New Medtech Incubator Models & Early Stage Investing

Lisa Carmel  0:08  
Thank you. Can you hear me? Okay? Okay, great. No, we have a great panel for you today. And we're going to be discussing early stage incubator models and early stage corporate investing, and hopefully there's going to be a little controversy here. I think maybe, Howard. Okay. So let's go. Let's go down. Why don't we just go down the row and please introduce yourself.

Lana Caron  0:39  
Hi, everyone. I'm Lana Caron. I, I'm a managing partner on Philips ventures. I lead business development and partnering activities in North America.

Fiona Mack  0:51  
Thanks. Hello, everyone. I'm Fiona Mack. I'm the regional head of J Labs located in Houston at the Texas Medical Center.

Howard Levin  0:59  
Hi, my name is Howard Levin, the CMO, CEO of Deerfield catalysts, a early Stage Incubator in New York

Andrew Cleeland  1:08  
afternoon, folks, and I just want to say thank you to LSI, to putting this on, it's good to get out and be amongst people again, and for Lisa for setting this panel up, and you are full of energy. We've noticed that already. So I'm Andrew Cleeland. I'm the CEO of Fogarty innovation, we are an educational incubator based in Mountain View, California.

Lisa Carmel  1:29  
Great, well look, when one one way that we thought we could kick off this panel is everyone could share a trend that you're seeing in the marketplace, and talk about how your model and organization is evolving to deal with that. Who wants to go first?

Andrew Cleeland  1:48  
Start with the ladies. First.

Lana Caron  1:53  
I'm happy to start. So we're seeing a lot of early stage innovation. And historically, Philips has not really been set out well to work with early stage companies. So we have recently rolled out a new investment vehicle focused on collaboration funding that allows us to work with early stage companies.

Fiona Mack  2:18  
So as I said, I am part of J labs or the head of J labs located in Houston. And J Labs is a incubator on for Johnson and Johnson. And we cover all of the sectors in addition to pharma and medical devices. And so I've been in roughly about a year and a half now and the site initiated almost five years ago. And in that time, I think we see an expansion from not only just like physical devices to really more of the digital devices and wearables that we're seeing the trends. And what we're new focuses on is seeing how we can combine digital surgery digital robotics efforts to incorporate into our current portfolio. So we're very much of the same have generated a few tools in which we can help de-risk that technology for early stage companies from an investment perspective. So allowing our sectors to really think about what really would be the the front edge of innovation, and what tools we can help to enable the entrepreneurs to reach a point where they really could be on boarded into our organization.

Howard Levin  3:16  
So we work mostly like in the back of the napkin seed series A area and what we've noticed is that the two things, one is that devices are no longer you know, their original and a sharper scalpel, and then they moved to more of, you know, even mechanical and then integrated electromechanical, now you're seeing devices, which are drug delivery, or you're seeing devices that are integrated with digital and AI. And so I think that devices are no longer, you know, that sort of catheter only thing. It's this big, broad area. And the other thing that I'm hoping I'm seeing, but you know, they can tell me if I'm lying, is that because of a lack of early stage VCs, some of the strategics, I think are moving a little earlier in in their area investment in J Labs is a great example of that, etc.

Andrew Cleeland  4:18  
So I think I'd be remiss again, not to talk about the last couple of years of COVID. So I think our companies have learned to be a little bit more capital efficient. The trends we're seeing very similar that we're seeing, increasing and plays in digital health, which I still think there's a long, long way to go. And there's a lot of shoddy companies out there but we'll see over time. And I think I was a bit surprised to see how many diagnostics companies are coming our way and again, not aimed at obviously not aimed at the virus but I ended and point of care blood tests, we've got a skin cancer company in the crowd here. So that's we've been saying more diagnostics than I would have expected,

Howard Levin  4:58  
You know, and I agree with I mean, I think that one of the problems, if you asked me like five or 10 years ago, I would never even consider a diagnostic clinic because there's no return on it. But as you know, even like what we see are things like for drug companies, right? So you have $1,000, a dose pill or something like that, right? You want to get that number needed to treat or your you know, your responder rate up higher. So you need some sort of diagnostic, whether it's based on physiological measurements or, you know, blood or something like that, you know, there there is this real drive towards these diagnostics. And there

Andrew Cleeland  5:35  
was a first just then that's the first time in about 15 years, we've known each other he's actually agreed with something.

