Dilip Goswami is the co-founder and CEO of Molekule which is a San Francisco-based science and clean air company that has developed a fundamentally new approach to cleaning the air. The company has raised $100 million from top tier investors such as Crosslink Capital, Uncork Capital, Foundry Group, TransLink Capital, Highway1, Foxconn Technology Group, Hack VC, Founders Circle Capital, Hone Capital, CSC, Inventec Corporation, and RPS Ventures.
In this episode you will learn:
- Going from academia to entrepreneur
- Embracing cutting edge technologies
- The first FDA approved healthcare device that kills viruses like COVID-19
- Making clean air a part of essential infrastructure, just like water
- The most important thing, which will make all your decisions easier
For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
The Ultimate Guide To Pitch Decks
Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).
Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.
About Dilip Goswami:
Dilip Goswami, the Co-Founder and CEO, previously served as VP of Technology at Advanced Technologies & Testing Laboratories where he lead research & development. He holds a M.S. in Electrical Engineering from Stanford University and B.S. from University of Florida.
While at Stanford, Dilip worked with the Technology Venture Formation program on a medical device startup, Surgicool. Dilip Goswami is the CEO of Molekule, and co-founded the company to commercialize the technology that helped him solve his long-standing allergy and asthma problems.
Connect with Dilip Goswami:
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FULL TRANSCRIPTION OF THE INTERVIEW:
Alejandro: Alrighty. Hello everyone, and welcome to the DealMakers show. I think that we’re going to have quite a good conversation here, and I think that you all are really going to enjoy our guest today. He has built an amazing company. The journey and how he’s gone from research and Ph.D. to building something meaningful, and he’s going to tell us about it. I think that you guys are really going to enjoy the process of building, scaling, raising capital, all of that. So, without further ado, let’s welcome our guest today. Dilip Goswami, welcome to the show.
Dilip Goswami: Hi, Alejandro. Thank you for having me here.
Alejandro: So, born in North Carolina. Your parents are immigrants from India, so I’m sure that growing up, you saw the hard work and going at it into the uncertainty kind of thing.
Dilip Goswami: Yeah, absolutely. My parents’ background is that they’re immigrants from India. My father came here to the states to do his Ph.D. here at Auburn University. Quite a bit of my family have gone through that immigrant journey. Even before that, they had been refugees, traveled to India during the Partition of India, and had to scrap to get scholarships to get educated at the highest levels. Certainly, that ethic has been fundamental to shaping my personal life and how I look at doing things.
Alejandro: Your mother, a chemist. Your father, a distinguished professor. Growing up, you dealt with some challenges when it came to allergies and asthma. I’m sure that really shaped you as a human being and perhaps how you look at problems. So, tell us what happened there.
Dilip Goswami: Yeah, absolutely. You’re correct that my parents came from a very deep science background. My father did his Ph.D., became a distinguished professor, very well known in the field of solar energy, Dr. Dharendra Yogi Goswami. My mother was both a chemist and an entrepreneur. She had a background in analytical chemistry and ended up opening her own analytical chemistry lab where she did testing for various local governments, the state, and federal government in terms of testing sample for complying with environmental regulations, making sure that water quality was up to par and doing those kinds of testing. I grew up in that very lab environment. The interesting thing is that story about how I grew up in North Carolina, the challenges that I face became formative in the formation of this company Molekule because I grew up with very severe asthma and allergies. It was a range of different allergies that could trigger my asthma, everything from food allergies, but the things that really were difficult to control for us were the pollutants in the air, the exposure to those that would trigger my asthma symptoms, and oftentimes end up with me going into the emergency room, my parents rushing me there because I couldn’t breathe. It was, in fact, severe enough that we ended up getting the equipment that they would use there, the nebulizers, and the various other pieces, at home so that we would have them readily available if a severe asthma attack happened. It was that experience that really shaped the company that we ended up building because seeing the difficulty in controlling those pollutants and the impact that had on my symptoms was what led my father into researching various ways – his background was in solar energy, and he had been developing methods for solar purification. My mother, as well, had the background in water quality testing. So, they were working on that piece, but we saw that there were pollutants in the air that were incredibly difficult for us to avoid and that were causing the symptoms, and that’s what led them down the journey that eventually led to us founding Molekule together.
Alejandro: I know, also, that having your father being a distinguished professor, he was into research as well as your mom, too, really made you spend quite a bit of time in research labs. Is that right?
