Decipher:Healthtech Ep04 - Kathleen McGing
This is our fourth episode of Decipher:Healthtech; the podcast exploring the intersection of healthcare, business, and technology. In this episode we had an insightful conversation with Kathleen McGing the Chief Business Officer of Flow Medical, a medical device startup.
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Show Notes:
CBO vs CEO - bringing the business view point into the lab to allow for the scientific innovation to make it out of the lab. Putting the innovation into a business context.
Design something that is not only innovative but can be impactful and commercialized.
Non-dilutive capital - SBIR grants, etc. A business person can help make your grant applications more sound from a market/financial model perspective. Can be a bridge to other capital for early stage companies.
Be careful of some accelerators that offer highly dilutive capital.
Be aware of how unit costs add up. Small amounts at a small scale can become large amounts at a large scale.
You have to balance between a prefect product and a product that can be funded and marketed.
At the end of the day if the business isn’t viable no patients will be helped.
The device space can be terrifying and complex. But there are many people with lots of experience in the space. Bringing on the right experts and consultants early can help you understand risk early and mitigate them before it turns into a larger problem.
Understand the value inflection points in your company lifecycle. 510k approval, first in human trials, etc are points that can significantly increase your company value to potential partners/acquirers.
Modeling can help you stay grounded and help you make decisions and see the impact of small changes. Talk to others in the industry and seek feedback from those with expertise.
Models can help you understand the future value of spending money upfront especially in a cash constrained environment.
Burn Chart will help you make short term decisions and prioritizing them.
Burn Chart is like a projection of how money is going out when you’re not making money. It tells you how long you have until your capital runs out.
Understand customers, the market, and how to position yourself. Having someone with the appropriate business background can help you.
Strategic investors can be invaluable partners, but your interests can be at odds. They want to invest in you but long term they may want to buy you as cheap as possible. Meanwhile institutional investors are concerned about the exit long term and want you to exit at as high of a price as possible.
In the short term a strategic can be valuable in providing advice and experience.
When negotiating with strategics bring everyone on to the same page that this is an investment and the goal of the investment is to make money.
Having a strategic can be validation to other potential investors, but can be a red flag to institutions when it comes to control (i.e. right of first refusal)
Entrepreneurship is a team sport; you will go further together with a team that has complimentary skill sets.
This was an amazing episode and there is a lot more insights from Kathleen McGing in our full episode available on your favorite platform below.