S5E8 Aaron Call | How to Find Money for MedTech Startups

The episode explores Aaron Call's journey from engineer to entrepreneur, and his insights on innovation, market intelligence and the future of Medtech.

Main Topics:

• Medical device development and market fit
• Market research methods for disruptive innovation
• Market analysis and decision-making in the medical industry
• Engineering background and its impact on business decisions
• Medical device industry trends, AI, and fundraising.

About the guest: Aaron Call is the innovative founding principal of Jaunt, a company specializing in market intelligence and strategic decision-making for the medical device industry. With a rich background in biomedical engineering and product management, Aaron has been instrumental in guiding both startups and established enterprises through the complex landscape of medical technology. His expertise extends to Class I and Class II medical devices, digital health technologies, and he holds patents in the medical device field. Aaron's leadership at Jaunt is marked by a commitment to empowering companies with the insights and strategies needed to succeed in the dynamic world of medical technology. Join us as we explore Aaron's journey from engineer to entrepreneur and delve into his insights on innovation, market intelligence, and the future of MedTech.

Links:
Aaron Call - LinkedIn
Jaunt Website

About Being An Engineer

The Being An Engineer podcast is a repository for industry knowledge and a tool through which engineers learn about and connect with relevant companies, technologies, people resources, and opportunities. We feature successful mechanical engineers and interview engineers who are passionate about their work and who made a great impact on the engineering community.

The Being An Engineer podcast is brought to you by Pipeline Design & Engineering. Pipeline partners with medical & other device engineering teams who need turnkey equipment such as cycle test machines, custom test fixtures, automation equipment, assembly jigs, inspection stations and more. You can find us on the web at www.teampipeline.us

Transcript

Presenter: 0:00

Hi, everyone. We've set up this being an engineer podcast as an industry knowledge repository, if you will, we hope it'll be a tool where engineers can learn about and connect with other companies, technologies, people, resources and opportunities. So make some connections and enjoy the show.

Aaron Call: 0:18

But I found myself always asking this question of why are we building this? Are we building the right thing, right? Sometimes it's difficult to actually get the technology to work or to get the clinicals to work, but that doesn't seem to be the hardest part right now. The hardest part is should we build it not? Can we build it?

Aaron Moncur: 0:47

Hello, and welcome to another exciting episode of The being an engineer Podcast. Today we have the absolute privilege to speak with Aaron Call. Aaron is the innovative founding principal of Jaunt, a company specializing in market intelligence and strategic decision making for the medical device industry. With a rich background in biomedical engineering and product management. Aaron has been instrumental in guiding both startups and established enterprises through the complex landscape of medical technology. His expertise extends to class one and class two medical devices, digital health technologies, and he holds patents in the medical device field. Erin's leadership at John is marked by commitment to empowering companies with the insights and strategies needed to succeed in the dynamic world of medical technology. Join us today as we explore Aaron's journey from engineer to entrepreneur, and dive into his insights on innovation, market intelligence and the future of med tech. Aaron, thank you so much for being on the show today.

Aaron Call: 1:46

Thanks for having me.

Aaron Moncur: 1:48

So let's start with the first question. The same one, I asked everyone, what made you decide to become an engineer?

Aaron Call: 1:54

Yeah, you know, growing up, I was just always interested in tinkering in technologies. You know, we had one of the first Macintosh computers kind of follow the Apple story as it was unfolding back in the 80s. And, and my parents subscribed to Popular Science Magazine for me as well. And so, always tinkering, always interested in those types of technologies. And when I grew up, and I was deciding what to do for college, I was really interested in engineering, and all the technologies that are associated with that. But I was also interested in life sciences and medicine. And, and just through a whim, rather, really, I found biomedical engineering that that was able to integrate the two sciences. And it seemed like a perfect fit for me at the time. And I could use the analytical analytical skills in the life science fields. And so that's the direction we went.

Aaron Moncur: 2:52

I don't know if you remember this, Aaron, but many years ago, for those of you listening, Aaron and I have known each other for quite some time now. But many years ago, when I was first introduced to you at a company where I used to work and you had applied to work. It was really funny because we were like doppelgangers. That's how I was first introduced to you, my manager back then he said, Hey, I talked to a really interesting guy today. He's your like, your digital twin. His name is Aaron. He spent some time living in Japan just like you. He has a degree in Biomedical Engineering, just like you. And there was something else. I can't remember what it was now. But there are all these like, Oh, I think it was snowboarding. You guys both snowboard or something like that. Yeah, I remember that. Yeah, that was the wild. Yeah, and here we are many gray hairs later.

