Reed Jobs' Yosemite Ventures Targets Cancer Cures with AI and Novel Biotech

Emerging from the shadow of a legendary surname, Reed Jobs is making his own indelible mark, not in technology, but at the forefront of the battle against cancer. His venture firm, Yosemite, launched in 2023, has rapidly evolved into a formidable force in oncology-focused biotechnology. Far from merely investing, Jobs and his team are actively constructing the next generation of cancer therapies, powered by a unique blend of strategic capital and a deep commitment to scientific innovation, increasingly supercharged by artificial intelligence.

Quick summary

• Yosemite, Reed Jobs' oncology-focused venture firm, closed its second fund targeting $350 million to build and invest in biotech companies, emphasizing a 'make our own companies' model.
• The firm leverages philanthropic grants alongside venture capital to de-risk early-stage academic research, specifically targeting novel cancer cures at institutions like Yale, Berkeley, and Stanford.
• AI has become a critical accelerator for Yosemite, significantly impacting both drug discovery—by identifying 'undruggable' targets like KRAS and p53—and optimizing clinical trial design through innovations like synthetic control arms.
• Yosemite's portfolio includes diverse approaches, from epigenetic gene editing for liver cancer (Tune Therapeutics) to non-invasive tumor destruction via histotripsy (Histosonics).

Why it matters

The work undertaken by Yosemite carries profound implications for the future of cancer treatment and the broader biotech industry. For patients, it signifies a concentrated effort to address some of the most challenging and historically 'undruggable' cancers, potentially leading to breakthrough therapies that extend and improve lives. The firm's focus on building companies from early academic research helps bridge the notorious 'valley of death' between basic science and commercial development, accelerating the translation of scientific discoveries into real-world solutions. For the biotech sector, Yosemite’s model of integrating philanthropy with venture capital offers a blueprint for de-risking high-potential, high-impact scientific endeavors. Furthermore, its aggressive embrace of AI underscores a fundamental shift in how drug discovery, clinical trials, and even healthcare delivery will be conducted, pushing the boundaries of what's possible and setting new standards for efficiency and innovation in a field historically burdened by immense costs and timelines. The firm's proactive stance on advocating for robust NIH funding also highlights the critical interplay between public funding and private innovation.

Background

Reed Jobs founded Yosemite in 2023 at a challenging juncture for the biotech sector. Following a boom fueled by the pandemic, the industry experienced a significant downturn, with the XBI (a key biotech ETF/index) plummeting from its 2021 peaks. Conservative investor sentiment prevailed, and pharmaceutical companies were less acquisitive. This environment made capital difficult to raise, particularly for nascent, high-risk ventures in oncology.

However, the landscape has shifted considerably over the past three years. Interest rates have improved, and the pharmaceutical industry is confronting its largest patent cliff in history. This impending expiration of protection for blockbuster drugs, coupled with substantial cash reserves accumulated during the pandemic, has spurred a significant increase in M&A activity. Large exits, such as Eli Lilly's $7 billion acquisition of Kelonia, and major advancements in areas like antibody drug conjugates, signal a resurgence of investor confidence and pharma's hunger for innovation.

Concurrently, artificial intelligence has transitioned from a speculative technology to an indispensable tool in biotech. Initially a 'curiosity,' AI is now deeply embedded in Yosemite's strategy, driving efficiencies in drug discovery and clinical trial design. This confluence of market opportunity, scientific breakthroughs, and technological advancement has created a fertile ground for firms like Yosemite, enabling them to pursue ambitious goals that seemed out of reach just a few years prior.

Additionally, Jobs has been a vocal advocate for the National Institutes of Health (NIH), a critical source of basic scientific funding. Last year, concerns arose over proposed federal budget cuts, including a potential 40% reduction in NIH funding—a cut of unprecedented scale. While bipartisan rejection in Congress prevented these drastic measures, the persistent pressure on NIH funding, which has effectively shrunk relative to inflation over the past decade, highlights an ongoing challenge for the foundational research upon which biotech innovation is built.

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Yosemite's strategic differentiation lies not just in its singular focus on oncology, a vast yet historically difficult therapeutic area, but in its proactive 'company-building' approach, which mitigates risk by engaging with research at its earliest, most formative stages. By channeling philanthropic grants into university labs, Yosemite effectively provides a no-strings-attached runway for promising, yet fragile, scientific ideas to mature before traditional venture capital is deployed. This unique hybrid model addresses a critical market failure: the inability of conventional VCs to invest in concepts too early for de-risking, yet too significant to ignore. The firm is not merely waiting for innovations to emerge from pharma or academia; it is actively nurturing and shaping them.

