Careers outside academia: Yongdo Kwak's success story as a PhD turned venture capitalist

Dr. Yongdo Kwak completed his PhD in neuroscience from POSTECH (Pohang University of Science and Technology. He studied the molecular links between brain diseases and circadian rhythms, and eventually began working in the pharmaceutical industry to develop new drugs for various brain diseases. He now works as a venture capitalist (VC) specializing in biohealthcare in the investment industry based on his experience in academia and industry. With roots in scientific expertise, Dr. Kwak has branched out into various interesting areas. 

In this insightful interview, Dr. Kwak shares his journey from academia to industry, what motivated him to make this transition, and his advice to academics who wish to explore opportunities in the industry.  

Q. Thank you, Dr. Yongdo Kwak for agreeing to this interview. Could you please tell us a little bit about your professional journey and what inspired you to switch your career in academia to one in industry?  

My name is Yongdo Kwak and I am a VC specializing in biohealthcare at Yuanta Investment. I majored in neuroscience for my master's and doctoral degrees, focusing on the molecular link between circadian rhythms and psychiatric disorders such as schizophrenia and depression. At the end of my degree, like most neuroscience majors at the time, I was looking to go abroad for a postdoctoral position. As a last resort, I applied to one of the domestic companies, and coincidentally, they were the first to contact me. I was curious about how research in industry works, and since it was a company that could utilize my major, I decided to go into industry, and joined SK Biopharmaceuticals. 

During my degree program, I studied the mechanisms of brain diseases, but at SK Biopharmaceuticals, I got to work on the next step, which is drug development for brain diseases. I had some eureka moments and some setbacks, but it was a valuable experience that allowed me to grow to the next level. However, as I discovered that the industry is much more complex and interdisciplinary than basic research, I realized that if I wanted to grow in this industry, I needed to have other skills besides research. 

I wanted to understand the business better, so after considering several options, including an MBA, I decided to pursue a career in investment industry. I thought long and hard about leaving research, as I had been pipetting for over a decade since my degree, but I knew I needed to take a step forward, and so I started a new career as a VC with a research background. 

Q. That's an interesting career transition. For those unfamiliar with the role of a venture capitalist, can you tell us a little more about the job? 

First of all, VC stands for Venture Capital. Typically, venture capitalists invest in unlisted companies that have a high potential for growth. The role of a venture capitalist requires a wide range of competencies, including identifying investment targets with high growth potential, analyzing companies, analyzing investment strategies, and profitability. 

There is no prescribed way to identify investment targets, and each investor must voluntarily identify investment targets through their own networks (this can include networks among VCs, academia, industry, and other sources of information about potential investment targets). This is the biggest reason why VCs need to meet a lot of people. It's not just about finding investments, but also about finding co-investors and doing reputation checks on companies. 

The bio-healthcare sector, which is my main area of investment, requires scientific expertise to analyze companies. Since we are investing in unlisted "companies" whose business is "science", experience in academia and industry is very important, and when investing in drug development companies, specialized knowledge such as disease mechanisms and pipeline analysis is inevitable. And even if you have expertise, science and technology itself are changing at a very fast pace, so VCs need to constantly update themselves about new developments. 

VCs play a crucial role in evaluating the financial viability of investments. They need to stay informed about the latest scientific and technological trends and assess their commercial potential. While providing capital, VCs also support investee companies to foster growth, ensuring a symbiotic relationship between investor and investee. Post-investment, regular communication with founders helps identify challenges and explore collaborative solutions, such as research partnerships, technology transfer, and talent acquisition, to aid the investee's success. 

Q. Your work is very broad and interesting. What has helped you in your career transition, and what challenges have you faced? 

My area of expertise and investment is in the bio sector. Bio-specialized VCs come from a variety of backgrounds, including R&D, clinical and business development, and pharmaceutical industry. In the bio sector, the ability to analyze the founder's research capabilities and scientific understanding of the business area are important in order to identify a business for investment. In this regard, I believe that my academic background and research career in industry were the most important factors in my transition to the investment industry. My experience in understanding the mechanisms of diseases and conducting drug discovery research is extremely helpful in understanding the "theory" and "reality" of bio ventures. 

While a career as a researcher can guarantee expertise, there is also a concern that one can become narrow-minded. In fact, the role of a VC investor requires a multidisciplinary mindset, as you need to be up to speed on new technologies and businesses. I've always been interested in technology and interdisciplinary research, so I think I was well-suited for this career transition. As a researcher, I enjoyed sharing and discussing my research with people. That I enjoy meeting and talking to people and exchanging information has helped me transition to the investment industry. 

