Feature
Getting Started
April 18, 2007
A Q&A with Dr. Robert McDonald, president of Aledo Consulting and clinical director of life science initiatives for the Johnson Center for Entrepreneurship and Innovation at the IU Emerging Technology Center
Robert McDonald is a new breed of doctor: one with an MD and an MBA. Three years ago, he founded and serves as President of Aledo Consulting, a company that provides general business strategy and reimbursement consulting for life science and health service companies in the U.S. and internationally. Recently, Dr. McDonald spoke with the IU Life Sciences Initiative about the value that life science startups bring to Indiana and his role in starting these companies.
You wear a lot of hats... what is it that you do, exactly?
To start with, I have three bosses: Mark Long (President and CEO of the IU Research and Technology Corporation and the IU Emerging Technology Center), Dr. Craig Brater (Vice President for Life Sciences at Indiana University and Dean of the IU School of Medicine), and Don Kuratko (Executive Director of the Johnson Center for Entrepreneurship and Innovation at the IU Kelley School of Business). What they have in common is that they are all part of the process of taking University ideas and moving them out into companies. Dean Brater's medical school faculty makes important discoveries every day. Mark Long and his staff determine which of these discoveries is commercially viable and how best to protect those through patents, copyrights, etc. Dr. Kuratko oversees the Entrepreneurial Management Academy, where MBA students help develop business plans for startups based on IU discoveries. In any single day I might deal with one or all three activities.
Dr. Robert McDonald
How do life science companies get started?
To get a company started, you need an idea that's ready to become a product that meets a commercial need. Then you need to identify people with the right skills to move the project forward. This involves writing a business plan telling investors and the management team themselves what they plan to do. If everything goes well, then the money starts to show up.
What does a new life sciences company need in order to succeed?
There are three core needs: the right idea, the right people, and money. Investors don't invest in ideas only. They invest in a combination of ideas and people. Interestingly, many start-up companies end up bringing to market a product completely different from the original idea they had when the company began. So a new company needs a team of people that can quickly coalesce around secondary ideas. Resilience is very important. So is the quality of the management team.
Indiana already has Lilly, Cook, Zimmer, and other established life sciences companies. What do startups bring to the table?
Before each of these companies was an large company, it was a start-up company. If we're going to grow the next generation of large companies, we have to start with small companies that take higher levels of risk. Big companies just don't move around much. The rate at which a new company can grow is simply phenomenal. The large Indiana-based companies of the future are represented by medium and small Indiana-based companies today.
You have an MD and an MBA. Do you encourage fellow physicians to go to business school?
I don't have to encourage them — student and physicians call me all the time asking how to get the same dual degrees themselves. Not every doctor will be a good manager, but it's increasingly common that doctors are stepping up to larger organizational and administrative challenges.