Lisa Carmel  5:41  
Don't worry, we have the next question for that. But no, I would say once you say that the diagnostics have had with specially during COVID, they've had to go to the patient or meet the patient where they are not necessarily at the doctor's office or the hospital. But so Howard, was Andrew. Now, here's that point of where you so how are you models? How are your models, incubator models? Different similar? You know, would you want to contrast the two of your, your models here,

Andrew Cleeland  6:15  
after you?

Howard Levin  6:16  
So you know, our model is we will look. So, so Deerfield Catalyst is we had our own incubator, grittier for the past 15 plus years. And about a year ago, we did a joint venture with Deerfield management. And the nice thing about it is, I don't have to spend 50% of my time on the road raising money, we have an operating budget, which is nice. But the other thing that comes in, that differentiates us from a lot of other medical device incubators, is the fact that Deerfield in house has med tech, pharma, digital and health services. So we're getting to work across a number of different things, or look for projects that have a number of different things that could be anything from, you know, how do you improve, you have a device that helps reduce the cost and value based care for health services company to better target drug delivery, you'll get it get a compound, specifically to specific area. So because of that, it allows, you know, we have a can see things that are not just pure medical base. The other thing is we tend to be very early, which is good and bad. But, you know, our job is for large partners to develop, well vetted series A companies and take the risk out of them so that or take what you know, the major risk out of them so that you know, at least there's a faster pathway or clear pathway to thing to approval.

Andrew Cleeland  8:04  
You know, I like that last part because like that's where we're very similar, which is hopefully producing seasoned, well vetted, series A Series B companies. And I said in my intro, we're an educational incubator. Another way of thinking about that is where a more impact incubator, we're focusing on developing the next generation of innovators, on educating folks around the infant around our med tech ecosystem with the idea of strengthening that ecosystem. So people, companies and ecosystem. Our model is somewhat similar in that we take, we help inventors vet their ideas. So working with local hospitals, physicians within those hospitals vetting their ideas, that's normally about a six month process. We take seed stage companies bring them in to Fogarty and they're with us for we had hoped two to four years we've had a few that are longer and a few that are shorter. And the third, the third one is we also help Series B, Series C Series B companies when they have specific issues. The way we do that, we've got a pretty remarkable team of folks, I think of the the what we call our coaching team. It's about a team of about 12 people, company size is 20. So 12 of them are focused on working daily with these companies living with these companies. And we have the average experience, there was about 28 years in med tech. So very experienced, driven group of folks who have all we've returned more than $5 billion to investors. So we've we've got a decent track record along the way. So we focus on just helping them come through, but really targeting the individuals within those companies. And we all know the numbers like 9 out of 10 startups fail. We would like every one of our startups to succeed. But if they don't we want those entrepreneurs those innovators better trained for next time round.

Howard Levin  9:59  
Yeah, Yeah, and the other thing is similar, you know, we'll look into similarities between what we have, we try and, you know, so we like to either do inside ideas, which is about, you know, a third of the ideas, and then the rest of them, you know, we're we like to look at early stage ideas, we're probably not the best to look at Series B, you know, if you want to look like pre series A or real seed, that's where we can come in, we'll bring you in, if we can find and fund you, you know, we can get enough seed funding in to actually go through it over the course of we'd like a year to 18 months. So we're on the shorter side of trying to move the thing forward. But you know, we'll put in the resources, puts give you space, etc, etc. So