Aaron Call: 3:44

Wow. Yeah, I've got a lot more than you do. That looks like wierd.

Aaron Moncur: 3:47

my beard. I'm getting them in my beard for sure. Just the other day, I noticed a few sparklies in my in what is remaining of my head of hair. So they're there. They're there for sure. All right. Well, John specializes in class one and class two medical devices as well as digital health tech. Can you elaborate on that a little bit and speak to some of the unique challenges and opportunities that that you face in these specific areas?

Aaron Call: 4:15

Yeah you know, people ask us if there's a specific vertical that we specialize in, within medicine, and I like to tell them that, yeah, class one, Class Two is really where we focus. But beyond that, it's a huge gamut. And it's getting bigger, you know, for the past 10 years, I feel like the digital element or the connected devices element of the technologies that we're working with is just continues to grow. AI is part of, you know, the strategies and technologies that work with these days. And, and so it's um, you know, med tech and med device is what we focus on. We don't we don't get into biotech and pharma strictly be because, you know, they're wildly different animal from a business model perspective. But some some of the challenges that we see in class one and class two is that, you know, bringing these devices to market is, I like to think of it as kind of, it's a giant puzzle, right? There's so many different pieces of this puzzle, as you're envisioning a technology that could help out patients can help out hospitals about medicine, there's so many different pieces of this of this that have to come together in a perfect fashion to make it all work. I mean, whether it be reimbursement or clinical results, or the technology itself. FDA regulations on clinical data. I already said that one, but value assessments and economics, there's so much that has to come together to make a product successful in the market. Those are the challenges that we deal with all the time. You know, 2025 years ago, Aaron, you could probably attest to this. But the biggest question in in technology development was, you know, what, what's the FDA pathway? You can you get it, you know, through the FDA, and we don't see that much anymore. I mean, it's pretty clear process. And there's some known entities there. But it's what has happening in the market? How can you displace the competitors that are out there today to get this thing to be successful? And all those other pieces of that puzzle that have to come together perfectly?

Aaron Moncur: 6:28

So this is a really interesting topic for me. Walk us through how you do that. I mean, you're you're looking at at product market fit, you're basically doing due diligence, right, as you work with startups and investors, I guess, what are the stages that you go through? What are some of the tools that you use to determine whether a product has a fit in the market? Yeah.

Aaron Call: 6:52

You know, early on, I started off in the trenches of hardcore engineering and building, you know, technologies, my hands, and but I found myself always asking this question of, why are we building this? Are we building the right thing, right. And so I started studying a lot of theories and technologies, books, you know, innovators dilemma being being one of them, of you know, how technologies can actually disrupt markets and become wildly successful, because in the startup world that I've been in my entire career, that's what you have to be able to do is raise funds, disruptive market, you know, and be wildly successful and scalable. And so, you know, I, I quickly developed this element of, you have to go upstream, you have to go so far as to know the customers what their problems are, what their needs are, what the job is that they have to be done, that they're trying to get done. And, and start there, you know, 100% of companies and technologies and startups fail because they didn't get customers 100% of them. And, and that's for a lot of different reasons. But the number one reason is, and we'd like to say, you know, projects, companies don't fail because the technology doesn't work, they fail, because we didn't understand the market requirements. And so, so that's where we focus is we focus on helping that element about it, I'm not gonna discount the, you know, sometimes it's difficult to actually get the technology to work or to get the clinicals to work. But that doesn't seem to be the hardest part right now. The hardest part is, should we build it not? Can we build it? And a customer element is the biggest part we spend most of our time on?

Aaron Moncur: 8:35

That's a really interesting inside not, can we build it, but should we build it? I assume that you have a lot of deals that come across your desk, if if you were I don't know if you even can do this, but if you were to think about all the different deals that you've evaluated, is there a percentage, you think, kind of a rule of thumb that like this percentage is a market fit, you know, eight out of 10, there is no market fit. And we find that out within whatever it is a month or two months or something and maybe two out of 10 actually go somewhere?

