Drew Taylor — Digitalis Ventures

Posted on Wednesday, August 18, 2021

Drew Taylor is a partner at Digitalis Ventures.  Digitalis has a $100M human health fund, a $100M pet health fund and $30M for venture creation.

We also discuss being part of a family business and why founders in pet health are great people to work with.

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Drew Taylor is a partner at Digitalis Ventures. Digitalis has three funds, a hundred million human health fund, a hundred million pet health fund, and a thirty million for early early stage.

Previously Drew was the head of new ventures at Taylor Farms, the world’s largest processor of fresh cut fruits and vegetables. Drew, did I get that right? 

You did, you did. Good to see you. 

Good to see you. I don’t think we’d ever talked about the fruits and vegetables part of your life actually.

We can talk about as much of it or as little as you like. 

Well, I will, I’m interested, but I’m going to start us with Digitalis, and so maybe, you know, kick us off, give us the background on Digitalis.

Definitely, so we have been operating as a firm since early 2016. When we launched we were singularly focused on human health. And so we launched the first hundred million dollar fund that you referenced, with a mission around investing in companies that were improving human health in some way or shape. And spend the first two, two and a half years really focused on that fund.

In the beginning of 2018, we launched a second fund that was focused also on health, but this time focused on pets. 

It is a funny jump? Like I hear people go, you know, deeper into life science. I don’t hear that many people go from human health to pets, but go on.

Right, right. Sticking within, within mammals, I’ve since focused a significant chunk of time on that fund, which we call the companion fund, since kind of the spring of 2018 and around that same time, is when we launched the, the early stage vehicle, which just gives us the flexibility to sort of do very, very early stage projects.

As you mentioned, including company formation and co-creation across kind of both human and pet health. 

Oh, okay. So the companion fund is the pet health fund. I didn’t catch onto that. And then for the nod early, early stage stuff, is it seed through series B? Do you care?

That’s perfect. Yeah. First check, usually in the 500K to 5 million range, up to 10 million. Usually over the life cycle of the investment in any given company with some wiggle room around that. But that’s kind of the ballpark. 

Got it. And do you talk about your LP?

Um, a bit, so we have one LP  per our last conversation is, is, is a bit noteworthy. Um, they are a large family owned, privately held company. Um, it’s also quite private in terms of kind of how they handle most of their affairs. And so we don’t talk too much about them, but they’ve been a terrific partner. Um, I think sort of goes without saying that they have strategic interest in both human and pet health.

Um, and I think as a family owned, privately held company is also very mission driven and purpose and what they do. And so they’ve been a great partner for us. And, as we talked about sort of the fundraising journey, it’s sometimes it’s nice to have kind of a single, a single capital partner to, partner with as opposed to many. 

Rub it in. Um, but you don’t, you don’t necessarily talk about who they are.

Yeah. It’s a company called tomorrow. 

Um, the internet cut out for one second, but it, can you just say that again?

And so the company called is called Mars, Inc. which most people know actually for their, their kind of history. In candy. And so they own Snickers. m&ms a number of the, sort of like conic candy brands, Um, and I think most notably and perhaps most surprisingly  over the course of the last couple of decades, they’ve become the largest owner and operator of, veterinary clinics in the world.

Um, and also one of the largest owners of pet nutrition brands in the world, uh, as well. And so hence kind of the, the deep, deep interest and purpose around, uh, around pets. Okay. 

Yeah. Now I think of them as a big pet food, right. Or pet nutrition, as you say. okay. But talk to me more about investing in human health and pet health and are those in any way really? 

Totally. So in some of this was a bit of a pleasant surprise for us. because you know, we had a lot of background in human health. We had, we had less of a background in pet health when we started. I think that we have learned so many interesting things about kind of the synergies between human and pet health.

I think we’d like to joke a little bit about, our work in the human health gives us a little bit of a crystal ball into what’s happening on the pet health side, because so many of the tools and treatments and care delivery methods that we, create for ourselves and our own healthcare system eventually sort of get ported over to caring for animals as well.

and typically there’s a little bit of a lag effect there, but if we think about the diagnostics that get developed, the drugs that get developed, even tools like, tele-health and virtual care, all of these things right. Are sort of happening in the, in the animal world as well, but generally a little bit behind kind of where they are in the human realm.

Biologically there’s overlap too. So there’s something like 365 shared diseases between humans and dogs, um, which was sort of a fun fact for me. and so I think there’s a couple of companies in the portfolio that are sort of working at that intersection. It’s called one health, which is typically thought of as kind of the intersection between human health, animal health and environmental health.

But they’re absolutely kind of shared biology. Um, at some companies are, are, are exploring. Um, but it’s been much more synergistic than we expected is kind of the, the short version. 

Hmm, how much biology do we share with our, with our pets?

Um, it’s, it’s pretty significant. We’d have to invite another guest in to talk about sort of the reference genome. Um, but it’s, it’s, it’s surprisingly large. 

Um, and, and is it always in that direction from the things that we focus on for humans or, I mean, my sister is a researcher who works with animals at times.