Dilip Goswami: Yeah. I would say a lot of my formative experiences growing up happened tailing them to their various workplaces. My father had a large research lab on solar energy at the University of Florida. I spend many summers going over there. It was quite a large research park, so there’s quite a bit of land and area. There was a solar house, as well as the labs and various different testing pieces. So, I spend a lot of time there. I also spent time at my Mother’s lab that she started up. I got to see a bit of her entrepreneurial journey. The environmental testing – that space is a highly-regulated space. It’s a challenging space because when you have a highly-regulated space, and you have a lot of existing players in that space, it can be challenging to start something new and to compete with them being a small business. I got to see that helping her. One of the first things I ended up doing was setting up – the software that these labs use is quite expensive. So, we built our own inhouse solution models in high school to help her manage all the testing data and be able to do that analytical work on the IT side without having to purchase that expensive equipment. I ended up learning quite a bit. I worked with her on the analytical chemistry side. I learned how to operate various equipment. At the same time, in my father’s lab, I worked with him on some of the early pieces of research that ended up resulting in the innovations behind Molekule. Those were my formative experiences, and because of that, originally, I hadn’t planned to become an entrepreneur. My thought was that science was really exciting and that I could do really positive things in the world from what I had seen from my parents, and I had felt like I’d like to be a professor and academic because it seems like a pretty good gig where you get the chance to explore these technologies, and you set your own agenda of what you’re researching and figuring out.
Alejandro: That’s like what you did. You went to school, you went to college there in Florida, and then you did research. You also did development, but then you went to Stanford, and I know that Stanford opened your eyes in a way that you hadn’t seen before. What happened there while doing your Ph.D.?
Dilip Goswami: The thing that was interesting about Stanford was, I had seen the tough side of the entrepreneurial journey, but I hadn’t gotten to see as much of the possibility of what can be done. One of the things that had bugged me for years when I had started at Stanford was that – my father had developed a lot of really interesting technologies. I had heard, not just from him, but from his friends quite a few exciting innovations that I felt should be out there in the world. It took years for them to actually appear out there in the world. I had this idea, “I want to go and get my Ph.D. at Stanford. I want to focus on doing something world-positive with that research.” At the same time, I also had this idea that even if you develop something, it still takes decades for it to get out there in the world. While I was anxious, I realized, “This is a really long journey.” The thing that was different there and that opened my eyes to the possibility was getting involved with various entrepreneurship programs at Stanford and seeing how quickly something could go from idea to scaled innovation that’s helping millions of people out there in the world. The first class I’ll credit while I was at Stanford, Fred Gibbons, who is a professor there. He was the original founder of Harvard Graphics, which is the first presentation software. I took a course with him that was a business school course designed for engineers. That really opened my eyes to the possibilities, and I started working with a few programs from the Graduate School of Business on entrepreneurship and then working on a medical device startup. Through this whole time, I was also talking with and working with my father on the technology behind Molekule. Eventually, what I realized was that the best way to make an impact on the world for me was not to be an academic, but to take this entrepreneurship route and this technology that my father had been developing in the background that we could actually help billions of people with this technology through a route that Stanford opened my eyes up to, which was the route of entrepreneurship, and especially venture-backed entrepreneurship because that gave me the idea: you can take an idea and scale it very quickly. I remember in one of my first classes that I took on this side of things, we had Marc Andreessen come in, and he talked about his journey from being a grad student at the University of Illinois at Urbana-Champaign developing the Mosaic browser to Netscape. I realized that if you have an idea that can change the world, this is probably the right way to do it as opposed to just trying to put it out there as an academic.
Alejandro: What happened next? You had this realization, and you realized that becoming an entrepreneur is the real deal to have a positive impact in the world, so what are the next steps that you took?