Fiona Mack  10:52  
J labs would be an extension of those various models where we're bringing in fairly well bedded companies at that particular stage that need physical incubation space. In particular our site in Houston has a lot of specialty equipment for a prototype designing for medical devices. And we've partnered with our Center for device innovation, which is the innovation arm that's kind of embedded within medical devices, is also right next door, and they have a lot of machine shops to to do that type of work. But we do think that that educational component for the entrepreneur is also key. So that continues on if you come into the J labs organization through adding them with a mentor, which we refer to a JPAL so someone has a an expertise internally, within your field to really kind of guide you along kind of strategic interests of Johnson and Johnson. Although incubation within J Labs is a no strings attached agreement. But we do think we want to be able to provide you the support and addition to the variety of programming that we have for CEO training, and some of our scientific program that go along with it. So as your company kind of develops out of these accelerators, incubation space J labs would be an extension of that, where you then get certainly access to an innovation hub, but also vetting from our own JDC venture group to see if there is a potential strategic investment that would could be of interest to the company,

Lisa Carmel  12:10  
is there a timeline that you would be a J labs,

Fiona Mack  12:15  
ideally, we think about two to three years. But as we go back, and we think that that is a good transition point for companies, either they will naturally grow out of this space, or they will will pivot and think about what their next steps would be. But to be quite quite frank, if we we really do

Andrew Cleeland  12:34  
we understand like out the door,

Fiona Mack  12:38  
like graduation. But as we look back in some of our data and thinking like how long does it really take to incubate a company to the world, they will get to a point where there would be a nice inflection point or onboarding into Johnson Johnson there are other larger deals, it really does take longer than two to three years. And so we have this analogy, though. What are our head is wants us to be embedded in ecosystems and find you know, the the red ping pong balls, right, so the specialty companies the the unicorns that we could cultivate, but others have the different philosophy that really what we have are these unripe avocados, right that you have to kind of keep in our system and have them them ripen to like get to a point where they are of useful for us. But then it's the same thing. If they're too long, they become rotten, and nobody wants. They're always trying to find the balance.

Unknown Speaker  13:25  
So they think as guacamole, you make guacamole.

Fiona Mack  13:30  
But as an aside here, that's kind of our constant trying to be abreast of what the companies are doing at each state. So we can begin to advocate for them internally, or once again, think about kind of some strategic changes that would help them along their journey. That's great.

Lana Caron  13:47  
So at Philips, we are very focused on coaching and providing information that startups need to navigate Philips. early stage innovation comes with risk. We talked a lot about risk last night. And so what we are focused on is really on de-risking that early stage innovation. And part of that is really understanding Philips well and where your innovation is going to land in the organization. So historically, it's been very difficult for us to identify a landing spot because very often early stage innovation is linked to a strategic area but is not in the historically target space for us. So again, what we work on very closely with our portfolio companies and startups that we do not invest into, but intend to partner with is identifying who are the champions within the organization, and how can we build the links or how can we identify projects pilots opportunities, light such opportunities to get the proof points that we will need to really chart this path towards commercialization. Because ultimately, that's what it's all about for us. How can we help you commercialize your innovation, your technology, bring it to market, and ultimately help you exit?

Lisa Carmel  15:20  
Let's see. So how about we talk about engaging with strategics? Advice? And what's the best way to engage with strategics

Howard Levin  15:31  
have something creative? If they can sell it today, you got no problem. But, you know, I mean, all kidding aside, historically, the problem has been the way we look at it. And I know you guys may look a little differently, is that, you know, up till maybe five years ago, it seemed like, you know, everything goes away, it's but it seemed like there was very difficult if there was any risk, other than maybe even a pivotal clinical trial risk left to get a strategic interested. Now the strategic seem like they're moving, at least to me seem like they're moving a lot earlier. And I wonder if you guys know, how do you, at what point? Can some people that come out of Andrew's and my type of area, come to you guys and say, hey, you know, would you be interested? And what everybody in the audience wants to know, if if you get into J labs, or you're getting into Philips? Does this mean, they're going to buy you?