Yeah, I think one of our sort of, dreams with this is that we’ll be able to pioneer things on the animal side that, that can then sort of go back to the human side.   I think we, I don’t have great examples of it yet, but I think I think the opportunity is. Generally speaking, the pet world is a little bit less regulated and just, you know, has, has a little bit less complexity.

I think that what we have on the human side, um, both with regulatory oversight and HIPAA and all of these things. Um, so I think we are hopeful that there is a world where, and in some companies actually are starting to choose, to launch first in veterinary and then sort of work with the FDA later on the humans.

Um, I think it’s still early days on this front in terms of companies that truly have pioneered something novel, um, in, in pets. And then, then sort of transferred that over into the human realm. But I do, I do think, yeah. 

So do you not need FDA approval or what are the. Yeah. Is it, is it faster 

if you’re 

generally not there it’s generally less expensive. So I don’t, I don’t sort of want to make it seem like there is no regulatory oversight because there’s, there’s significant regulatory oversight. Um, as it relates to that care as well, it’s just generally a bit faster and generally a bit less. 

Yeah. As, as, as would make sense. Um, and are you leading rounds into these companies usually or participate sometimes?

Both. So we’ve done. This is probably true for the portfolio as a whole. We’ve led probably half of the investments that we’ve done and then been part of a syndicate for the other half. 

that makes sense. and can you give me, in fact, maybe we could talk about scratch because that’s one, that’s a Pasadena company. I always give shout outs. Um, but yeah, maybe we can talk about scratch. I think it’s one that you’re on the board of. 

Yes. 

How did you meet them? What round did you invest?

Why did you invest? What do they do?

Yup. great team, you know, John Keeley well Kayla more space in Pasadena. Um, we, it was actually one of the first investments we made out of companion fund, I think was the, the second investment that we made within the first couple of months of the, of the fund formation. And so we led their series a or co-led their series a in 2018.

Um, they, uh, the company continues to evolve in a really, in a really fun way at the time. And we met them. They were focused exclusively on veterinary clinics and they were focused exclusively on, point of care financing. And so you have an unexpected surgery that surgery costs a few thousand dollars.

You don’t want to come out of pocket. You don’t want to put that on your credit card. They offer a very simple kind of friendly payment plans to sort of spread out the cost of that over time.  Four paths. um, the way the business has evolved is it’s, it’s sort of part of this broader kind of buy now pay later movement with companies like affirm and Klarna that are just allowing you to sort of break up a purchase into just kind of a simple installment loan.

And so four easy payments, five easy payments, oftentimes in kind of an interest free way. and now the, the, the product suite has expanded too. And so I think maybe the best way to think about them is, again, let’s think about the veterinary clinic as an example. they will take over payment processing for clinic in partnership with Stripe.

And so, um, they’ll process payments. Uh, they will offer payment plans, oftentime interest fee, payment plans, and then also offer kind of a suite of other software tools to that clinic. that can integrate with the medical record. And so things like, sending text-based appointment reminders, just to make sure that people show up to their appointment.

And there’s a sort of a reminded of kind of when and where it is. Um, they can do all that as a virtue of kind of being integrated with the practice management systems and, and being sort of a vendor of record to the clinic. And so again, doing a lot of that growth within vet clinics are now doing this, some of the same thing within dental clinics, envision clinics and, and other, uh, other practices that have kind of similar attributes.

And so. it’s been a fun journey. It’s an amazing team and we’ve loved working with them. 

Well, that’s great. And it helps me get a sense of what you invest in. Um, is there any, I can’t help, but think, is there any truth to pets? Enable human health. And I guess I’ve just been reading all of this stuff about pets during COVID. Right. Is it true? Like has pet ownership exploded? Is that a true thing?

For sure pet ownership has definitely exploded during, during COVID. I mean, the truth is it was exploding before COVID and COVID just accelerated that trend. I think like it’s done too many things. Um, there is really good research around companionship and loneliness being a huge problem, again, pre COVID and even bigger problems during COVID.

And there’s some great research that supports, um, just the benefit that pets can have from a companionship standpoint.  kind of the loneliness issue. And so, definitely makes you feel good about kind of the work that we’re doing. I think that for many reasons, the people that are attracted to starting businesses in pet care just tend to be good humans.

and so it’s, it’s been another unexpected benefit I think, of, of launching the companion fund and being able to, to do the work that we do is just generally speaking. It’s just, they’re fun people to work with and good people to work with. And so we’ve, we’ve loved it. 

And so you came from food processing. has there been anything in the pet market that’s kind of surprised you or interested, like,  our dog, people are more extroverted than cat people are like, are there any, I dunno, 

Yeah. definitely. there are a very similar number  cats as there are dogs in this country, but I don’t know if most people would guess that, For whatever reason, if we think about just the number of companies that we see in kind of our pipeline, I would say it’s 90% focused on dogs. And so for whatever reason, when most people decide to sort of, to, to start a company in this space, um, they start with dogs.

