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Medtech Venture Investing


Ryan McGuinness

Ryan McGuinness

Commercial GM, Triple Ring Technologies
Read Biography
Oliver Keown

Oliver Keown

Managing Director, Intuitive Ventures
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Amy Belt Raimundo

Amy Belt Raimundo

Co-Founder & Managing Partner, Convey Capital
Read Biography
Tak Cheung

Tak Cheung

New Enterprise Associates, Partner
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Rik Vandevenne

Rik Vandevenne

Managing Director, River Cities Capital Funds
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Dan Galles

Dan Galles

Partner, Providence Ventures
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Let's dig deep and find out what these VCs are looking for and find out where they are focusing their next round of investments.

Ryan McGuiness  0:05  
All right, thank you very much for the introduction. And good evening, everybody, it's great to see you all in person. We have, I'd like to thank Scott Pantel and the entire LSI team for putting on another fantastic event. Let us all gathered here, we have an exciting panel assembled for this evening with a range of experienced and active venture investors, this is going to be a lively and open discussion about the current state of med tech, and healthcare investment. And we'll be touching on unmet needs, markets and their dynamics, technologies and even teams and their portfolios. So as, as I was introduced, I am the commercial GM at Triple Ring technologies. And Triple Ring is the Co-development company. We stand side by side with innovators and entrepreneurs to solve hard problems, launch breakthrough products and start companies build companies. We are a big team of doers that work at the complex systems for life Sciences, med device, health care generally. So if anyone needs help building product, and access to early stage capital, we'd love to talk. So we'll begin our session this evening with introductions of each of our panelists. Starting with Dan on the end. Over here, starting with Dan here. Thank you looking the wrong way. Yeah, yeah. And then working through through the list. And so yeah, please thought,

Dan Galles  1:53  
So, I'm a partner at Providence ventures. A partner in Providence ventures, which is the venture capital arm of Providence Health System, which is a large, integrated delivery network. Based out of Seattle area, we operate about 50, the system operates about 50 hospitals and 900 ambulatory clinics and performs a range of of services post post acute and acute care services, in the mission of our venture arm is to find innovative technologies, software services, medical devices, that one, we'd love to invest in them to generate a financial return for the system. But pretty importantly, and pretty prescriptively we only do so in looking at companies that we can see a tangible relationship with the system. So in the case of medical devices, right, so better, you can hear me. So at Providence Ventures, basically, we look for innovative companies that can make an impact on our system. And the first thing we do we go look for those innovative companies, find them and talk to the stakeholders that are relevant to and introduce them to our key stakeholders and try and drive education and relationships there. And when those come together, then we take a look at opportunities of investing. We've invested in 28 companies over the past seven years, and invest between five and $10 billion in those companies and then work closely with them like a traditional venture capital fund would within Providence.

Amy Belt Raimundo  3:39  
Hi, can you hear me good? Thumbs up? It's a good start. Amy Belt Raimundo , I'm a co founder and managing partner at Convey capital, which is a new venture fund that kicked off in July of last year. My background is actually strategic venture came out of Kaiser's venture capital program, and then before that Covidien venture capital program. And convey is really about driving a similar benefit of the strategic interactions with strategic LPs and then financial LPs to really drive the ability to, you know, advance innovations. We're focused more on health tech, but really, from a device perspective, it's where technology data interacts with medical technology to really change the delivery of care is a game changer. So, you know, we're really focused on that aspect of med tech. You know, I started my med tech career guidance, so I've got a long history on the technology side. And really excited to be here.

Tak Cheung  4:49  
Can you guys hear me? Okay? Tak Cheung, a partner at NEA. We're 40 plus year old firm with 23 billion plus under management over that period of time. In 2017 was a $3.6 billion fund diversified across tech and healthcare. I have been here for four years. I was previously with another venture firm called mirror you before that, I co founded and now commercial laparoscopic Instrument Company. And before that I spent about a decade in BD m&a at three Orange County firms and real life sciences Bausch+Lomb and AMO and have an engineering MD and MBA degrees before that, you know, we invest across all the spectrum of medical devices really looking for billion dollar plus Tam's investing. Typically it's Series B or at the very earliest stages, but we'll invest all the way through commercial rounds. Let's meet up.

Oliver Keown  5:46  
Good evening, everyone, Oliver Keown. I'm Managing Director at Intuitive ventures, where the investment arm of Intuitive Surgical company has pioneered the field of surgical robotics were structured as $100 million funds focused on early stage investments in the ecosystems of minimally invasive care companies that are really transforming the field pushing the digital therapeutic and diagnostic opportunities of a minimally invasive care forward. And we're typically investing half a million to $5 million in seed series, a series B investments. But ultimately, we're pretty flexible across those stages. Part of our view of the world is where we can really add differentiated value and to those opportunities, leveraging the mothership, the key assets and strengths of our corporate parents, but taking a very clear financial lens, and really driving that independent value creation for those companies and aligning ourselves around the independent path that those companies are pursuing.

