Ubiome is an unusual startup. The three-year-old sequences the collected microbes in the human body and sells $89 kits to those curious to understand their own microbiome better.
Now uBiome founders and academics Jessica Richman and Zachary Apte — who’ve raised $6.5 million from investors like Andreessen Horowitz for the San Francisco company — are taking an even more unusual step. They’re launching an AngelList Syndicate to fund other microbiome startups.
It’s not an entirely novel concept. There are plenty of corporations that create funds expressly to get a look at startups whose work might be of strategic interest to them. There are also a sprinkling of founders who are running early-stage startups and forming Syndicates to make startup bets of their own, including Joshua Reeves of four-year-old Gusto, a payroll startup that was formerly called ZenPayroll.
Still, investing in young startups that could eventually compete with your own young startup isn’t something one sees every day; we talked earlier with Richman to learn more about her Microbiome Fund — and why she and Apte decided to do it.
TC: Understanding of the role played by the microbiome in many health conditions is relatively recent and you have a very young company, Why shift some of your focus to investing in other startups?
JR: We’ve heard from a lot investors, including angels, who’ve wondered what other companies they should invest in other than us. We’re also heard a lot of interest from [microbiome] companies that are curious about investors. We want to help, with what we think is the first microbiome fund ever.
TC: Are uBiome’s investors at all concerned that this Syndicate might become a distraction for you both?
JR: A Syndicate just means that you list an investment. You don’t have to do any work at all. If you have certain expertise, you [publish a little information about what that is], you push a button and that’s it. It’s pretty amazing.
TC: Playing devil’s advocate, what about conflicts of interest? Can you promise investors you’ll be backing the best microbiome startups if you’re simultaneously worrying about competitors?
JR: We’ll look at investments that will be complementary to what we do. There are a number of companies in the therapeutic space, but in the microbiome diagnostics space, we don’t really have a direct competitor. We’re the leader.
TC: Entrepreneur Dave Morin has said he will back you. How much are you looking to raise, and what is the minimum investment?
JR: We’re planning to keep it open. The minimum investment is $5,000. It’ll will be open to any accredited investors who are interested in the microbiome. We’ll see what happens. It’s a very new field. But we think there will be a lot of interest.
TC: You’re launching this today. Do have your sights set on particular startups or technologies?
JR: We do have some [startups] that have been talking with us. We’ll get together the team of angels, then go back to some of the opportunities that we’ve seen and see if they’re a good fit.
TC: What about uBiome itself? You raised your last round 14 months ago. Are you talking again with investors?
JR: We are talking about a Series B round and starting to look into that.
Update: The original version of this story mistakenly stated that uBiome was launching the microbiome fund. It is a separate effort from Richman and Apte.