How to Compete with Industry Goliaths

Key Learnings From Joe’s Experience

• Don't be afraid to explore unconventional ideas if your product and the market conditions warrant it. For example, you may want to really lean into sales and distribution strategies tailored to your product's strengths—like building a broader ecosystem around your device. This may attract other parties not directly in your stakeholder loop, generating value outside of your direct product sales.

• To outmaneuver incumbents, adopt a lean, adaptable commercialization strategy based on the advantages of your product. As a startup, don’t make the mistake of scaling your salesforce prematurely. With a focused, low-cost initial launch, you can gather vital market feedback and refine your approach. And if your technology is novel, invest in education – adoption hinges on stakeholders understanding how to fully utilize your offering.

• When it comes to M&A, you want your company to be purchased, not sold. Focus on building a strong, desirable business to attract buyers organically. Befriend potential acquirers, including competitors, and foster trust over time. 

Joseph DeVivo’s expertise in medtech first took shape at US Surgical, a company that changed surgery around the world twice: first by bringing surgical stapling into medical practice, and second by commercializing laparoscopy. “In a way, that's where I feel I did my residency. I have a tremendous amount of mentors there,” Joe shares. 

He then moved into a leadership role at Teladoc Health, a telemedicine company that enabled specialists, such as neurologists, to remotely diagnose and make critical treatment decisions by facilitating tele-consultations between physicians in large hospitals and patients in rural settings. 

Butterfly Network shares a similar mission with Teladoc: to democratize healthcare and improve patient care with its handheld, imaging device that incorporates ultrasound technology into a semiconductor chip, disrupting the market that is known as point of care ultrasound (PoCUS). “It's the future of imaging, and it's the future of care,” Joe reckons. The device has the potential to bring high-quality imaging to office settings, underserved demographics, and remote areas across the world. 

Butterfly iQ3 is the company’s latest chip-powered PoCUS device with superior image quality, rapid data processing, advanced imaging tools, and ultrafast scan times. "Our image quality is so good now that we're getting into a lot of subspecialties. This is allowing us to tap into the $8.5 billion portion of the ultrasound market," Joe shares with enthusiasm. 

The company has established its own ecosystem for software development and sharing: Butterfly Garden is where AI developers can launch their apps for Butterfly’s ultrasound devices and sell them to Butterfly’s users – much like the Apple app store model. For example, practitioners can find applications to streamline different procedures that can be performed with the Butterfly device. “It's very similar to the Apple app store, where you have this supercomputer device that you have in your pocket that becomes more valuable with each application.” With Butterfly Garden, practitioners can find apps tailored to specific tasks, like detecting birth defects in the womb or assisting with cardiac ultrasound analysis. 

Today, Butterfly is a leading ultrasound provider with the largest global app base for this type of hardware, making it an attractive platform for AI developers. Commenting on Butterfly’s ecosystem, Joe says, “It's a business model that works once you've hit scale.” Launching a similar app store or a development kit without a substantial user base won’t attract developers who, naturally, are seeking the largest marketplace to sell their software.