Building Syndicates of Cross Border Investors in Medtech Companies | LSI Europe '24

Ashley Seehusen 00:06
Go, well, welcome everybody. We're excited to talk to you about building cross-border syndicates. Today, we have a great panel. I'm actually going to let you guys introduce yourselves, a little about where you work, and maybe one or two sentences about how cross-border investment means to you and how that's played a role in your recent life.

Rob Krummen 00:24
Well, great. I'm Rob Krummen, the CEO of Vektor Medical. I like to think of Vektor Medical as the Google Maps for cardiac arrhythmias, and you'll hear today about how cross-border syndicates make a big difference in our company's trajectory and our plans for the future.

David Der 00:41
I'm David Der. I'm a founding partner and managing partner at Soulsby Ventures. Cross-border investing, to us, is going anywhere outside of the great State of Tennessee and the Volunteers. Rob owes me five bucks. Go ahead.

Luc Marengere 01:00
So look, I'm a managing partner and co-owner of TVM Capital. We are a transatlantic fund, so we have an office in Munich and an office in Montreal. We invest truly on a transatlantic basis, so European companies that want to build operations in the US and vice versa, of course. I'm glad to be here. Thank you.

Alexander Goemans 01:30
I'm Alexander Goemans, the CFO of Xeltis. We develop artificial vessels that get absorbed by the body and turn into living, healthy tissue. Our latest fundraising round included strategics from China and the US, and also VCs from Europe and Asia. Great.

Ashley Seehusen 01:47
Good. Let's start with a little bit of the story of Vektor Medical. You guys raised $16 million back in February. It was a cross-border syndicate. So talk a little bit about that and how that came together.

Rob Krummen 01:59
I'd be delighted to. So one of the things for all the innovators out there, one of the things I want to discuss is the importance of understanding that every dollar, or here, every euro, isn't worth the same amount. You're looking for value-add euros. Our first term sheet for our Series A round came from Dr. Der here. After he did his due diligence, and we did our due diligence, we realized we wanted to work together. One of the great things that Dr. Der did is he said, "Let's go to LSI Europe and see if we can find a cross-border syndicate." That's where we got introduced to Luc and TVM Capital. We really understood our very first conversation with Dr. Der was realizing the opportunity in Europe, and we wanted to be able to leverage both the expertise that we had in the United States and the expertise that existed in Europe. It was a match made in heaven, and we're delighted to be sitting with these two gentlemen today and talking about Vektor Medical and cross-border syndicates. David,

Ashley Seehusen 03:00
Can you talk a little bit about why you suggested a cross-border syndicate and what kind of led to coming to LSI?

David Der 03:09
Vektor was a unique situation. Cardiac mapping in Europe really is not something that's done a whole lot. It's mostly fluoroscopy and that kind of thing, which is bad for the patient, bad for the doctor. We always start with the patient first, and then everything else will take care of itself. I remember the first phone call was actually seeing patients as I'm calling on a Sunday night. These guys are presenting late at night. I said, "If I get all this right, I think this is great for the US, but I think it really is a great value add for the European market. Have you thought about CE and how do we do that?" Rob said, "Wow, you're the first investor that said we ought to be thinking that." That kind of sold the deal for us. We were like, "Yeah, we want to run a two-pronged approach, US and Europe." That's how we came together, and then we met Luc here on my left, and we've forged a great friendship and partnership with Vektor, looking at more deals.

Ashley Seehusen 04:10
Can you talk a little bit about how your previous investors felt about bringing in outside investors from overseas? Were there issues? Were there things that they were concerned about? What did you guys have to think about that was different?

Rob Krummen 04:25
Yeah, it's a great question. Our existing investors have been extremely well educated. Most of them are doctors or family offices, and they knew the opportunity that existed in the EU, so they were delighted for the opportunity. We always work with sophisticated legal counsel, so bringing in cross-border funds wasn't an issue. Now, I will mention, for anyone who doesn't have sophisticated legal counsel, I'd recommend you get it, because there are a lot of additional issues associated with investment from outside the United States. But there's so much value add. It's worth that time and effort, and it opens doors. David and I have a number of contacts that we share in the United States. Luc and I have a number of contacts that he's introduced me to in Europe, and those are priceless insights that you wouldn't otherwise have. So our investors were absolutely supportive of the effort.