Rik Vandevenne  6:45  
And Rik Vandevenne, Managing Director at River City's capital funds, we just rebranded in January to RC capital, currently investing out of our seven funds. So we've been actively investing in health care for 28 years, 140 or so investments over the years. And for us, healthcare is medical devices, healthcare services, and healthcare IT growth equity focused, so you know, typically companies on the med tech side will have commercialize the product of some revenue, maybe, you know, 4 to 30 million or so. And we come in with the sort of tried and true playbook to help scale the business up, you know, and then hopefully find the right strategic partner or public offering.

Ryan McGuiness  7:36  
Super, thank you very much. So, my back on, good. Alright, so I'd like to start our discussion this evening, by reflecting back on the last couple of years, and particularly on the resiliency of the economy, and markets. Just think back even 18 months from now, when when most of our clinical trials were halted due to a lack of beds. And yet, the industry and venture investing in the industry has been, you know, record breaking. So if you can reflect or I'd like, like your perspectives on on the wild ride of the last couple of years. And I want to start with you, Amy, what made you emerge from the relative safety of a COVID lockdown to start a venture fund now?

Amy Belt Raimundo  8:29  
Well, I have to say like, there's nothing like a global pandemic to say like, Hey, life's short, you only live once if you if there's something you want to do, go do it. And I know there's tons of entrepreneurs in the audience who have made that commitment, and then often time and time again. So like, A, you know, kudos to you, B, much humility to that process, because I think it's, you know, it's so great to just, you know, bust out and try something that you think is valuable. I think the other thing is, you know, from a health tech, so the digital enablement component of everything. Yeah, you know, the first moments of COVID was a lockdown, but then there was an explosion of disruption, where, you know, we no one was doing anything the way that they were doing it before. And, you know, we obviously had a lens from a, you know, pair provider perspective at that point, to say, like, everyone had to change what they were doing overnight. And from a, from a venture perspective, you see that as an inflection point, because things were brewing, that technology was available, but you didn't have to use it. And then suddenly, everyone collectively, provider payer patient had to use digitally enabled technology. And so it really meant that there was a new opportunity. We're still in the early innings of that I would describe, but it felt like this was a time to really sort of, you know, push something forward. And then in terms of our model, which is you know, I guess, you know, really similar in terms have been able to bridge the strategic particularly payer provider side with the technology, you know, what I would say about sort of the convergence of sort of tech and med tech and tech and healthcare is that it's actually much more integrated into the workflow much more new. And so actually, there was a lot of value to be gained by being able to sit at that nexus. And so we felt like we had a model that we could really push forward to develop that and really create value for the system to then be able to, you know, bring new technologies, I think that's the hardest thing is that, you know, you're building something, particularly in sort of a new landscape is, you know, how do you relate to the system that exists, and being able to provide that insight from both perspectives, and that really where we felt like. That was a value that we could add, based on our experiences, so we wanted to put that together and, and kick it off?

Ryan McGuiness  11:00  
Rik, to describe how the pandemic in the recent past has changed the way you've done things or, or

Rik Vandevenne  11:11  
even, you know, a lot of what you said, I mean, I think when you look at, you know, telehealth, right, that was an industry that, you know, a lot of money had gone into a lot of companies were sort of struggling and battling it out for 1%, you know, of the opportunity. And it was amazing to see how fast the hospital systems and physicians were able to adopt and rapidly, you know, make that part of their workflow. And, you know, within, you know, three weeks, in some cases, you know, it went from 1 or 2% of visits, were telehealth to 85-90%, you know, telehealth and, you know, pretty amazing to see that, and, you know, now it's, it's, it's reverted back to, you know, maybe 14 or 15%, but still an incredible growth over a pretty short period of time. And I think that's just an example, you know, of how technology can be used and innovative ways in healthcare. So I think we're seeing, you know, more and more of that, from, from a venture perspective, you know, I didn't get on a plane for, you know, a year and a half, right. And so, but we were still looking at lots of companies and talking to people and doing deals. And so, you know, we did not do a deal where we did not meet the management team in person, at least at one point, but I think there were sort of some funds, who were, you know, making investments, you know, in, in company sight, sight unseen. So, so that's exciting. I think now, you know, the diligence process, we typically will be able to do a lot more on Zoom, before, you know, and can even get to term sheets and things like that before people are traveling on planes. And that just makes us more efficient. We're able to process and evaluate a lot more companies than we were before. So it's good for us to

Ryan McGuiness  12:57  
Oliver I saw you shaking your head, you had,

Oliver Keown  12:59  
we certainly we did invest in companies where we hadn't met management teams. And, you know, I joined Intuitive in the summer of 2019, I was hired to help formulate a venture strategy and launch a new venture investing effort. I think in March, April time, I was just at the point where we formulated a thesis and approach, you know, how can we leverage intuitives DNA, which has had an incredible success, really ideating and innovating from an early stage and bringing that to really create a new market? And so our thesis was early stage investing structured as a fund, and then the global pandemic hit and, you know, I was going into some of these meetings with our pitch wondering, is this going to fly, you know, I just the company and for us, you know, intuitive leadership really saw this as an opportunity to lean into uncertainty, to innovate, to structure our approach and stick with that thesis, you know, early stage investing, where can we add differentiated value. And that was incredible to be to be able to participate to add, you know, capital and support to early stage companies, for all the reasons described, incredibly, rich, you know, time to be innovating and so many wonderful CEOs and companies out there doing it in this tough time.

