We recently caught up with medtech start-up extraordinaire, Mike Wallace, who shares his insights and experiences with the Medsider community. Mike is the co-founder and CEO of DeVoro Medical, an early-stage medical device company focused on developing innovative devices for peripheral thrombectomy.
Mike says the initial idea or concept for a medtech company is just 5% of the journey. Medsider is all about shining light on that other 95%!
In this conversation with Mike, he’ll give tips to newcomers, including some mistakes entrepreneurs often make in the early stages of their companies. Mike explains how you can pivot when an idea doesn’t pan out, and he’ll give his expertise on seed-stage fundraising as well as navigating the regulatory waters. Plus, more on his current work with DeVoro, including how he started working on problems related to peripheral thrombectomy.
But first, a bit more on Mike’s medtech background:
Prior to co-founding DeVoro Medical, Mike served as Chief Technical Officer and VP of Operations for Silk Road Medical. Mike has spent most of his professional career working for medical device start-ups, some of which include Target Therapeutics (acquired by Boston Scientific), BARRX Medical (acquired by Covidien), and Baxano (acquired by Trans1). In addition, Mike has co-founded and exited three other start-ups: TW Medical and GW Medical Neuro (both acquired by Stryker Corp) and CardioProlific (acquired by Philips).
Mike graduated with a B.S. in Mechanical Engineering from the University of Delaware, holds a M.S. in Mechanical Engineering from the University of California, Davis, and is the co-inventor or primary inventor on over 130 issued U.S. patents.
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Mike, please tell us a little about your personal background as well as what you’re working on at DeVoro Medical.
I grew up half-time in Ireland and half-time in the Philly area, which was an interesting mix of cultures. My Irish father always espoused the great contributions of first-generation immigrants to this country, implying I better build on that reputation! And so that’s one of my professional goals.
After getting my undergraduate engineering degree, I moved to Northern California as a young newlywed in 1993 to chase the excitement of the West Coast lifestyle and take advantage of a free master’s degree program at UC Davis. After working with an energetic surgeon in graduate school, I got hooked on the thrill and pace of developing novel medical device products. The surgeon was passionate about his procedures and pushed me to develop new technology to support his vision. The net result, once completed, was beautiful: a new procedural solution that helped patients who were having ACL surgery. I thought, what could be better than doing this for a living? Upon graduation, I immediately got a job at Target Therapeutics after cold-calling Erik Engleson, who was the VP of R&D and Operations. He invited me down to Fremont, California, for an interview. And that’s how I got my first medical device job in Silicon Valley.
Fast forward 27 years and I’m now running DeVoro Medical, a disruptive peripheral thrombectomy company that I co-founded with Skott Greenhalgh in 2018. It’s our third startup together and a fun privilege to lead the company. It took time and a lot of experience for me to be ready for this current CEO role, and I think we’re poised to do some special things at DeVoro.
At DeVoro, how did the idea for your peripheral thrombectomy device come about?
Skott and I were studying the limitations of commercial stroke thrombectomy solutions and sort of stumbled across our initial idea. For about 9 months, Skott, a talented engineer, Roy Leguidleguid, and myself worked the quintessential nights and weekends while holding down other jobs. On our 19th try, we finally got our prototype to ingest clot like no other device we’ve come across. This accomplishment, and some rapidly-issued patents, gave us the clear signal it was time to raise some money, pull together a team, and drive the project aggressively forward for our first application, which was acute ischemic stroke. Eighteen months later, with the help of a super talented engineering team, we developed our WOLF thrombectomy solution through successful human use in acute stroke patients. The outcomes were impressive and we were thrilled with our progress.
As part of our funding arrangement, we sold the rights of the WOLF thrombectomy system for neurovascular applications to Stryker Corporation in late 2019. After that, we immediately re-directed the team’s efforts on the WOLF thrombectomy’s next application, which make up Devoro Medical’s peripheral thrombectomy efforts. We were fortunate to be able to leverage all the knowledge we gained from the WOLF stroke project to accelerate the development of the WOLF peripheral thrombectomy solutions.