Ashley Seehusen 05:23
Great. Luc, do you want to talk a little bit about what attracted you to Vektor and, again, syndicate coming from the US? What were the things that you were concerned about or questions that you had?

Luc Marengere 05:34
Happy to. To begin with, maybe a little shout-out to Scott and Henry, because we met Vektor at the LSI in Datapoint for the first time. In fact, we've ended up investing in two companies now that we were introduced to in the context of an LSI conference. So that's great quality coming out of this. What attracted us to Vektor? We like, obviously, transformative, differentiated types of technologies and products. I'm going to pick up one point that David made. He talked about the standard of care in Europe. In this particular case, it's a US-based company, but we were very intrigued by how that product not only worked in the US but also would work in Europe. When we do due diligence on a US-based company, we also test drive the concept from a European point of view as well, right? We contacted electrophysiologists in Europe as well, where we introduced that concept of using V mapping, as you pointed out, it's Google Maps for arrhythmias, right? "Burn here, there's your target." People thought about this for the very first time. The feedback was overwhelmingly positive, and that was an important first step. One of the reasons why we like companies in the US that want to commercialize in Europe and vice versa is that it increases the universe of investors and the universe commercially. You double your total addressable market, essentially, and you increase the universe of strategic buyers. For us, that is very important; we need to know that it will fit transatlantically.

Ashley Seehusen 07:29
That's great. Alexander, similarly, your last round was an international syndicate. You raised 48.2 million euros in June of 2023, led by China Grand Pharmaceutical, DaVita Venture Group from the US, and then the European Innovation Council. Can you talk a little bit about how that syndicate came together and how that cross-border aspect played into who you were talking to?

Alexander Goemans 07:58
No, of course. It came together in different stages. In the first stage, we really talked to those investors that were, let's say, the least risk-averse, being the investors we already had in the company because they knew us already. For the Chinese companies, we ran a structured process in China with 20 companies, and then serious discussions led to five term sheets with three, and then we picked out the best one. That was at the point in time where we really didn't have any clinical readouts at all, so you couldn't be too risk-averse at that point to step in. But then six months later, interesting and very good clinical data came out. We had a strategic partner, DaVita, joining, as well as some Asian and European VCs. Then another six months later, the EIC, European Innovation Council, also stepped in because they essentially piggybacked on the work of others. They wanted to make sure that they wanted to see who was joining that round. Is there good corporate revenue? Is there good reporting, etc.? So it came to be in different stages; you can't do it all together. That would be a huge negotiation mess.

Ashley Seehusen 09:05
How did you find your potential investors? Did you have connections? How did that process go?

Alexander Goemans 09:05
Yeah, again, it's a bit of a mix. When I think of China, as I said, it was really a structured process. Of course, the European VCs, we know most of them. We know them well or at least have connections with them through our board members or network. The same was true with DaVita joining. We had a joint contact, and the board was really helpful in making that happen.

Ashley Seehusen 09:26
Did you have different asks from your international investors? How did that differ from Asia to Europe to the US?

Alexander Goemans 09:35
Absolutely. The European VCs act like VCs. DaVita acted mostly like a VC, of course, had a bit of strategic interest. They wanted to make sure there was value to be created in their markets, not just in the US but globally, because they are a global player. But then Grand Pharma had a very clear Chinese angle. It was a combined equity and licensing deal where most of the focus was on the licensing part and making sure we created something in China. So the asks were very different on that front.

