Have you ever imagined how it to be an entrepreneur in a heavily regulated industry like the medical device industry?
Maybe you have seen software products going through development, launch and sale in 6 months.
How about working on a single product for 5 years? Selling a vision and ideas to obtain millions of dollars in funding, partnerships, FDA approvals, value analysis approval and many other complexities.
Today we chat with Jeff Conroy, a co-founder of embody.Inc, a medical device company that is reinventing sports medicine, disrupting the industry while solving the problem of finding an alternative of using cadavers, synthetics and plastics for surgical repair by using biological products.
How is it like to bring a team of medical experts, cell biologists, surgeons to be part of this vision?
How do you secure strategic partnerships for your business?
After realizing that the defense force, sports medicine and the surgical industry face this same challenge, Jeff was able to secure funding and partnerships from DARPA and the Department of Defense(DOD) for this product, Tapestry.
As Embody Inc prepares to go commercial, we talk about what the transition is like going from manufacturing and product development to aspects like marketing. How does that change the company culture and what adjustments are needed?
Why is the analytics of marketing models important?
As entrepreneurs, we face many adversities.How did 5 years of adversity training prepare embody Inc for the adversities brought about by COVID-19?
In this interview we cover:
Why marketing models are a must-have before your product goes commercial
How to sell a vision/story before the actual product is developed and acquire funding and partnership.
How to prepare for adversity and use set-backs to bounce back as an entrepreneur
How to create and lead teams that align with the vision and why this is the key to success in business. Learn from an entrepreneur whose biggest asset for 5 years was people.
How to get funding and find the right partners that align with your vision
What systems do you need in place to prepare your company for future acquisitions by big players in your industry?
How communication and culture evolve in a company and how to adjust while staying aligned especially considering the post-COVID 19 workplaces.
Helpful resources
1) For more live interviews and insights
2) If you’re marketing doesn’t make money…
Interview transcript
Reade (00:01):
One. Welcome everybody and thank you for joining me on a another growth secrets interview. I'm here today with Jeff Conroy. He is the CEO and founder of embody inc. And we're going to have an awesome conversation about how he's been bringing a medical device company and a product to market. A lot of really interesting insights. There's unique situation. We were just talking before we went live about how the sales starts before any actual sales are made. So I'm excited about this conversation and what's to come. But without any further ado, Jeff, thank you so much for joining me. Thank you. Recap. You did happen to be here and a chance to tell our story. Appreciate it. Absolutely. Well, let's start that story just by [inaudible] telling us a little bit about yourself, right? What, what brought you here? What's your, what's your history?
Reade (00:53):
Great. so my background is about 30 years of medical device experience side. You know, as I came out of college, I went into a sales role at Abbott laboratory. And so I was trained in a world class system to be a salesman right out of college. And I had a real excitement about joining the medical industry, went and from Abbott I learned working in a large world-class company that I didn't necessarily like having one of 300 jobs or one of 50 jobs in those big organizations. And it just led me to, to, to want to work for smaller and smaller companies. I went through some life science startups in Boston, ended up working in a company called Thermo electron for about seven years as part of a group that was commercial paralyzing medical products. And all the while I just really one or two want it to be in a product business that I control.
Reade (01:58):
I wanted my own company and I always thought that my company would will be a product developer. And so I had a, I, I started a couple companies. I started initially a licensing and a strategy consulting firm where I learned a lot about transactions. And it led me to an opportunity to become the president of a tissue bank. And so I had a, a, an acquaintance who was owned a tissue bank and needed some help to kind of straighten it out. And I learned about allograph tissue tissue from cadavers and how we take products that are processed from cadavers, bones, skins, soft tendon cements and putties. And and I learned about that business and had the opportunity to meet many world-class surgeons who would talk about limitations of using skin from back of a cadaver
Jeff (03:00):
In a surgical repair or allograph tendons, tendons from cadavers and how they weren't sufficient. And it really struck me it, it, and I want to highlight the fact that it led me to my problem, right. It led me to, Mmm. Understand that sorry about that. Led me to understand that everyone's got a unique problem and an art. In my particular case, my career led me through a pathway that resulted in, Mmm. I had had this background. I was working in the tissue banking business. I listened to all these surgeons say, Hey, we've got to get cadaver tendon, cadaver tissue out of surgical repair. And, and in in fact many products that were being developed, we're, we're synthetic plastic polymer products. And so I ended up having this idea, which was can I engineer cadaver? Could I engineer purpose-built products which would solve this problem?
Jeff (04:09):
And and that led me down a path of deciding to start a company, fund the company, and subsequently you know, start the whole process of bringing a medical product to market that's turned out to be about a five, a five year process. But really the excitement through the whole thing was that we've funded it in a very different way. And so when I took a problem that I found, meaning, okay, surgeons are telling us here's a need in the market solution does some exists. We went and, and came up with a vision to develop this, this a product we call tapestry. And it really then required us to fund it and say, how are we going to get this thing? How are we going to get this product developed? We've got to bring a vision to life. And because we're in Virginia, we decided to do this a little different and we started working with the department of defense and I spent about a year developing relationships and building a business case at DOD.
Jeff (05:21):
And we ended up competing for and winning initially a $12 million R and D contract from DARPA, the defense that's advanced research projects agency. So it turned out that the problem that I had identified and decided to build a company around was also a significant problem. Sports, it's medicine injuries are the number one injury that plagues DOD. And in fact, when you think of very high value warfighters special operations forces, sports injury, med tendon, rotator cuff, ACL injuries where they're number one injury. So we found an alignment between our customer base and a motivated, a strategic partner in DARPA to be able to try to bring this forward.