Lisa Carmel  16:38  
Now, it doesn't mean. But that doesn't necessarily mean that you shouldn't try? And do you know, there are many reasons why you should engage with Philips, or a strategic in general. And so my first advice to you is, if you are an innovator, if you have a company, and you are interested in engaging in with this strategic, be very clear, what is the goal that you're trying to achieve? Are you trying to create a new channel? Are you trying to create or de risk your proposition? Are you trying to get closer to KOLs, that will help you get to that next milestone, and help you lend the next, you know, fundraise, really be very clear what you're trying to achieve when you reaching out to a strategic. And the other piece of advice that I always give to the startups that are reaching out to us is, think about a strategic like you think about a customer, think about who your buyer is going to be what p&l, your product or service or solution is going to end up on who is going to use your product and solution within within Philips. And then articulate that, in a way pitch it in a way that you would pitch it to a customer. And if you approach it in that way, it makes it easier for us within Philips Ventures we are fairly small, but mighty team. So any pre work, any diligence that you can do on your end helps on our end. And that makes it easier for us to take that next step step together. So for example, I love when folks reach out to me and say, Hey, I have reached out to a general manager or business category leader, we connected at a conference, we had a great discussion. And here are some of the questions that he raised. Or here's the feedback that he has given me, how do we take it to the next step. So that shows that you know somebody has done that pre work, understands Philips landscape, and it helps me take them to the next step that much faster.

Fiona Mack  18:58  
I agree that the starting those conversations earlier are also quite quite key. Back to their avocado analogy, it's really trying to move along this this journey with you and get you to a point where you have some strategic interest for the organization. So we've talked about a bit of the programming that's done at Johnson at J labs. And in particular, where we really do try to highlight what our strategic focus areas for the organization would be. And trying to have those discussions of knowing where we are from a position and how your particular technology would lead to that would be enabled to have those later discussions. But coming to any of us with the idea is a key step to beginning that process. So I would encourage even early discussions along that lines. You know, I think startups are are used to the word no, but as Lauren highlighted, there is some great feedback that you get even from having those initial conversations that could be guided yes for the very next step. So we're certainly open. From our perspective at Johnson Johnson innovation, the idea is that if you talk to one of us you eventually talked to, to all of us. So approaching me,approaching a lot of our subject matter experts at at conferences, that information all does get collected and put in a broad database, which we actually do review quite quite regularly and see what are really great opportunities to follow up on. So that means one conversation could be about an investment opportunity, but can you could become approached about whether or not you want to be incubated in the J labs? Or may it be useful for having a research collaboration. So we do try to expose you to the broad network of the Johnson Johnson enterprise enterprise to really see if there is some placement for you within our organization.

Andrew Cleeland  20:42  
And it's gonna Yeah, I think so early is a relative term, right. So I agree that you need to be initiating conversations at the right time. And not that is not three weeks before you, you're going to be offering yourself up for auction. So it is early. But I think you've got to have a plan, every one of us if you're a CEO of a startup, you need to have a plan, a fully baked plan of how you're going to engage each of the strategics. Hopefully, there's not just one. And by that, I mean, make sure you've done your due diligence on who you're going to be talking to, when you're going to be talking to them. And we actually started member way back at Ardian, we had a whole year that we'd planned for social well, we call it socialization. Getting out there having conversations with people at conferences like this, and planning our discussions out. And one of the things that I got told, after the the acquisition by another company was that they had every time we'd spoken to them, they'd put out in front, what we told them we were going to do. And the next time we'd speak to them, which would be the next conference, this was, you know, the confirmation that had we had we not said what we were going to do, and they are actually just watching our cadence. So I think you've got to be very deliberate, you got to go in with your eyes wide open, right that you can go into early, you will be informing their own internal programs, if there are internal programs, so you need to be aware of that. And so I think, just go in knowing that the folks are talking to you, for their own interest, not for your interest for their interest. It's both of us, right? Hopefully, we'd like to have joint interest. But I can pick on Medtronic because they're not up here. Chris might be in the audience. The point is you, it is the interest that you're trying to impress not not your great technology it's do you fit in. So I think you need to really understand whether or not you fit in.

Lisa Carmel  22:36  
I just want to chime in really, really quickly, I have a good example where a company reached out to us, they were very early. And we couldn't find a good landing spot. They were again linked to a strategic area, but we didn't really have a good p&l for them to land on yet. And so we you know, they were seeking funding, we decided to pass on that funding round. However, they were persistent. And we were able to identify a project to pilot a collaboration with our research group. And as they continue to work with them, the organizational landscape changed. And so we found identified a number of champions within the organization that said. You know what, this is going to be now on my roadmap on my as part of my strategic plan. And as a result of that, we ended up investing. So all I can say, if you're an innovator, stay persistent, and take small wins, right, pursue those small wins, they do add up, and they will lead you to the goal that you're pursuing.