Mike, you’ve been involved in several innovative, early-stage medtech companies. When it comes to designing and prototyping the alpha and beta versions of a medical device, what do you think is the biggest mistake most start-ups make?
Many first-time entrepreneurs simply don’t work hard enough or smart enough. They don’t understand their target disease well enough. They don’t do enough research on competitive products. They don’t talk to enough experts to hear brutal critiques. And they don’t pivot at the right times because it often requires starting over again. Lastly, they simply lose interest in their project because it can be hard, lonely, and sometimes sole-breaking work to get your project far enough along to be worthy of being funded.
In my experience, the initial idea, while critical, is just 5% of the journey. Commercially successful products are the result of intense multidisciplinary efforts and are most often led by stubborn, unrelenting founders. Many early startups and first-time entrepreneurs don’t have enough experience or staying-power to bring their first ideas to fruition. Those who keep at it and master their trade will ultimately win, and get rewarded. Go get some yourself!
When it comes to navigating the regulatory waters, what 1-2 pieces of advice would you give to other start-up leaders?
Get some wins with 510(k) products first. You learn more with multiple projects that are shorter in duration. Then, graduate to PMAs later in your career if you have the patience and the passion to pursue longer-duration projects.
Mike, tell us more about your approach to scientific evidence. What’s your best counsel for other early-stage companies that are building out their clinical research roadmap?
First, learn the unmet needs of your market, understand product requirements, and know your competition inside and out. You must have a clear problem that needs fixing and a decent market size. Then, with your idea in hand, pressure-test your solution with those you can trust.
If the solution passes all your business requirements, then build a small team with engineers, technicians, and physicians who have deep domain expertise in the disease or the core technology. All team members must be talented at early product development and resilient to failure. These types of people are much harder to find than you think.
Lastly, you as the leader are key. You must recruit, sell, and inspire. Many, many times over. If that is not your thing, it will be a tough road. Once you have your team, then it’s the “do loop” of ideate, prototype, and test. Keep running this loop until the product meets your bench and animal testing requirements. Then, go evaluate the product in humans -- safely and ethically.
And finally, if needed, iterate again.
What are a few of the most important lessons you’ve learned over the years when it comes to insurance coverage and reimbursement? In other words, how much are you thinking about this topic when designing and developing device concepts?
No, or limited reimbursement, is a major risk that you have to seriously weigh before starting a company. If reimbursement is not in place, then you better have all the other risks almost retired in your mind: technical, clinical, and regulatory. Also, be prepared to raise plenty of money to ultimately influence the medical societies and insurance companies with the necessary clinical data and cost-saving justifications.
All that being said, it can be extra rewarding if you can overcome reimbursement challenges that are often part of commercializing breakthrough solutions. One example I saw up close was when CEO of Silk Road Medical, Erica Rogers, led the team through CMS reimbursement for the ENROUTE transcarotid revascularization procedure. This was achieved about 2 years before Silk Road’s enormously successful IPO. But it’s important to note that it took over a decade of oversight, funding, and consternation by Silk Road Medical’s co-founders and board members -- Tony Chou and Jack Lasersohn -- before reimbursement risk was retired. Most start-up companies don’t have the lasting power that Silk Road needed to obtain new reimbursement hurdles.
Mike, you’ve had the opportunity to work on several seed-stage medtech projects. What’s the most important piece of advice you’d give to other entrepreneurs that are trying to raise pre-seed or seed rounds of capital?
The further you can develop your idea and de-risk it, the easier it will be to raise the ever-critical seed round. The most important thing to know is you can take your initial idea a lot further than you think with just sweat equity and a little cash. Maybe it’s just the co-founders’ cash for a while. You can do your own IP searches, file your own provisional patent applications, ask friends for some materials for prototypes, clean your garage and set up a table with a microscope to build your early prototypes, recruit other like-minded people, and incentivize them with equity rather than cash to get started. You will need every friend in your network to ultimately make your company successful. Especially if it’s your first one.
