Daphne Zohar has a superpower – she can see the potential in anything. She was sixteen years old when she started importing watches from Russia depicting the perestroika symbol on them. The Boston-based youth went from store to store to sell these unique pieces and made a profit doing it.
From there, she patented a lipstick-sized container for storing pantyhose at age 20 and licensed it to a bigger company. Zohar also managed to start a successful olive oil business and found time to sell racehorse ‘hoof pad’ products to veterinarians. She graduated from Northeastern University with a degree in business administration and has been busy building an entrepreneurial empire whereever she sees room for possibility.
In 2004, Zohar founded PureTech Health to help life sciences companies get their start. It’s more than just a venture capital investor – it’s a company builder. Launching a business is a big undertaking and can involve several complex steps such as negotiating the needed licensing, finding the right funding, and understanding the competition. “As one individual, you may not be optimized to do all these things,” she said.
She started PureTech because she saw an opportunity in “institutionalizing the process of founding a company.” To date, her company has helped nineteen companies get their start, including Enlight Biosciences – a Boston-based tech firm with backing from the likes of Pfizer and Eli Lilly. The company went public in 2015 and currently trades on the London Stock Exchange.
Despite Zohar’s obvious talent for moving in and out of different industries, she was drawn to the challenge of doing business in biotech. “I find the creative process very exciting, the idea of creating something out of nothing,” she said. “A lot of life science discoveries that could have an impact on human health never get developed because they are stuck in a translational valley of death. I’m drawn to the challenge of bridging that valley of death.”
Zohar own opinions on the venture capital business may have influenced her choice to start her own firm. In an open letter to venture capitalists published on Xconomy in 2009, she is almost prescient in her prediction that VCs would have to up their game if they wanted to stay in it.
“A lot of people have been asking lately if the venture capital model is broken. But to me it’s just decrepit,” she wrote. “A case in point was hinted at in an earlier post about ‘down’ being ‘the new up’ by Michael Greeley of Flybridge Capital Partners. [He] made the argument that venture-backed companies ‘should be considered fortunate to just raise capital, at any price, in this environment.”
Zohar argued that it’s in investors’ best interest to treat their entrepreneurs as valued partners in a process that could be profitable for all. Venture capitalists who treat their ideas-people like the disposable wrapping that comes with their shiny, new money-maker aren’t likely to get that many investment-presents next year, she asserts.
A decade later and Zohar couldn’t be more right. Investors must compete fiercely with one another to attract emerging innovators to their firm. Accelerators, incubators and mentorships are just a few examples of the initiatives out there meant to entice new talent but Zohar knows that it often comes down to a fairly simple equation – people and relationships.
She offers this advice to women starting out in biotech: “One thing I’ve learned is that people who are perpetually negative have developed that strategy as a defense mechanism (if you’re always negative you look smart in an industry where the odds are stacked against you),” she said. “I’ve learned to focus on those people who see possibilities and have open minds and creativity rather than expending too much energy on those whose imagination is limited to potential problems. My advice is to be thoughtful about which criticism to listen to and which to discard.”