Luc Marengere 10:05
May I add something, please? One thing I would add is that we've built syndicates inside the US, US plus European investors. We also just closed a deal that we co-led with the Chinese investor Yong Jin Ventures. In fact, we've done deals with Middle Eastern investors out of Dubai as well. In our experience, what is really, really important, and I really take your comment to heart, is to figure out the fit and that you have a common agenda well before you go and close that deal. A word of warning: whether you're in Canada or Europe, there are certain jurisdictions that will make matching funds available to you. The tricky thing with these is that if you're building a syndicate with local matching funds, but then these funds have a geographic focus and an economic development mandate, they may want the company to stay in that particular jurisdiction post-M&A, so they can act as a bit of a fly in the ointment when it's time to strike a deal. Those are sometimes tricky things that you have to work out ahead of time. Just broadening the syndicate is great as a concept, but then you need to drop down to 1,000 feet and make sure that everything is going to roll in one direction before you get everybody signing on the dotted line.

Ashley Seehusen 11:54
Does that come back to great legal counsel?

Luc Marengere 11:59
It comes back to great legal counsel.

David Der 12:01
Full disclaimer here, Rob is an attorney by profession.

Luc Marengere 12:05
That was undisclosed.

Ashley Seehusen 12:13
David and Luc, have you guys always been cross-border investors, or is this a new thing for you? How did that evolve in your investment?

Luc Marengere 12:20
As I mentioned at the beginning, TVM is transatlantic by the very nature of how it operates, right? Munich and Montreal. We like to build companies that, if they're a US-based company, we ask how this is going to fit in Europe. If they're a European company, how is it going to fit in North America? A great example: we just made an investment in a Germany-based company called Smart Reporting. The financing is to allow them to buy a business in the US and basically grow from a $10 million to a $25 million top-line revenue as soon as they close on that asset in the US. Buying the company is one thing, but then you also need a team in the US, and you'll need to drive more clinical data and everything that ensues from this. So thinking cross-border is definitely part of our DNA. Cross-border can be Canada-US as well, so we've made investments in Canadian companies. We tell them the day we make the investment in your company, Canadian company, you become an American company. So we drive that concept. Yes, cross-border is us.

Ashley Seehusen 13:52
So part of your DNA.

Luc Marengere 13:54
It's definitely what we like to do.

Ashley Seehusen 13:56
David, how about you?

David Der 13:57
We're just a sprout. I mean, we've obviously Vektor is the centerfold of perfect. We were in a company in Estonia that, you know, it was kind of weird to be kind of Americanized. I guess we were applying for some EU grants, and the local folks were concerned that we would get a grant and then pluck the company out and move it to the US. I understand the legitimacy there, so we walked away and banned the position, but we're still supporting it scientifically, etc. Like Luc, we always think about both markets. We think that there's, you know, whatever the US market is, the same market exists here. All of our companies have that eye towards coming across the ocean. I'm here for this meeting because our next fund will have at least a third of that component hopefully based here in the EU, and we have a venture partner, maybe, oh, there is, there's Laura, a guest panelist earlier today who's going to head those efforts up for us. So, yeah, we have an eye on the now and the eye on the future.

Ashley Seehusen 15:00
Great. Alexander, Rob, can you guys talk a little bit about how your companies have changed post-cross-border investment? Alex, for you, more of Americanizing or having that American component. And Rob, for you, going international.

Alexander Goemans 15:14
Alex, why don't you start?

Alexander Goemans 15:15
Yeah, I mean, how have you changed? Well, we have started pivoting to the United States. Of course, with that comes a lot of work. It comes a lot of work on market access, on reimbursement, on what does the commercialization plan look like. That's something we had to do anyway, but of course, it's extremely helpful to have a partner like DaVita, who is the second-largest dialysis player in the field, in our cap table helping us. It would just be a much, much bigger task to do without their help.

Rob Krummen 15:42
Definitely.

Ashley Seehusen 15:43
Do you have a US entity, or just do you have an office space or people working remotely?

Alexander Goemans 15:50
Very small, and it's very limited because we're now building the US pivotal trial, and more and more sites come online. Of course, the team is going to grow. This is really where the focus is. I don't think the European side is going to grow that much, but the US side is now going to expand very significantly in the coming months, I would say. Fantastic.

Ashley Seehusen 16:08
Rob, how about you?