Dilip Goswami: That was 2009 when I started at Stanford. By the later half of 2014, I had already spent a lot of time working on some of these entrepreneurship courses and working on some of these programs, and I felt like it was the time for me to take that step. I didn’t end up actually finishing my Ph.D. I worked through my Master’s, but I didn’t finish the Ph.D. at Stanford. I decided I didn’t want to wait any longer, so I took leave from Stanford and ended up deciding to go fulltime on the company. Now, one of the real accelerating points there was that we had been looking at various ways to do this, and we felt that to launch something – what we were trying to do with Molekule was very challenging because we had this technology that my father had developed. Based on his scientific research, it was what we call today Photoelectrochemical Oxidation or PECO, and it was using light plus a nanoscale catalyst that we had developed to chemically breakdown these pollutants. That probably sounds pretty complicated. In practice, our device is fairly simple because we have light shining on this filter surface, and there’s a reaction happening on the filter surface as breaking these pollutants down. But taking that laboratory science out there into the market, into a real physically realized product is quite a challenge. So, we decided not to go it alone. We ended up doing an accelerator program that was called Highway1, at the time. It was just by coincidence and serendipity that we found out about the program because a friend of my sisters, who she had met while working at the D School at Stanford, was currently going through that program. She had taken her thesis project from the D School and decided to develop that into a company and was working with this accelerator to help take that from an idea to an actual prototype that could be pitched to seed investors to then build a company around. We ended up taking that route. We did the accelerator. We got accepted into the accelerator in December of 2014 and started in the spring of 2015. That started us on the journey. There are still plenty of challenges on our way because we’ve got this hardware product with deep science inside. It’s not your typical Silicon Valley innovation. We had a long way to go from there, but that accelerator was our first step into making this a reality and really committing to the company fulltime and diving into to make sure this really happens.
Alejandro: Got it. What happened there? How did you dive into it to make sure that it actually really happened?
Dilip Goswami: We used a network around that accelerator to help us build out the company. For emphasis, I think a good lesson for people because normally, in an accelerator, everything builds toward a Demo Day. Then, you’re hoping that your Demo Day goes well, you have something exciting, people will come to you and want to invest. That’s not the way that our journey took place. We built up to quite an exciting Demo Day. We had a lot of interest around the company, but it didn’t materialize into what you think of as a type of a YC experience where you do a great demo. You come offstage, and all the sudden, you’re discussing term sheets. That didn’t happen to us. It was a process that, through the accelerator, we built up a prototype, we built up positioning around the company. We did some early beta tests where we showed some really amazing impacts on people and their ability to potentially breathe with this device. So, we had a great foundation to show that this technology can make a huge impact on the world, and we have a device that helps people realize what it can be, but it took some grinding after the Demo Day. We did end up meeting our seed investor through the process of that program, but he was somebody who happened to show up to a Mentor Day. This was Jeff Clavier from Uncork Capital. He didn’t show up for the Demo Day, but he showed up for Mentor Night. We talked to him. He was interested. He had experience investing in hardware. So, a couple of months after the Demo Day, we ended up doing a meeting with him, and that led to him committing to lead our seed round in the company, and things started from there. Even beyond that, our first employee, our first CMO, Peter Riering-Czekalla, was actually a mentor at Highway1. We reached out to him because we were having some trouble making some decisions around the product. When we talked to him, he asked us a range of different questions about the positioning about the customer and helped us to base our decisions on the product based around the positioning of the customer. His background was, he had worked with the team at IDEO for ten years and had done the startup himself in the hardware space, so he had gone through the ups and downs of it and ended up coming on as our first employee. We tried to take whatever network and whatever progress we built at the accelerator, build momentum on that. Then it took some grinding before we could turn that momentum into reality. But by the end of 2015, we had done an initial seed round of funding that was 3.25 million in seed funding, and we had tapped through the network there to be able to find a manufacturer to work with, which was quite exciting. So, we were well on our way toward making this a company by the end of it. But it wasn’t something that we walked off stage on Demo Day, and it just got delivered. It took some real grind there.
Alejandro: For the people that are listening, what ended up being the business model of Molekule?
Dilip Goswami: One of the things that we’ve looked at over time is always trying to learn from what comes before. With us, there was a natural difference in our business model from your typical hardware company because we have a device. That’s the Molekule device that has the PECO technology inside. It’s an air purifier. We have a range of products, now, today, but what we first launched with was the Molekule Air, which was a device that covered about 600 square feet and was able to not just filter, but destroy the pollutants coming through, which was the key factor, for example, for me, in being able to breathe better. That was quite powerful. What we did with the business model was, we sold the device upfront, but we also had these filters that are necessary to operate the device over time. We’ve built that out as a subscription business. What we looked at there was, with your typical air purifier, oftentimes, what happens is that it’s not really clear when you change your filters, how to buy them, do you need to go to Home Depot or can you get them online? These are the typical factors. We saw with the customers that people don’t typically want to have to deal with the mess of doing that. So, we set things up on the filter side as a subscription with the Molekule Air. It’s $129 a year filter subscription. That covers all of your filters that you need. Those filters are shipped to you once every six months. The device indicates that if you connect the device online to the app, it indicates to you when the filters need to be changed. That was an experience piece that we felt was important to solve, and that naturally tailed into the business model of the company where we sell devices upfront, but we also have a subscription model.
