A small biotech company based in Michigan, CircNova, has successfully raised $3.3 million in seed funding for its innovative technology that utilizes AI to target “circular RNA.” This breakthrough holds significant promise for the rapid development of therapies for conditions that currently have no available treatments.

This new funding also marks a notable achievement for the company’s co-founder and CEO, Crystal Brown, who has taken an unconventional path to becoming a biotech founder.

RNA, or ribonucleic acid, plays a crucial role in converting genetic information into proteins. Circular RNA is a relatively newly discovered class of such structures that form a circle rather than a strand, regulating critical biological processes. The hope is that therapies based on these molecules will be able to target complex health issues.

According to Brown, CircNova has developed a “proprietary AI engine that enables us to identify, design, and produce novel, non-coding, circular RNAs.”

The company’s AI engine is similar to Google’s AlphaFold, as it also employs deep learning AI to generate and analyze new circular RNA for therapeutic use.

CircNova boasts not only its NovaEngine, which it claims is the first in the world to predict circular RNA structures, but also a wet lab. This means that the AI engine produces actual physical molecules, which can then be validated and researched in collaboration with the University of Michigan, Brown explained.

“We have the capability to reverse engineer, going from sequence to structure and from structure to sequence when developing the molecule,” she said.

The ultimate goal is to “treat diseases that have not been treated so far, such as ovarian cancer, triple-negative breast cancer, neurodegenerative diseases, and rare genetic diseases,” Brown described.

The technology is based on the work of CircNova co-founder Joe Deangelo, the company’s chief scientific officer and former CEO of biotech Neochromosome, as well as the former CSO of Apex Bioscience. Investor William Grenawitzke serves as chief business officer and the startup’s third co-founder.

Lessons from a failed startup

Brown’s background may seem unusual for a biotech founder, as her career was previously in the automotive manufacturing industry until about seven years ago.

She had been climbing the corporate ladder to become a “C-suite automotive executive” when a friend introduced her to a CEO running a life science startup. The startup CEO was looking for a business manager.

Brown’s curiosity led her to offer to keep the books part-time, which eventually evolved into her bringing business tactics from auto factories to help the startup, such as overhauling their business contracts.

She asked the team numerous questions about the science, and some of her friends suggested she should quit the automotive industry and work full-time in biotech.

“I thought, no one’s going to take me seriously. I’ve never studied biology; I studied poli sci and women’s studies,” she recalled.

However, she decided to make the leap, taking a significant pay cut from her well-paying six-figure job to what amounted to intern-level pay. She learned about startups, raised money, and worked her way up to director of operations. The company went public, providing her with a substantial enough payout to buy a house, she said.

Emboldened by her success, she launched her own biotech startup, a contract research lab.

She raised funds but made classic first-founder mistakes, such as hiring people too quickly and opening up her lab.

Two years in, her startup burned through its funds, and she knew she had to shut it down. The experience was heartbreaking and drained her bank account, even causing her to lose her house, she recalled.

Despite this, she gained a solid reputation in Michigan’s tight-knit startup community, and VCs told her, “You’re a good founder anyway,” Brown recalls. Several expressed their willingness to fund her next idea.

Knowing she would soon be available for a new venture, Deangelo began sending her scientific material on circular RNA, having an idea for using it with AI drug discovery.

“He started sending me, literally every morning at 5:30 AM, five to 10 articles,” she remembers. “I hadn’t even shut the other company down all the way.”

However, she studied up and became convinced that this idea could work. They founded CircNova in May 2023.

“I approached it very cautiously, throwing just a few things at the wall, wondering what I could do with the $15,000 grant to get it started?”

The initial expenditure led to the development of the startup’s first process, and another $25,000 from a National Science Foundation grant resulted in the first patent application.

She began to split her time between Michigan and Boston, near her customers and potential customers like Moderna and Pfizer.

As for investing in Brown again, VCs like Nia Batts, a General Partner at Union Heritage Ventures, had no reservations.

“We are no stranger to the resilience that is needed when you engage in the journey of entrepreneurship,” Batts said, adding that she knew she wanted to back this new venture “the moment” she met Brown and heard about the idea.

The $3.3 million seed round was led by diversity-focused VC South Loop Ventures and includes investments from Dug Song, Union Heritage, Michigan Rise, Invest Detroit, Kalamazoo Forward Ventures, and SPARK Capital.