MDB Capital (NASDAQ:MDBH) executives used the company’s fourth quarter and full-year 2025 update call to outline plans to scale its “public venture” model, discuss the buildout of two internal businesses—its clearing platform and its IP law firm—and provide updates on key portfolio positions including eXoZymes and POLX.
Strategy: scaling “public venture” and the impact of AI
Chief Executive Officer and Co-founder Chris Marlett opened by revisiting MDB’s long-standing approach: conceiving and launching companies into the public markets. Marlett said the firm has completed 18 IPOs over 29 years and described the track record as “never a failure” in completing an IPO, adding that the firms taken public (with the exception of the most recent) have historically traded at “a very significant premium to the IPO price.”
He said MDB is building standard operating procedures into “agentic models” to accelerate screening and diligence across multiple data sources such as patent data, grant databases, and conferences. Marlett estimated the firm can compress deep diligence time by “two-thirds,” and said the process of preparing companies to go public—previously taking “6–18 months”—could increasingly be done “in weeks.” As an example, he pointed to early work on an S-1 registration statement for POLX.
Building and monetizing MDB Direct and PatentVest
Marlett said an underappreciated focus since MDB became public has been investment in two internal businesses: MDB Direct, the company’s clearing operations, and PatentVest, its IP-focused platform that has been developed into a law firm. He said MDB has been investing roughly $4 million annually since the IPO into these assets and now views them as “separate discrete assets” with “significant independent value” that could be launched as independent entities.
On MDB Direct, Marlett emphasized changes in capital markets distribution and argued that clearing is becoming a key differentiator for brokers seeking to serve individual investors in smaller offerings. He described clearing as enabling profit engines like “stock loan” and “margin lending,” and said MDB’s platform took five years to build with vendors and software developers. Marlett said the “big opportunity” is a strategic partnership that would both monetize the asset and help solve distribution challenges as MDB seeks to scale from “one company every 18 months” to “3–5 companies a year.”
Marlett also noted that, to his knowledge, “there’s no other clearing firms for sale or partnering capability right now,” and referenced another clearing firm transaction that “sold for…tens of millions of dollars,” though he did not provide a name or specific valuation.
On PatentVest, Marlett said MDB became one of the first ABS (alternative business structure) IP law firms, enabling the organization to render legal opinions and operate with attorney-client privilege. He credited Javier Chamorro, who runs the operation, with building out capabilities spanning patent prosecution, foreign prosecution management, docketing, maintenance fees, and front-end research.
Marlett said the firm aims to spin PatentVest out as an independent entity and “finance it before year-end.” He argued that large law firms face an “existential crisis” in patent prosecution because it has become more of a process business, and said MDB is in discussions with law firms regarding partnerships. He estimated U.S. patent prosecution as a “$10 billion–$15 billion” business.
Portfolio updates: eXoZymes and POLX
Marlett highlighted two portfolio assets beyond MDB Direct and PatentVest: eXoZymes (public) and POLX (recently funded). He said both represent “billion-dollar market cap potential,” consistent with how he described MDB’s historical targets.
Discussing eXoZymes, Marlett said the company’s strategy evolved from partnering with pharmaceutical companies to pursuing the ability to “make things that nobody else could make” and then selling products directly. He also referenced broader sentiment around synthetic biology and said the company is now at a point where its technology is being transferred to contract manufacturers and demonstrated at scale, which he described as a critical milestone.
In response to a question about potential dilution at eXoZymes, Marlett said the company has an operating expense base of about $10 million and argued dilution should be “relatively minimal” because the business is “super capital efficient,” can outsource manufacturing, and is not comparable to the cash demands of running drug clinical trials. He also cited government grants as a funding tailwind and said the company is positioned in large addressable markets.
On POLX, Marlett said MDB plans to take the company public “later this year” and hopes to initiate a clinical trial in September, around the same time as the IPO. He described POLX as a potential diabetes therapy aimed at helping the body produce insulin, with relevance to both Type 1 and Type 2 diabetes. Marlett said clinical trial results could begin to emerge “at the end of this year or early next year.”
Balance sheet view, operating expenses, and principal assets
Marlett provided a snapshot of what he called MDB’s “four principal assets” and referenced year-end figures. He said MDB’s stake in eXoZymes had a market value of about $45 million at year-end, and that the value had fallen to about $30 million at the time of the call. He also said MDB owns 7.1 million shares of POLX, though pricing and valuation would depend on the eventual IPO.
He added that at year-end, a combination of cash and current assets (including market securities) less current liabilities was about $22.3 million. Marlett noted that a transaction involving Buda Juice was expected before year-end but “trickled into January,” which he said would benefit the first quarter.
On expenses and cash burn, Marlett said MDB has about $10 million in fixed operating expenses and burned about $5.7 million for the year based on the cash flow statement. He said approximately $4 million of that expense base reflects investment in the clearing operations and PatentVest, and that excluding those investments would imply an effective burn of about $1.7 million. After potential spin-outs, he said operating expenses could drop to about $6 million per year, which he said would increase financial leverage if MDB can increase the pace of company launches.
Other holdings, risks, and distribution focus
During Q&A moderated by George Brandon, President and Head of Community Development, Marlett addressed several other portfolio names and reiterated that commercialization and distribution remain central challenges.
- ClearSign: Marlett called it a small position and said the company has been on a long commercialization journey, adding that its burner technology is “more relevant than ever” given expectations for increased natural gas use.
- HeartBeam: Marlett said HeartBeam achieved FDA approval for a “pocket 12-lead ECG” and suggested its technology could be a “game changer,” including potential to detect heart attacks. He said the company needs to execute commercially and pursue partnerships.
- Cue Biopharma (referred to as “Q”/“CUE”): Marlett said the company is “struggling,” citing challenges in management and commercialization. However, he said Cue has partnered with Boehringer Ingelheim and ImmunoScape on CUE-101 and is preparing to put CUE-401 into the clinic, and he characterized those programs as valuable “shots on goal,” despite the stock price not reflecting that value in his view.
- Buda: Marlett said MDB viewed the opportunity as creating a “whole new category” tied to a broader shift toward fresh food, and he emphasized that the business is profitable.
Marlett outlined several risk factors, including macro and global risks, difficult microcap market conditions, execution risk at both MDB and its portfolio companies, and clinical and regulatory risks for life sciences holdings. He called the “distribution gap” the “biggest worry” and said MDB’s community remains relatively small, noting “675 active accounts” despite “a couple thousand shareholders.”
He also addressed a question about whether PatentVest could be a SaaS business, saying he believes “SaaS is gonna be crushed by AI.” Marlett described how PatentVest has used AI to reduce patentability analysis work from roughly 45 hours to “an hour and a half,” while improving quality, and argued the future is “human-in-the-loop IP development” supported by attorney-client privilege and a unified workflow.
In closing remarks, Marlett acknowledged a “tough couple years” for shareholders and said the company has pulled back internally, including not giving raises and taking back RSUs, while continuing to push forward on execution. He said MDB is “super excited about the future” and believes the combination of its current asset base and pipeline gives it the potential to create meaningful shareholder value, while cautioning that outcomes are not assured.
About MDB Capital (NASDAQ:MDBH)
MDB Capital Holdings, LLC, through its subsidiaries, primarily operates as a broker-dealer. The company operates through two segments, Broker Dealer & Intellectual Property Service, and Technology Development. The Broker Dealer & Intellectual Property Service segment operates as a full-service broker dealer that focuses on conducting private and public securities offerings, as well as providing research services for investment banking due diligence. The Technology Development segment engages in the synthetic biology technology development business.
