How Early Research Helped BioCrypt Avoid a Costly GTM Mistake

The Challenge

BioCrypt, a Web3 infrastructure company specializing in computation verification, wanted to expand beyond crypto-native use cases. Their hypothesis was simple but bold: the pharmaceutical research industry might benefit from a secure enclave solution that allows organizations to share proprietary models or datasets without exposing sensitive IP.

The concept seemed technically sound. But was the market ready? Would researchers actually adopt a tool like this? And if so, where in the R&D pipeline would it be most useful?

Our Approach

Protocol Theory launched a rapid, exploratory research sprint to evaluate product-market fit. We interviewed seven domain experts across pharmaceutical R&D, biotech innovation, and AI. These included senior researchers, IP consultants, and technical leaders with deep experience navigating sensitive data environments.

We focused on four core areas:

• How data, models, and IP are currently shared across organizations
• Where risk, friction, or incentive misalignment may be slowing collaboration
• Reactions to BioCrypt’s concept of a secure, non-extractive compute layer
• The feasibility of integrating payment or licensing functionality into the product

This phase wasn’t limited to assessing desirability. It focused on understanding how trust, regulation, and commercialization operate in a high-stakes, low-margin-for-error environment.

Key Insights

The research identified several critical insights that helped BioCrypto clarify the commercial potential of their proposition—and it’s associated challenges:

▪️ The technology isn’t new. But that’s not the point.

Secure enclaves have been discussed in pharma for more than a decade. What matters now is how well a solution fits the reality of existing workflows, commercial dynamics, and user expectations.

▪️ Fundamental research is the wrong entry point.

Much of the early-stage science is based on public datasets and open sharing. Researchers are motivated by publication, not monetization. A secure compute product won’t deliver much value here.

▪️ The real opportunity lies in applied discovery and pre-clinical work.

Small biotech companies often develop valuable models using proprietary simulation or synthetic data. They want to share these with larger pharma companies without losing control. That’s where a solution like BioCrypt’s may be most relevant.

▪️ Security is necessary but not enough.

Participants agreed that fear of IP leakage holds companies back from broader collaboration. But legal contracts, reputation, and personal trust often carry more weight than encryption alone. Any product must account for these social dynamics.

▪️ Licensing models are complex and non-linear.

Built-in payments could make sense for small-scale usage, but pharma deals are rarely that simple. Business development, legal, and procurement teams all play a role. Payment mechanisms must reflect the reality of long evaluation cycles and complex licensing arrangements.

▪️ The true blockers are social and institutional.

The most valuable data often lives in hospitals and insurers—yet these organizations have little incentive to share. Regulation, risk aversion, and organizational culture are far more limiting than technical barriers.

Impact

The research gave BioCrypt a clear picture of the commercial landscape—and ultimately, a confident decision not to pursue the product.

It clarified:

• That the core pain point was real, but the market wasn’t ready
• That execution would require significant domain expertise and long sales cycles
• That alternate applications of BioCrypt’s technology might yield stronger returns

The project revealed what it would truly take to succeed in this space: deep domain expertise, strong industry relationships, and a long-term commitment to navigating regulatory and organizational complexity.

“Our engagement with Protocol Theory was fantastic. The team quickly understood the complexities of our solution, industry dynamics, and market landscape, delivering critical insights that directly informed our product-market fit assessment and ultimately our strategic direction. They were proactive, informative, and great partners to work with.”

Strategic Takeaway

Good research doesn’t always lead to green lights. Sometimes, it helps a team walk away from the wrong idea—before wasting years building something the market won’t adopt. BioCrypt saved time, money, and strategic focus by validating its hypothesis early.◼️

Looking to validate a new market or sharpen your go-to-market strategy? Talk to Protocol Theory about our Market Opportunity and GTM research solutions.

Note: While company and individual names have been changed to preserve anonymity, this case study reflects a real client engagement conducted by Protocol Theory in early 2025.