Russ:  Hi I’m Russ Capper coming to you from Angel MD’s Alpha Conference where I’m very pleased to have as my guest Dr. Geoffrey Ling, CEO of Sun-Q; Geoffrey, welcome to the show.

Geoffrey:  Thank you so much.

Russ:  You bet. Tell us about Sun-Q.

Geoffrey:  Well Sun-Q is a startup.  What it really is is that it is a spin out from a lot of the work that we had done when I was at the agency called DARPA; the Defense Advanced Resource Project Agency.  I had been there for 12 years and I actually ended up being the Founding Director of the biotech office; first new office since 1990.  And the prior office was actually the micro processing technology offices.  So that gives you an idea of the impact that DARPA thinks biotech is now coming in to.  But Sun-Q itself really is a multipurpose company and really what we do is we do is a lot of consulting work in terms of advice in terms of the biotech space, as well as we’re actually involved directly in some startups and so we have three startups that we’re involved in.

Russ:  Okay, I want to get into those and I assume most of our audience knows about DARPA, but for those that don’t give us an overview.

Geoffrey:  So DARPA – the Defense Advanced Research Project agency – is really an unusual federal agency.  It is an agency of the federal government, it’s a funding agency, and it’s basically part of the defense department; so it’s military and at the time that I joined I was an active duty U.S. Army Colonel.  So the role of DARPA is unique.  So DARPA was founded – and this is relevant – shortly after Sputnik went up and once Sputnik went up of course it scared the entire country.  And President Eisenhower felt at that time that this was really an insult because how could the Russians beat the U.S. into space?

And so he felt that one of the issues – and there were many of course – but one of the key issues was that the U.S R&D community had become conservative, and so he wanted to get rid of that conservativism certainly at some level and he created this agency which was given just an unbelievable amount of flexibility.  And so the flexibility largely is around how they do business with innovators number one, and number two is how they could move the money.  So moving the money is a very key issue right?  And we all know that, being in the investing world, that the faster you can move money, especially at early stages with non-dilutive capital – which is government money – that can be transformative.

And that was in fact the vehicle of DARPA, how it was able to achieve a lot of the transformative technologies that it is credited with.  It was because it’s able to move in that level of efficiency.  DARPA has a very interesting investing approach that I think is a good model for the general community.  Number one is DARPA begins with the concept of is this idea truly cool?  Is it a big deal?  Not could it work or anything, forget that part; would this – if it worked – be transformative?  If the answer is yes then by golly try to find a way to make it happen.  Now of course if you don’t have it, it is what it is.  If you have it, second step, I have to resource you.  Resourcing of course starts with money, and that’s what all of us in the investing world try to do, the second part though is that we also invest technical support.

So many startups as you know have limited resources, not only capital but also in human capital.  DARPA recognizes that, we will send in a team that may be a PhD in Electrical Engineering or a PhD in Mechanical Engineering or a PhD in Neuroscience, whatever it takes so that we can help the team succeed.  So it’s a really interesting model and you say to yourself well give me an example.  Wouldn’t it be cool Russ to have an invisible airplane?

Russ:  Yes.

Geoffrey:  We all said that would be cool; something called stealth technology, that was a DARPA program and we have invisible airplanes.  Wouldn’t it be cool to have computers all talk to each other around the world?  That would be cool.  Of course that was in 1963, that project was known as the ARPANET – the Advanced Research Project Agency Network – and of course it’s become the Internet.

Russ:  Right.

Geoffrey:  Wouldn’t it be cool to know where your ships are at sea whether you can position yourself relative to the stars or the sun and it’s a cloudy day, it doesn’t matter, wouldn’t you love to know exactly where your ship is in the middle of the ocean?

Russ: Sure.

Geoffrey:  Absolutely, that would be cool.  Called Trident; was the first GPS satellite that was a satellite sent up purely for positioning.  It was a Navy DARPA project and of course it gave rise to what we know as GPS.  And on and on this goes.  So it all starts with is it cool Russ.

Russ:  I love it.  It’s also kind of interesting that you say non-dilutive capital.  I mean it’s really good if you have a technology and have DARPA come in as an investor, they just give you money and expertise and they expect you to be successful.

Geoffrey:  That’s exactly right.  That’s the government role I think.  The government role is using taxpayer dollars to enable these kinds of technologies, these kinds of companies, to blossom for no other reason than to provide that capability.  Remember we’re not building a thing, we’re building a thing that gives you a capability, and for DARPA’s world of course it’s capability for national security; an invisible airplane, that sort of thing.  But when you build that capability you would say well what’s the ROI, other than the obvious intellectual one.  Well the ROI is very simple.  The government hopes that Russell’s company survives, hopes that Russell’s company blossoms, hopes that Russ’s company will in fact sell many, many products because you know why, the government will tax them and the government gets back its ROI.  Furthermore we want Russ to build this big, big company that’s going to make all the products because he’s going to employ lots of Americans because guess what, we’re going to tax them too.  So the taxman and the government always gets theirs.

