[Disclosure: AgFunder is the parent company of AgFunderNews.]
- Cromatic—a San Francisco-based startup building an integrated platform for outsourcing R&D—has raised $5.3 million in a seed round led by AgFunder and LifeX.
- The round, which was supported by investors including Accel, Kleiner Perkins, Lux Capital, and FJ Labs, will help cofounders Ann Lin and Anne Chen accelerate the onboarding process for new clients and add extra functionality to their platform.
Finding the perfect CRO… and then managing the relationship
Apps helping us find the perfect love match are now ubiquitous. But there are precious few online tools to help biotech companies find the perfect contract research organization (CRO) and then manage that relationship thereafter, observes Cromatic cofounder and CEO Dr. Ann Lin.
“Finding a CRO is still mostly by word of mouth,” says Lin, who has a PhD in genetics from Stanford and served as the scientific cofounder of machine-learning powered drug discovery platform Meliora Therapeutics before teaming up with software engineer Anne Chen (CTO) last year to create Cromatic.
While 50% of R&D is outsourced to contract research organizations, which may handle everything from lab testing to a large-scale human clinical trial, the process of both finding CROs and working with them remains fraught, claims Lin.
Once companies find a CRO, she claims, even large biotech, foodtech, and pharma companies still use email, spreadsheets, and phone calls to manage these relationships on an ongoing basis because their in-house project management tools are not designed for collaborations with external vendors.
“I was at an event early last year with some investors and I was describing some of these challenges to Elliot Hershberg at [media and VC firm] Not Boring. I was basically complaining that CROs are slow to answer, and that there isn’t website to tell you which CRO is good at what and who you should reach out to to get certain experiments done. And he said, ‘Why don’t you start a company?’
“So that conversation was around March of last year. Right after that we sent a Google sheet into the community to see if anyone in our network was looking for CROs and within a week, we had people with projects [collectively worth] around $15 million. And that was when we thought this could actually be a venture-funded business. We were then incorporated in May .”
After that, Lin and Chen spent several months talking to biotech companies and CROs to understand their workflow and pain points, and built a platform incorporating tools such as project management software basecamp and payment processing capabilities. By January 2023, it started onboarding clients, and now has around 50 biotech clients and 100+ vetted CROs, with $15m+ R&D budget under management and partnerships with biotech accelerators including Nucleate, SOSV, and ValleyDAO.
“Biotech companies often struggle to find suitable CROs and manage million-dollar contracted projects without proper software support. This can lead to suboptimal partnerships, prolonged R&D timelines, increased research expenses, and, in extreme cases, company failure. That’s why I founded Cromatic.” Ann Lin
One-stop CRO shop and project management platform
Cromatic aims to serve as a one-stop-shop by providing a marketplace where companies can find CROs and a project management platform enabling them to manage all aspects of their ongoing relationship from payment processing for hitting project milestones to video conferencing, says Lin.
“Our marketplace is more interesting for smaller biotech companies that don’t have as big of a network, haven’t worked with any or many CROs, and are often just googling to find partners.
“But larger biotechs are enticed by the project management component because they’re outsourcing tens, sometimes even hundreds of different projects simultaneously, and managing all these projects at the same time is a huge burden.”
In a nutshell, she says: “We take biotech clients all the way from initial proposal submission to project completion. Our platform receives project proposals and quickly matches biotechs to CRO candidates. Once a match is made, we facilitate regular communication between the parties, allowing biotechs to more effectively track the progress of their projects, all in one place. Currently, no platform exists that combines effective CRO identification and subsequent project management.”
The business model
Biotech companies wishing to access the platform pay an annual fee for a subscription and then Cromatic receives a referral fee for each transaction processed through the site. CROs don’t pay a subscription fee but pay a referral fee per transaction on the platform, says Lin.
“We align very well with the goals of CROs, who always want more business. We have CROs signing up to be on our waitlist on a daily basis, so our focus in terms of marketing is much more about attracting users on the biotech side.”
While platforms such as scientist.com and scienceexchange offer matchmaking services in life sciences, she said, “they have been around for years and this problem still exists,” in part she claims because they provide quantity rather than quality when it comes to matches, and do not include collaboration tools for ongoing engagement with CROs.
Cromatic, by contrast, enables biotech clients to identify vetted CROs based on project criteria; and on top of that offers contract negotiation and signing tools, a project tracker, data storage and analysis, and collaboration tools to keep all analysis and communication in one place instead of across multiple applications.
To get onto the platform as a qualified vendor, CROs must go through an onboarding process submitting certifications and other documents, says Lin. “First, we do a background check on the CRO to ensure they have the proper laboratory infrastructure to take care of our client’s requests. Once we confirm they have the proper scientific expertise, we will verify the type of certifications they have and perform client reference calls to ensure previous client satisfaction.”
Over time, Cromatic will then track metrics such as responsiveness and repeat rates as it builds more data from its platform that could in future form the basis of ratings users can see on the front end of the site, adds Lin. “If a CRO rates very well through our algorithms, they’ll be classified as a super vendor.”
Access to outsourced R&D all under one roof
Asked what attracted AgFunder to Cromatic, associate Andrew Finkelstein noted that the discovery, development, and manufacturing of biotech products is transitioning from individual entities to collaborations among multiple stakeholders: biotechs, CROs, and others in this growing R&D landscape.
“As a country—and really as a planet—we’re already at the point where about 50% of R&D is outsourced, but the R&D landscape is so fragmented and challenging to navigate that ventures are practically penalized by the disorder,” said Finkelstein.
“It’s a patchwork of globally hard-to-find specialists, manual workflows, and custom software among and between organizations. This status quo increases the cost of innovation for biotech in general, and for footech and agtech specifically. That goes for whether you’re in the field of cell-based ag, ag biotech solutions, food-as-medicine, synthetic biology, decarbonization, or other areas across the food and ag value chain.
“Cromatic is tackling the issue by bringing access to outsourced R&D all under one roof with an organized marketplace of vetted CROs and an ‘all in one dashboard’ for project status, management, and communication across projects.”