Thanks to an old colleague, a few years ago, I started judging and mentoring MedTech start-ups for a well-known Swiss accelerator program. This experience has been incredibly enriching, providing me access to an interesting ecosystem and allowing me to meet young founders and their entrepreneurial ideas.
Over the past few years, I’ve mentored several early-stage startups in the MedTech field. Some were at the idea stage, while others were more advanced. Here are the top six lessons I’ve learned through my experience as a mentor, combined with my sales and marketing professional know-how.
1. Getting Out of the Building
Steve Blank, author, entrepreneur, and educator, coined the term “get out of the building,” which means getting to know your customers in their environment. Blank says, “there are no facts inside your building,” referring to the customer development methodology. This means you need to validate your ideas and hypotheses with customers.
Since founders and entrepreneurs are not the audience who will be buying or using the product, they need to “get out of the building” and speak to their target audience. This is one of the most important lessons for startup founders.
I’ve written about listening to the voice of the customer (VOC), conducting customer interviews, observing customers, interacting with key opinion leaders (KOLs); all of these activities align with Blank’s suggestions. Startups need to meet their customers regularly along the pathway to market. Testing ideas, hypotheses, and collecting feedback is the essence of the lean startup movement inspired by Steve Blank. Unfortunately, despite not being a new concept, I still find founders lacking sufficient exposure to customers.
2. Marketing Must Start ASAP
Very often, when I discuss with teams participating in the accelerator, they think that since they are early-stage start-ups, marketing is not a priority because they are far from market launch. This reasoning has two faults.
First, it shows a misunderstanding of the role of marketing in the medical device business. Marketing plays a key role in product development; it is responsible for developing a product that creates value for customers. This aspect of marketing is called upstream marketing. Surprisingly, the concept and value of upstream marketing are not commonly known among founders.
Second, the idea that you don’t need to think about how you will position and sell your product because commercialization is far off is flawed. Over the years, I’ve seen many unverified assumptions, creative positioning, and unclear value propositions. You don’t need a complete marketing plan, but a market-verified approach to who your customers are, what value you will bring them, how you will reach them, and what their challenges are is essential.
3. Diversity is an Asset
Start-up teams are frequently composed of brilliant young postgraduates. However, teams made up solely of “technical” or “scientific” founders have a much harder time building a true business. Highly innovative products and businesses emerge from diversity.
After observing startups and their teams that successfully built a new and marketable product, I noticed they all had one common element: a high degree of diversity. To build a successful MedTech start-up, you need a diverse team with diverse perspectives, backgrounds, and skills. Diversity is necessary but not sufficient; a start-up needs more, but without diversity, they are missing a key element.
4. Mentors and Advisers Provide Much-Needed Knowledge and Expertise
As a member of the accelerator community, which includes hundreds of different mentors covering almost everything a startup could need, I’ve seen the significant value that knowledge and experience can bring. For example, a knowledgeable marketing and sales mentor can provide concrete strategies that aren’t available online or in books, speeding up the definition of your go-to-market strategy.
One important thing I’ve noticed is the need to establish trust before starting mentorship. A trusted relationship between the startup and the mentor is a prerequisite; otherwise, things will not work. A good mentor can help you avoid fatal mistakes, save you time, and even be a competitive advantage.
5. Choosing the Right Partners and Co-Founders
How can you ensure the core team of the startup won’t break up when facing difficulties? It’s important to understand what motivates every member of the core team.
Co-founders and other key team members may start or join a start-up for different reasons. Some seek money or fame, while others want to fulfill a dream, have an impact, or work on an innovative project. Understanding what motivates each member is useful in predicting how they will react when difficulties or opportunities arise.
6. Do Not Copy Large Companies
Start-ups and large companies are fundamentally different entities. Often, founders think the only difference is related to resources. In reality, large companies excel in executing growth strategies, minimizing risks, and developing incremental innovations. Their business model typically does not evolve, and if successful, they become bigger and bigger. Large companies are not supportive of breakthrough innovations.
Start-ups, conversely, should experiment with ideas, products, and business models. In start-ups, processes are almost non-existent, and the level of uncertainty and chaos is very high. Entrepreneurs should learn how to cope with this volatile situation rather than trying to replicate what large companies do.
Conclusion
I must confess that I will hardly see myself as a founder of a MedTech start-up, but I truly enjoy supporting young entrepreneurs in their mission. Successful start-ups result from a trial and error culture, continuous iteration, and uncovering and validating customer needs. Building a successful start-up is hard but not impossible. I hope these six suggestions help you build a strong medical start-up and outpace your competition.
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