MDB Capital (NASDAQ:MDBH) is reassessing its strategy amid continued weakness in the micro-cap market, with plans to focus on monetizing and building value in existing portfolio companies, CEO Chris Marlett said during a company presentation.
Marlett said the firm has spent roughly three decades launching companies it believes have defensible positions, often based on intellectual property. MDB Capital recently completed its 18th initial public offering, he said, and has historically worked both as a co-founder of companies built around licensed university technologies and as an investment bank for outside clients.
“It’s much harder for these small companies to really get noticed,” Marlett said, adding that the company’s decision to go public and scale its operations came at an unfavorable time for the asset class.
Focus shifts to portfolio companies
Rather than relying on a recovery in the micro-cap market, MDB Capital is focusing on four principal portfolio initiatives: Public Ventures, PatentVest, eXoZymes and Paulex Bio.
- Public Ventures: MDB Capital built a self-clearing brokerage operation over roughly five years. Marlett said the company is now in discussions with multiple larger companies interested in becoming self-clearing firms, and MDB Capital is seeking a partner to monetize the business while retaining the ability to support smaller offerings in the future.
- PatentVest: The company plans to separate PatentVest into its own business unit and fund it through outside investors. Marlett said the business is intended to use AI, analysts and legal technology tools to support patent prosecution lawyers.
- eXoZymes: Marlett described the public synthetic biology company as entering a commercial phase. MDB Capital owns about 40% of eXoZymes, he said.
- Paulex Bio: MDB Capital has filed a registration statement for Paulex Bio and owns 7 million shares, according to Marlett. He said the company is developing a potential treatment for type 1 and type 2 diabetes.
PatentVest sees AI-driven opportunity
Marlett said PatentVest is targeting the U.S. patent prosecution market, which he estimated at about $15 billion and described as fragmented. He said the company does not intend to sell a single legal technology product, but rather to combine AI tools, internally developed agents and analyst support to improve the work of patent lawyers.
He expects AI to increase both the rate of invention and the urgency for companies to secure intellectual-property rights. Marlett said PatentVest’s technology has reduced the time required for a patentability analysis from about 40 hours to approximately two hours in some cases.
The company has been adding clients and lawyers and is preparing to “hyperscale,” Marlett said. He added that MDB Capital is in discussions with strategic parties and investors regarding a PatentVest spinoff, with a hoped-for timeline of the next several months.
eXoZymes and Paulex Bio development plans
Marlett said eXoZymes was spun out of UCLA and is developing synthetic biology capabilities intended to produce natural compounds and small-molecule drugs. He said the company is progressing toward commercialization, though its shares have been affected by micro-cap market conditions.
For Paulex Bio, Marlett said MDB Capital worked with Francisco Leon, formerly chief scientific officer of Provention Bio, and Miguel Sanjuan. Provention Bio was acquired by Sanofi for $2.9 billion, according to Marlett.
Paulex Bio licensed technology from Mount Sinai that MDB Capital believes may have the potential to regenerate beta cells. Marlett said the company’s first clinical safety trial was expected to begin in December. He said the company could seek to go public early next year if safety is demonstrated, though he characterized the timing as contingent on that milestone.
Lower operating expenses targeted
Marlett said MDB Capital aims to become more capital efficient and reduce annual operating expenses. The company’s operating expenses are currently about $10 million annually, he said, but could fall to roughly $6 million after Public Ventures and PatentVest are spun out.
The company completed two banking transactions in the first half of 2026 that offset a portion of operating expenses, Marlett said. He does not expect to complete two similar transactions in the second half, in part because the Paulex Bio timeline was pushed out.
MDB Capital intends to return to a leaner operating model, Marlett said, emphasizing selective investments in companies with potentially large asymmetric upside while maintaining meaningful equity stakes. He also said the firm holds a small position and warrants in Buda Juice, a company it took public that he described as profitable.
About MDB Capital (NASDAQ:MDBH)
MDB Capital Holdings, LLC (NASDAQ: MDBH) is a financial services company focused on supporting businesses whose value is substantially tied to intellectual property. Through its investment banking platform, the company works with innovative and technology-driven enterprises seeking to develop, protect and commercialize their intellectual property.
MDB Capital provides services that may include capital raising, mergers and acquisitions advice, strategic planning and investor communications.