The firm's aggressive integration of AI, particularly in tackling notoriously 'undruggable' targets and streamlining the arduous clinical trial process, is not just a technological adoption but a fundamental recalibration of the drug development paradigm. This signals a future where the traditional bottlenecks of time and capital in biotech may be significantly reduced. However, this pace also presents challenges, including the need to continuously validate AI's findings in biological systems and navigate evolving regulatory frameworks like the FDA's stance on synthetic control arms. Yosemite's rapid expansion and ambitious pipeline, coupled with its founder's direct engagement, position it as a bellwether for the next wave of precision oncology, demonstrating that impactful change can be driven through a combination of visionary capital, scientific rigor, and a willingness to challenge established industry norms.

Building the Future of Oncology: Yosemite's Model

Yosemite's operational philosophy diverges significantly from traditional venture capital. Rather than exclusively seeking pre-formed startups, about a third of its substantial $350 million second fund is allocated to creating new companies. This involves either incubating ideas internally or collaborating directly with leading academics at institutions like Yale, Berkeley, and Stanford to spin out ventures from groundbreaking research. This hands-on approach allows the firm to guide the development of potentially transformative therapies from their nascent stages.

A distinctive element of Yosemite's strategy is the integration of philanthropic capital. A portion of the firm's assets under management (2.5%), along with an annual $1 million from its management fees, funds a donor-advised fund. This provides no-strings-attached grants to university labs, enabling critical early-stage de-risking of scientific concepts. For example, two of the 20 companies in Yosemite's initial fund originated directly from such grants, illustrating the success of this philanthropic-venture hybrid model. This unique financial structure allows the firm to foster ideas that might otherwise struggle to attract conventional seed funding.

Among the portfolio, companies like Azalea, born from a grant to Jennifer Doudna’s lab, are already advancing into clinical stages. Quarry, another example, was built with serial founder Craig Crews, focusing on 'induced proximity'—a novel therapeutic approach where drugs manipulate disease-causing proteins by directing them to the cell's natural breakdown systems, rather than simply blocking them. This innovative method represents a new frontier in drug design.

AI's Transformative Role in Drug Development

The advent of artificial intelligence has dramatically reshaped the landscape of drug discovery and clinical trials, and Yosemite is at the forefront of harnessing this power. Reed Jobs notes that AI has moved beyond a mere curiosity to become a core component of the firm's operations. In drug discovery, AI is revolutionizing the ability to identify and target previously 'undruggable' proteins, which constitute a significant portion of the human genome.

Historically, only about 15% of the genome's proteins could be effectively targeted by drugs due to their smooth, featureless surfaces, making it challenging for drug molecules to bind. AI has been instrumental in finding cryptic pockets and novel interaction sites on these difficult targets. A prime example is KRAS, a gene frequently mutated in aggressive cancers like pancreatic cancer, long considered impervious to drug intervention. While early breakthroughs like Amgen's Lumakras targeted specific KRAS mutations, AI is now accelerating the discovery of ways to tackle a broader spectrum of variants, significantly expanding treatment possibilities.

Beyond discovery, AI is poised to dramatically reduce the cost and time associated with clinical trials—a major bottleneck in drug development. Phase 3 cancer trials, costing an average of $260 million with only a one-in-three success rate, are particularly inefficient due to patient recruitment and retention challenges. AI offers solutions like 'synthetic control arms,' which use existing patient data to create a computer-generated comparison group. This innovation could halve the number of patients required for a trial, thereby increasing speed and reducing costs. The FDA's openness to such advancements signals a significant shift towards more efficient and patient-friendly trial designs.

Tackling the "Undruggable": Specific Targets and Novel Strategies

Yosemite is actively pursuing some of the most elusive targets in cancer biology. The firm is investing in three different companies employing various strategies to tackle p53, often dubbed the 'guardian of the genome.' p53 is a tumor suppressor gene, and its mutation or suppression is a near-universal characteristic across human cancers. Re-activating or targeting its mutated forms represents a potential Achilles' heel for many malignancies, an endeavor that has eluded scientists for decades. Yosemite believes it has identified novel ways to address exposed markers across various p53 mutations, offering a glimmer of hope for this formidable challenge.

Another major 'undruggable' target being addressed is KRAS, as mentioned earlier. The ability of AI to uncover new cryptic pockets on its surface and identify various targetable variants has unlocked possibilities previously thought impossible. These breakthroughs could lead to significant improvements in survival rates for cancers driven by KRAS mutations, such as pancreatic cancer, where an experimental drug targeting KRAS has already doubled the survival rate for the most common form.

