💸What Makes Investors Tick? Psychedelics Investment Summit
Welcome back to The Microdose Diet a newsletter about getting more success, passion and happiness in your career by using alternative medicines, such as microdosing psychedelics. 🍄
Last week I attended and spoke at The Cannabis & Psychedelics Investment Summit in NYC. This event is targeted to family offices and private investors who have mostly already been active in the space. On the back of Wonderland it was interesting to compare and contrast the perspectives. Some of the same themes emerged; 1) importance of preparation and integration in psychedelics’ journeys; 2) correlation between psychedelics, mental health and longevity; 3) the scalability and profitability challenge.
My panel on “Psychedelics and Pharma: Investing into the Future of Medicine and Brain Health” brought some colors on what investors such as Shelby Clark of Lionheart Ventures and Vitaly Pirotsky are looking for in companies when pondering investments. Entrepreneur Michael Rubinov who founded 3R Pharma shared his perspective on what makes potential investors in his company tick.
How to navigate the uncertain regulatory environment is obviously front and center as no overarching regulatory framework seems ready to emerge in the short term. Some investors (mainly funds) chose to abide by the current legislations and will not invest in anything that is not already federally legal. Others are more offensive, usually family offices and HNWI, betting on early stage companies currently evolving in the grey zone of the law.
A theme that was recurring, unsurprisingly at an investors’ conference, was the challenge associated with scaling profitably, ethically and efficiently. This conundrum is true for most companies dealing directly with patients’ treatments. In fact, the importance of preparation and integration linked with most psychedelics’ treatments creates a flurry of costs, mainly medical professionals’ time. Hence some investors focusing on medicines having short window of treatment to reduce time and costs, solving a small part of the equation. Many ketamine clinics have already gone under creating a new dynamic in the space, with some clinics looking now at offering group treatments in order to manage the costs down. This cost management is one of the aspects of the industry that makes some nervous in terms of quality of treatments and ethics in the way patients are being taken care of. The Do It Yourself approach for ketamine treatments, such as the one offered by the company Mindbloom, is another way to cut down costs. I have to say that taking large dose of powerful psychedelics on your own “under the guidance” of an app and with “the support of a community” is definitely not something I would do, nor recommend.
Giving more power to the patient / participant is totally the way I envision the future of healthcare. However, when it comes to healing “trips” (taking large dose of psychedelics) self-administered treatments are not the way to go. FMP, whether one decides to allocate the resources for a healing “trip” guided by professionals (such as the one I did last year with The JourneyMen Collective), whether they chose to microdose by themselves. I did hear stories of people having great experiences macrodosing on their own with a sitter, I also heard pretty disturbing stories (and Gents, men are more likely to have bad trips). So it is wonderful if your brother-in-law had a great healing journey in his basement under the supervision of a friend or stranger, but that could have easily happened another way.
The Investment Summit and Wonderland actually brought me a lot of validation when it comes to my own protocol and business model. With the strategic approach to microdosing psilocybin, self-administered and self-managed under thoughtful guidelines for preparation and integration, the participants are in control of their experience. Microdosing is a totally different path than macrodosing, with no trip, hence no bad trip, and no need for supervision as everything happens at sub-perception levels. The low costs, the quality protocol, the self-management, the easy access (no need to find a doctor, nor to have a doctor decides for you if “yes, you deserve to feel better”, and no risk to be pushed into a more lucrative treatment for the doctors / drug rep), all of that makes The Microdose Diet a great process for the participants (and a great investment for capital allocator😏).
Bottom line, if you are interested in investing in psychedelics keep in mind the balance between profitable scale and ethical efficiency as it is definitely a challenge for these businesses administrating treatments to patients, from preparation to distribution and integration.
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Once again the correlation between psychedelics, mental health and longevity was front and center during the discussions. It seems more and more obvious for investors and actors in the space that, as a panelist mentioned, « the first determinant of health is mental health ». Storytelling is taking a large place in the industry evolution with everyone (including legislators when advocating for broader access) sharing anecdotes from unmet needs with tragic consequences to successful and quasi-miraculous healing. The media seems very hungry for these stories of transformation which could bring benefits or pitfalls to the industry depending on the professionalism and credibility of the outlets involved.
Similarly to other spaces, the alignment of leadership’s incentives and investors’ protection was also pointed out as necessary which in the past (notably in the cannabis and tech industries) has not always been the case. Brand and IP are also at the top of the list of investors’ preoccupation when screening companies. Some investors preached to have the best Chief Scientist Officer on staff, while others opted for a top notch Chief Marketing Officer, and a third group privileged the Chief Legal Officer. This choice will obviously greatly depend on the business model of the company assessed, its distribution channel and potentially the treatment offered.
Everyone was making prognostics, more or less optimistic, regarding the changes in regulation. But all agreed that the symbolism behind these regulatory changes was what everyone was looking for.
As a conclusion, a lot is happening in the psychedelics space despite the valuation’s correction seen since 2021 in the public and private markets. The wild card in the industry is obviously the regulations. With many business models proving unsustainable in the long run, investors are also readjusting their investment approach. Nonetheless, the FOMO is very real among investors and among entrepreneurs. The main question remains around timing as none wants to be late to the party, but too early could also be quite costly. The healthy lobbying happening in the space will hopefully accelerate the timelines for the benefit of investors, entrepreneurs and more importantly participants.
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About The Microdose Diet
The Microdose Diet by Peggy Van de Plassche focuses on personal and professional development using alternative medicines, such as microdosing psilocybin, tapping meditation, journaling, guided meditation and visualization ✨
I am Peggy Van de Plassche, a former banker and VC who spent 20 years in the financial services and technology industries. I now speak and write about the benefits of alternative medicines, such as microdosing psilocybin, for professional and personal growth. I created More! The Microdose Diet - the 90 Day Plan for Success, Passion and Happiness🍾 My book will be published in 2024 and available for pre-order on Amazon.ca and Amazon.com in November 2023.
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This newsletter is designed to entertain and inform, not provide medical advice. You should always consult your doctor when it comes to your personal health or before you start any treatment 🩺