Rob Krummen 16:11
Yeah, it's a great question. We always contemplated coming to Europe. Part of the Series A round was going to Europe, as we talked to David Der about quite extensively, but the connections and the introductions that Luc has made, including some consultants on the regulatory side, have sped that up tremendously. We announced earlier today that we're seeking CE mark and hope to get CE mark early next year. That timeline is about a year ahead of when we were forecasting it a year ago. These connections really matter, and who you sit with and who you talk with really matter. These are two of the gentlemen on my board, and I reap so much information from them every time we speak. Again, it goes back to $1 is not $1, and a euro is not a euro. What dollars do you want? I would recommend experienced, educated, and connected individuals.

Ashley Seehusen 17:07
What advice would you guys have for people in the audience who are looking to start a cross-border syndicate? Where do you start? How do you start meeting investors from different countries and different regions?

David Der 17:22
I perhaps need to echo, I think, Luc's comment on you might start with a certain group of investors, but you have to keep in mind who do you want to add to that syndicate? In our particular case, when we started with our investors, but also the Chinese investor, I mean, if it would, of course, any strategic that comes in is asking for certain rights, which you don't always have to say yes to, because if you do that, it would exclude some European VCs or American strategics if you say yes to that. You need to have a bit of a mind, a bit of a view on where do I want to go and make sure that the terms you agree to in that first phase are palatable for everyone else joining later on.

Rob Krummen 18:02
I also think it's really important to think about a synergy or an alignment of ideation, where do you intend to go, and where do those individuals who you're bringing on board intend for you to go? If they're in the same direction, that's fantastic. Build that syndicate. But if they're in opposite directions, as we've alluded to, maybe it's not the best dollar to bring in, because at the end of the day, this is your team. Due diligence on the front end, making sure they're the right partners for you in terms of where you meet these. I mean, advertisements for this event, there are incredible funds here throughout who have experience in the med tech industry. I find these events, both in the United States and Europe, to be incredibly helpful for talking to individuals. The more people you're in front of, the more you can learn about the process.

David Der 18:53
I would just echo that. It's kind of like getting married. Your first wedding night is your best night; it goes down after that. On a serious note, I think people, whether they're across borders, across town, or across the room, there are similar-minded people, similarly informed, seldom disagree. You've heard about visualizing the end; that goes down to the board level. How's the board dynamics? If you get somebody who's early in a fund, they want to go long, and somebody who's got a year left in their fund, you know, that's a natural mismatch. I want to sell as fast as I can. There's a lot that goes into it, but I find whether it's friends, business relationships, or syndicates, just start out with those basic things. Are these people that I want to go have a beer with? If the answer to that is no, I probably sure don't want to get in bed with them, putting money into a company that we're going to be tied up with for the next three to five years. There was a little bit of apprehension because Luc's going, "Such a cool name," and Sascha, and they're doing their diligence. We're the great State of Tennessee, and we're just Dave and Billy Bob and whoever else. What really struck us was the commonality, putting the patient first, thinking through how that's going to be, the thoughtfulness, sharing diligence. Couldn't have asked for a better syndicate partner, and I really didn't think about it being international. I just thought, "What a great group to work with." We want to work with great people, and that includes Rob. You know why Vektor was appealing to us? We start with that, and then where the chips fall, they fall.

Luc Marengere 20:39
I think I pick up on that theme as well and certainly echo the comments. Return the compliment to David. The alignment is key to me. Let me give an example. Sometimes I think that's useful. Given that we're in Europe, I'll give the example of a typical European med tech company that wants to make inroads in the US. Very often, what we see are European med tech companies that have built a clinical database in Europe, and they pitch the concept that we're going to open up an office in the US. We're going to get ourselves a 510(k), and Bob's your uncle, you're commercial, right? This is when funds like us can really help. Now, it takes two to tango because your advice is only as good as the other person receiving it and viewing it as useful, right? But we would discuss the implementation of clinical trials in the US because once you've got your 510(k), how are you going to sell it, right? There's not enough time here to get into a lot of details, but how are you going to get that reimbursed? You need not just clinical data to pique the curiosity of the healthcare providers to try your device, but how are you going to get that reimbursed? What's the economic value proposition for a third-party payer at some point? All of that machinery, supply chain, etc. Five years ago, you talk about supply chain, and people roll their eyes. What do you mean, supply chain? Well, post-COVID, guess what? Supply chains are a real thing. You better pay attention to that, right? It's all these little things that add up to a good experience or a Gilligan's Island three-hour tour that never ends, kind of thing. That's one example, but there are plenty of examples of US companies wanting to go to Europe and also doing it a bit clumsily, right? That too can be streamlined.