Aaron Call: 9:07

You know, the rule of thumb and venture capital is Yeah, eight out of 10 fail, one returns, you know, a good portion of money and then one is a homerun hit. And, and I used to believe that there was a clear line in the sand where you say, okay, all these are crap. If you say no, 100% of the time, you're gonna be right 80% of the time. You're right. I used to think that was true, but what what what I've seen what have I I've experienced even more of is the initial concept might be wrong 80 90% of the time or 99% of the time really from what I've experienced. But as you continue to work on it, right as you continue to have this staying power to being able to understand the true needs of the customer that you can you can start to massage it even closer when Closer and closer to exactly what they need and what's going to be successful, right. So some of them are so far off that, you're, you're just not going to get there and the people in charge of it aren't going to get it there. Right. But, you know, when somebody comes to us, and we're evaluating something, it's not that we say to him here, all the data came back and said, You should stop now. It's that all the data comes back and says, you know, you're going this direction correctly, these other five directions, you go in correctly. And here's the data that shows you how we navigate it in a different direction for him to be successful. And so it's, it's very strategic in nature, as opposed to a binary statistic, if you will.

Aaron Moncur: 10:45

Yeah, interesting. So a customer comes to you says, Aaron, we've got this new technology, this product that we would like to launch, you go out, you do your research, and you find 99 times out of 100, or whatever it is that this is not quite the right fit, but it's close enough that we can make some tweaks to get it to be truly the right fit for the market. Is that right? Yeah, yeah, that's about right. Terrific. Okay. Can you share some of the tools that you use? You know, like, the customer comes to you and says, I've got this technology? I want to launch it? What what are you doing like boots on the ground? What are some of the tactical skills that you've had to develop? And the tools that you use to go out and do that research, find the data, and then be able to present that data to these customers? Is it is it just like, Oh, what are they called, where you get a group of people together, and you show them the product? And you ask the questions. I can't the name is escaping me right now. But is it that kind of phone focus group? Thank you focus groups, like focus groups or other like data fields out there that you know, specifically, and you can mine? Insights from? How does that work?

Aaron Call: 11:51

Yeah, so the interesting thing is, is we like to draw a line between what we call disruptive innovation and sustaining innovation. systems. And let me describe those a little bit further. So. So sustaining innovation is, you know, let's go find out what our customers want in relationship to products that we already have on the market or products that they're already using. Yeah, and let's, let's tweak those, let's tweak our own product a little bit better, to make more customers like it to get closer to, you know, the customers that are buying it, to improve it even better clinically speaking, or whatever it might be. That's what we call sustaining innovation. In those scenarios, you know, it is vocal focus groups, brand strategies, things like that. Tell us a lot about what the market wants was, you know, early on, I had a lady that I worked with, say, Hey, Aaron, it doesn't matter what we think what matters is what the market thinks. And that's true, you know, across the board here. So in sustaining innovation, focus groups, and some of those work really well, what we found is on the disruptive innovation side of the equation, where you're actually creating almost a new category, in every scenario, where you're coming in, and asking people to change the way they're thinking, change their processes to use something drastically new, which is a tall order and medicine, because they have something that's at least working decently well for their patients, in a lot of cases, sometimes they have nothing was working well, in some, some been some indications that we're working with, but asking them to change all that is, is disruptive. And it's, it's, it's a lot more work. And so you can't just come to them and say, you know, what, do you think of this? Is this going to work? You know, do you like this idea? It's more, it's more whatsoever. It's more discovery in nature than that. And so rather than focus groups, we walked through a process and that process is number one, starting with the problem and the needs that are in the market. And we don't say go out there and say, Hey, what's your problem with surgery? With laparoscopic surgery as a as a for instance, you know, we go out there, and we we probe and we get deep and we try to get them out of their element to understand and start to complain about things that they wish was different or and from that it's an art form in nature as you start to get into what are the problems? And then from there, you get into how are they solving that today, you know, oh, I'm just gonna use laparoscopy because probably a decently easy example. How do you solve you know fogging of the lens? Oh, we take it out. We wipe it right. So you start to see this process of standard of care that they're doing today to solve that problem. And from there, you can start to derive a value proposition of a product that meets I'd be able to interject itself into this process and be a solution for them instead. And so that discovery element is hugely important. And you're asked about tools. So we do that lot through secondary research, we do a lot of primary research, that primary research starts with qualitative, where we're actually talking to these physicians, and getting deep into how they're utilizing things, how they're not utilizing things problems, they're having decision the way they make decisions in these technologies. And then we get into quantitative really quickly, actually, and we say, across the entire United States, you know, what 100 visits shouldn't say about these problems and needs, what are they going to say about the value proposition that we're presenting, and the details within that buyer proposition? So those are some of the tools that we use in the discovery, marketing, side discovery innovation side of this equation?