Ryan McGuiness  14:11  
Nice, nice, Dan, did you likewise,

Dan Galles  14:14  
not it's it's being a part of a large health system like we are, it's been a an interesting and humble kind of ride being a venture capitalist in an organization of 130,000 caregivers, which I did. My mom was happy when I told her I'm a caregiver. They call us all caregivers at Providence. And it's very different than the many of the caregivers within our organization, we're on the front line, so it is humbling from that perspective, but to see it, you know, even at my level and see the changes that COVID has brought in terms of how we deliver care, and there was the short term spike, but the evolution and the accelerate the pushing on the acceleration pedal is something like something I've never seen in my 25 years where starting with telehealth, but It's really starting with all kinds of transforming how providers are going to look to have to contract to get closer to the premium dollar. Because fee for service, all sudden was not a very good thing when things when the spigot gets cut off. So there's a move towards that. And I think that's accelerating, which is important, I think, for med tech companies to understand. And I think it's a good thing as it relates to med tech, because a lot of things in med tech where you try to get extra premium price doesn't accrue to the clinicians or the providers. It accrues to the payer, when you're having better outcomes, and so forth. So I think that there's a good opportunity there with respect to some of the dynamics that are that are going to be happening in the industry. Also, the multimodal care where whether it's virtual, the push towards even more outpatient, and again, the issue for moving from our hospitals, which we have 50 of them, we is part of our mission as an organization, but we want them to we need they're going to be smaller, right, we're gonna, we're gonna have a lot less inpatient surgery that happens even though that's where we make our money. Today, we're going to push into hospital outpatient, we're going to, we're being big deals, and ASCs and partners there, which has huge implications on med tech in terms of that DRG in that payment. You know, we've got a company in the in the orthopedics area that is a much lighter alignment system for doing kind of robotic, kind of semi robotic surgery for joint bundles. And we're introducing them into our group there, because it's a good alternative for orthopedic surgeons who like to do that in the inpatient environment. But a lot of these procedures are now getting pushed outpatient, and it's challenging with some of the technologies the to be able to bring those into those environments. So there's a lot of change on the horizon related to the economics and how providers are going to look to contract and get paid in the future that will impact med tech.

Ryan McGuiness  16:45  
touch on that in a bit later. And so Tak when we spoke last week, you said there's been many changes, or reactions to the last couple of years at NEA, but also you had some international thoughts, as well.

Tak Cheung  17:00  
Oh, yeah, sure. So, you know, I think the last say, half decade has actually been really interesting from a med device perspective, there's been a massive expansion, along with all the capital markets, in, you know, funding, you know, you know, startups across the board, but but, you know, physically within, within med tech, and there's been IPOs, and m&a. And it's been, you know, some of the best years and decades for med tech. I think I think what you're referring to is actually, you know, we did analysis, you know, how exciting it's been in the US, you know, the IPO market has just been fantastic. It's been the best that we've seen in decades. You know, I encourage everyone here to continue to focus on internationally as well, as, you know, there's as many IPOs as that have been in the United States, there's been twice as many IPOs in China worth over a billion dollars, as there have been in the United States in med tech. So I encourage everyone to continue to look, you know, internationally, as well for, for for exits in for money as well. I think that's an opportunity.

Ryan McGuiness  18:04  
And then anything else, any of those remarkable over the last, you know, even six months,

Tak Cheung  18:09  
yeah, it's like, you know, I, you know, the pandemic, you know, within the first week, we had an IPO a minute m&a and two investments that got pulled within a week, it was it was pretty amazing. That, you know, IPO ultimately happened, you know, the m&a ultimately happened, the investments ultimately happened. But, you know, we we did end up retrenching and there was a new normal. And, you know, I think we initially, you know, focused on making sure that all our companies have enough money to make it through and actually, I think we, we didn't really lose any, which is fantastic. You know, and more more capital has been coming in. And so, you know, we're looking for hopefully, the IPO markets will reopen. You know, the, honestly, the even though the the public valuations have come down in med tech, they haven't come down as much as in say, you know, consumer or service health care services or biopharma. So I think there's still, you know, an opportunity for, you know, companies to do well, unfortunately, the private valuations really haven't come down. So we're gonna wait a little bit, maybe, maybe smiling, which is waiting too. So, you know, but, but yeah, I think those are, those will correct over time, as well. But yeah, we're still super excited about the future.