And so I think part of the opportunity has been for people that are cat lovers or people that are, that are founders, kind of within, within this realm, there’s a lot less activity on the cat side. And we’ve got a couple great companies that, um, are investments that are cat focused that really. Um, but for whatever reason, cats just seem to get a little bit less love as it relates to company formation.

So I think that’s where part of the opportunity is 

Fun. and are you, do you look worldwide? Like, are there different things worldwide? Are you mostly U S focused.

we do mostly us focused. We do a lot in Europe. Um, so mostly, mostly north America and Europe, I think, um, if we look at the portfolio from kind of a percentage basis, it’s probably. It’s probably 80% north America, 20% Europe. Um, we’ve got what, two investments in China, one on the pet side and one on the human side, but those are, those are more outliers, I would say from a geographic standpoint. 

That’s interesting. I’ve been talking to a lot of folks who are like media investors, and they’re looking at a lot of trends that come from Asia, let’s say, is, is there anything different? That’s like, yeah. In China, they, you know, they have different sorts of cats or something. Is there anything to learn from other models?

Definitely, uh, cat ownership in particular sort of exploding in China. And so probably the fastest growing market globally, I would say is, is the cat market in China. As to why that is. I think part of it is just when you’re living in sort of a dense urban space, there’s just not as much room for a dog.

And so it kind of lends itself to cat ownership versus dog ownership in many cases. And because a lot of growth is concentrated in cities. I think that the trend that you’re kind of seeing across the board is. More growth than cats and also more, growth in sort of small dog breeds.  I think in the cities, in China, in particular, it’s like 9, 9, 6 in terms of the working schedule. And so when you’re working those hours, cats, just generally tend to need a little bit less oversight and attention. And so. Again, it sort of lends yourself to if making the decision between sort of dog and cat, you choose cat, but it is amazing.

Definitely like regardless of country that we look at, like there’s different sort of local preferences, cultural preferences. Um, so it’s been pretty interesting to learn some of that.  

Hmm. Yeah. The 9, 9, 6 thing that keeps coming up, it seems like it would lend itself to a lot of human health investment. It’s different topic, maybe. 

Exactly. 

I do. Okay. Rather than ask random questions about cats and China, are there certain themes, theses that are your areas of, of interest?

Yeah.

totally. Like I would say that as always, we try to be opportunistic and look at where the market’s going and liquid growth is and sort of, you know, sort of be there, I think. But also there are. Um, definitely problems that I think we try to focus on in terms of just where, where are the core problems and what solutions sort of need to exist to solve these problems?

I think that, from a problem standpoint, I think affordability of care is a huge one. And so cost to care has continued to rise. There’s a lot of reasons for that one, one reason is that there’s a pretty significant shortage of veterinarians, uh, in this country. And. In many places of the world and that sort of maps to a shortage of practitioners on the human side as well.

So it’s a huge issue, which unfortunately, sort of drives up costs. there are other reasons as well, but I think as a general theme, cost of care and companies that are tackling that problem and trying to come up with innovative solutions to produce the cost of care, I think is very top of mind for us.

access to care is another one. And I think this is. Again, trends on the human side have been very illuminating as to what’s happening in kind of the animal world. And so telehealth and virtual. is a great solution to solving sort of actually both of those problems, both the access to care issue, but also to the extent that there’s a shortage of, of, of providers, which there is virtual care helps bridge kind of supply and demand and sort of a better, a better way. there are some barriers there that we spend a lot of time thinking about and working on, uh, there’s some specific, regulation called CPR, which is the veterinary client patient relationship, which says that in order to treat a pet virtually, you need to have first met that pet in person. And so that becomes a barrier to being able to sort of treat across state lines or treat an animal that you haven’t examined in person before.

And so I think there’s good, good arguments on both sides as to whether. Or not that should exist in the way that it currently exists. And it’s this, it’s the topic of much conversation. I think our hope is that some of those regulations will sort of evolve in a way that sort of lent lets virtual care.

Uh, play a bigger role again, just to solve this problem around sort of availability of care and access of care for the kind of conditions and indications that can be treated, uh, virtually which again is, is somewhat limited. But I think is, is, is more significant than what’s, uh, than what people are kind of able to.

To treat, uh, today. So, those are, those are two big problems, um, uh, that we’re focused on.   And then, you know, from a trend standpoint, again, much like the human side, I think channel is a big one. And so, DTC e-commerce, I think, is having a big impact on pet nutrition in particular. and so I think everybody is trying to figure out sort of where that’s going, whether it’s Amazon chewy.

your own website, other kind of emerging vertical e-commerce sites, all of the trends around e-commerce livestream, um, um, socially native, um, e-commerce I think are all just as relevant to pet nutrition as they are to any other kind of C category. And so, um, we try to keep up with those trends as much as you possibly can and, and, and help sort of guide our companies in the right direction. 

