Haplotype: Personalized Genetic Analysis

This is The Startup Breakdown, the only newsletter looking into the new Y Combinator companies that you need to know. By joining this growing community of hundreds of founders, investors, and other startup aficionados (think i spelled that right?), you're getting a firsthand look at the companies that may be the next Airbnb, Coinbase, or Reddit.

Haplotype: The Future of Personalized Healthcare through Genetic Analysis

The Story: Personalized Genetic Analysis

Thanks to Starbucks, if my prescription contacts don’t come in a box with my name written in massive font followed by a detailed explanation of how each individual lens is custom-made for my retinas and adjusted based on my daily breakfast of Frosted Flakes, I don’t want it.

Consumers are conditioned to expect personalization, and while a misspelled name on a latte cup might be nice, this level of tailoring can be life-saving in healthcare.

Haplotype aims to rip off this band-aid of healthcare generalizations, introducing AI-powered personalized genetic analysis to enable personalized treatments, predictions, and research.

Specifically, the company is developing a platform to allow for population-derived risk analysis of certain diseases to enable preventative measures, as well as various other important data points to inform broader-scale R&D, management, and even insurance.

Even beyond basic (although the science and math behind it are anything but) risk modeling, the platform serves as the home for securely storing and wielding data, using AI to allow stakeholders to interact with this data through natural language queries, further enhancing the potential for personalized genetic analysis.

Unsurprisingly, AI has allowed for an acceleration in the research and development of new sequencing models, and the platform even allows data owners to test the performance of these various models with their own as well as publicly available data.

The increased interest and attention in the space desperately needs a central solution to facilitate and organize R&D efforts. Haplotype Labs has every opportunity to be this hub, benefiting society as a whole through extended lifespans in the process.

The numbers:

Traction:

• No reported metrics

Market Size:

• TAM: $21.3 billion (7.6% CAGR, and InsurTech market growing at >30%)

• SAM: $17 billion

• SOM: $$170 million

Competition:

• Illumina, Helix

• CRISPR Therapeutics, ADNTRO GENETIC

• 23andMe, Ancestry

Team:

• Mike Polcari, CEO: VP & Chief Architect at 23andMe (15 years), cloud computing, security, genetics, and ML patent holder

Risks:

• Bigger companies developing internal tools: The platform is nothing without data, and the biggest data owners in the space could develop their own management and prediction tools

• Privacy: Healthcare innovation is hamstrung by power-hungry thoughtful regulators concerned with protecting consumer privacy and safeguards against breaches

• Regulatory juggling: Each market that Haplotype attempts to enter comes with its own Old Testament of data privacy laws and practices, and the company will have to invest heavily in its legal department to ensure compliance and continuously monitor the regulatory environment

What I like:

• Customers: Yes, genetic data is invaluable for healthcare providers, but it’s also attractive to researchers, insurance providers, and the Chinese Communist Party 🇨🇳 

• Mike’s expertise: There may genuinely not be a more knowledgeable person on the genetics industry than Mike… just look at 23andMe's success and his decades of research in personalized genetic analysis

• Public and private data: The decades of proprietary data accumulated by the biggest customers is invaluable, and allowing them to securely combine this information with public data makes the platform more attractive

Opportunities:

• Expanding uses: Can eventually power uses such as wearables, nutrition, and an assortment of other bio-data-enabled industries

• Selling data and insights: Data is gold, and Haplotype could profit as an anonymized data marketplace or even quarterly insights reports

• In-house research: Access to more data than anyone in the space, enabling them to push the boundaries of personalized genetic analysis research internally

It takes a lot to be a rockstar in genetic sequencing. Mike has managed. His reputation convinced YC to take a shot on a solo founder, something they don’t do very often, and if you injected the partners with truth serum and asked them to pick the companies they’re most confident in, I genuinely think Haplotype Labs would be top 3.

Links of the week:

How am I doing?

I love hearing from readers, and I’m always looking for feedback. How am I doing with The Startup Breakdown? Is there anything you’d like to see more or less of? Which aspects of the newsletter do you like most?

Cheers to another day,

Trey