By Scott Meacham
Copyright © 2018, The Oklahoma Publishing Co.
Anybody who’s ever heard me talk about building out Oklahoma’s innovation economy has heard me say that capital begets capital and deal flow begets deal flow.
The challenge is that it takes a predictable continuum of investment capital to build a robust pipeline of startups, and it takes a robust pipeline of startups to attract capital.
It’s taken 20 years of Sooner grit, but the vision that our Legislature set forth back in the 1980s for diversifying and expanding Oklahoma’s economy with high-growth startups in information technology, biotechnology, and advanced manufacturing is delivering statewide impact in a big way.
Major exits and deal flow in Oklahoma are leading to increasingly larger investment rounds.
About 18 months ago, Scott Rollins, CEO and president of Selexys Pharmaceuticals, engineered the $665 million-dollar acquisition of Selexys by Novartis, the second-largest pharmaceutical company in the world. About the same time, WeGoLook, the world’s first gig economy platform for enterprise customers, sold an 85 percent interest for $36 million.
i2E started investing in Selexys about a decade ago, funding about $800,000 over time. We were also the first institutional investor in WeGoLook.
The latest news is that Tetherex Pharmaceuticals, a privately held clinical-stage drug development company formed by Rollins in 2014 as a spinout of Selexys, just announced a $50 million series B investment round. Tetherex is developing groundbreaking therapeutics for the treatment of thrombosis, inflammation and cancer.
About $43 million of that $50 million round, including nearly $1 million of investment from i2E, came from Oklahoma investors. Tetherex’s technology comes from the research of Rodger McEver, MD, while he was a researcher at OU. Now, he serves as vice president of research at the Oklahoma Medical Research Foundation.
To build his first company, Alexion, which has grown to a market cap of $26 billion, Rollins had to move the technology from Oklahoma to the East Coast because sufficient funding could not be raised here at that time.
It’s not like that in Oklahoma any more. Rollins and his longtime business partner, Russell Rother, returned to Oklahoma in 2008 to build Selexys from clinical trials to acquisition. Now, backed by the $50 million of funding from i2E and others, Rollins and the Tetherex team are working on doing it again.
“I’m an entrepreneur and a drug developer,” said Rollins. “My job is to design and develop drugs that target a clinically important molecule. What we do is take drugs through the critical clinical trials to determine if they have a significant impact on a particular disease. This is my third company and fourth drug.”
Think about what’s happened in Oklahoma in less than two years. A $665 million exit in biotech and a second exit with WeGoLook. A $50 million investment round in Tetherex, funded primarily by investors in Tulsa and Oklahoma City.
Add to that another 21 high-quality companies that i2E invested in last year, and we can begin to see what Oklahoma’s future can be.
Scott Meacham is president and CEO of i2E Inc., a nonprofit corporation that mentors many of the state’s technology-based startup companies. i2E receives state support from the Oklahoma Center for the Advancement of Science and Technology and is an integral part of Oklahoma’s Innovation Model. Contact Meacham at i2E_Comments@i2E.org.