Aaron Moncur: 15:54

So it sounds like it's a lot of conversations with people as opposed to I don't know, like data mining or something.

Aaron Call: 16:01

Yeah, 100%. Um, there is a huge data mining element to it, because the clinical economics is becoming even more and more important. And not only the clinical economics, but the healthcare economics that the dollars and cents, but you know, there's more economics than just the dollar side of that, that starts to have a lot of analysis that's associated with it. But yes, there's definitely that soft element of what are the decisions that a physician or a BAC member, you know, or a provider payer is going to make in the scenarios that, that we need to understand and sit within? That

Aaron Moncur: 16:38

That's sounds like a lot of fun, almost like being a detective in a way, right?

Aaron Call: 16:42

Yeah. Yeah. I like, I like that description.

Aaron Moncur: 16:46

Can you think of a experience, I'm sure there are many of them. But I know I'm sure your work is pretty confidential. So maybe there's some things you can share. And some things you can't but if there is a scenario that you can share a story where you had a customer come to you, and they were looking for your help with product market fit and do diligence, and you're able to go out and learn some things from from your network of physicians or healthcare professionals wherever they are, and came back with with some data that you were able to use to make use to make concrete decisions. And maybe there was a tweak to the product or the technology that was originally presented, and then ultimately led to a successful launch. Yeah.

Aaron Call: 17:33

So I've been doing this for about eight years. And what's interesting is the timelines, a lot of we're still in the process. Oh, interesting. Wow, full, full gamut. You know, I've got a couple of examples, but but not a lot. So, but the first one that comes to mind is we had a client come to us, they're a platform technologies, we work a lot with platform technologies, because, you know, there's a lot of decisions that need to go into which market should we go after first? Which segment should we go after first, and, and so we're we're working with the company, in a specific market, and their board challenged, have been set, locate this app, this technology can be applicable to a lot of different markets. In fact, they identified I think, 12 or 13, different markets that it could be applicable in. And as your as a board member, or as a CEO, and as you know, the decision makers of a fairly large company like that, you know, you're not just going to make those decisions on a whim. And so you're looking at a lot of different variables that come into those decisions, you know, market size, being one of them, applicability, clinical feasibility, technical feasibility, I mean, there's, there's so many different factors that come into play here to say, can we build the right product? Is there a need for that product? Or is the product going to be successful there? And can we make a good chunk of money? And and so what's the best investment opportunity? And so the company came to us and said, Hey, can you run market opportunity analyses on all 13 of these markets, put them up against each other, and in some sort of, you know, analytical format to show which ones are going to rise to the top and why based on criteria and weighting of those criteria. And there was all custom weighting that we put together for it. And so we did that. And we walked through this customer centric approach, that that showed where all these different markets were going to land with all these different variables. Then they presented that to the board and the board was ecstatic. They basically said, who did this you know? We'll jump dead and they're like, Well, this is amazing work. And I love I love hearing things like that when we when we put some soul and effort into our work. And they said this is spot on. Let's go with number one. Number two. On the list here, and they've made those decisions from that data. And so that's, that's what we aim to have happen is having these strategic decisions become ridiculously clear, because we pulled this data together to show you the facts. And, and so that they were able to make that decision. And and move forward. In last I heard that product is doing really well. And that number one market that they hadn't even started to go after yet, well, they're going a different direction previously. And a lot of really good results, and a lot of good feedback. And so I like to think that that that, that market analysis work that we did for him helped him make those right decisions. That's

Aaron Moncur: 20:45

a great success story. Thank you for sharing that. That must be kind of a rush for you. Right? When things like that happen. Everything lines up.