Fiona Mack  23:53  
That's sort of an argument, maybe, as you said, defining what what early means for us is early the stages of technology or early just in terms of you forming a company, or early because you're not quite yet raising funds. I think, that can all be modulated by really, if there's an interest in internally, and what you're developing. So we certainly have models where we can help you with new company creation, if there is a strategic interest in what you're doing kind of the same thing. Our internal strategies do change. So while there may not be some early alignment now over time, there could be some so I still advocate for at least initiating that conversation, but having it structured where if you're given feedback, how do you follow up on it for the next time to this is a you know, business model of developing relationships, that's really how things get done. So having those conversations with anyone who is willing to be open to it and and provide you with some guidance is I felt always going to be useful.

Howard Levin  24:51  
So you going back to what you had said previously about what's different today than previously or whatever. I think that even for us, at the earlier stages, we're looking at it to a certain extent more like a later stage VC or a strategic we look at it, so to speak. What I mean by that, you know, 10-15 years ago, you had three pigs a provisional patent and a cool idea, you can probably raise some money series, a whatever, you know, what, what was Series B and C, then is now like Series A, to a large extent. And so, you know, the thing is, when you're going in whether you're going in to pitch a VC or whether or incubator, are you going into pitch a, a strategic? There are two things one is you have to have an answer, or at least the thoughts about all the different things, you know, what's the unmet need, whats the clinical problems, you want your trial design, what's the reimbursement request, the IP risk when engineer the whole thing, you don't have to have all the answers, but at least you have to look like you've thought through it and identified the issues that you're gonna have to address. And I remember the, like, the, literally the first company that I had on my own, with Mark Gelfand, actually, and so we were raising our series B, we had raised like, a million dollar series A we're very happy, we're gonna raise Series B. And, you know, we could talk physiology and clinical in some engineering, they said, so, we're pitching to a VC. They said, so what's your distribution plan? I really thought so. I said, FedEx, and and. Okay. Yep. So what they did was, they looked at each other laugh, stood up and walked out of the room. So, you know, I appreciate it more now. Now, it's less funny to me than it were more funny to me than it was then. But I think, you know, you're pitching to different people, everybody, you know, when when there's you're sitting down with Andrew and his team or a strategic and his team. They're not just listening to your great science or your great widget, or whatever they're listening to what can this become? And I think you have to at least present something like that. I don't know. Yeah, completely

Lisa Carmel  27:22  
agree. 100% agree, commercialization, there's a ton of risk. And we often see a greatest success when a company comes in, and they say, look, we've validated not only our technology, but also commercialization path. We have a number of reference accounts, and we have proved willingness to pay. And we know that you Philips actually have the channel in this space. And we have a number of customers, your customers that are interested, potentially interested in testing and buying our technology. So that shows to us that there was a commercialization path, and again, creates a fast track to funding and partnering opportunities.

Fiona Mack  28:13  
Thank you. But that also means it's been fairly de risk at that point. Right? They they have a great strategy and that you even potentially revenue generating. And yeah, that's an easier path to go over thinking about your your FedEx story. If you were told at that moment that or that's not viable. Let's sit down with you and make a better plan. Could there have been more success there? So

Andrew Cleeland  28:38  
good, I think doing that I wouldn't be doing that in the room with you at the time, we should be fine. I think what I was pointing out that's different 20 years ago than what it is now. It's much more sophisticated. Just because everyone's learned, as always happens. Right? Everything gets a bit harder. So I guess it goes back to go early, but at the at the right time, right, the right information. Because it's it is it's looking at someone that you're going to ultimately get married to right. And we're trying to wait with hopefully want to be picking partners as well, as you guys picking partners.

Lisa Carmel  29:14  
Do you find it with your incubators that you're doing some matchmaking and helping with timing?