On the other hand, because of my roots in the sciences, I often encounter difficulties with the financial knowledge and practices required in the investment industry. To compensate for this, I got an investment advisor license and have taken relevant courses, but there are still many things I don't know, so I'm still learning as I go. I want to stay true to my roots but expand my branches. 

Q. What types of career opportunities are available for master's and doctoral students and researchers to explore in the area you're working in? 

As the bio industry grows, there is a growing need for professionals who understand biotechnology in the financial investment industry. There are investment review positions at VCs, like mine, and there are also investment review roles at corporate venture capital (CVC) firms in large and mid-sized companies. In addition to the investment industry, there are also careers as analysts specializing in pharmaceutical bio at securities companies, and there are also bio specialists in the investment banking departments of securities companies that organize IPOs and mergers and acquisitions of bio ventures. 

However, it is relatively rare to enter the financial sector directly from the field of basic science, and often requires experience in industry or the financial sector, so for students or researchers who want to enter the financial investment industry, it is recommended that you plan your career in advance and actively seek advice from acquaintances who have similar careers. If you have difficulty finding such a person, you can contact me. (Editor’s note: If you'd like to get in touch with Dr. Kwak, please leave a comment on the interview article or email insights@editage.co.kr and I'll pass the message along :-)) 

Q. Finally, based on your experience, what are some of the most important things that MSc and PhD students or researchers should consider when exploring a career outside of academia? I'm sure this is really valuable advice for researchers interested in a career in your field. 

If you've already started your PhD program or are a post-doctoral researcher, you may feel overwhelmed by the prospect of moving into a career outside of academia. If you're going into an industry that allows you to do research similar to what you're doing in academia, you'll have some career continuity. However, if you're pursuing a completely different subject area, or if you're thinking about a different industry than research, you'll need to think twice. I would like to share a few nuggets of advice for those who want to move from research to investment. 

1. Don't lose your identity. If you're in grad school or a postdoc, you've already entered the realm of specialization and the number one thing I've heard since moving into the investment industry is that you need to become a generalist. It's interesting to note that if you start your career as a generalist, you're stuck as a generalist whether you want to be or not, but if you start as a specialist, you can become a generalist. 

The caveat here is that the moment you lose your identity as a specialist, you lose the ability to differentiate yourself from a generalist - you're getting older, you're entering the workforce later, and you're losing your competitive edge. Gone are the days when a degree gave one a competitive edge. So I don't completely agree that specialists should become generalists. Instead, I think it's necessary to have an edge in your area of specialization so that you don't get blunted, but to also have broad knowledge in other areas as a generalist. 

2. You need to be scalable: It's common for researchers to specialize in a particular topic and become relatively insensitive to other areas (although they may change topics as trends change). In the investment industry, on the other hand, you need to have broader knowledge beyond your research topic in order to be able to invest in a variety of companies. 

Now science and technology are advancing at a very fast pace. Compared to 16 years ago, when I started my degree, and 9 years ago, when I started researching drug discovery, many areas that are changing rapidly, including the mechanisms of disease, laboratory equipment, techniques, and types of drugs. In addition, previously disparate industries such as digital healthcare and brain-computer interfaces are gradually converging. Therefore, it is necessary to expand your area of expertise through continuous learning. 

3. Be able to practice self-objectivity. As you expand your expertise in the investment industry, you will inevitably encounter a gray area between expertise and non-expertise. In fact, if you have invested in a particular sector multiple times and frequently review investor relations materials, you may find yourself talking like an expert. The problem is that, like the Dunning-Kruger effect (*Editor's note: a cognitive bias in which incompetent people make poor judgments and reach incorrect conclusions, but are unable to recognize their mistakes), we feel most confident when we have a little bit of knowledge, and the combination of limited knowledge and confidence can lead to bitter consequences. 

So you need metacognition to know where you stand, what you know and what you don't know, and you need to work on filling in the gaps. This is where I'm most wary of myself. 

4. Finally, interpersonal relationships are important. Of course, interpersonal relationships are crucial when you're in academia, unless you're doing it all by yourself, but in other professions, interpersonal relationships are much more important. Drug discovery research in industry alone involves working with as few as 10 people and as many as dozens on a single topic, with each person taking on a different role. Interpersonal skills are very important in VC investor relations, as it's a job where you have to meet a lot of people and networking is very important. That's why it's a very personable job. 

Dr. Yongdo Kwak, thank you for sharing your interesting story about the unfamiliar profession of VC.  

If you're thinking about a career outside of academia, let us know what you'd like to know more about in the comments section or what you'd like to see covered in the future.