Aaron Call: 20:51

Yeah. Yeah. Sometimes it lines up well, and sometimes the lens of NASA, when someone says, Hey, can you run this full market analysis? And I say, Yeah, sure, that comes back. And it's just like, terrible or social chosen, you need to go wildly different direction, right? And you just see them getting deflated. I'm like, Hey, I'm, I'm not telling you to go this device. I'm just telling you what the data is saying. Yeah. And most of the time, they they take our advice, but that does happen a lot.

Aaron Moncur: 21:20

Sure. Yeah, I'm sure it does. What what are some of the most common challenges that you've seen in startups in the medical device world?

Aaron Call: 21:32

You know, as a JP Morgan, this week meeting with a lot of startups. And so I saw a lot of decks, a lot of pitches, and we go through hundreds of decks every year. The biggest one, I see it, and then and again, this is my lens, but is the executives, a lot of times have a hard time articulating what the problem is. And defining that problem in such a way that their solution is, you know, the most grand all be all solution for that specific problem. And because, you know, we work with a bunch of investors too, and that's what the investors need to see, they need to see that, number one, this problem exists the big problem, that it's hard problem, right? That you just solved it. And so we're off to the races and, and they need to see that this is gonna be wildly successful before they even get to market. And I'm talking pre commercial, you know, it's seed series, A, Series B type of raises. But those are, that's what I see a lot of is, you know, when I'm looking at a directory with a executive for the first time, and I'm gonna go through the deck, my, my eyes immediately go to okay, what's, what's the problem? Can you help me to find this and they'll say it, I'm like, let's dig deeper, you know, like, that's not exactly the problem. That's not why they're going to choose you over what they're using that because you have to give them a huge reason to choose that. There's so many examples of devices that have done, you know, incrementally better than what the standard of care is, but just don't make it that flat, they fall flat, because, you know, they weren't hitting the right problem, or they weren't solving, you know, didn't know that nuances of how this physicians were gonna make decisions within the processes that they're working with it. So that's one of the biggest things that I see.

Aaron Moncur: 23:26

Nice. Okay, I'm gonna take a very short break and share with the listeners that our company pipeline design and engineering develops new and innovative manufacturing processes for complex products that implements them into manual fixtures or fully automated machines to dramatically reduce production costs and improve production yields for OEMs. Today, we're speaking with Aaron Cole. So Aaron, you started off as an engineer, I guess you're always in engineers, who's still an engineer, and kind of transitioned into the role that you're in today, owner of jaunt? Can you talk a little bit about that journey? How you went from engineer to entrepreneur? And how did the your engineering background influenced the way that that you run your business?

Aaron Call: 24:13

Yeah, I appreciate you asking that. So yeah, it started off in the trenches of engineering and just designing and technologies, building technologies, largely in the cardiovascular space, but but as I started to ask those questions of building the right thing, I started writing the product requirements, not only for myself, but for other engineers, and this is what we need to build. Right. And that was from looking at the market. But that that core engineering element, largely has stuck with me and stayed within me from the perspective of, you know, when I look at a market need, I look at the data that's associated with that and let that dictate what we do right And the data that's associated with that. But then, but then also, there are some gut feels some qualitative, some soft elements, too, you know, which direction should we go? What should we build that that comes into play there, but I take the engineering approach the analytical mindset, to decipher what exactly we should be doing. And that, and that helps tremendously. And what we should build, it helps tremendously in defining the market that problem the needs we've been talking about. And, but it also helps with a huge element, which is health economics and the value analysis, because that is dollars, that is hard analysis and calculations, that has to happen because the hospital is going to hold you to it once you come to market. And they say, Hey, what's your value analysis? estimates on this new technology, and, and, and so all that engineering mindset analysis mindset I utilize to help, you know, use data to position products for more successful commercialization.

Aaron Moncur: 26:09

Yeah, I think that engineers make some of the best business owners because we have that analytical mindset. Right. One of the most important things I think we get from our education in engineering is how to learn and how to analyze systems. And that, for me, anyway, has been super helpful as, as a business owner. You mentioned economics. And before we started recording, we talked a little bit about this, I'd love to hear your take on the current state of the economy, especially as it relates to medtech. Engineering. Where Where have we been the past year? And where do you think we're going in the next year?

