Staying at the forefront of the medical device industry takes work - a lot of it, in fact. Communication with R&Q's peers in the industry is in large part how our employees do it, and a big part of that is addressing hot topics in the industry. R&Q's own Client Solutions Advisor Christine Santagate was featured in MassDevice's May 2016 issue of Medical Design and Outsourcing in an article titled, "Everything You Ever Wanted to Know about Starting a Medical Device Company." The publication serves as a fantastic how-to guide for startup companies. Here's what she had to say.
Over the last few months, several of the potential clients I’ve met with have been start-up device companies. Typically, I find that start-ups will have a fantastic product idea that can positively impact countless lives – but, often, they do not have a clear plan for how they are going to get a Series A or Series B funding.
While there are many ways to attract funding (VCs, Angels, Family/Friends, Grants, etc.) in this article I’m going to focus on Angel investors – after I recently read a great article on MedCity News (http://medcitynews.com/2013/06/success-with-an-angel-syndicate-how-one-pharma-startup-raised-16m-without-vcs/) about a company that raised a $16M series B round without a dollar from Venture Capitalists – done entirely through Angel investors.
One website that is a great way for new companies to try to look for angel investors is AngelList. (www.angellist.com ). What I like about this website – it allows companies to not only look for new angels to partner with, but companies can also present to angel groups, all online.
When approaching Angels for investments, device companies need to have a clear plan. Expect the angel group to do extremely thorough due diligence – the days of writing blank checks are simply over. They’ll want to know exactly how much money you need, and what exactly you intend to do with it. They’ll want to know how your product is a solution to the industry, how you can quickly grow it, and they are going to want to know your exit strategy. It can take multiple meetings with angels to get funding, and the process can typically take anywhere from 1 – 3 months. The key is to be patient, and also do your homework on appropriate angel groups you should be talking to (for instance – if you are a device company, don’t be targeting angel groups that typically invest in Consumer Retail Products). Offering angels shares in your company is a good way to