Hmm. are there things going on with DTC? I mean, I keep hearing challenges is mostly what I hear.   

it’s amazing. I think that’s true. In most of these cases, I think. So you could probably guess this, but, so the largest pet retailer in the world at this point is Amazon. Probably not so surprising, but, um, that’s obviously sort of a, a newer, a newer fact than it was just a few years ago. And so I think the stat I just saw was that in 20 15, 90 2% of pet food sales still happen in a physical store and the 2015 wasn’t that long ago.

in 2020, it was something like 70, 30, so 70% were still taking place in a PetSmart or Petco or a specialty kind of pet retail store. And 30% was online. So huge, you know, huge increase from kind of 8% to 30% e-commerce but still a long way to go from that standpoint. I think what a lot of our companies are trying to figure out is this Okay.

DTC sort of, sort of owned channel versus other e-commerce Amazon chewy, et cetera, and Amazon, and to where you’re quite different just in terms of kind of ways of working.   But, um, I think many companies are trying to understand where all that’s going. I think different products have different attributes, some of which lend themselves better to DTC than others.

And so some have higher price points, some have more subscripted, kind of natural behaviors. Others are more one-time sort of purchases at lower price points.  Depending on the product and the attributes of it. Again, I think some lend themselves to some channels better than, than others, but Yeah. it’s amazing.

Cause I think we’d get, you know, we think about it a lot in the, in the pet world and a little bit in the human world, but then we’re always reminded that like if you just keep zooming out. So many companies are trying to solve this same, whether you’re selling cars or, uh, hotel rooms or sneakers, or, you know, you name it like so many people are trying to solve sort of a version of this problem.

And so I think we definitely want to learn. You 

dog treats? Um, what’s the, what is the difference between chewy and Amazon?

Um, I think Amazon probably has more,  

Okay.

for sellers. And so it’s a little bit more of a choose your own adventure. Whereas I think chewy is a little bit more, you know, this, this, this is partly because of their ownership as well. little bit more of sort of a vendor customer relationship, and it’s a little bit more limited.

You just kind of sell product to them and then they kind of take it from there. so I think. the benefit , they are vertically focused. All they do is think about sort of pet, pet owners and serving kind of those needs. but for sellers that want to be a little bit more hands-on and kind of actively managing the channel, I think Amazon definitely provides many more tools to be able to. 

So do, do you spend your time just on pets or how does the funds sort of work?

It’s been an evolution. Yeah. I used to spend all of my time on humans now. I probably spend 80% of time on pets. 

Hmm. is it motivating, hopefully it’s motivating to you? do you have personal passion for this.

I do. No, I do. And it’s, again, some of this.

is unexpected and you learn a lot about sort of like work and meaning of work and all of these things as a result of it. But I think the things that have been. Most interesting to me are, again, I think probably the single biggest thing is just the people that we get to work with, and have been almost universally, just a joy to work with.

the idea that working on pet health has all these wonderful people that makes a ton of sense to me.

And like what, I don’t know. There’s lots of other things that matter, but like, in terms of like things that really matter, that’s a big one. Yeah. And so first and foremost, we get to work with great people and that just makes all of it fun. and it’s really interesting. It’s, it’s really interesting. And again, I think the parallels between the human and the pet side have been surprising. Um, and so it’s been sort of fun to sort of explore some of that territory.

Uh, together. So Yeah.

it’s been, um, it’s been surprisingly enjoyable. I would say 

Huh? Yeah. Like I think if you own, is this an aside? I think if you own like a Labrador retriever every morning and like had to take that dog for walks on the beach, it would be hard to be a glum person. That’s my bias for sure. Um, how does, how does that work? So you said you were like 80, 20 right now. It might, you know, might change.

How does sort of decision making, like, let’s just put So Yeah, that makes sense. I’m a founder. I want to approach digital is how do I know who to talk to and how the process is?

Yeah.

it’s pretty fluid. So we, um, and this is definitely kind of a work in progress, um, for us as we’ve gone through a few different iterations, but we have at least in the current incarnation, we have three. Practice groups. And so we have a health sciences group. We have a health tech group. Both of those are human focused, and we have a pet health group, which is dedicated to companion fund.

Um, everybody on our team sits in at least two of those practice groups. And so everybody has exposure to both the human and the pet side. Um, and, and, you know, most of them sort of at least, uh, uh, you know, spend some time in all three of those sort of practice groups. And so everybody has at least visibility into kind of the full range of activities.

And then we, um, we try to kind of specialize from there. And so for any given investment that we’re sort of spending meaningful time on from a diligence standpoint, what kind of have a deal team. And so we try to pick the best kind of two or three people are the most appropriate kind of two or three or four people on our team, to work on any given deal and that, you know, that deal team will be different for every deal, depending on the nature of it.

And so if it’s a diagnostics company versus a third, a therapeutics company, again, whether it’s human or. Um, there’s so much technical similarity there that we want, you know, the best, the best team they’re sort of, regardless of, of kind of the human pet distinction, where sometimes it can be sort of a false, a little bit of a false distinction.

And so, um, it will, it will be deal specific, I guess, is kind of the, the, the, the short way of saying it. And, and typically you’ll have kind of one lead to communicate with, and then that lead will be working with kind of a smaller subset of the deal team to, um, to kind of work. 