Aaron Call: 26:48

Yeah, so in terms of fundraising, maybe that's more specifically what I can speak about. But in 2023, fundraising was down drastically. venture firms just aren't out weren't out as much as we were used to them being in the past, and particularly during the years, that post COVID, where digital health just took a huge growth curve in investments. It was down about 50%, from the year before 2023 funds largely are not doing multiple deals that Doom single deals. Forget the last number of analysis we ran, but it was, it was only a handful of funds out there, we're doing more than one deal and 2023. And so everyone was really in this, like, conserve mode, let's let's, you know, be really careful with every dollar that we have, let's run as many bridge loans as we can to least just stay alive get through this, right. And so it was really interesting to watch and see, you know, in the past, you can say good companies get funded, but in 2023, and currently, it's like only exceptional companies are getting funded. And even then there's this weird element of bookends of companies where some companies, you know, some funds are designed to go more seed stage more early, so that they can get in early and stay with that company. And given the staying power they need and follow on rounds that they need, move it on. Others are just sticking with, you know, investments that they've already made. And, and so I was at JPMorgan this past week. And And largely, the sentiment is everyone's really, really hopeful for 2024. I was talking to an attorney that said they just filed the first IPO for 2024. That was all super exciting for everybody because the IPO markets have been dead. And so the IPO IPO markets coming back the debt markets coming back, seem to be what's going to fuel this backlog, this logjam of venture investing because the money's there, it's just, you know, the LPS aren't pushing on him as much the VCs are just being slow to react. And so the long story to say that I think the sentiment is that 2024 is going to be a lot better than 2023. However, it's still really early, what are we two weeks in now? So I think it's a lot of people being hopeful at and hoping that these things are coming with very, very small trickles of evidence that it's actually going to be that way. But I am definitely in the bullish camp. From that perspective.

Aaron Moncur: 29:26

Well, let's let's cross our fingers that that hope leads to actual improvement. Yeah. What advice would you give to engineers or entrepreneurs that are looking to enter the medical device industry?

Aaron Call: 29:41

Yeah. I would, I would say for engineers, marketing, sales, I mean, everybody needs to truly understand the customer, the end user, right? And we have a lot of customers in medicine. We have a We call them the five P's and startups. But let's talk about four of them, the payers, the providers, the patients, and then the physicians. And so you have to truly understand all those customers, those end users, that, that you're designing these devices for. And, you know, everybody within the med device field can benefit from understanding how all that works. And so engineers are going to engineer things better, the marketers are going to be able to communicate those better the salespeople are going to talk about those better clinical people are going to be able to design clinical studies and data for that better. And so truly understanding that end user and the needs of all those, all those customers, I think, is a hugely important element.

Aaron Moncur: 30:48

What do you think the future of med tech holds? I mean, three, five years from now what what do you see the future of medical device technology heading?

Aaron Call: 30:57

Well, you know, AI is a buzzword. And, and rightfully so, there's so many interesting things happening with AI right now that it's, it's almost really hard to keep up with. It was all the talk in the last like three conferences I've been at. We've read web webinars on them, we've worked with other people, running webinars on them, educating ourselves as much as we can on generative AI and analytical AI and everything in between. So, you know, not to be cliche, but that is an element that is going to continue, we're going to continue to see that effect technologies moving forward. And I don't think it's going to affect, you know, the core med device side of the equation as quickly as it will affect some of the inefficiencies in healthcare administration, for instance, and some of the decisions and the way things are ran. And the empowerment that comes to patients, for instance, I think we're going to see insurance start to change a little bit. So it's going to start to change how this huge ship kind of runs and operates. And, and then on the on the technology, side, medicine, pharma, biotech, all of them are going to start to use AI in a new and unique way that that just makes everything speed up, I believe. So that's the first thing comes to mind. And it sounds a little bit cliche, because everyone's talking about it. But it's absolutely true. There's amazing things that's happening with it right

Aaron Moncur: 32:41

now. I'm super excited for this. I mean, AI has already transformed the way that I work. And I just, who knows what it's like you said, it's almost, it's really hard to even keep up with the changes that are happening today, let alone, you know, what is it going to lead to three, five years from now?