Andrew Cleeland  29:21  
Yeah, absolutely. I mean, I think that's, that is our role. You know, we're not looking at just at the two, two years or so that they're with us. We're hopefully helping them plan out what the ultimate path will be. And yeah, we're venture invested companies, right. So we've got venture investors who are looking for returns up until, you know, two to three years ago, right, the IPO market did open up and now it's shut and let's see how long hopefully it's only shut for a short period of time. But prior to that, and now we're back in the only real exit is is acquisition. So I think

Howard Levin  29:57  
one of the advantages that The Andrew has or we may have is that, especially for earlier stage stuff, not even early, but earlier stage stuff, different funds or different points in their fund, you know, like, so they're if they're going to do an early investment, chances are, they're going to do it early in the fund to give enough time for it to run. So you have to know which funds have just raised and run, so just being sort of in that area, you you tend to have more context or, you know, knowledge of who's got doors at the right stage to pitch a company.

Lisa Carmel  30:40  
What about me want to talk about funding? You know, early stage funding? Is it getting better? Is it felt the same? Or is it worse? Versus pre COVID?

Andrew Cleeland  30:53  
Yeah, so I think there's been a couple of interesting things happen, right, and we're seeing very rapid cycles, because I'd say, early stage, so very early stage where Howard and I work in that seed seed, series A is horrible. Go back pre global financial crisis, there are a ton of people investing in that space, then it's gone down to about, I would say, easily a handful, maybe maybe two hands, coming back again. And then though with with the success of the med tech IPO market, which was quite successful, we've seen folks like Fidelity and some of the larger players coming into the later rounds, which is pushing some of those latest stage VCs to go earlier, which the mid stage is now going earlier. So there was a period of time where it was starting to look pretty good. Again, we're seeing really decent series A's. Now that's shut down. And it's gonna be interesting to see how quickly fidelity and the others stop investing in, in these late stages.

Lisa Carmel  31:54  
What's interesting, yeah, so we saw an uptick, uptick in the investment activity in general in 2020, right, 2021. A lot of the capital did go into the earliest stage companies, not maybe into seed specifically, but we did invest into some of the seed companies. I think our sweet spot has been definitely in series A B ish, sort of stage. But I have seen definitely a lot of capital also going towards earlier stage. And again, as I mentioned earlier, we have rolled out a new investment vehicle that really helps with early stage investing, where we focus, if let's say, we are not in a position to identify yet a landing spot, we can still fund that company through a collaboration funding vehicle that really focuses on is specific proof point or a number of proof points, and really helps us derisk that collaboration or partnering opportunity.

Howard Levin  32:57  
Let me ask you guys a question. From your point of view. I mean, we've seen maybe, Andrew, I don't know, if we've seen a lot of early stage deals done with like convertible notes. Nobody wants to set a valuation. So they do with convertible notes, or, you know, if, if I've even seen strategics come in and put in some money, then they get caught. Because their corporate governance says, you know, it's not only 20% We can, you can only own so much of the company where you can only be this size of an investor and a particular round, or all these things which I have no idea and don't understand. But do you think that strategics can actually invest in earlier stage companies? Or do you really just get caught because it's too small for you to follow on later with the ownership? Yeah,

Lisa Carmel  33:49  
I do. I do. Fiona chime in as well. But, but what Phillips has done is really we focus on making sure that if it's an early stage company, we're not a lead investor, right, and there was a strong syndicate around us. And maybe we now go good and go after a large chunk of equity. And so we provide expertise and advice and guidance, right? To accompany but at the same time, if the company chooses to go a different direction, come the next round. They're, you know, in a position to do that as well, and we're not really tied. We're holding that back, so to speak.

Fiona Mack  34:36  
Certainly from a pharma perspective, Johnson Johnson usually goes in as a part of a syndicate. I've heard heard, they can be more leads and medical devices, but we did utilize the same tools of convertible notes to really derisk some of these technologies particularly for some of the early stage J labs companies before we have the the sector that we refer to it, do more of the resharing for that components, so we still expect them to probably contribute, and later around, so we have to have that strategic alignment from the very beginning.

