Background
Life science start-ups face a notorious challenge: an incredibly long road to market and incredibly large amounts of capital required to get there, if at all. Understandably, scientific founders often take a lean-team approach and outsource non-R&D functions for cost efficiency. Such was the case with Vedantra Pharmaceuticals (now Elicio Therapeutics), which hired Danforth Advisors for support in the company’s early stages.
There was a very basic finance function in place; QuickBooks, a chart of accounts and payroll, but with only five employees focused exclusively on the science, there was no one to manage it all with an eye towards future needs. Danforth’s Daniel Geffken, already a board member, was initially enlisted as CFO. Yet, looking to trim expenses even further, Vedantra disengaged with Danforth in favor of a bookkeeping consultant – only to reverse course and bring Danforth back a short while later. The realization? Bookkeeping alone can’t address all the aspects of building a sound corporate foundation for growth.
Danforth Role
- Engaged an interim CFO to guide finance function and strategy
- Provided controller consulting services with expertise in life science start-up operations
- Managed operational accounting and handling of the company’s formal valuation, benefits, payroll and insurance
- Managed accounting issues that needed to be resolved in the wake of the former bookkeeper
- Worked with newly-appointed executive chairman to manage a challenging financing round that culminated with $30 million in funds
Results
Following the $30 million capital raise, the company re-launched as Elicio Therapeutics and named its first full-time CEO, Robert Connelly.
“Danforth has been an outstanding partner to Elicio. In just a short time with the company, I could see how the results of their work kept the venture on track,” said Robert, who has nearly 20 years of experience building life science start-ups. “I’ve never run a company with the help of a firm that can manage so many things at once – from high-level strategy to day-to-day operations – as opposed to relying mostly on internal resources. I’m sold.”
We have continued to evolve with Elicio’s needs. Because the company’s major investor is a public company, it is required to produce quarterly reports with a much faster turnaround time than is typical of life science start-ups. An additional Danforth consultant was brought in to help with complex accounting and ensure that all requirements are met on time. This included oversight of the company’s first-ever audit. Elicio now has the proper foundation in place – built and managed by experts in life science start-up operations – with the ability to cost-efficiently scale as its business advances.