Aaron Call: 32:58

You know, just to that point, you a year ago, I didn't use chalk GGP at all, yeah, um, he, I use it every single day now. And mainly from an education standpoint, but it's doing so much more beyond that. It's, it's amazing. And so it's, we're gonna see that in

Aaron Moncur: 33:15

healthcare, we just started a really interesting initiative that I think a lot of the listeners would be interested in as well, where we have transcripts for all of these podcast episodes, right. And what we've done is we've taken all those transcripts, and combined them into a single PDF document. And then we've uploaded it to a chat GPT agent. And then we can query this agent and say, Tell me about the episode I had with Aaron Cole. And what were the you know, top five? Give me a summary of it, what were some of the key insights that we should take away from that episode, and it's amazing, it just spits it out, you know? So I think what we're going to do, we haven't really nailed down exactly how to use it yet. But probably what we'll do is just make it publicly available. And anyone can tap into that. And we have, you know, 230 some odd interviews now with high performing engineers. So it's almost like having the collective knowledge of of all the information these engineers have shared at your fingertips. So you can just, you know, type something in. Pretend that you're a senior mentor for an engineering student. I'm having this issue right now. What should I do? spit back and answer pretty cool stuff. Just amazing how it accelerates the work that we're doing.

Aaron Call: 34:32

So, so true. Yeah, I think openeye just don't quote me on this, but they just opened their store right there. GPT store, right? L'Oreal create these agents like you talked about, customize them and deploy them. And yeah, we use two or three on our end daily.

Aaron Moncur: 34:49

Amazing. Yeah, I love it. Well, we're getting towards the end here. Before we wrap up. Can you walk us through the process of of how a startup gets funded? You talked you shared a few terms earlier, series a funding Series B flooding seed stage funding pre commercial, maybe define some of those terms. And then and then wrap around that the the summary of like, what's the process, you know, A to Z of how a startup gets funded.

Aaron Call: 35:17

And we're starting this one. So there's so many different options for funding. And so many different theses on the investors, investment for these type of companies, that I think everything starts with the executive or the founder truly understanding what they have, right? I mean, do they have $100 million market DME product, for instance, that is going to compete in a fairly crowded space, or do they have a $1.2 billion dollar market opportunity with a disruptive technology. And those are wildly different animals, right. And so I think, first and foremost starts with truly objectively understanding what you have. And knowing that every time you go to raise funds, to help you move a technology or a company forward, you're in a market, you're going to be competing with everybody else that wants funding as well. And so you have to first get into the right swim lane. And that swim lane starts with probably you bootstrapping something, and go into what we call the three F's, the friends and family and pools, that maybe don't understand the nuances of what you're getting into yet, but you know, believe that you're going to make something happen. There's angels that can help you kind of in those initial initial stages, they're going to be looking for probably 20x Return on any sort of mathematical ROI that you are running for them, with the, with the finances that you're proposing. But then lose at least get you started. Those seen precede rounds, or you know, sub sub one to 2 million, typically speaking, and, or in your more personal realm of investors. After that, series, a when you're chip up and getting into and this is different, depending on class one and versus class two, digital health and so many different things. But the series A is largely where you're wrapping up your product and getting ready to go commercial between series A and Series B is where you're raising your funds to go commercial. I, I don't profess to know the exact numbers off the top my head, but I think typical series A rounds at the med tech med device space, are somewhere in the 15 to $20 million range, raise those, you're typically gonna go with your VCs, your venture, your venture capitalists or institutional investors, they're gonna put some pretty strong diligence on you to make sure that you're going in the right direction. And then yeah, and then from there, it's execution, execution execution, right? It's all about the executive raising the right amount of money having the right amount of money to reach the right milestone, and that waterfall calculation that you have to do from the beginning, you know, will really map out how much money you need, how much equity you're going to give away, what the opportunity is what that looks like, and building that that story for these investors. So there's so much to it, but maybe that's a decent little.