Do you guys, um, I’ve been asking a variety of people, sort of how decision-making works does. Do all the partners vote on things. Does everyone vote? How do you all decide?

Yeah, well, if I have a good answer here, it’s a very interesting topic of conversation for us and for many others. Um, so if, if you’ve been able to crowdsource the answer, please do share it. we, I think we started life as a very consensus driven firms. So we kind of needed everybody to say yes, and we were smaller and it was kind of easier to do that.

And maybe that was the right, you know, sort of method, maybe it wasn’t, but we started that way, I think, as we grew and, and things move very fast, especially these days, it sort of, I would say we swung not today opposite end of the spectrum, but we had a few deals in particular that were quite contentious.

And I think, you know, those were good. Good in hindsight experiences for sure. And so we definitely pushed the boundaries in terms of, of deals got done, that didn’t have full consensus and, and they became cultural issues for a while in terms of, um, uh, you know, the process doesn’t always feel good. Um, uh, and I was right in the middle of a couple of those.

And so I think we learned a lot from it in, in, in, in particular. I, you know, I took some, some bruises from, from some of it. Um, and I think if I had to say, uh, Where we are now, I would say we’re somewhere in the middle in terms of, I think we’ve just acknowledged the fact that there’s just no way with the pace at which things move these days, that we’re going to get every single person in our team fully up to speed with every deal that we’re doing in order to make sort of fully informed decisions.

And so I think you just have to divide and conquer. And so the, you know, maybe the, the single biggest decision that we make is, is choosing the deal team. Um, once we’ve chosen the deal team, which again is typically two or three people, we really empower that team, um, uh, to sort of make a recommendation to the broader group.

And then the broader group’s job is to sort of challenge that and, and, and, and create for the healthy dialogue. And so typically, yeah, I would say we, we try to get to consensus within the deal team. So if it’s two or three people, I think generally speaking, you know, we we’d love it if. All all two or three of those people are sort of positive.

It’s not always, you know, you, you, you end up with kind of mixed degrees of positivity, sort of within a deal team. But, um, uh, I would say that’s kind of where we’ve landed, uh, today. And so not, you know, not at full consensus, it’s more of a, uh, let’s let’s divide and conquer and let’s specialize, and then let’s empower and trust that specialized team to kind of make a decision on behalf of the group or at least make a recommendation to the group. I think scale also matters. And so I think you know, the larger, the check, I think the more conviction you generally need for us. And so I think it’s a little bit easier for us to make a controversial decision for a smaller check than it is for a larger check. And so, you know, sometimes I think if you end up in one of these controversial things where two people are pounding the table, and then you’ve got one or two that are sort of humanely opposed, you know, one, one solution to that, you know, can just be to downsize the check for this round.

Watch it, and then, you know, hopefully the, you know, the right answer will kind of start to emerge over time. And so I think flexibility on, on checks, ice has been a big one for us in terms of navigating some of those dynamics. 

Interesting. That’s that’s I mean, I think you have a slightly larger funds, so maybe you, can you have that flexibility? and, uh, how about the early, early stage that you do? do you have lessons learned on how to successfully are you. do you have thoughts on what’s worked really well?

Yeah.

It’s, uh, I think by definition, it’s still too early to say on a lot of them because there’s such early stage. Um, I think in terms of why we do it, I think a couple of reasons, one out of general interest, I think a lot of the people on our team kind of come from, from operating backgrounds. And if you sort of give people the choice around. Co-creating a company versus, battling out with tiger global to lead a later stage round. It’s sort of an uncomfortably large check and sort of an uncomfortable pace. You know, I think it’s a pretty easy answer as to which direction people are going to go. Um, so one, I think there’s a lot of shared interest in our group around sort of doing that work at that type of, of, of, of state.

Um, there’s a few different varieties. And so oftentimes it will come from a piece of research that’s being done in an academic setting that we will be helping to spin out and turn into a company. And so there definitely are best practices for us and a little bit of a playbook that’s emerged around just how to deal with technology transfer offices, you know, how, how to, how to navigate the, the, the, the licensing process and the spin out process.

Some schools, as you know, are easier to work with, I should say then than, than others. Um, each one is a little bit different and so each one has a different set of stakeholders.

some groups, are extremely prolific. others are doing it for the first time. But also just having a relationship with some of these groups. I think, I think helps a lot. 

Are there any lessons there? for better ways of dealing with tech transfer offices,

I mean, maybe the simplest decision. I forget what that book is, but like, what’s the one thing that solves all, all other things, just some are more difficult than others, to be honest. And so just ones where, you know, are notoriously difficult to work with. Like maybe the easy decision is just, there’s just certain groups that we don’t work with. 

focus on the easy ones.

I the frustrating part to us is often when it’s counterproductive, because the whole goal is to sort of get these things out of the university setting and sort of into a company setting.

And let’s do that as quickly and seamlessly as possible. It’s a little bit less. A couple of basis points sort of on the royalty rate or whatever the case may be. It’s more about, let’s just get this thing out into the world as quickly and efficiently as it can, and let’s give it a chance to have the kind of impact that we think it can have.

