Crowdfunding and IPOs for Medtech Startups

Benjamin Sexson is a mechanical engineer-turned-medtech entrepreneur. A CFA charterholder with a background that spans business development roles to founding a successful B2B retail brand, Benjamin is now poised to bring a new era to knee replacement surgeries with their fully-automated robotic arm at Monogram Orthopedics. Even though he describes himself as a “Moses-type leader who’s reluctant to do it”, he has been steering the ship successfully into uncharted territories since 2018.

Monogram’s flagship product is mBôs Surgical Robot. The team recently demonstrated its prowess in the world's first fully-remote total-knee arthroplasty on a cadaver. This particular market – knee replacement surgeries – is projected to surge to $37.99 billion by 2030. While currently 88% of surgeries are manual, 50% of surgeries are expected to be completed using robotics by 2027. You could say that Monogram is strategically positioned at the cusp of this transformation.

Benjamin is refreshingly direct and practical. "When you think about robotics, it’s supposed to commoditize things. It’s supposed to increase throughput at a lower cost," he says, which is exactly the core mission of Monogram – to make operating rooms, starting with knee replacement surgeries, less reliant on manual skills, to reduce incremental costs and boost efficiency.

Benjamin’s vision of roboticizing knee replacement surgeries was shaped by his collaboration with Dr. Douglas Unis, a practicing orthopedic surgeon, who later founded Monogram. "It probably wasn't until about three to four years of seeing knee after knee after knee that I really started to understand why this was a must-have product," Benjamin says. Additionally, he realized it was almost mandatory to integrate 3D printing for custom-made implants with robotic surgery.

In hindsight, Benjamin describes it as a "no-brainer innovation." Yet, Monogram’s project isn’t without its skeptics. Some argue that the concept isn’t novel. "You really have to start to drill into the details of the surgery to really understand what's actually different here," Ben explains. But to give you an idea of what’s unique versus conventional methods: first, Monogram focuses on soft tissue management instead of just bone-cutting surgery, which makes it incredibly precise. Second, the operating time frame is currently 40 minutes as opposed to the market average of 80 minutes. And third, the mBôs system is fully autonomous, which is a first in the robotic surgery market. 

Commercially, the company is gaining momentum. With the first sale of the mBôs system to a major global distributor in late 2023, Monogram is not only eyeing the lucrative U.S. market but also recognizing the potential overseas, especially where there's a dearth of surgeons. The journey towards FDA approval is ongoing. Trials are expected to begin in 2024 and FDA clearance is anticipated in 2025. 

While knee replacements are Monogram's initial focus, the company's roadmap includes a broader array of orthopedic solutions. From robotic surgical equipment to tissue ablation tools, Monogram is poised to make a dent in the orthopedic joint replacement surgery market.

As Monogram prepares for its next live stream, it is also set to demonstrate not only the technological marvel it has created but also the economic and clinical benefits it brings to the table. 

Key Learnings From Benjamin’s Experience

• Avoid the sunk cost fallacy. Don't let past investments cloud your judgment about a project's present viability. Regularly reassess the viability of your idea based on current conditions, not past investment. Be willing to pivot towards a better solution, even if it’s difficult. Maintaining a steadfast belief in your work is crucial; without it, your ability to overcome challenges and effectively communicate your vision will be compromised.

• Finding the right funding source is tricky, especially for early-stage startups. Consider alternative routes like crowdfunding or IPOs. Be aware that both options have their challenges: crowdfunding requires a strong marketing push and IPOs can create administrative headaches. Thoroughly evaluate your specific needs but don’t be afraid to iterate as you move forward.

• Medtech is a team sport. A strong support system and an A-plus team are a must. Find talented people who are willing to shoulder responsibility with you through the tough times and can set aside their egos. Maintain a company culture where everyone is heard and there’s no punishment for raising one’s opinion, even if it proves to be wrong.