Beyond Small Molecules: Diverse Therapeutic Approaches

Yosemite's portfolio extends beyond traditional small molecule drugs, embracing a range of innovative modalities. Tune Therapeutics stands out as a leading epigenetic editing company. Their technology allows for the precise addition or removal of methyl groups on DNA, acting like a dimmer switch to regulate gene activity without altering the underlying DNA sequence. This approach holds promise for conditions like hepatitis B, which affects over 250 million people and is a primary driver of liver cancer. Tune aims to epigenetically silence the hepatitis B virus itself, mimicking the natural mechanism by which a small percentage of individuals spontaneously clear the infection.

In a departure from Yosemite's usual focus, Histosonics, a device company, is also part of the portfolio. This firm employs histotripsy, a non-invasive therapy that uses focused ultrasound to create and collapse microscopic air pockets, precisely destroying liver and pancreatic tumor tissue. This method offers a highly targeted treatment option, akin to a sophisticated ultrasound, and is expected to become a crucial component of therapy for these challenging cancers, particularly given that pancreatic cancer often metastasizes to the liver.

Navigating the Biotech Landscape: Funding and Partnerships

Securing funding and forging strategic partnerships are critical for biotech startups. Jobs emphasizes that while pharmaceutical companies are essential partners, founders must view them as 'moving targets' due to shifting priorities and leadership changes. He advises founders to stay attuned to which pharma companies are genuinely active and committed to their specific therapeutic areas, as illustrated by Pfizer's exit from infectious disease post-COVID.

Yosemite maintains an open-door policy for founders. The firm actively removes CVs from consideration when reviewing grants and companies, prioritizing the scientific merit of the idea over the prestige of the founder's background or title. This meritocratic approach ensures that groundbreaking science, whether from Nobel laureates or first-time grant recipients, receives equal consideration. The firm expresses interest in all modalities—from small molecules and radiopharmaceuticals to gene therapy, immunotherapy, AI, and digital health—underscoring its broad commitment to impactful cancer research.

The Broader Horizon: Longevity and Pan-Disease Factors

Beyond oncology, Reed Jobs has also touched upon the burgeoning longevity industry, acknowledging its personal importance but expressing a cautious perspective. He notes the lack of a 'grand unified theory of aging,' with different scientific disciplines offering varied explanations. Jobs believes aging manifests differently across cell types and individuals, making a one-size-fits-all business model challenging.

He highlights, however, the unexpected impact of GLP-1 drugs, which have not only created the first trillion-dollar pharmaceutical company (Eli Lilly) but are also showing early signs of protective effects against neurodegenerative diseases and cancer, independent of weight loss. This connection reinforces the understanding that obesity, like smoking, is a 'pan-disease' risk factor, elevating risk across nearly every disease category. This insight has revitalized interest and capital in large disease areas that had previously 'gone cold,' creating renewed ambition to tackle long-standing oncogenes like KRAS, Myc, beta-catenin, and p53, which are now considered to be within reach.

Sources

• Reed Jobs would rather talk about curing cancer than his last name | TechCrunch

FAQ

What is Yosemite's primary focus?

Yosemite is an oncology-focused venture firm dedicated to discovering, building, and investing in companies that develop novel cures and therapies for cancer. It specializes in early-stage academic research and tackling 'undruggable' targets.

How does Yosemite integrate philanthropy into its investment strategy?

Yosemite allocates 2.5% of its assets under management and $1 million annually from its management fees to a donor-advised fund. This fund provides no-strings-attached philanthropic grants to university labs, helping de-risk promising scientific ideas before they are ready for traditional venture capital investment.

What role does AI play in Yosemite's work?

AI is a critical component for Yosemite, significantly accelerating both drug discovery and clinical trial design. It helps identify novel binding pockets on 'undruggable' proteins like KRAS and p53, and it aids in optimizing clinical trials through innovations such as synthetic control arms to reduce patient recruitment needs and development timelines.

What are some notable companies or technologies in Yosemite's portfolio?

Key companies include Azalea, which originated from Jennifer Doudna's lab and is now in clinical trials; Quarry, which focuses on induced proximity therapeutics; Tune Therapeutics, a leader in epigenetic gene editing for conditions like hepatitis B; and Histosonics, a device company utilizing histotripsy for non-invasive tumor destruction in the liver and pancreas.