#26 - Three Breakthroughs: Chevron and the Startup Space, Bridge Gene Editing Breakthrough, and AI Arms Race

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This has huge implications on multiple dimensions and in ways that I don't pretend to fully anticipate.

The implications in medicine are vast. There's a lot of really complex genetic disorders that you can't get at with just CRISPR.

But just, you know, give somebody a chunk of money based on their talent and let 'em just go. When that is done, good things happen.

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Great.

Yeah.

Are you ready?

Let's do it. I'm ready.

Let's do it. Okay. Welcome to this episode of the Tech Optimist podcast, our 3 Breakthroughs show, where we talk about what we think are 3 notable breakthroughs the last week or 2. And I'm Mike Collins. I'm the founder and CEO of Alumni Ventures, and I'm joined by Matt Caspari, one of our managing partners from

Yeah. Good to see you, Mike. Hi there. Yeah.

All right. So, I think I'm going first today. And, this is a little bit of a build on one from about a month ago where identified really this kind of trend that has been happening, which is I'm calling it kind of the electric fence going up on, you know, regulation bureaucracy coming from our court system.

Yeah.

And this was before, uh, maybe the most monumental of this is the Chevron ruling, right? The Chevron, uh, preference, which basically, um, gave, uh, our institu— our executive branch institutions, FTC, SEC, IRS, really a deference when it came to interpreting the law. And the idea that the legislative branch would have the big picture, the broad framework, and then it would be up to, quote unquote, the experts within the regulatory space to really make the rules. And I think from a— this is about— we're venture capitalists and we obviously deal with these institutions in industry after industry, our portfolio companies do. And so listen, I think this has huge implications On multiple dimensions and in ways that I don't pretend to fully anticipate. I think it is seismic in the implications for particular companies and particular industries, from healthcare and getting things approved by the FDA to in the venture capital space. I founded our company really on the heels of the JOBS Act in 2012.

Yeah.

And that was interpreted, in my opinion, very, very narrowly by the SEC to the fact that there are whole parts of the JOBS Act that became impractical. There were really, in my opinion, the legislative intent was very different than the way the SEC interpreted it. So I think we're going to see it in industry after industry. We are going to see it in kind of the venture capital space as far as how things get done, how things are going to go. I think, again, like a lot of change, there's huge opportunities for entrepreneurial companies to do new things. Do things differently. I think it is seismic in its implications.

What do these changes mean and when will we see them? That answer right after this.

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Any thoughts on how fast we're going to start feeling these changes?

I think you're going to see them fast because I think many of these agencies are going to become much more flexible when it comes to how they're going to view it. Yeah. When there is going to be lawsuits, there's going to be threats of lawsuits, there is going to be preemptive stuff, I think, done by these regulatory things now that they're going to have to. So I actually think I think you're going to see some changes in the matter of— and I think you're going to see lawsuits in the matter of weeks and months. Yeah. Where, you know, again, just to pick another sector, I think there's issues going to be coming down. There's going to be lawsuits coming down in energy. I think there's going to be lawsuits coming down in healthcare. I think there's lawsuits going to be coming down in industry after industry on this. And again, I am not making a legal judgment. I'm not saying that I, as a citizen, I necessarily like all of this stuff. I'm literally saying, um, uh, change is coming, and change is coming in a big way on how things are going to get done. Um,

and I'd say generally, from what we know, positive for those looking for, for innovations to, to get out of the lab and into the marketplace.

I think so. Yeah, I think in trying to— I'll give you a very specific example that I can speak to personally, which is in the venture capital space. It is very restrictive in being able to invest in venture-backed companies, is restricted to a group of people called accredited investors.

Yep.

And, you know, that in our country is defined by one's balance— personal wealth and balance sheet. And I think that that definition— and that has been, oh, we need to protect people. And, you know, I, I think that, that, um, the restricting an American's ability to spend their own money and invest their own money is somehow expanded if you're rich is not going to play very well with a judge or a jury. And so I think that's just one example of where I think change is coming and it's going to come pretty quickly because— I didn't know that. Yeah.

Great.

So what do you got, Matt? Yeah.