Um, I think that, um, so just, again, some of that is just trust and working relationship that’s, you know, that, that, that, that, that happens with some of these groups that have a lot of experience doing it both directly, but also just more broadly in terms of the number of companies that get spun out. Um, each one is a little bit different and so each one has a different set of stakeholders.

some, some groups, are extremely prolific. and you know, George Church comes to mind for example, that that’s, that’s, that’s spun out. You know, dozens of companies. And so I think that the model is sort of pretty, pretty well understood there in terms of the different stakeholders in that process and, and, um, uh, how that process goes, others are doing it for the first time.

And so I think, um, uh, you know, each of these is a little bit different in some cases, you know, we’re a very significant part of the cap table in a very significant part of the founding team and others. It’s a little bit more. Kind of first check in. So it’s a little bit more pre-seed or seed station we’ll own sort of a much smaller percentage of the company.

And so the dynamics of those, again, differ a little bit when you’re in sort of more of a majority type position versus kind of a minority position. And so each one’s a little bit different, but I think the, the goal that everybody wants at the end of the day is just focusing on let’s let’s. Uh, let’s give whatever this advancement is, you know, a real chance to sort of exist in the world and kind of thrive in the world and have the kind of impact that we want it to have.

And so just finding groups that are kind of aligned with that mission, uh, tends to be the biggest thing for us. 

Okay, let me get us out of this out entirely. Take a step up and say, okay. So if you were starting any company, you could start any company in the world. You could start right now. what do you think you’d be focused on? What would you be building?

Oh man. that’s a tough one. I will, will be accused of, recency bias here, but I think, I would say something related to fertility. it’s such an important journey for people. It’s such an emotional journey. when you sort of think of, what the most important kind of products and services you could, possibly hope to help people with. I think navigating their fertility journey is as high as you can sort of possibly get.

just from a business model standpoint. I think there’s some similarities with what we see with veterinary clinics and other sort of elective healthcare practices.

 well, I appreciate your answer.  but it wouldn’t be in food processing. Tell me about food processing 

Okay. 

is for the processing. Interesting. Tell me about what you were doing.

Endlessly endlessly interesting and all, and we can go sort of as deep as you want in terms of the life cycle of a vegetable, sort of, as It travels from, you know, from the field all the way, to your table. But, the history there is I’m, I’m from Salinas up north, which is sort of affectionately referred to as the salad bowl of the world.

Um, home of John Steinbeck also, so sort of called the area of the pastors of having, um, a very significant amount of kind of specialty crops as they’re called. So fruits and vegetables are sort of groaning in California and in that region in particular. And so it’s, probably the single largest growing region for a number of different lettuces, leafy greens, berries, strawberries, and raspberries in particular.

Castroville right next to where I grew up as the artichoke capital of the world. And so it’s sort of like pick your vegetable you know, we sort of have, you know, Gilroy just up north is the garlic capital of the world. And so it’s, it’s kind of what we’re known for. uh, 

this a family business?

it is. Yeah. so my family has kind of been in that, in the produce industry for, uh, I guess four generations now.

So my great grandpa was involved in it. My grandpa was involved in it. My dad ended up starting the company where I spent much of my career at Taylor farms. Five years ago, I’m focused mostly on the processing piece, as you mentioned. And so it’s, uh, if you picture a packaged salad that you might buy at whole foods is sort of the, the, the finished product.

Typically a company like Taylor farms would contract with the growth. help harvest the product, bring it into a processing facility where you’re essentially washing, cutting and packaging, and then distributing that on to either a retailer like whole foods or a broad line distributor. That’s that’s going to service a restaurant.

And so if you have a salad at a restaurant, oftentimes it sort of passes through a company like Taylor farms on its journey. who’s again, responsible for sort of washing cutting and packaging sort of along the way. And so it’s a pretty interesting supply chain and it’s amazing how quickly it moves.

From the moment you harvest a piece of lettuce, you know, it, has,  at most kind of 20 days to live. And so you have to in and often shorter, depending on sort of, you know, which, which variety it is. And so you have to kind of get it through that entire supply chain to your plate at a restaurant or to your refrigerator at home.

Uh, you know, all in the course of kind of less than 20 days, which from a supply chain standpoint is pretty fast.

Yeah. And it, it makes sense if you’re living in Los Angeles, not that far from Salinas. I imagine that a lot of those lettuces are going around the country or how far away do they go?

Yeah.

totally. So most, would let us, in particular, it’s mostly grown in the west coast and in the winter, or excuse me in the summer. Um, you can have growing regions in Canada. You can have growing regions in, in, in Florida, kind of Eastern seaboard. For the most part, the vast majority of that product is coming from the west coast and being put on a truck and shipped across the country.

And so it takes, call it a couple of days to kind of get across the country, but then it’s going to a distribution center. It has to go from a distribution center to the store level. It has to, you know, get from the back of the store onto the shelf. It has to sit on the shelf for a few days and get in.

So it’s that 20 days is even, as to be even more tightly choreographed, when you’re traveling that far. And then part of this has sort of given rise to kind of controlled environment agriculture and indoor agriculture in terms of groups that are growing in, greenhouse environments, But also in, in kind of fully indoor, environments.