Russ:  Yeah.  So what sort of things did you see after you started this health tech – the biotech category that are coming that you can talk about?

Geoffrey:  We have a project where – and it came out from my own wartime experience.  My first combat deployment was in 2003 when I went to Afghanistan and that was just before I joined DARPA.  So I joined DARPA between the time I was sent to Afghanistan and I was sent to Iraq.  So I went to Afghanistan, it was a very transformative time for me.  I ran the intensive care unit at the 452^nd combat hospital in the Northwest corner of the country and during that time took care of service members, but I also took care of a lot of Afghans.  And not a single day went by that there wasn’t a young afghan child that was brought to us or in my ICU missing a body part and it was largely because of the plethora of Russian landmines that were throughout the country.

You realize that the child will survive but missing an arm or a leg in the very difficult environment that Afghanistan is their likelihood of surviving quite frankly to adulthood is very low, very low.  And it’s tragic, it’s tragic.  Even in our country loss of a limb is a disability, but it doesn’t mean that it’s a life threatening disability.  Anyway, came back to the country and said this is just not right.  And then of course we did see that our own service members were getting hurt by IEDs and missing limbs.  Medically what’s available is of course the prosthetics we’re all familiar with, so really not very functional.  So we said to ourselves what is it that we really want?  Again, what would be cool?  What would be cool would be an arm like Luke Skywalker or Del Spooner have; it looks like and arm, works like an arm and you control it like an arm.

In other words when you think about it that’s how it moves.  You don’t use twitching body parts to make the thing open and close.  So we said let’s go do this; let’s create a research project to build a replacement arm like Luke Skywalker’s and we did.  And if you look at it you say to yourself it’s really daunting, but it’s actually not so bad.  It’s hard, but it’s not improbable.  And what I mean by that is we said what would it take to do this.  It takes really just two things; it takes robotics and the other is Neuroscience.  If I can tap into the brain, decode those electrical signals that control my native arm but now instead use them to control my robot arm I’ve got it.

So it becomes a tractable problem, just break it down to those two silos.  So we work with some of the best roboticists in the country, we work with some of the best neuroscience people in the country, and low and behold we were able to create that platform and it was wildly successful.  It’s been featured throughout the medical community, but certainly 60 Minutes has carried it forward, CBS Morning News has carried it forward and on and on it goes.  And there are people now who have Christopher Reeve type of injuries – quadriplegics – with these arms and now you can imagine how transformative it is for them to control an arm with their brain, to feed themselves, work a TV remote and the like, and that was great.

However, it opened up a new opportunity because what have we done?  We’ve got the brain controlling a robot arm.  We’ve got the brain controlling a robot – that changes things dramatically because now the way you and I interact with our environment is with our hands and our feet.  If I can directly interact my brain to an environment through a tertiary device I can bypass a lot of the control mechanisms that we use.  Can I fly an airplane directly with my brain?  Can I drive a car?  And on and on it goes and the short answer is yes and we demonstrated it.

Russ:  Wow.

Geoffrey:  And what that means is in the next 5, 10, 20 years what else can we control directly with our minds?  And it opens a tremendous space that even you and I can’t think of the possibilities and that is cool.

Russ:  Share your perspective on what Angel MD is doing.

Geoffrey:  Angel MD is a really – this is my first exposure to Angel MD.  I was brought in by my medical school friend by Bill Heroda who said you have to come to this conference, it’s amazing, and he was absolutely right.

Russ:  Okay.

Geoffrey:  But Angel MD is addressing all the levels of friction I think.  That’s what’s great about this conference, it’s not just about this is cool tech, we should invest in it.  Angel MD is thinking about how to invest wisely, which is what we’re always talking about, but also what is the exit strategy?  What is the development plan?  What is the long term impact?  All of these things, every level, is actually addressed in this conference which to me is remarkable.  We often think only at the front end, right?

Russ:  Oh yeah.

Geoffrey:  The second thing I think about Angel MD which is really amazing is the investors themselves is a rather eclectic group. You have physicians in here, you have hospital administrators in here, you have people who are very well versed in the investment area of healthcare and of course you have your traditional investors who are coming in and taking the opportunity of working with this very eclectic group who because of their diverse nature I think are probably going to be the smartest in terms of how to do this.  They’re going to leverage against each other so they’ll know a doctor who is an expert in that space.  That same doctor may have no idea how to do the business development but you have another guy who does, and on and on it goes.

Russ:  Geoffrey I really appreciate your perspective on all what’s going on right now in healthcare.

Geoffrey:  Thank you so much.

Russ:  You bet. And that wraps up my discussion with Dr. Geoffrey Ling, CEO of Sun-Q, here at Angel MD’s Alpha Conference.