Ryan McGuiness  19:33  
Okay. Thank you. Thank you. Alright, so I'm going to switch gears a little bit, but our focus this week is on medtech innovation in the companies that are driving it. And we have some of the best startups in the world here with us today. So I'd like to give them an opportunity to learn about how each of you invest and what you require to make your investment decisions. So I'd like to start this part with Oliver, you could briefly lay out just the essentials of an investable opportunity, and what are the table stakes essentially for considering an opportunity? Yeah.

Oliver Keown  20:11  
Well, certainly, as you say, incredibly sophisticated audience and trailblazers that have experienced, you know, the navigation of deals and heard probably millions of investors talk about table stakes, you know, investment terms, so believer that, you know, addressable market, big unmet needs, you know, so on so on. I think for us, it intuitive ventures, it starts with our Northstar, which is advancing the field of minimally invasive care, and the ecosystems that will drive better outcomes for patients. And so we look actually really diversely across medical devices, biotech digital, we look at the convergences of those areas, and we bring it back to the north star of minimally invasive care, and that bubbles up for us some critical questions. Are you, you know, helping shift care, as Robotics has, you know, from trauma to the most minimally invasive approach, maybe even to non invasive maybe to prevention and cure? Ultimately, can we use this technology to detect disease earlier, to identify and characterize characterize disease better so that we can treat it better? Can we maybe deliver therapies or brand new therapies to the right patient, maybe to the right place in situ in the body. And I think if we can find really exciting passionate teams that are, you know, compelled and you're making differentiated innovation in those spaces, for us, that's minimally invasive care and that's the race to the top of the kind of excitement, excitement pile, and then it goes to the basics. And we'll look to see if this is an investable opportunity to deploy capital. But that that first filter, I think, is critical for us to get to a point where we can deploy capital and forge a partnership, you know, with the startup that we're investing in.

Ryan McGuiness  21:58  
Dan as another institutional investor. Can you your perspective on this as well?

Dan Galles  22:04  
Yeah, I think that from a venture capital perspective, it's a good question to ask any venture capitalist, because some stage, everybody's got their own view of that and what their own strategy is, for us. We're typically on the med tech side, looking at companies, we'll look at things that are certainly clinical stage, most of the things we're doing are commercial stage. And part of that's just our strategy of where can we add value, we want to give visibility and how we can add value and providing, there's elements of political stage devices where we can make introductions, and we've got, you know, leading clinicians and 50 community based hospitals, where we can be parts of studies and provide some feedback, we can also have a pretty good insight with respect to economics, and what our tech assessment committees and a large system like this, which are getting harder and harder to get new technologies into what they're looking for, and what you can be prepping for, because you never prep too early for that. So we're typically looking at companies that are either at that clinical stage or commercial, where we can educate our different program managers in the different specialty areas and these virtual clinical institute's that we have to provide that information to those clinicians just like your sales reps would be trying to do, and provide a filter of credibility that they think a lot of the clinicians appreciate, and our program managers appreciate. So we can get in front of them, they're going to make the call about what's the right thing to do for our patients. But we try to, you know, help make the connections and, and connect the dots there.

Ryan McGuiness  23:30  
Thank you. So Rick, so in RC capital, what are you guys looking for specifically, it was differentiated about your approach. Um,

Rik Vandevenne  23:41  
So I think, you know, part of it is, I think, like, what's been talked about is sort of the value that we can bring, you know, to the opportunity, we want to make sure that we have, you know, relationships, connections, we've got, you know, 28 years of experience. So we've seen a lot of ways that companies have have stumbled, we've been fortunate to partner with some great entrepreneurs that have built some amazing companies over the years. And so we try and leverage those relationships and connections, along with relationships with hospital systems that we have, as well. And so, you know, that's, that's kind of a big part of his kind of just the experience and connectivity and sort of the Roll up, roll up your sleeves and gotta jump in alongside the entrepreneurs to help them build these businesses. And because we've seen it, you know, many, many times we have visibility. So try and, you know, talk about what's sort of coming around the corner that may disrupt the path of the company and make sure that we're heading in the right direction, so,

Ryan McGuiness  24:41  
so 27 years,

Unknown Speaker  24:42  
she said, yeah, 28 I

Ryan McGuiness  24:44  
think yeah, and then Tak it's been 40 years for NEA right. Yeah.