And so you’ve seen these vertical farm companies that are, increasingly sort of proliferated across the west coast or the east coast, I should say. And I think their promise is. Build it as close to the kind of the end customer as you possibly can. in many cases, it’s actually right next to the distribution center, that’s kind of feeding the, the supply chain, but if you can grow product in that environment, um, and again, in a fully indoor setting or in a greenhouse setting, you can sort of, you know, you’re, you’re sort of not subject to, to climate and temperature and all this sort of mother nature of factors that, that you deal with when you’re growing outside.

Um, In theory, at least you can grow year round. You can grow much closer to the customer. You can deliver fresh your product and you can do it in a somewhat environmentally friendly way with kind of fewer inputs, really expensive to do it. Um, and so I think that’s, that’s what they have to kind of figure out is can they do it, uh, in a way that is sustainable from an economic standpoint, but there’s definitely some, benefits to that approach.

But in your even just sort of more normal food processing operation, you know, is there a lot of robotics? Is there a lot of tech that affects your work? 

Yeah.

Increasingly. So, I mean, I think that, and I mean, if you, if you go way back, I mean, the trend is sort of the mechanization of agriculture, which goes back hundreds of years at this point in sort of the bigger crops or corn soybeans, wheat, you know, much of which has grown in the Midwest.

I mean, those are almost fully. mechanized operations at this point from planting all the way through harvest and processing. I would say that, fruits and vegetables have been a little bit more of sort of a boutique industry. And just because of the nature of them, they don’t really lend themselves as much to kind of more of the monocropping approach.

And so, you, you tend to see less automation in that, but I think that’s really starting to change. And so I’m sure you’ve met many of these companies, but for every stage of the process, Planting to weeding, to thinning, to harvest robots are being developed for every single step of that.

Um, even at the, in sort of the processing facility level, in terms of, um, much of it has been automated in terms of the washing systems and the packaging systems and all these things, but Yeah.

You know, 10 years ago, it was still a person putting the bag into the box. It was still a person taping the box.

It was still a person putting those boxes on a pallet. It was still a person sort of loading that onto, uh, onto a truck. And you know, now it’s mostly robots that are, that are doing that. And I I think that the challenge that most of these companies, including Taylor farms are facing is just labor, is getting increasingly difficult to find to be able to do these jobs.

And so it’s not unusual if you’re a strawberry grower to kind of. Not have enough people to harvest your crop. And so I think when somebody is coming to them with a robot that says, you know, this is expensive and it’s relatively unproven, but you know, it can, it can sort of pick your strawberries for you.

Oftentimes the choice we’re making is between the strawberries not getting harvested at all. And this robot that may or may not do a good job of, of, of that particular task. And so I think you’re definitely starting to see it. I think it’s, it’s, it’s much more mature in certain sort of some places than others in terms of kind of where it’s been adopted.

But I think it’s the existential threat is just not having labor to kind of do the jobs that need to get done in order for us to enjoy the berries and the salads and all these things. Enjoy and it’s, you know, problems that a lot of people don’t don’t think about in terms of what has to happen to kind of get your food onto your table and, and to you.

But I think that for sure, um, you’re going to see more and more automation and more and more robotics and kind of every, every step of the process. 

Yeah. Another aside, wait, isn’t it that like the classic AI example is like the strawberry picking robot that takes over. Because he’s so focused on picking strawberries. Do you know what I’m talking about?

Tell me more. 

Well, I wasn’t gonna edit out, but like the strawberry picking robot, like, like takes down people like is like so focused on picking more strawberries. It’s like, it’s the classic, like, uh, I think he like, you know, plows through other fields so we can plant more strawberries. We can pick more strawberries anyways, 

I mean, I, yeah, if I, if I had to speculate, I would say that it’s probably not going to be the strawberry picking robot. That’s going to do us in first. 

I have other other concerns. Um, okay. Wait, here’s one. I am interested in, um, I’m always fascinated by family businesses and like, what do you think your parents did well in bringing you into that business? Like what can we all learn as, new parents on how to expose our children and, and what not to what to do or what not to do.

Yeah.

totally.  I mean, it’s such an important question. I will, I will not pretend to have the right answers here, but I mean, I just, I think. What they did, that was amazing was one they exposed us to early on. And so we have these great family pictures of like, you know, going on family vacations, but we were touring, you know, like the processing facilities.

And so there’s these like daily pictures of us, like in the onion processing room, wearing our white lab coats and hairnets and a bruise crying. Cause it, you know, Massive amounts of onions, sort of being cut and that was vacation. And so like we did internationally, it was sort of a big part of our, of our family and dinner table conversation, all these things.

And so I think we got exposed to it at a very early age, which was amazing. and three brothers and we’re all different. So I think they did a great job of sort of understanding our differences and sort of saying, you know, the businesses, the business, and we, you know, we have a history of doing this and we’d love to have you involved in any way, shape or form if that’s the path that you want to go on.