Alejandro: Got it. You were alluding to and talking about Jeff Clavier from Uncork, a great, great, great investor, Jeff Clavier. How much capital have you guys raised to date that is public?
Dilip Goswami: We’ve raised almost 100 million in capital to date. It’s been an interesting process. I would say, as a hardware company, we’ve seen both the peaks and the valleys of people’s sentiment on hardware because it was quite high when we started. It became quite low. I think there’s now interest in hardware again, and people are realizing now that there are a lot of the challenges out there in the world. I look at every challenge as an opportunity. A lot of these challenges out there in the world require some atom’s piece, like some physical piece to actually solve them. You have to have some real physical innovation combined with innovation in software to deliver the maximum level of impact out there in the world. We raised 100 million capital to date and, again, it’s been a process of ups and downs, but the exciting piece is that we’ve been able to find investors who really believe in the mission of the company, and that’s something that we’ve looked for consistently as we’ve gone through our various rounds of funding.
Alejandro: You guys have people like Crosslink or Foundry. So, great investors. Dilip, why would you say that hardware is such a beast because, with the hardware founders that I speak with, they are telling me that hardware is just difficult when it comes to raising money. Why is that the case?
Dilip Goswami: There are a number of different factors that play into that. I think one is that there are some unique challenges that come with doing hardware. When you have a huge increase in demand, you have to negotiate that with a supply chain that there are sheer physical limitations oftentimes in terms of scaling them up. Then there are also business challenges in scaling them up. The same way as a hardware company – the same way that you go out and pitch investors, you’ve got to mind manufacturers that are great partners. We’ve been able to find that with IC and FinTech Corporation. They’ve been great partners to us, and we have that now, but it’s a challenge for a lot of companies to find that in terms of having a good supply chain partner who can scale up with you because it’s going to be impossible, even arranging venture capital, for you to do all of your manufacturing 100% inhouse if you’re making a full consumer product. We do part of our manufacturing inhouse. The filter technology that we talked about we actually do that ourselves. We have our own manufacturing facility that we built up domestically to take care of that piece, but we have to have the right partners on the other side. The other piece is that there’s some fear of the unknown, I think, for investors because a lot of them are comfortable making software investments. They’ve had plenty of successes along the way, but there are challenges that they haven’t necessarily faced with that are very different in the hardware space that they don’t have as much experience with, so there’s a degree of caution in terms of looking at investments in the space because there is a fear that “Something could go wrong that we don’t anticipate and we don’t know the right pieces to ask this founder to reduce our risk on that side.” So, I think some of it is the fear of the unknown. Some of it is the challenges. The final piece is hardware business models have also changed over time. Just selling a single device upfront has been something that we’ve seen that public markets don’t reward, and then selling something that’s made out of, let’s say, commodity electronics is often something that has been a challenge because you have fast follow-on from people who can do this cheaper and oftentimes, [26:18] providers, but sometimes domestic as well. For us, the way that we solve for that is we innovate it on the business models. We went to subscription. Then, our technology is based on really deep IP. The reason why you’re manufacturing inhouse is because we have real chemistry trade secrets that are difficult to replicate, and so that’s where we’ve answered those questions as well.
Alejandro: For the folks listening to get a sense of the size of the operation, how many employees do you have, or what can you tell us?
Dilip Goswami: We’ve got about 120 employees to date. That’s across a number of different locations. We’re headquartered in San Francisco. We also have inhouse manufacturing that’s based in Florida. We’ve scaled up quite a bit over time. I think we’re excited for the next set of challenges that we’re faced with. We’ve got a mission to serve – there are over a billion people in this world that are faced with chronic respiratory problems, people, like me, who have asthma or COPD, etc. We’ve got a long way to scale and serve those billions of people. We’ve been quite happy with how we’ve been able to scale so far.
Alejandro: So, a long way to scale, and the journey, and the road ahead. Imagine you go to sleep tonight, Dilip, and you wake up in a world in five years where the vision of the business is fully realized. What does that world look like?