Okay. Yeah, so the one I have is a new gene editing technology called bridge editing. So 2 papers came out in Nature last week talking about this discovery, and it was done by researchers at the ARK Institute, which is a nonprofit research institute in Palo Alto that's pretty interesting. So they've got collaborations with Stanford, Berkeley, UCSF, and they've got really a novel model for collaborative research. So they bring on these core research scientists and they give them this no-strings-attached multi-year funding agreement. And the idea is that the researchers won't have to spend so much time fundraising, and they'll have a lot more flexibility and freedom to pursue research that they're really passionate about, but, but also can take risks on— take on projects that could fail. And this research institute launched in late 2021 with $650 million in funding. The founders of Stripe played a key role in getting this off the ground. So really interesting to see some breakthrough research coming out of this institute. And to understand the potential significance of what we're talking about here with bridge editing, I think it's a good place to start is talking about CRISPR.

Mm-hmm.

Which I think a lot of people have heard about, but this was this major breakthrough in gene editing that allowed scientists to make precise edits to DNA. And, the scientists behind this won the Nobel Prize in Chemistry in 2020. It's transformed genetic research over the last decade, allowed us to treat specific genetic disorders as just one example of the impacts of CRISPR. So, People talk about CRISPR as genetic scissors. You can go in, cut the DNA, and then you rely on the cell's repair mechanism to insert new DNA. Bridge editing, this new technique, doesn't actually cut the DNA.

Hmm.

It unzips it, a small section, inserts new DNA, and then zips it back up. So you're talking about a totally different method that should be a lot more precise, have less errors, And really, the promise here is to insert any piece of DNA into any location in the genome.

Hmm.

Rather than a technique that lets you cut DNA, you're talking about having like this write capability directly into the genome. So, the name of bridge editing, they called it this because it's physically bridging 2 pieces of DNA. So this could allow for just totally new ways of dealing with biology and biotechnology. And we've talked about some of these in the past, but, you know, applying this to crops and agriculture, disease resistance, drought resistance, the implications in medicine are vast. There's a lot of really complex genetic disorders that you can't get at. Mm-hmm. with just CRISPR. This new methodology could open up the opportunity there. And then there's this whole vast field of synthetic biology.

Mm-hmm.

You create novel organisms to do things like alternative fuels. So very exciting. This research is early. It was just done in E. coli, which is where a lot of this research starts. Hasn't been applied to humans yet, but this feels like one that we may Yeah. Look back on it in a few years as this was a massive step forward for the field of biotechnology. So, an exciting one to watch.

Regarding this insanely fascinating breakthrough that Matt shared here, the ARK Institute actually released a video of how bridge recombination works within their discovery. And, I wanted to share the video. So, Hop over to YouTube and, you know, watch the video version of this podcast there. But there's also an audio with a really cool voiceover. So here is the video from ARK Institute sort of explaining this breakthrough that Matt just brought to the table. Enjoy.

What if we had the capability to recombine, insert, excise, or invert any 2 pieces of DNA? A team led by scientists at the Salk Institute has discovered that jumping genes from the IS110 family produce a new kind of non-coding RNA guide that enables fully programmable DNA rearrangements. Uniquely, this bridge RNA contains 2 loops: one that guides the recombinase enzyme to the genomic target site, and a second that recognizes the donor DNA. Once bound to both DNA substrates, The recombinase forms composite active sites to swap the top strands between the 2 DNA molecules. Following strand exchange, the DNA forms a Holliday junction-like intermediate. Finally, the bottom strands are exchanged to fully recombine the 2 DNA molecules without creating unwanted DNA breaks. Bridge RNA loops can be independently reprogrammed to insert, excise, or invert any 2 DNA sites of interest, allowing us to make flexible genome manipulations beyond what's possible with CRISPR. Now, for the first time, the Bridge Recombination System gives us precise control over large-scale DNA rearrangements, enabling a new generation of genome editing and design.

Yeah. And again, I think it's like alternatives in that space are good as well. I know there's been some patent dispute issues related to CRISPR.

Yeah.

And so, if there's other ways to kind of achieve innovation and experimentation there, I think that's nothing but good. And again, your bigger point too about You know, everybody thinks of VCs as being just, oh, we want the practical short-term implications. But there is such an important role in our society for basic research and letting people kind of go where they want to go intellectually, just from their curiosity and not having to apply spend 2/3 of their time raising money, applying for grants, but just give somebody a chunk of money based on their talent and let them just go. Yeah. I think we have found that when that is done, good things happen. And so it's like it's a role in our society of the super successful paying it forward with these kinds of just open-ended grants. I think we saw that. I think we've seen that in the nonprofit space with Melinda Gates and just these individuals that are just writing checks versus trying to kind of micromanage this, that, or the other thing. It's just like if you've got a great researcher, If we can just write them checks and let them do their thing.

We get developments like this. So yeah, super exciting to see. Yeah, new approach to basic research and getting some really strong results quite quickly. Again, they just opened this a few years ago. So

yeah,

pretty cool.

