Doug Kelly's Venture Adventure
As academic programs in Chile respond to the Internet surge, the Santiago Chamber of Commerce looks to make Chile Latin America's e-center.
by: Theresa Urist
Doug
Kelly is a leading biotech venture capitalist with Alloy Ventures.
He also teaches Business 16: Starting, Financing and Running a Start-up,
at Stanford. How did he get there? A chat with him reveals a medical doctor
who uses his entrepreneurial flair to create profitable businesses. A rowdy 15-year-old, Doug Kelly was into motorcycles and playing in a band. But something else began brewing when he started stealing the Science and Nature section from the papers he was delivering--fifteen at a time. While Doug Kelly was a lousy paper boy, he was a budding enterpriser. After reading about the paper, the gutsy teen phoned Stanley Collins, a CEO and biotech researcher at Stanford. Kelly told him the he wanted to look at his lab because had ideas on how to improve his experiments.
The seasoned exec asked his age, and then told him to try college first. Kelly responded by calling him every day for the next month.
Collins ignored him.
Kelly calculated when Collins would be out of town and rode his motorcycle from Reno to his lab at Stanford. There, he accosted a post-doc, asking her if he could have some chemicals and equipment. She said no.
Undaunted, he pressed her into letting him tour the lab so that he could sketch what he saw. He rode home and began constructing a lab in his garage, based on his rough blue-prints. He used the kitchen refrigerator to store his chemicals, and began his first round of research.
He then followed Collins' advice and entered UC San Diego, graduating with a BA in Biochemistry and Molecular Biology. Fueled by his desire to be a medical scientist, he went on to Albert Einstein Medical School. Even though he was on the fast track to an MD, he was still avid about his rock 'n roll career, so he took a year off to study music in Los Angeles.
During that time, he rode through an industrial park in San Diego and passed the Hydrotech lab. In awe, he watched a bunch of trucks roll into the lab and wondered about their contents. But more than that, he contemplated the innovation behind the products. A light went on, and he saw the connection between business and healthcare.
It dawned on him that starting companies was his true calling. Even so, he had second thoughts. For a lot of people medicine is a library of gratification and it's very hard to watch somebody go do something else. He second guessed himself, Am I really doing the right thing? But the more he thought about it, the clearer it became; he completed his MD and applied to MBA programs.
While attending Stanford's Graduate School of Business, he interviewed at a firm where he met venture capitalist Dick Scheider who became his career mentor. His first post-MBA job was with a pharmaceutical firm in San Diego. "They are now publicly traded…probably in spite of my being there," he jokes.
Since then I've been involved in a bunch of biotechnology and biotech device companies, he says. His medical experience has shaped his business choices. I've actually worked in a hospital and stuck my hands inside patients, he says. I tend to be more cynical about how things are applied to patients because I've actually worked with them. Of biotech startups, he has learned to ask, what are the critical problems like, and what is it (the product) going to show, and how are you going to prove that?.
He then moved to Boston, where he specialized in early stage biotechnology and health care companies. There, he noticed a different culture than the one he was used to in California. In Silicon Valley, if you fail it's not a big deal, he says. Also, California startups provide an engineering culture that doesn't nearly exist a lot on the East Coast. Engineers here (CA), he muses, are made to live in hovels and eat flat food and that you can slip under a crack under the door because the door is locked and they are busy programming. While the image might seem grim, Kelly is well aware of what that culture is able to produce. Not surprisingly, he returned to Silicon Valley.
Today Kelly is a General Partner at Alloy Ventures with a distinguished list of successful startups to his name. Recently he has begun 'sharing the wealth' in a different way - by teaching. His new pet project is showing others the proper care and feeding of a start-up. His popular class, Business 16, Starting, Financing, and Running a Start-up is offered through Stanford's Continuing Studies Program. In it, Kelly caters to the culture of Silicon Valley by showing students how to go from business plans to public offerings . He also offers mentorship, invites guest speakers, and shares his personal triumphs and setbacks. Through the lively course, he encourages others to ride the roller-coaster of young companies. All aboard!