Ashley Seehusen 22:52
Alex, since none of your board members are on this panel, I'll ask you this question. How is having people in different time zones, like trying to get a board meeting together? What dynamics does that add to your company? Is it additive? Is it hard? Tell us a little bit more about that.

Alexander Goemans 23:09
In practice for us, it's now quite easy because we used to have people from the US in the board already, but now we also have people in China, and those time zones very neatly coincide at 4 PM in the afternoon for us. For us, it's really easy now, but it's a bit more difficult with people in the US and China because of that. Perhaps echoing also what David said, you need to find people with a common way of thinking, and that is perhaps just not as easy as it always sounds. I mean, you also have experience with Chinese investors. I think here, due diligence just becomes a bit more of a two-way street, where it's not just the investor doing due diligence on the company. There's always a bit of back and forth, but we did intense efforts to make sure that the language barrier, the cultural barrier, and political tensions wouldn't become a problem. You do need to spend a bit more time together, and just like in a relationship, you really get to know each other, and this should be an effort from both sides.

Ashley Seehusen 24:10
So you dated a lot.

Alexander Goemans 24:14
We dated. We did for months and months and months. It never ended until they did.

Luc Marengere 24:17
Dinner for investors.

Ashley Seehusen 24:20
Fantastic. So this question is for all of you. Over the last couple of years with MDR and IVDR being kind of a mess, most companies have a US-first strategy. Do you still think that's the best path forward, or is that starting to change? What do you guys think?

David Der 24:42
Well, I mean, we are a European company, so we are a European company first, and we are farther ahead in Europe than in the United States. Pivotal in Europe is almost complete now, and we're starting in the United States. In a way, that is helping us in the US because we are now starting to pivot in the United States without having done any prior study there, without having done an early feasibility study, for example. Yes, we have focused on Europe first, but I'm not sure we've lost time in the United States because of that. We were also lucky to have been selected for the MDR expert panel. MDR is still difficult. There are still uncertainties, let's be honest about that. We're hoping to get a bit more clarity sooner. Because of that, it is getting a bit more structured and a bit more clear as it goes.

Luc Marengere 25:27
I think that whole MDR thing, yes, the standard has changed, but I think for the first year and a half, it was more about the backlog, right? Companies like Vektor and others that we have in the portfolio were looking to even just meet a notifying body that would take them on and take them on in a reasonable timeline. This is one of the things that we worked out in Europe. We've worked with Intertek, by the way, if others are interested, but that's a good body to work with, and they've served us well. The logjam for the first 12 months for smaller companies, the bigger companies got the red carpet treatment. But the young, entrepreneurial companies, you know, knocking at the door, "Vektor, who?" They basically take a number, right?

Rob Krummen 26:29
We kind of used the Google Maps analogy. Since Rob's the Google Maps guy, we saw the traffic jam. Just like Waze when it turns red, you're not moving. Most of our companies started looking for exits somewhere in what I would call the southern or northern hemisphere, doing limited first in Europe, then rapidly coming into the US to do the first in the US. In number-wise, maybe 10 to 15, 10 to 20, always thinking Europe. We love you all. We're mostly from Europe, but the MDR mess, you got to sort that out. When you sort it out, then I think we're hoping that the time delay we can have now, you know, nice green road and come back in on it. That's how we're approaching it.