And then life science is just so much exciting stuff going on. Yeah, my third one is Again, just a bit on the same theme of, you know, it was, you know, the recent AI release coming out of, you know, Claude and Perplexity. And I think when you had ChatGPT coming out with ChatGPT, 3.5 and then 4.0. Yep. I think there was people thinking it's like, oh, they're going to take it. And I think now mid-year 2024 with releases that we're seeing out of Google, I think what you're seeing out of Meta, I think what you're seeing out of Apple, I think some of these other chip companies coming online like Rock and again, seeing great things out of Perplexity and Anthropic. I just think this, and again, I was playing around with Anthropic's latest release and it's just really strong, really powerful. Does has its own take on things. I just am now seeing kind of a suite where those looking to bring AI into their own workflows, into their own businesses, into their personal lives, you know, that you have a suite of tools now that are available. that have their own strengths and weaknesses. And so it's like you want to have them all available, frankly. Yeah. And then combining that with seeing AI being built within tools that you're already comfortable with and using, right? So you may be really a fan of Canva or something like that, and just seeing those companies building it in, I just, again, see the pace of AI releases and developments coming hard and fast. And just again, this— I have now hit the tipping point where it's just like, I just think you're going to have— it's just like the App Store or software. You're going to have a variety of tools to do things. Well, and now we have a whole class of new tools that are AI tools to help you do something.

And what do you think about the agents coming? Do you think your agents will tap into different models depending on, you know, the cost of the models, the use case? It feels like it may be hard for the individual to figure out what's, what's the right model or the optimal model for the specific situation.

Yeah, I mean, I think the issue of agents, I think, is we're right on the cusp of that. I don't think we're quite there yet. You know, I don't think a lot of people are trusting these systems yet to do a lot of stuff commercially on their own. Right. There's still, there's still, there's still a little bit of, you know, middle schoolers or teenagers, frankly. Checking in on them.

You need pretty strong oversight.

Right, kind of thing. But I think what you're starting to see is companies and individuals developing workflows where they're intervening at checkpoints to double-check. They may break down a workflow into kind of 3 or 4 parts with a couple of different intervention points, and then obviously one right at the end before deployment.

Yep.

But I see those strings getting longer and longer and people's confidence with them going. I'm seeing this with, you know, self-driving technologies, right? Which is, you know, it used to be, oh, this is basically cruise control plus that I'm only going to use on kind of the highway. And then, you know, with great dubious care. And now I think the state of play is people are doing it You know, in routine drives or doing, you know, it's not just like push the button and go in the back seat. But I do think the segments where one feels good about deploying it, growing and growing quarter over quarter in a significant way. So yeah, I just think it's more and more and more and more responsibility that we're giving to these systems. But I think it's I think the Anthropic release, big deal. I just think there's going to be many winners here and they're going to all find their niches over time.

Yeah, super exciting.

Excellent. Another good week.

Yeah, great to see you.

Thank you.

Take care.

Have a good one, Matt.

See you.

You know me being the sort of guide for this show. I have heard a lot of interviews, right? And I've heard a lot of CEOs and entrepreneurs and startup owners talk about AI and talk about AI tools that they use every day. And like Mike was talking about, use those AI tools within their workflow. And I too, after listening to Mike and, you know, all these people that he brings on the show, I too have changed my own workflow. With how I research for this podcast, how I edit this podcast, how I organize myself and all the files that we have for this show. And I wanted to share a few that I use that I have picked up from this show. So Perplexity was one that Mike and Matt talked about today, and I use that every day. Perplexity is a constant tab that is open on my Google Chrome that I use every single day for literally any questions that I have. It's really good about summarizing Um, and picking research from a bunch of different sources and providing just a lot of content for you to answer, uh, any questions that you might have asked it. Um, and then recently, after listening to this interview with, uh, Mike and Matt, I have started using Claude, uh, which Mike brought up here with his, uh, other third breakthrough. And it too is kind of— it's like another version of ChatGPT. So I've been using both ChatGPT and, uh, and Claude, and they're both Mike is very right. They both are used for their own sort of specialty baggage of things, but they too have really helped my workflow. And another one, which is for more fun stuff that I sort of use for other things, is Midjourney. And Midjourney is like that sort of image generation AI, which you can use through Discord directly through their server modifications. So Yeah, these are just some AI tools that I have used after listening to a bunch of these interviews and/or doing some research myself. But we are going to round out this episode with one more short break. Thanks so much for listening to The Tech Optimist. See ya.

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