Andrew Cleeland  35:08  
We're definitely seeing more convertible notes. And I think the you got to be so careful there, rather than these are normally seed stage. And unfortunately, I think there's you set expectations, we have some of these convertible notes with valuation expectations that are sometimes too high. And, you know, sounds strange to me saying that they're too high. But there needs to be a nice growth over time of the company of some value, hopefully. So we've seen that being an issue. We're seeing more grant funding becoming available. And I don't know what happened with NIH, but they're definitely sending out more cash which is great. It's what we need. But still that dearth, I think there is a dearth Yeah, we if you don't have a look at the it's been record year after year after year, even through COVID, the amount of capital coming into the into VCs, but it's we're not seeing it get down to the Series A, in the in the numbers we'd like it to be.

Lisa Carmel  36:04  
So what about you want to share where you where you are finding your your best investing companies in your portfolio companies? How are they coming to you?

Lana Caron  36:17  
There are three ways to engage with Philips, through a business, business champion through a customer and through Philips ventures, if you if you have or working with a clinical partner, and they are a huge advocate of your technology, your solution. And it also happens to be Philips customer, there is an easy way to get connected, you can always reach out to Phillips venture folks, it's you we are on LinkedIn, we have a website, so you can easily reach out to us. And as I mentioned earlier, if you are able to navigate Phillips and I know that sometimes it's really difficult to to identify the right champion within within the organization. But if you are able to do that, go direct and connect with that champion, and give a feedback on the technology the solution how it fits within their strategy. And then obviously, we will get connected, you will get routed to us. Because again, we are at Philips, Philips Ventures is a center of excellence. So we are leading all the investment and partner activities related to startups.

Fiona Mack  37:45  
So sourcing is a big effort for us. So I actually have like physical space that I have to fill that needs to be strategically aligned. So we have a site for Johnson Johnson innovation where you can simply log in your inquiries if you're interested in J lab space, or research, collaboration, etc. And once again, all of that data actually gets collected and gets a gets you a response. We have our program and events where we use our highlighting our strategic interests, we often will have in conjunction with that a one on one partnering request. So you can meet someone within the field within Johnson Johnson to have more direct conversations. But a lot of what we get are coming from referrals, people who have worked with J labs before worked for other companies, and then become interested in the space. So all of those inquiries can can come to me access me through LinkedIn or through my email address. And we're happy to give you more information. And once again, I'll walk you through some of what our strategic focus areas are. And once again, if there's an interesting opportunity, it will get vetted for research collaborations investment opportunities, the full suite of external interfaces that would be available at Johnson and Johnson.

Howard Levin  38:50  
So for us, you know, we a lot of is going to conferences like this and being able to talk to people but a lot of our stuff like you comes in through word of mouth, you know, you have somebody that knows or something and says hey, you know, have you looked at this or can these people call you and you know, we'd like to look at the early stage stuff if it's if there's too much money in or you're too far You know, we were happy to put you in touch with you know Deerfield management the you know, that do the series ABC. Or, you know, other VCs, we may know if it doesn't fit with them type thing, or we send an Andrew who actually knows what he's doing.

Andrew Cleeland  39:36  
But all jokes aside, that's where we want to see companies, right. So for us, we've got a 30,000 square foot facility on our hospital on El Camino Hospital campus. So access to the hospital, and we've got room for 20 companies. So the same sort of deal. We want to keep the place full. That's the community we're trying to do. So you can apply it we are pretty picky. We're trying to find folks who actually do want a learn at the same time. So that's that's straightforward way. But we're out now doing having a lot of conversations with strategics and with VCs that we. They see companies all day every day. And while we've asked them to do is send anybody that they just think needs a little seasoning, send them to us, we'll help the company grow to a point where they're hopefully the strategic can take them back. And last but not least, we're doing some creative stuff now. Working with strategics, you know, in a fundamental build to buy type capacity. A little bit more creative than that, but that's working for us as well. Great, triple zero, triple zero. Yeah.

Lisa Carmel  40:42  
Well, thank you so much, everybody, and thanks. Let's give a round of applause to these amazing