Rob Krummen 27:21
That's a really great question. As an attorney, I'm extremely reluctant to criticize any regulatory body, but I will say that the MDR confusion did lead us to go to the US first. It had been, in years past, easier to start in Europe. That wasn't true when we went through. We went through the United States first with an eye on developing the clinical study so that it could be used for CE mark. I still think some of those discrepancies and difficulties exist. For a company that hasn't done it, maybe it hasn't changed, and maybe you should start in the US first unless you're domiciled in Europe. There are some things that need sorting out, and I will say, for a small company, it is tough to get a notified body’s attention. Again, it's helpful to have a syndicate partner who can help and make introductions. You can rely a little bit on their reputation. They've taken another company through this notified body that is taking you through this notified body, and that helps.

Luc Marengere 28:24
I think there's another element as well. At the end of the day, entrepreneurial companies have to raise money. If you're spinning your wheels in Europe but you have a clear path in the US, you should sometimes take the path of least resistance, at least to get going, get some data behind you, and so on. To some extent, there is far more capital in the US than there is in Europe. The difficulty also in Europe is that there is obviously capital in Europe as well, but it can be geographically limited. In the US, if you're based in San Francisco, you're based in Austin, you're based in Boston, you're doing medical devices, you're just a US company. You're not a Boston-based company. The Minneapolis-based VC cannot touch you. Access to capital, access to KOLs, ability to generate data, ability to get a product on the market, ability to get it adopted while the other jurisdiction is spinning its wheels will influence a US-first approach.

Ashley Seehusen 29:37
Do you think that's changing attitudes in Europe about being so specific from a geographical perspective?

Luc Marengere 29:44
I don't have enough data points to really have a strong view on that, but I can speak to this company that we've invested in, Smart Reporting, as a case in point. This company has been bubbling along in Europe for a number of years, and what looks like is going to be their coming-out party is the acquisition of US assets, right? Them becoming a basically transatlantic company, with the US business becoming the bigger anchor for them right now. I don't know if that's representative of the entire landscape, but that's one example where they migrated to the US.

Ashley Seehusen 30:30
And how do you think that, you know, regulatory is one thing, reimbursement is another. In Europe, it's very, I mean, it's kind of the same in the US because you're dealing with all the different payers. But how does that go in terms of making inroads in Europe?

David Der 30:50
Well, we have a secret weapon, Laurent, who helps us here in Europe. Anything we need there. Laurent, you got to fix this? The US has such a great repertoire of offerings commercially, some of them who are here. Veronex, I'm on the board at Veronex, full disclosure, can help with regulatory thinking through marketing and reimbursement strategies, those kinds of things. While the US is, in one sense, fragmented, in another sense, there is some cohesiveness because it's not like you have to reinvent the wheel every single state, every single hospital, every single city. From that standpoint, between the two, we cover it that way. I don't know if that's unique or about like everyone else's approach, but Luc, you guys got any other ideas on that one?

Luc Marengere 31:39
Reimbursement is a challenge regardless of whether you're on one side of the Atlantic or the other side. In some ways, the US reimbursement landscape, I agree with you, has a lot of opportunities. It's also fragmented. You have MACs across various regions. You know that one MAC reimburses at $10 a test, the other one at $500 a test. There are frustrations and challenges in the US as well. In some ways, in Europe, you could also see it as perhaps simplified in the sense that what are your biggest markets? France and Germany, right? You start there, you start in France and Germany, and build from there. In some ways, it's also fragmented; it's also bureaucratic and everything else. It's meant to be that way, but then it's also simplified in a way. You don't start in a smaller country; you start where the bigger markets are.

Ashley Seehusen 32:41
Alex, how does that translate to Asian markets?

Alexander Goemans 32:45
Yeah, I mean, we, well, we, I don't know. It's the honest answer because we have a licensing agreement, of course, so we have someone else taking care of that, luckily, because we would never go there ourselves. I think this is exactly the type of market where you probably need to go with a partner. I can't see us or most recent companies do that without a local partner.

David Der 33:03
I think you have to do that in those limited markets like that because it's very closed. We've had a couple of companies, and we kind of looked and like just threw our hands up, said, "Okay, the running the traps, the politics, all the other things." It's best to get a partner there of some sort.