So, yes, you need some friends and allies too. Vet and double-vet your idea with physicians and business experts that you trust. Do all this before you raise a serious seed round. Other entrepreneurs are comfortable raising money earlier in the vetting process. But raising money earlier, even if you can do it, may not be prudent if you can vet the project further with just founders and early team member sweat equity. Plus, you minimize your ultimate dilution when you raise that seed round after taking the project further.
For smart and experienced investors to invest in your seed round, they need to fall in love with your idea and plan, trust that you can run the company successfully through the next phase, and have an appetite for early investments. While it may take time to find these investors, they do exist.
Such great advice, Mike! What’s next for DeVoro Medical? What are you most excited about over the next few years?
We at DeVoro feel the thrombectomy market has somewhat settled for existing technologies of suction tubes and drag nets to open thrombus-occluded vessels. We believe limiting the solutions for thrombectomy procedures limits patient outcomes. Especially when it comes to the peripheral vasculature.
DeVoro thinks of problems differently and we are partnering with physicians who want to challenge the status quo in thrombectomy. Significant improvements in patient outcomes require significantly different thinking and solutions. We believe the WOLF thrombectomy solution will meet those challenges.
DeVoro products will help address gaps in the arterial thrombosis, DVT, and PE space. Our mission is to bring to market novel, best-in-class peripheral thrombectomy and embolectomy solutions to enable “En Bloc” removal of both hard and soft clot, in a rapid and lytic-free procedure. Our WOLF technology has several technical and ease-of-use advantages over the market leaders such as Inari, Penumbra, and Boston Scientific. We can’t wait to commercialize these products and help our patients.
Before we get to some rapid-fire questions, where can readers or listeners go to learn more about you and DeVoro Medical?
We are currently in stealth mode but plan to come out in late 2021. Check our website then, which is www.devoromedical.com.
Okay, now for some fun questions. Mike, for someone that is starting their entrepreneurial journey in the medtech or healthcare arenas, what’s the most critical thing they should know?
It is super exciting, but also hard. You don’t see many 20-year-olds disrupting the medical device space because it takes time to learn all the operational and entrepreneurial skills needed to run a medtech company. But for those who like a challenge, want to help patients, and are lifelong learners, it’s a very rewarding, fun, and stimulating field to work in.
What influential books, podcasts, or resources have been most helpful in your entrepreneurial adventures?
One of my favorite books is Shoe Dog by Phil Knight. One of the themes revolves around the idea that Nike didn’t always know where they were going. Kind of like, ‘fake it until you make it’. For a planner like myself, it’s helpful for me to realize that at certain times, you’re forced to take risks outside your preferred comfort zone. In those moments, you have to believe that you and your team will get through it. You just have to ride the startup bull.
Also, I’d recommend reading or listening to anything you can that describe the path of both successful and failed medical device companies. Many patterns can be gleaned from their experiences and stories.
Are there any medtech or healthcare entrepreneurs that you find particularly inspiring?
Entrepreneurs that I worked closely with over the years have inspired me the most and include: Henry Nita, Erik Engelson, Erica Rogers, Vahid Saadat, Jeff Bleich, Greg Barrett, Skott Greenhalgh, and Tom Molz. This is an amazing, talented group of people that have all started early-stage companies and I have been lucky to work for, or alongside, them all.
If you had to teach a class on one thing, what would the topic be?
How to be a medical device executive and entrepreneur in the San Francisco bay area, while being the primary breadwinner and co-raising 4 kids. In other words, how to effectively balance security, risk, and following your dreams. Lecture one starts with the most important piece of advice: marry the right person! I got very lucky with that one!
Starting over in your mid-20’s, knowing everything you know now, what would you do differently?
Nothing. It has been far from a perfect run, but definitely a fun, exciting journey. The best is yet to come and I believe we can all change our path, anytime we want, if we really, really want to.