Tak Cheung  24:49  
Yeah. Yeah. Yeah. You know, we think about, you know, most important is obviously teams we always talk about that and, you know, the three legged stool is his team's market and technology and obviously, specifically for, you know, healthcare and medical technologies, you got to add regulatory and reimbursement in there as well. You know, we think about, you know, really ideally, taking one deep risk, maybe two across those spectrum, across those five issues. You know, we would not do that with respect to team. But, you know, so for example, you know, it is easy to make an earlier stage bet, if the reimbursement and clinical path is clear. If it's not clear, we will probably wait until there's there's a decent amount of, say, clinical data, and be willing to maybe take the reimbursement risk. But taking the risk all the way across the board is not super easy. We will do that, if it's it's amazing team. But, but otherwise, especially, you know, you know, the way that reimbursement has been playing out recently, you know, it is it is tough to make early stage bets, where you're gonna have to take all those risks across.

Ryan McGuiness  26:15  
Amy, you were on your first or second of a 40 year ride, right? 40 years, 27 years. 16 years to be on the investiture.

Amy Belt Raimundo  26:33  
But you know, we're focused on digital enablement, component and where and that is the operative element, the game changer and how you deliver care how you create access quality in different economics. But for us, then therefore, you know, that's a far more integrated approach to a healthcare system or a payer. And so we are focused on sort of the top priorities for those strategic players. So that they will focus on that because I would say the thing that I've taken away, I started my actually started my career 20 years ago, on the health system side, the implementing change. And I think the thing that gets over looked or under appreciated is that actually, behavior change is actually the hardest thing. Change management is the most expensive thing. It's not the technologies that change management, and there's only so much innovation, any one organization can take at once. And so you really have to be above the waterline in terms of the Hey, I'm going to change my workflow and change my systems, I'm going to change this and that in order to, you know, take this new innovation on, it could be good. But if it's not above the waterline, you know, it just you can't devote the resources organizationally to take it on. And so we really focus on, you know, we're really focused on with our strategic partners, what are those top elements, things they must change and must devote resources to, so that they have the time and attention to implement them? And I think that's, you know, we think it's incredibly exciting. But it's also a very pragmatic approach to Hey, the juice has got to be worth the squeeze. And the squeeze is really challenging. And so really have that perspective when we look at new technology, can you produce the the ROI, or the clinical quality impact of that technology to make it something that we really are interested in?

Ryan McGuiness  28:36  
And I'd like to shift the conversation to technology, and indirect a question it, Dan, Dan, you're aligned with a $27 billion healthcare system. And your perspective on on the the fitting new technology into clinical workflows is somewhat unique. And so if you could kind of describe how that gets done with a group like yours, yeah.

Dan Galles  29:03  
There's two angles to it. I think, what we're thinking about, just in general, when we're thinking about the things we're thematically what we're looking at, and it applies to software services and medical devices, some of the, you know, exciting things that were talked about before that COVID has wrought from a innovation perspective. Thematically, I think great, a lot of opportunity related to changes again in in payment and how you thought to think about economics for provider organizations that are going to be thinking differently, we're $27 billion revenue system that just lost $700 million last year, before investment income or whatever. So it's systems are under pressure, and they're going to need to change and it's going to change how they look to contract. And payers aren't stupid so they will not just give up margin. So it's going to be a challenge, but also how we're delivering that care and doing a lot more outside of the walls of our care. You know, you think about old care, old style health care. Show up, sit in the office. You know, there's a attentiveness to the consumer that's changed. And a lot of that's been brought by this awareness of, Wow, that was easy to think about, you know, whether it's Amazon, you click a button and it comes telemedicine, you know, click a button, every consumer, every physician now has been forced to wake up and see how this works. It's like, oh, that works pretty good. So I think there's gonna be a lot of change with respect to where people are getting care. So you got to think about, I think the monitoring and diagnostics side, I think there's a huge, huge opportunity to kind of figure out how it works with respect to the economics, but we're going to start caring for patients and not want to see them as much in person we're going to try, we need to reduce the cost of care and reduce the friction for how they get that care. So they need what we're picking up in terms of signals on the monitoring side needs to be impactful and important. It's not just, you know, stuff that what are you going to do with it, but and then you need software to ingest that data to make it usable for the clinicians to be able to react to it. So I think there's real opportunity on that side. And then I think at home diagnostics, which you think about, you know, besides the exact labs test for colonoscopy screening, there hadn't been a lot of at home testing that has really send, send it to it here. COVID change that. And I think people are waking up to all kinds of things where you can do at home diagnostics, self diagnostics, you know, using your mobile phone to be able to capture information. And we're gonna think about how we get care differently, that technology is going to be an important part for how we do that, not only in the diagnostic and monitoring, but also on the care side, it's let's help for more self self care, in the home as well.