But also first and foremost, we want you to be happy and do work that you think is meaningful and rewarding. And so if that path takes you somewhere else, you know, we’re gonna, we’re going to support and encourage you on that path too. And each of us have chosen slightly different paths. Three, three, my other three brother are actually all working in the base.

Today, but they’ve all spent time outside of the business at different junctures and they’re all in kind of different roles. And so we’ve all spent time inside the business at different parts of our career. We’ve all spent time outside of the business at different points of our career. And I’m sure that will continue to sort of evolve as, as everybody’s journey sort of evolves. I think the best thing you can possibly do is just. One encouraged people to figure out in what they’re interested in and what they’re good at and support that regardless of whether that sort of is in the family business or not, um, to, I think, encourage people to like go out and explore the world and go and get different experiences and go learn other things.

Um, I, you know, I think I’ve learned more outside of that business in terms of just diversity of skillset. Then inside it just because it’s a very particular thing and you’re inside any, any business, you kind of learned skills related to that thing. When you go to another thing, you kind of learn, learn other things.

Um, you know, maybe one other piece related to family businesses that they don’t, and this starts to get into nepotism and some of these other things, but like once you start to get into sort of a generational business, it can be hard to create an atmosphere. That’s like a true meritocracy. 

So one of the best ways to solve that is just to say, go do something else I go. Um, and I think that, you know, people have to kind of want this, but it’s, um, uh, I think that’s one of the best things that you can do. And I’ve seen examples of other family businesses that actually. Require that in order to come back and work for this company, you actually have to go and spend X number of years doing something completely different.

Um, just because that’s the way the world works. And it’s really not, you know, having an environment that’s anything other than a meritocracy doesn’t benefit you at the end of the day, it doesn’t benefit the company doesn’t benefit the family. It doesn’t benefit the other stakeholders. It doesn’t benefit the customer.

Like it doesn’t benefit anyone. And so just being mindful of that atmosphere and the fact that. Can happen and taking proactive steps to kind of preventing that from happening, I think is a good one. 

As you thought about navigating your career. What have been some of the things that have really worked for you that you might pass on to others in terms of, you know, are you just a really hard worker? Are you risk-taking like what events, some of the things that have served you well, 

Yeah, that’s a tough one. And I won’t pretend to have the answers on this one, but I think, For me personally, I think being open-minded as to where different paths can lead, I think has been a good learning for me. And so I think just going to where interesting people are doing interesting things, I’m going to where there’s growth, that’s happening, growing to where new problems are being solved.

And because of that new skills are being acquired and develop. Um, and just kind of heading in that direction without necessarily knowing where it’s going to lead and, and, and, sort of not pretending to know what the five or the 10 year plan is going to look like has been a really big one for me, because I used to be more of the type of like five-year plan type of person.

And I sort of want it to be able to sort of predict where it was going to go. And I think that’s been, less true for me recently in a really rewarding way. And so to this point around you started in human health and now you spend 80% of your time sort of working on pet health that wasn’t in the five-year plan.

Um, but it’s been a really like fun and rewarding part of the journey. And if I attempted to predict where that’s going to lead in five years, that’d be wrong. And so I just don’t, I don’t try to predict it at this point. I just trust in the fact. There’s growth that’s happening. Um, the work, the work that in and of itself is rewarding.

The people that I get to work with, um, you know, there’s, there’s, there’s meaningful relationships there. And so I just think focusing on learning, focusing on growth and focusing on the stuff that sort of intrinsically matters versus some of the intro ex extrinsic stuff has been a big part of, of, uh, of my journey. 

How do you manage learning and growth when there’s like an endless list of to-dos in your inbox?

I don’t know. you know, some people are good about organizing their inbox?

and in all of these folders and filters, I’m not one of those people. And so you’re back to this idea of like, what’s the one thing that makes all the other things easier. I think the one thing for me is like Releasing the sort of expectation that every email is deserving of a reply, or like, just because someone emails, you, you, you now have an obligation sort of a social contract to respond to that person.

I used to feel that way. Some people still feel that way. I, I don’t now feel that way. So just releasing yourself of that burden, I think was a big one. Um, everything is triaged. I just think of everything in life is triaged at this point, just because I think there’s just more. There’s more that could be done.

And there’s more that is coming at us than we could ever hope to do and ever hope to do well. And so whether it’s personal staff, professional staff, I always 

when I’m feeling overwhelmed, which is often I just try to step back and just kind of say, what’s the most important thing, what matters the most.

And, you know, usually that starts with family and health and all of those things, but what’s just grounding myself in that perspective also from a, from a professional standpoint, Um, 

and then just kind of refocusing on those  📍 things. 

And, you know, if you, if you end up with extra time, which is usually not the case, and you can kind of get to the long tail of stuff, bonus points, but, um, at least you’re getting the important stuff done. 

I love it. Drew the emails then. Um, well, do you, I always love chatting with you. I learned a lot. I think we’re probably at about time. I think I’ll wrap it up. Say drew, thanks so much for coming on the pod. 

Likewise. Great. to see you. Thanks for having.