Vine Ventures
Meet Vine, a venture capital firm at the intersection of modern and ancient life sciences technologies.
Vine was created as a vehicle for solving some of the world’s most pressing problems. Today, 1 in 5 people will suffer from some form of mental health issue — a number exacerbated by the COVID-19 pandemic.
Johns Hopkins, a leading U.S. medical research university, called COVID-19’s second-order effects on mental health a “shadow pandemic.”
The cures for the shadow pandemic are here. Since 2017, the United States Food and Drug Administration (FDA) has designated three psychedelic compounds, MDMA, psilocybin, and ketamine “Breakthrough Therapies” for the shadow pandemic ailments of PTSD and depression. Ongoing clinical trials on treating addiction using ibogaine and its derivatives, dimetyltryptamine (DMT), and mescalines have groundbreaking results.
The first psychedelic to hit the market in the USA was a ketamine-based nasal spray called Spravato (esketamine), a short-acting dissociative developed by pharmaceutical giant Johnson & Johnson.
The FDA designated esketamine a Breakthrough Therapy for treatment-resistant depression (TRD) in 2017. In 2019 the FDA approved ketamine as a prescription medication. Today there are more than 800 ketamine clinics operating in the U.S.
This bodes well for psilocybin. The FDA designated psilocybin a Breakthrough Therapy for TRD in 2018. The 800-plus ketamine clinics could be the infrastructure for a psilocybin therapy boom.
Next, maybe ayahuasca. A conversation between Richard Evans Schultes, the father of modern ethnobotany, and a Kofán shaman in the Upper Amazon highlights the potential of ayahuasca (called Yagé by the Kofán):
When Schultes asked the shaman how often the people drank Yagé his response suggested the question had no meaning; during illness, of course, and in the wake of death; in times of need or hardship; at certain passages in life; when a young boy of six has his initial haircut or when he kills for the first time. And naturally, the shaman suggested, a youth will drink Yagé at puberty […] as a young man he may drink it at his leisure to improve his hunting technique or simply to flaunt his physical prowess.
The message that Schultes received was that the Kofán took Yagé whenever they felt like it — at least once a week and no doubt on any occasion that warranted it.
Wade Davis, One River (1996) p.226
The total addressable market for psychedelics is much larger than many pundits who expect a hyper-medicalized market may realize.
With an eye on grassroots movements in Denver, Oakland, Santa Cruz, and Ann Arbor pushing forward local decriminalization for time-tested entheogens like teonactl, ayahuasca, peyote, huachuma, and iboga, Vine sees a future informed by the indigenous perspective the Kofán shaman shared with Schultes more than half a century ago.
Origins
Named after Banisteriposis caapi, a helical vine endemic to the Upper Amazon and the eponymous ingredient of ayahuasca, brewed most often from a combination of B. caapi and Psychotria viridis leaves, Vine was born out of Breaking Convention, the world’s premier conference on psychedelic science at University of Greenwich, London.
Vine’s advisory committee has grown to include some of the most distinguished and innovative scientists in the field: renowned ethnopharmacaologist Dennis McKenna, who in the words of National Geographic Explorer-in-Residence Wade Davis is responsible for carrying the torch across the generations from the elders of the 50s and 60s to today together with his brother Terrence; rising star researcher at Imperial College London Malin Uthäug, whose pioneering work on 5-MeO-DMT in naturalistic settings serves to identify new treatment modalities for a short-acting compound some refer to as the Holy Grail; and expert medicinal chemist David Sherman, who leads the scientific arm of the Boiling River Project, sponsored by National Geographic, at the traditional Amazonian healing center Mayantuyacu, home office of the Ashaninka shaman Juan Florez Salazar.
Beliefs
There is great value in solving the world’s most protracted problems.
When Muhammad Yunus won the Nobel Prize in Economics in 2006, he focused his acceptance speech on redefining capitalism to make it work for the 21st Century. Yunus’ point was that in order for us to fix society’s problems capitalism should be redefined as not just making money but making money solving social problems.
Vine implements this in a couple ways.
One, Vine invests in companies solving social problems to do with mental health.
Two, 50% of the Vine general partner’s carried interest is distributed into non-profits, community organizations, and international development initiatives involving indigenous peoples via the Vine Reciprocity Trust.
Value is accruing upstream with significant experimentation downstream.
We analyzed more than 450 companies in this sector, both for and non-profit, looking at funds raised, categories, sub-categories, locations. We found that capital is concentrated upstream in drug development. The number of companies is highest downstream in distribution infrastructure. Vine’s approach to portfolio construction reflects this reality: it concentrates upstream but includes key experiments downstream, gaining exposure to key companies across the entire psychedelics value chain.
The most compelling returns come from early-stage venture.
Some of the most promising companies in our sector are not yet publicly traded. Vine focuses on those. Learning from data gathered over decades in venture Vine invests mainly in at the seed and pre-seed stages, which historically provide the best returns.
The Race
Name-brand investors like Mike Novogratz and Joseph Lubin of Ethereum fame, Tim Chang, partner at Mayfield Fund, and Peter Thiel, investor in PayPal and Uber, have moved in and planted psychedelic flags.
The pace of psychedelic science today has outstripped that of the 1960s. The 60s were dominated by one compound: LSD.
Today there is more diversity of psychedelics under investigation.
Research is underway at the world’s top universities, with Johns Hopkins and Imperial College London leading the charge.
The psychedelic intellectual property landscape is quickly evolving.
A patent race kicked off at the turn of the century.
MDMA leads in both number of patent applications filed and number of patents granted. Mescaline is the caboose, though a YCombinator-afffiliated company is working on mescaline medicines.
Patents have been granted for methods of treatment for a range of indications including depression, PTSD, anxiety, anorexia, Alzheimer’s, immune disorders, and microbial infections. They have also been granted for medical devices, testing methods, and a variety of consumer products such as topicals and supplements.
What’s Next?
This is just the beginning — a pre-vintage era of a sector that we believe will define the 21st Century just as it has defined so many thousands of years of human history.
So what does the future of this space hold?
Read Vine’s Hello World from our Managing Director Ryan Zurrer here: https://medium.com/@rzurrer/bac9757ca8ba