Ryan McGuiness  31:43  
We have a discussion around adoption as well, in systems as large as yours. And the physicians are necessary but insufficient for adoption for adoption of tech. Yeah,

Dan Galles  31:55  
so yeah, thinking about, kind of always knew this. And this has been an evolution over decades now. But you know, the old world, if you think about physician preference devices, and surgical devices, or things in the cath lab, you know, get, you got to start with the clinician, check the box, you've got to get them excited, they got to believe in it clinically, this is better for all these different reasons. But the tech assessment committees within the hospital are, there's still some specialties where they have, you know, enormous power and say I need it, there aren't many of them, you got to go through that tech assessment committee process, and plus one plus two features. They don't want to bring them in, we want the system wants less products that are being used in rathan than more and that means they want the right ones, they want innovative ones. But you know, we have two hips and knees that we use. Now we've got you know, for the more commodity stuff we're trying to win. So to raise above that bar and innovation, you not only have to demonstrate better clinical outcome and the physicians like it better, but you got to really focus on what's the impact on the economics and advocate for that as well.

Ryan McGuiness  33:01  
Yeah, nice. Nice. And then Rik, your team focus has focuses heavily on IT and healthcare services, in addition to med devices. Can you speak to the ongoing convergence?

Rik Vandevenne  33:13  
Yeah, you know, just just hearing Dan's speak there, you know, I thought about, I was on the board of a company called Bardy Diagnostics. And, you know, that was a cardiac rhythm monitoring company. And when when COVID happened, right, they were able to quickly go to where the patient would call into their cardiologist, have some concerns. And then Bardy could dropship, you know, the device to the patient's home. And then they can wear the device for, you know, 14 days, and, and be monitored. And so, you know, it was a cutting edge medical device, right. But they also had, you know, 70 readers, right, so there was sort of a services business that we were managing as well, to, you know, look at the data, create the reports that could go back to, you know, the using the data to the cardiologist to give a good report about that, you know, individual patient. And then, of course, there was a huge IT component, you know, to it, where we're using AI and machine learning to make it more efficient, faster, and take less time for the reading and higher quality and be able to, you know, to identify arrhythmias, you know, quicker and faster. And so, I think that, you know, that's hard to do, right? Because that's, that's a services business, it's an IT company, and it's a device company, all in one. And they had to be excellent at all of those. And, and, you know, that's why we ended up you know, selling the company. And, you know, the the buyer ended up paying something like 15 times revenue because it was, you know, clearly a, you know, a value add, you know, business and so, those kinds of remote monitoring technologies are ones that I think we're, you know, we're pretty interested in and, and speak to that convergence. Just you know, of it, I mean software sort of eating the world, right? We heard that 15 years ago in Silicon Valley. And I think that that is very true in the med device space, right, we're getting the data and the ability to do predictive analytics and all that is so exciting. And we're just on the, you know, early innings of that.

Ryan McGuiness  35:20  
And Oliver, so your mandate is focused, maybe a bit more focused in than others. But even still, you have some fascinating technology that you have access to and are interested in. So

Oliver Keown  35:33  
yeah, yeah. And actually, a lot of those convergences are, you know, kind of square in our wheelhouse here in two dimensional setting, a bias trend that I'm excited about, you know, as you think about the future of robotic minimally invasive surgery, and the penetration and growth that that market, multiple players participating in, it will achieve, think of the data just intuitive, you know, as an example, 25 years of embedded sensors in our systems, 10 million procedures, that's a vast amount of data that's powering today and a bunch of insights and analytics and solutions for surgeons and and how they operate. But for us in ventures, I'm thinking, how does that power the ecosystem? Where are there going to be opportunities to connect in to leverage that type of rich data set to power, you know, the next wave of digital surgery, customizable training, you know, analytics in real time, predictive analytics, as you said, opportunities to close the variability gap, both operational and clinical outcome improvements. So yeah, that's how we look at those opportunities, and how I look at startups when I think about data strategies, and maybe opportunities where we can leverage our unique strengths on the intuitive venture side to accelerate some of the companies we invest in.

Ryan McGuiness  36:50  
Pretty cool. So Amy, what kind of technologies are getting you excited and very highly focused on?

Amy Belt Raimundo  36:56  
Yeah, I think, you know, shifting and Dan mentioned it, it related is being able to shift the site of care, you know, you digital means that you can sort of not be beholden to the same geographic constraints that historically were true. And so suddenly, you have an opportunity, with technology to shift care to a different setting, and it could be the ASC it could be home. Now with that requires a very sophisticated group of, of cert, yeah, oftentimes service with technology with device. And so I think that ecosystem is evolving, it's, again, early stage, but it does actually have implications for the devices at the end, whether it's a less, you know, like, if you're not in a hospital setting, or an ASC setting, you know, you have a different set of, you know, standards and things you need to hit from a user perspective, from a cost perspective, same is true in the home, that you have a different set of either technologies or monitoring that enable that. And so, you know, we're really thinking on the hospital side, like hospital of the future, what does that look like? And what technologies and then the wrap arounds around those technologies that make them possible? So I think that's very exciting. Because I think, again, you know, we're, if we take yourself out of the geographic structure of like, we built hospitals to be very efficient internally as a system, but then suddenly, you don't have that same sort of geographical constraint. How can you use technology? How can you use AI? How can you do that to, you know, be able to leverage expertise across you know, different sites of care? How can you actually get access to expertise outside of the traditional setting, because if you think about, like, we're all going through this incredible change of like, we had to be physically together, which I love for the record, being physically together, like the three dimensional people is a wonderful thing. But it does open up new doors of being able to, you know, be able to extend the expertise of one person across multiple settings, or across multiple times, it doesn't require them to get in a car or get on an airplane every time. But I think it's those kinds of technologies, but I think it's gonna have to be a systems approach, for those to be real, and for those things to be realized. And so it's a, you know, I think we're really excited about how do you construct both the technology at the end, but then what do you wrap around that technology in order to bring more care to more places?

