Accelerator and lead its expansion to New York. Weissman took a leave of absence in June, when the condition, unmanaged, caused some erratic behavior, he said. The disease has taken enough of a toll that he needs a major organ transplant. Even so, Weissman says he’s feeling much better now on medication, has his energy back, and is looking for a new job.
Weissman said he’s happy to have Le take over at Accelerator, and that the board of directors “have been incredibly supportive of me.”
“Thong understands what we do, how we do it, and he’s got the energy,” Weissman said. “He can do what I can’t do anymore.”
The leadership switch at Accelerator comes at a delicate moment for the company. Accelerator has raised three funds worth a total of $45 million, and put all the cash to work in a dozen companies. While a few have “graduated” from the incubator to raise significant venture financings, none have yet delivered a home-run, venture-style return or grown up to become cash-flow generating independent businesses. Accelerator itself last made a seed investment in a big-idea biotech startup (Oncofactor) almost three years ago. Only one other Accelerator company is still operating inside the nest—Acylin Therapeutics.
The task list in front of Le is long. He’s got to nail down the next fund, Accelerator IV, which has a goal of raising $50 million to $70 million. He’s got to implement a more diversified strategy, with a mix of early and later-stage opportunities, to appeal to new investors who have soured on early-stage ideas. He needs to carefully cat-herd a network of academic institutions who have agreed to license intellectual property with commercial potential to Accelerator. Plus, he needs to carry out the plan, started by Weissman, to open a second branch of Accelerator in New York—another city with great research assets and limited biotech startup capabilities.
“I want to work with some of the most driven, and brightest, entrepreneurs to start some really cool companies. My goal is to be able to say that once we’ve invested the new money, we’ve got four or five rocking companies in Seattle and another four or five in New York, where we can do something transformational,” Le says.
Le got started in the new job in September. He said he plans to continue investing in some more ‘big-idea, big potential’ super-early stage companies that may take years to pan out, which Accelerator is known for. But Le said he also wants to pursue some focused drug development opportunities that hinge around a single asset and shouldn’t take as long to ripen.
He’s had success with this blended platforms-and-products strategy at Seattle-based WRF Capital, where he invested in companies that were platform opportunities (Alder Biopharmaceuticals and VLST), as well as focused single-asset plays (Corus Pharma, Resolve Therapeutics, Cardeas Pharma and Hyperion Therapeutics (NASDAQ: HPTX).
Raising new money for early-stage biotech investing is almost always tough, given the long timelines and high degree of risk, especially for funds that don’t have a glittering track record.
“The jury is still out on Accelerator funds 1, 2, and 3,” Le says, adding that alumni companies such as Theraclone Sciences and Allozyne are still in business. Another Accelerator company of the past, Homestead Clinical, was shut down and later restarted as Integrated Diagnostics, which continues to operate.
Weissman said he still thinks the earlier Accelerator funds have a chance to improve their returns. “I’m very hopeful about Theraclone, and VLST is a much more positive exit than is publicly known. It returned multiples of capital. And the biggest is yet to come. Oncofactor has a chance to be by far the biggest of all the projects.”
If any of those companies get acquired, it certainly would help Accelerator continue to justify its existence. But Le says he’s confident he’ll nail down the fourth fund and get Accelerator back in its groove, starting one or two new companies per year and seeing where the chips fall.
“This is my opportunity to take the bull by the horns, with all the great work that’s been done here, and with a great team I’m inheriting, to do some really cool deals,” Le says. “We’re not here for economic development. We’re here to make strategic investments for our investors that make them money.”