“There’s a 15 Minute Window on a Certain Tuesday” | Why Your Biotech Can’t Get Funded | Stone & Wiklund

Every founder who has raised money knows the feeling of being told no for reasons that have nothing to do with the science. Edwin Stone gave that feeling a shape, and it is the reason this episode has the title it does.

“For investors there is probably about a 15-minute window on a certain Tuesday where you fit into the right window,” he says. “It does appear there is a very very narrow window of time which may be measured in minutes when you are absolutely at the right window for an investor.” Stone is CEO of Cellular Origins, which builds robotic automation for cell therapy manufacturing, and describes “20 years working with entrepreneurs” behind the observation.

Erik Digman Wiklund hit it from the other side. CEO of Circio Holding, which develops a circular RNA expression platform alongside next-generation AAV gene therapies, he was told by venture investors that his company was simultaneously too early and too late. He stopped trying to fit and raised the money somewhere else entirely.

The platform problem

The clearest structural change both men describe is what investors now want to buy. “VC investors have stopped investing into platforms,” Wiklund says. “They now want much more clean asset plays. They want one program, take it to the clinic. They want disease so that it’s a binary bet on that being approved or not.”

That is a difficult thing to be on the wrong side of when your company is, by construction, a platform. Circio’s technology expresses genes through circular RNA, which is not an asset so much as a way of making many assets. Wiklund describes having to force-fit an equity story into an asset-centric shape that never really suited it, and eventually declining to. “We actually opted for moving this technology into a listed company and raising money in the public markets instead,” he says, “which turned out to be much easier and allowed us to raise $35 million.”

Stone’s theory for why platforms fell out of favor does not blame the platforms. It blames what the industry did with the money. “There was a huge amount of capital sunk into building facilities. Every biotech had its own manufacturing facility,” he says, with tens if not hundreds of millions deployed. “That’s always going to be an expensive way to build an industry.” The capital inefficiency was real. It may simply have been attributed to the wrong cause.

Falling between the cracks

The mechanics of the funding gap are more specific than most founders realize, and Wiklund lays them out precisely. A founding investor now anchors roughly half of a Series A and funds the company all the way through to a clinical readout. That works if you were built inside that system. If you were not, the structure has no slot for you.

“You may have something super compelling, but you fall between the cracks,” he says. “You may be too late for that founding round, and then you may have investors who don’t have the network or the sufficient capital to anchor up your Series A.”

The consequence is a company that is neither failing nor fundable. It has data, it has a story, and it has no route to the round that would take it forward.

Investors move in herds

Both guests independently arrive at concentration as the deeper problem. Capital is not scarce so much as it is clustered. At the time of recording, the cluster was in vivo CAR-T, and Wiklund watched five new companies appear in a single week pursuing what looked to him like the same approach already heading into the clinic.

He has seen where that ends. In the PD-1 wave, roughly a dozen approvals followed and only two or three produced a real commercial return. The pattern repeats and the cost is paid elsewhere: whole areas fall out of fashion and stay there. He names vaccines, where he says the current environment has made funding close to unavailable, and antibiotic resistance, where the medical need is not in question and the commercial case is.

Stone frames the same behavior as an odd inversion. Retail investors are told to diversify. Venture portfolios are frequently the opposite, and the market inherits that shape.

What falls out of favor, and who catches it

The cost of the herd is paid by whatever it is not looking at, and Wiklund names two. Vaccines are the sharper case. He describes an environment where “capital is fleeing out of that now” and where the people he spoke to at ASGCT were blunt that “right now you can’t do vaccines.” Circular RNA is his own example of the knock-on: the format was originally pursued to improve on COVID vaccines, and those same companies have redirected into in vivo CAR-T because that is where the money went. His expectation is that “there’s going to be several years now where we lose out on vaccine development.” The second is antibiotic resistance, where he notes the “massive medical need” and the commercial case that does not follow it.

The unexpected counterweight is big pharma. Wiklund reports hearing proactively from pharma companies that in areas like gene therapy “there is a responsibility for us to make sure that companies with interesting technologies are funded,” even when the science is earlier than they would normally transact on. Their reasoning is self-interested and honest: post-COVID fundraising has been hard enough that “we feel pressured to get in earlier to do some sort of support deals in order to get to that data,” because otherwise the data may never exist at all.

The part of the industry nobody funds

Stone’s answer for the most underfunded corner is his own, and he makes the argument carefully because of that. “I think broadly tools and tech, and I’m not just talking about our business, I’m talking about that in the broader sense,” he says. “I think historically is very underinvested given the disproportionate impact it can have on a space.”

The reason is structural rather than dismissive. Tools businesses earn revenue only after capital has already reached the therapeutic developers who buy from them, so they lag the cycle. Stone also argues their risk profile is genuinely different: a robotics provider’s return is not staked on one therapy succeeding, which makes it a bet on an industry rather than on a molecule.

He is equally clear that tools and therapeutics should not be forced into the same company, because value arrives on different timelines. A therapeutic accumulates risk for years and then resolves at approval. Tools accrue value gradually as sales expand across many programs.

Why first-in-human is moving

The cost of getting to the readout that gates everything has moved sharply. Wiklund, citing the CEO of Strand Therapeutics, reports that “the cost of getting to a phase one data point has gone up by 4x” in under a decade, at “a time where capital is constrained in biotech, this is highly concerning.”

That arithmetic is pushing early development east. “What we’re going to see is a shift to a lot of clinical development going first in man in China,” he says. “There you have pathways to much more cost-efficient clinical data. You can do IIT so investigator-initiated phase one trials with no approval from central authorities, only by hospital IRBs.” Stone adds that China already runs the majority of cell and gene therapy trials, part of a broader shift in where research money now goes.

His concern is what happens next. Therapies developed under a distributed, hospital-side model do not transfer cleanly into centralized Western manufacturing, and the industry has not solved tech transfer. He describes a major pharma company with an approved therapy whose motivation for automation is not cost at all. “One of their big concerns is actually about transferability of therapies,” he says, and “a manual process is really hard to tech transfer locally, let alone globally.” Left unsolved, the outcome is geographic inequality in who can actually receive these therapies.

What a fundable company looks like now

Asked what investors will expect by 2028, Wiklund describes a market that has already changed. “The rounds are larger. You see fewer companies getting funded, but those deals that are done are usually very substantial.” The driver is that nobody assumes a follow-on round exists, so a company is funded to its readout or not at all.

Stone’s list is shorter and blunter. Certainty about your market, evidenced rather than asserted. Fiscal discipline, because the era of covering its absence with more capital is over. And a willingness to test the thing in the market earlier than feels comfortable, which in his experience is what separates the strong founders from the rest.

Wiklund closes with an argument he now makes directly to American investors, and it is really a claim about what these therapies cost to build. “The cost of operating in Sweden is between 1/3 and 1/2 of the cost in the US,” he says. “It’s just so much more capital efficient to operate in most countries in Europe these days.” When capital is the constraint, burn rate stops being an operational detail and becomes part of the pitch.