Ryan McGuiness  39:36  
And Tak if you could, the technologies that you're interested in today and but also this systems perspective, and are you you know, focused on technologies that can be used across the portfolio or integrated into various other things or what, what kinds of things are you are you thinking about these days?

Tak Cheung  39:57  
Yeah, you know, I would echo a lot of the comments by the other panelists around AI, ml connected devices, we've been talking with all over about robotics, you know, I think there's a ton of opportunities. And frankly, we've got a very big services investment team as well, that, you know, we think about investing together and things, I think there are a lot of places where, you know, connected devices, you know, on their own, there may not be enough there, but if you build a service around it, it becomes a multibillion dollar opportunity. So when I talk to some of these, you know, CEOs that I just want to sell the device, like, it's not enough for us, but if you're willing to build a service around it, we can do something there. And we've got, we've got teams, that that can help us with that. So yeah, you know, we think about that, I'll just go in a slightly different direction to, you know, sort of like traditional med tech, you know, we're still spending a lot of time and in neuromodulation, really excited about, you know, stimulating all sorts of nerves to treat all kinds of diseases. And then also still really excited about structural heart. So you know, spending a lot of time looking at, you know, tricuspid and other valves in the treatment, they're in an atrial fibrillation, I think it's still a lot of opportunity there, left atrial appendage closure is become a massive market. Obviously, atrial fibrillation, technologies have become massive as well. And there's still a ton of opportunity there as well.

Ryan McGuiness  41:32  
Thank you. So I'm going to switch it up a little bit. Diversity, equality, inclusion, and accountability are social and organizational drivers that are real and important. And so I'd like to discuss how these concepts impact the work you do. And I'm more interested, I think, in the not so much the initiatives within your own teams, although that is interesting, but more how your organizations can use their position in this community to advance these important initiatives broadly, if I may, I'd like to start with you Amy.

Amy Belt Raimundo  42:10  
Sure. Well, I think one thing is just foundationally. It's a, it's a talent, and representation question. Like I think, you know, selfishly, like, if we're tapping too small, a portion of our population are not getting enough talent. And then on the representation side, we're also not solving all the challenges we'd be solving. So I think there's an incredible opportunity, and I see it in those lights, as opposed to an obligation, even though you know, it often gets painted in that regard, I think from as investors, we are, you know, driving where the capital goes. And so what, you know, companies flourish, and we all get caught in our sort of day to day how things are, how things are, you know, what's efficient? What's in front of you? How do you do that as quickly as possible? But I think, you know, there's a real responsibility, but also opportunity to be looking where our capital is going, who are we funding? What are those teams look like? Are they representing the patients and providers that we are creating solutions for, and we're backing? So I think that, you know, is something that I think is, you know, come to the fore, but I have to be realistic about, like, you have to do the work, you have to create networks of people that don't necessarily look like you because I think there's a basic affinity bias. I have an affinity bias. I have my med tech women organization, sitting here right front and center. Yeah. But I think there is an opportunity to break out of what our natural networks look like, so that we can tap that talent and opportunities and others. And then we have to keep ourselves accountable to it. Because I think in fast paced worlds, we're trying to do a ton of things. If we aren't, you know, doing that work and breaking out of our things, we're not going to actually create the solutions with the talent that then have the impact that we're all looking to have in healthcare. So I will get off my soapbox, but I can't get down because I might fall off this chair because it's way too high.

Ryan McGuiness  44:21  
And Tak, can you give some some perspective on this as well?

Tak Cheung  44:26  
Yeah, you know, I think maybe it was going there, but I'll just sort of maybe expand on it and stress it right. So so, you know, I think, you know, diversity, inclusion, belonging is super important from an individual perspective. And I think it's important from a checkmark, ESG perspective, you know, everyone looks at the market caps of, of ESG friendly companies, and they're better, right. But I think fundamentally, it's actually when we're biased, it's a market inefficiency. And it's a loss to society actually, right, we as society members all lose. And, and so I think it's super important to inculcate it not only in what we do in business, but as we as as individuals, to make sure that we are listening to and capturing as much, you know, insight and giving everyone the opportunity to stand up and, and contribute to our society. I think we're just better off. Look, I mean, 1776, right, like, you know, Americans, and, you know, we could still be working for a king, right, and, or an emperor depending on, and I could still be, you know, I don't know, in China, right. There's the the fact that America has allowed my parents to come here and, and me to be born here and help out in our society and, and for us to rise up and, and, you know, replace our King every four years. Well, hopefully, we are in Orange County, I won't be careful. But you know. But, you know, I do think it is super important. As you know, from a societal perspective, we want to produce the most value for ourselves and our children, you know, to, to not have these biases.

