Gajus Worthington, co-founder of Fluidigm, talks about how the three members of the founding team of Fluidigm met in Stanford Physics professor Doug Osheroff's lab.Though the men went in separate directions after college, the bond that had formed between them remained.When one of them approached the two others with a business proposition about ten years later based on his research at Caltech, they joined him, and Fluidigm was formed.
Worthington explains that the market climate at the time of the formation of Fluidigm, around 1999, was not favorable towards anything without dotcom in the title, and their funding requests were met with hundreds of no's.However, as the technology continued to develop, it became clear that they were on to something big; a small, simple rubber valve that was like an integrated circuit for biology, he says.
Fluidigm started the wrong way, notes Worthington.Instead of discovering a market opportunity and then finding the technology and team to take advantage of it, they invented the technology first, realized its potential, and then searched for an application for it.Worthington suggests that most technology companies, in fact, work the latter way.
Worthington talks about how the founders understood that the key to creating a successful company was picking only the very best people at every level of the company, especially the VCs and Board of Directors.Gajus sacrificed time (it took a year and a half to recruit some board members) and money (settling for a lower valuation from a better VC) to assemble the right team.
Worthington explains that creating a company puts incredible strain on the founders and calls upon them to do things that people do not normally have to do.They way to get through these challenges is not by talent, but by obsession and determination, he says.Without these qualities, he would not recommend starting a company.
After bringing together the best team, raising money in tough environments, and establishing and living by core values, says Worthington, Fluidigm focused on launching the product.The product development went much faster than anyone could have hoped and soon they had a product with many important features, including an immediate economic benefit to the customers, he notes.
Worthington warns that a lot of entrepreneurs get so caught up in the technology or science behind their product that they forget to focus on the business metrics which drive success.It is essential to pay attention to the margins and avoid price erosions.
Though Fluidigm is essentially a tool company, which is not very glamorous, says Worthington, they were successful in raising funding because they were a real, functioning company that already had customers and were able to prove a real market.Worthington recommends not wasting time with venture capitalists that are not immediately enthusiastic about the company.Once they make up their mind against the company, there is no use pursuing it.On the other hand, when there is that mutual connection, pursue the VC relentlessly.
Worthington answers the questions: Will the stock price of a company keep going up?He discusses Fludigm's financial history and how the company was able to continue to provide investors with a nice return.
Worthington relates an anecdote about how renowned intellectual property lawyer Bill Smith joined Fluidigm as general counsel. Worthington gave Smith the pitch before Fluidigm was even funded.Nonetheless, Worthington notes, Smith decided to join the team with the idea that it was going to be a total train wreck, and it was going to be really fun to watch.
If Worthington could start the company over, he would hesitate less in firing people.Firing is one of the hardest things to do as a manager, but unfortunately is necessary in some situations and important to the future of the company.
Worthington talks about how Fluidigm relied on two assets to help them recruit top talent: breakthrough technology and chemistry. Obviously, the technology was a big draw for many people to come to Fluidigm, he says. Chemistry was not as obvious an asset.Worthington got along well and developed strong relationships with many individuals that helped Fluidigm to recruit the top talent.
Worthington would not trade his technical degree for an MBA.He sees entrepreneurship being about breaking many of the rules that one learns in business school.He sees being able to lead as much more important to having an MBA, and suggests practical experience as a better alternative.
The applications for the Fluidigm technology may be far from being realized, says Worthington.Fluidigm is currently working on high-throughout methodologies, like genome screening and protein-protein interactions, as well as what could turn out to be breakthrough science: usingrubber pumps to simulate body functions to trick cells into thinking they are inside the body, he says.
The financial hardships Fluidigm encountered after September 11 were the most difficult stage for the company, says Worthington.The company needed financing quickly or it would disappear - a time that was incredibly physically and emotionally draining for him.Fortunately, the tough times were more than balanced by a number of fantastic highs, including the first major reorder, the first shipping of a complete system and the first success report from a customer, he notes.
From the beginning of the company, Worthington was aware in the back of his mind that someday Fluidigm would have to go global and setup manufacturing overseas. He has had previous successful experience in Singapore and was drawn by the favorable economic and governmental conditions.
Worthington tried to create a balance between technical skills and business skills within the founding team.A mix of background provides a wider set of knowledge and experiences that are beneficial to the success of the company, he adds.
When experimenting with new capabilities and technologies, unexpected things happen, notes Worthington. These unexpected results can often be a useful source of new knowledge.
When in search for a market, Worthington advises not to focus the company too early.Though there is tremendous pressure in the beginning to focus, this is dangerous; once a company has defined a focus the decision is very hard to undo.Worthington suggests waiting it out and seeing how the product develops before focusing.
There are no plans at this time to make the rubber chips reusable, says Worthington.Because the chips are so cheap to produce, Fluidigm would have to charge an enormous amount for them in order to make a viable business model where the customers are reusing the product, he adds. There is also the practical consideration of using pristine materials in experiments to ensure against contamination, he notes.
If Fluidigm had not decided to market the crystallization chip, says Worthington, they would have developed a platform for doing large-scale parallel PCR.However, they decided against it because the market was already firmly established by major companies and Worthington was not optimistic about forming a partnership with a large company.
Though the Fluidigm executive staff was incredibly bright and talented, says Worthington, they initially were almost incapable at making decisions and constantly argued.Worthington decided that the only solution was to set up a decision making process.He set a timeline for the decision, organized the staff into teams, and gave them specific instructions to evaluate the options.Each team performed wonderfully and the process even spurred invention, he notes.