Rob Krummen 33:23
Speaking of partners, I was going to say that as the small company who is actively going through reimbursement efforts, our strategy reflects exactly what you heard from the two gentlemen over here on my left in the US. We've worked with phenomenal regulatory consultants, including Veronex and others to help with that. We're far along on that path in the EU and will be targeting Germany, a very sophisticated electrophysiology market, and it'll work well for our initial launch.

Luc Marengere 33:54
In some ways, just to sort of close one of the loops, when we did due diligence on Vektor at the beginning, we targeted electrophysiologists in France and Germany, and we wanted to understand what's the standard of care, how would they view this V mapping technology, you know, friend or foe kind of thing. Show me a little bit of data or show me 10 years of traction. When we realized that it would be, in fact, quite an easy flip based on showing data on anywhere between 25 to 50 cases, that's what they wanted to see. That's entirely manageable. We did focus on Germany and France. The reason why we do that, above and beyond early due diligence, is that once the company is in Europe, we already have access to the KOLs in Germany and in France.

Ashley Seehusen 34:47
Great. We're getting close to time, so I'd love to end with a round robin on what's your best advice for companies. I know we've covered a lot of territory in the last 40 minutes, but that are interested in doing cross-border syndication. What would you guys recommend? Alex, we'll start with you.

Alexander Goemans 35:08
The best advice? Well, the best advice is perhaps to first of all, consider cross-border investors, even if you think certain geographies might be more difficult. Think of Saudi Arabia. Think of China. The issues that you typically see there—geopolitical tensions, IP, language, culture—these issues might not be insurmountable if you put some work into it. It's really thinking about, okay, make sure that the whole still fits together and not just add on investors to add on investors. It still needs to be a whole that works together.

Luc Marengere 35:45
Start early and keep an open mind. One of the things that I find interesting about the med tech industry, so I've spent the first 10 years of my almost 30 years in this business in venture capital doing almost exclusively therapeutics. On the therapeutic side, it's more rigid. VCs will do venture investments, and it's even further rigid than that. Sometimes, you know, Boston-based venture community, they do Boston deals, and San Francisco-based, they do Valley deals. What I find interesting about the medical device thing is you can get a healthy mix of not just cross-border investors but strategics, VCs, and now multi-family offices with expertise in medical devices. All of these things blend in and can make a very strong syndicate. But do start early, and do keep an open mind as to what that final syndicate is going to look like. It's probably not what you thought it would look like at the beginning of your fundraising.

David Der 37:01
I don't think I've ever seen one look like what I thought it was going to look like. Luc's going to think about the end, but be careful what you ask for. You could be the little dog that catches the car. Is that really necessary? Now, at a Series A, is it more appropriate in a Series B? Each company is unique. Think those through because everything comes with a cost, whether it's board seats, personalities, all the time zone things you've got to manage. When you're thinking about that, think about how that cross-border formation will help you drive value first and foremost for the company, then secondly for your shareholders, and then, most importantly, for patients. There are opportunities, as you see with Vektor and Xeltis, where that's going to help patients all over the world. We've cut timelines because of a cross-border syndication. If you're looking for seed capital and you're in Munich, or if you're looking for seed capital and you're in Minneapolis, I probably wouldn't be thinking cross-border. I would just be trying to get the right people in the right place at the right time. A little bit different theme there, I guess, but always thinking about the team, how you build that. That's the most important part.

Rob Krummen 38:22
I think it's all phenomenal advice. I would just say to any innovators out there, if you really care about what you're doing, and you shouldn't be leading an innovative company unless you really care about what you're doing, you're going to work really hard. You're going to do a lot of due diligence. You are going to do diligence on the people you're going to be working with. You'll do due diligence talking to other innovators. Our company CFO, Doug Coleman, sitting out there, he and I have done thousands of hours of due diligence on these guys, on other funds, where we're headed. Do your work, and if you do that work, you can feel more confident about alignment and where you're headed and be able to reach those goals that you set out for yourselves.

Ashley Seehusen 39:05
Great. Thank you guys. It's been a great conversation. Hope it has inspired some of you to go out and look at cross-border syndicates. Give everyone a round of applause. Thanks. Applause.