Aaron Moncur: 38:18

That's a great summary. How far along are these companies typically when they get their their first significant round of funding, whether it's an angel investor, or a venture capitalist, but you know, they're getting millions of dollars? Are companies oftentimes putting, you know, millions of dollars into their development before they get any funding? Or is it all across the board? Some are just starting out and have hardly done anything, and others have put$10 million into it? Yeah,

Aaron Call: 38:48

all across the board. And it all depends on how disruptive that technology is, and the opportunity is going to be, right? Yeah. If you have an amazing solution for big problem that nobody can solve right now, then you're gonna get institutional investors that say, Hey, that's worth a $10 million bet justice, just to get you to do an MVP or something, right. And so that's why I say it all starts with that understanding, like what and defining what lane you're going to be and knowing your market size, knowing how disruptive you're going to be, how big of a problem you're actually solving. And so it's a tough question to answer. But, you know, we do see a lot of technologies getting started with grant funding as well like non dilutive grant funding to least get them through some of those research phases that the government's willing to fund where investors are not. We are seeing investors becoming coming earlier and earlier to start to fund some of that research. But most, most investors I would say, want to see that you have de risked the technology and the market enough to start to move forward to where they can visualize this. So Classical Paths tool path towards full scale adoption.

Aaron Moncur: 40:03

Yeah, got it. Okay. Well, great. We're coming towards the end of our show here. Aaron, before we leave what is within the context of your role as an engineer? Because you're always an engineer? What is one thing that frustrates you? And one thing that brings you joy?

Aaron Call: 40:23

Yeah, you know, I'd say, um, the frustration side is probably largely because I am an engineer, that, that it frustrates the heck out of me, when I see executives, just completely blowing smoke about a technology or a concept, you know, or a market size. You know, this is a billion dollar market. And I'm like, it's actually a $50 billion market, you know, because the analyst in me is saying, No, those calculations are not working, you know, so that drives me crazy when they're just telling this crazy story. Yeah. And blowing smoke and, and then people buy it. And that's, that's what drives me crazy. You know, when I'm like, No, there's actually a mathematical equation to tell you that he's blowing smoke is wrong. Yeah. But it's just, it's just wrong. And then three years, a year later, they completely fail. And you're like, oh, my gosh, wait, why can't people do this math?

Aaron Moncur: 41:23

I'm curious is is it investors that that buy into that? Also, are these just like late people that?

Aaron Call: 41:29

Oh, yeah. Don't even start I mean, Holmes things is a huge notes. Case study in that where the past 20 years has been a huge element of what I call FOMO investing, because money has been so cheap, that you can raise a fund and just say, Hey, we're going to follow on investments where I'm going to do due diligence for this, this investor put into Him, we trust them. So it's gonna dump our tons of money into there, you know, and they're going to do this calculations. And to me, I'm sit back thinking, these are so easy to do, you know, you can take it a VC fund to 50% or higher success rate rather than 10 to 20%. If you just do these, these engineering, analytical calculations, right, so they happen to all Yeah, so that's a huge frustration of mine. Because I think we can engineer our way out of this from a diligence perspective. And the joys is, you know, just having that vision and working on that vision with an executive order investor and saying, I see it, we see what can be done on how this can help patients, and then watching that come to fruition and actually getting there and patients bringing, you know, affected by that. And seeing that product come to light the way you envisioned it, I think is a huge choice. And that's, you know, both of those are the internal engineering mind to me, I believe. Wonderful.

Aaron Moncur: 43:02

I love it. Well, Aaron, thank you so much for joining me today. What a pleasure it has been to catch up, we haven't had the opportunity that hanging out in a while. So it was good to catch up anyway, and provide all kinds of really super helpful, valuable and interesting content for all these engineers who are listening today. So thank you again, for being with us. How can people get in touch with you?

Aaron Call: 43:26

Thanks for having me here. And it's been a pleasure. I'm gonna get touch with me about via email, or go to our website, our website is chopped up.com. That's Jauntup.com. And my email is just Aaron Aaron at Jauntup.com. So that's the best way to get in touch with us.

Aaron Moncur: 43:43

Terrific. So for all you med tech startups out there who need help with due diligence, give Aaron a call. we go all the time. That was funny. Give Aaron Cole a call. I didn't plan that. Sorry. That was lame. You're probably like, yeah, Wnever mind. Okay, Yeah, I bet. On that note, thank you very much, Aaron.

Aaron Call: 44:04

Thank you.

Aaron Moncur: 44:06

I'm Aaron Moncur, founder of pipeline design and engineering. If you liked what you heard today, please share the episode. To learn how your team can leverage our team's expertise developing turnkey equipment, custom fixtures and automated machines and with product design, visit us at Team pipeline.us. Thanks for listening