Ryan McGuiness  46:23  
Thank you for your thoughts on this. And I would love to discuss it more. But I do need to kind of keep things moving along. And so we want to get the audience involved. And we have a few minutes for questions and answers and, and all of us will be here through the rest of the event. So we'd love to chat some more. But are there any questions? Folks would have please

Question  46:44  
walk around the event and I see these signs for reggae. Plus, I notice tomorrow morning, the keynote speaker was the gentleman who designed a Reg A+ regulation to help write the regulations. And I'm wondering, how does Greg, how does Venture Capital Work with Reg A+?

Ryan McGuiness  47:01  
Okay, so, I'm going to repeat the question so we can get them recorded. So the fundamental question just how to venture capitalists work with Reg A+? Plus, manage it? Yeah. Who would like to take that? Am I gonna have to select somebody? Who's gonna tack? I think it's you.

Rik Vandevenne  47:28  
Are there any regulatory consultants here? I think everyone should attend that session. And if anyone can provide me with the cliffnotes, I'd appreciate it.

Ryan McGuiness  47:52  
I'm do the keynote in the morning. And then we can ask him. Any other questions? Maybe a softball question. Over here, please. Reimbursement reimbursement for medical devices?

Yeah, so the question is around reimbursement and at home care. Yeah. The shift. Yeah, okay. Please,

Dan Galles  48:32  
I'll start doing just simple examples. And these aren't even the new ones. But like the starting with different reimbursement mechanisms around bundles. So like, our organization, Providence now has huge number of contracts with both Medicare and with commercial payers, for hips and knee replacement that we're taking basically one payment for kind of a 90 day. So we're everything that happens between the visits before and after, we're taking full risk on that and the implications of that one, we're, wow, we better stop sending people to rehab when it's unnecessary. That was an easy one. But there's things implications with respect to what goes into that. That bundle of goods that we're using, and physicians are using, that were much more thoughtful about now, too. So that's an easy example. In terms of a change. Also, we're seeing it, you know, this is a perverse incentive of the US healthcare system, right where we make all our money on at a health care provider system on commercial patients, we try to break even on Medicare and we lose money caring for Medicaid patients, the way things work. And we also the way we make money is on the inpatient. So we'd like to do inpatient, even if it's not necessary, but things have been pushed in saying, well minimally invasive and all these things, why are we doing our inpatient environment where you get paid more, at least put it in a hospital outpatient setting, and why are we even doing it there? Let's put it in a more comfortable, better ambulatory surgery center every single payment is lower. Right? So we're we're under hospitals now we're understanding that and we understand that things are moving. And the implications for that's happening every day and think about the big surgeries, what would make a lot of money in terms of joints and things. They're all moving out into lower cost settings, which, you know, intuitively, it'd be really interesting here. I mean, you've got an incredible technology. I don't know if there's a better example in med tech of a company that's come in and created a category and dominated in terms of continuing to innovate and own it, and done incredible things from surgery. But it's, it's an interesting thing, that dilemma in terms of as things move out to lower cost lower environments, in lower cost environments, we're gonna have to think about the technologies we're using, and they need to be as good but cheaper, you know, in those environments?

Oliver Keown  50:52  
Oh, yeah, no, I agree. I think it's gonna drive a ton of innovation, as you say, around platform design around innovative finance mechanisms on the med tech side, right? How do we charge customers? How do we think about value? You're demonstrating that evidence upfront, and I think you're seeing early stage companies come into the field with that sophistication up front and tech said, the importance of reimbursement? I think, as we look as an investor at early stage companies, seeing that sophistication, seeing the strategy, seeing a pipeline of evidence generation, that's not just clinical that ties to healthcare economics, it's so critical, and I think you're gonna see it on the platforms, the the approaches, and some of these lower acuity settings of care.

Amy Belt Raimundo  51:33  
So the only thing I'd add is that this shift to me you're seeing actually movement towards things even like hospital at home, and initiatives there that actually have really taken off and in, in some in sort of the payer provider system, and so therefore, sort of being creative about what does that, what does that ultimately then look like if you've got more integrated plans, actually looking at that as a net savings? And I think that's actually, you know, a sort of a newer area of momentum.

Ryan McGuiness  52:02  
Okay. All right. Thank you very much for our panel tonight. I think everybody should give him give him a hand and thank you for everybody.

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