Dilip Goswami: What I would say is that we have levels to our vision. I think there are different pieces to this, but the basic level for us is that it’s important for PECO to be now a fundamental infrastructure technology throughout there in the world. One of the things that I started my pitch with, I actually looked back at a deck that I had designed in 2013 before I had taken the fulltime plunge into the company. I was still on the Stanford campus, where investors have office hours, so I wanted to get their feedback before we actually developed some of these things. One of the things that I had in there was around some of the work that we’re doing today. Unfortunately, as the world we’re faced with in the difficult situation today, with the pandemic around COVID-19, one of the things that we had looked at, even early on, was the spread of airborne infectious disease because one of the challenges that we’re often faced with is that the technologies in this market – the HEPA filter was designed around capturing dust back in the 1940s. They, at that time, weren’t anticipating “How do we use this technology to help stop the spread of airborne infectious disease, and that’s something that we thought very deeply about because we’re thinking about not just the allergens that make people like me sick, but also the various bioaerosols, the molds, the bacteria, the viruses that are in the air. We today, tested our product and have been able to get into healthcare with the AirPro XR, the first device for healthcare that’s been FDA cleared for the destruction of proxy viruses like the ones that we’re faced with today. To me, one of the things that we talked about as a moral imperative for us was to be able to, when some crisis like this happens, be able to scale up to match it. I think the long-term piece or where I’d like to wake up in five years is to see this technology not just in the standalone devices that we’ve built, but as a fundamental part of infrastructure out there in the world. There are two pieces to that. One is, being able to have infrastructure in your HVAC systems that respond, that can actually help take care of problems like we’re faced with today. The other piece is that if you just think about it on a normal basis, how many times have you been in a stuffy room and felt like, “I need to take a step outside to clear my mind.” That’s a fundamental piece. The air quality around you influences so much. There are many things that we’ve researched; there are many things that we don’t even know yet in terms of how this impacts health. We just know that it has a deep impact on health. I think our indoor infrastructure should be able to provide you the same way that we’re able to provide you out of the tap, clean water to drink. You don’t need to go out and find a natural spring for that. We should have our HVAC systems be able to provide you clean air to breathe that doesn’t lead to that feeling of stuffiness. There are various pieces to that. You also need natural light and these kinds of things. At least on the air front, something that’s able to do the same thing that we’ve been able to do on water and food, providing you something where the infrastructure actually makes it healthier for you to exist in there as opposed to detracting from it. I think that five-year vision is really being a fundamental part of the infrastructure and being able to deliver on a great clean air experience in that infrastructure.
Alejandro: Very cool. One of the questions that I typically ask the guests that come on the show is, knowing what you know now, Dilip, if you had the chance to go back in time, let’s say before 2014 when you launched the business and have a chat with that younger Dilip, and you had the opportunity to give yourself one piece of business advice before launching a company, what would you give in terms of one piece of advice that would address that and why knowing what you know now?
Dilip Goswami: One piece of advice is quite difficult because there are hundreds of things I’d like to tell myself before starting the company. If we bottle it down to one, I think one of the decisions that we made that was really important that we did this unconsciously, but we try to do this in a more conscious way now as we’ve matured as entrepreneurs into building this company is, the most important thing for your company is your values. Your values need to be reflected not just from you, not just from your employees, but also from your investor base. I think we’ve been really lucky, in retrospect, to be able to work with, not just Jeff Clavier, Eric Gins, Chris Moody, Sam Wang, who led our class round, Mike Chung. These people are all people that I’m really proud to be associate with because I feel that they reflect the values that we have as a company. It’s important because when you’re onboard and when your investors reflect those values, it makes it easier to make value-based decisions throughout the company. If everybody is aligned around that, then a lot of the other issues that you’ve got – there are like 100 things I’d like to tell myself at that point because there are so many things that in hindsight or retrospect you’re able to fix, but the thing that’s your north star through all the ups and downs, through all the mistakes you make are your values as a company. I think emphasizing that is the one major piece of advice that I give myself, and to have confidence in feeling like, “Yes. If we do this right, we will get the other things right.” Because going through that journey oftentimes, there are times when you’re scared of something working out. But the more confidence that you have in your values and in your way of doing things, those other pieces will eventually work themselves out. If you have the right process, at some point in time, if you have enough persistence and determination, the results always follow. It’s just a matter of how much time and how much determination you want to put by in something. So, that’s the most important piece of advice I would give myself.
Alejandro: I love it. So, for the folks that are listening, Dilip, what is the best way for them to reach out and say hi?
Dilip Goswami: Take a look at our website. You can always shoot an email and contact us through there. We’re really excited to talk to people. I’m happy to talk to people about entrepreneurship and our journey. There are plenty of people who come through and reach out to me that I try to help advise as best I can. If there are people that are learning more about this technology of the product, the site is the best place for that, as well.
Alejandro: Amazing. Well, Dilip, thank you so much for being on the DealMakers show today.
Dilip Goswami: Thank you, Alejandro. It’s been an absolute pleasure talking to you, and I hope that the words that I’ve spoken here have been helpful to others today.
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