Reade (06:15):
All right, so you have taken the PR the question that I normally ask, and you have given probably the most interesting path to that, right? I always ask this question of what was the problem in the marketplace that, that made you think to yourself? No, there has to be a better way. And so what you just, you basically, if I'm adding all that up in my head, you're talking about a five plus year process where you saw this problem and you began to develop the bones, no pun intended, of a solution to that. Is that, is that fair?
Jeff (06:50):
Yeah, that's, that's, that's correct. I was in a role where I saw this problem and I had an idea which was we should be able to engineer structures which would behave like tendon. Now, the only problem I had is I had no, no scientific or technical qualifications to turn that into reality. That the number one challenge I had was to go and find a leader, a scientist who had the vision to be able to operationalize a solution here. And again, I can't highlight enough. These are none of, none of our successes are about, I did this or I did that. You know, I was, I'm in a position where I saw an opportunity and was thankful that I thought it could be done. And I decided to invest time and capital to find a group of people who could bring it to life.
Jeff (07:53):
And I found my cofounder Michael Francis who's a, a PhD biomedical engineer who also happens to be a pathologist. So he is, and again, back to everyone's path, puts them where they're supposed to be. You know, here's say here's a biomedical engineer who understands pathology in the study of cells and how they grow. And his super power ended up being using biomaterials and physical structure to be able to insect cells to behave in a certain way. And so I ended up having a commercial vision. Can we develop a solution for this problem that would be different than anything that had been done to date. And I found a partner in that with a scientific vision of here's, here's a couple of different manufacturing approaches. We've built an additive manufacturing company that uses collagen. And so our bodies are 60 to 70% college and connective tissue,
Reade (08:56):
Muscle skin. All combinations of college and we're effectively building implants that grow new tendon tissue and sutures that are load bearing, but they're effectively made from biologic material that that really the, the other fundamental challenges getting cadaver tissue and getting synthetic plastics that never go away or getting skin products that are built from cadavers that also never leave your body. So the future, one of the, one of the key futures in orthopedics, his products to play their role when you're healing and then resorb dissolve and go away. And so we found ourselves squarely focus there and I was dangerous enough to see an opportunity and think that we could find it. And then I was lucky enough to find them, really a visionary scientist. And then from there we had to go, okay, we need an engineering leader. We need a cell biologists, we need molecular biologists.
Reade (10:04):
It really was building a kind of a, a scientific 18 to be able to go and do all of the research and do all the background work so that we could, we could do this some days. I wish that I had started off in the, in the in the software business because you can see a problem and, and build a product and six in six months or nine months and then tweak it. We've got from vision to launch, our product launch should be sometime in September. So that'll be five years of work to then be able to compete to sell our product and get it into patients.
Reade (10:45):
Okay. So a couple of things that I see here that are really worth digging deeper into. So I want to come back to that idea of how you plan to take this to market. But before that, I love what you describe here. Is this building a dream team or building an a team? A lot of business owners tend to really, they, they tend to really, I think diminished the value of partnerships. Perhaps they've been burned in the past. Perhaps they've had partnerships go wrong. But the more I dig into great businesses and the more folks I interview as a part of this series, I'm seeing that it's impossible to do really great things without building a great team. Can you talk a little bit more about how you guys work together and how you manage to fit what I imagine are multiple, very intelligent, very driven people in a room together
Jeff (11:55):
Have minimal stepping on toes and minimal egos and maximum and optimal, you know, output and focus. Yeah, no, happy to. Absolutely. I'll start by saying, you know, in a, in an endeavor like this, when you're setting off on a five year journey to then be able to start selling, it's, it's five years of pre-work to then have all the work or building a sustainable business. And as I've said to my team, our team for the longest time is that this group of people is the only asset that we have for the first four years. You know, we've got a couple of patents that have issued now. We have some ideas which will be very valuable in the market with products that will come to market. But fundamentally it's keeping a group of people motivated, excited, committed, and sentenced on a, on a shared vision.
Jeff (12:52):
And and it's also been one of the most fulfilling things I've ever done professionally because you're basically, you've got a suspend ego and you got suspend you know, thinking that you know what to do and truly your job is to just assemble a group of people. And in this case, by the way, it's easy for me not to judge what to do because on the science side I was in their hands. You know, we, we really needed to execute and create manufacturing methods, methods and create characteristics in our products, which have never been done before. And think about this, we're effectively taking a biologic powder, almost like a gelatin and we're turning it into products that are as strong as steel wire in some instances. And so it, what it meant was that you had to really try to accelerate the understanding of each other when, when we started out as just two or three people and you really had to work on that shared vision and you have to recognize a couple of things.
Jeff (14:07):
You really had to recognize that every time we add another person to the company, we changed the culture. So if we're not conscious stewards of what are our values, what are we focused on? How do we work? Even in terms of how do we communicate, how do we solve problems? How do we mediate differences? We've got to do it in a transparent way so that, Mmm, we learn from it and we get stronger from it because the, you know, the five person company that becomes an eight person company, it has got different communication dynamics and then you're at the same time you have this, it almost becomes in the communication world, think of it as, it's almost like a three dimensional chess challenge because it's, it's one issue when you got really smart people trying to do things for the first time. I'm that are, you know, it's an iterative process.
Jeff (15:07):
They don't, it's, science doesn't always work, but you have to, you have to be confident not only in your capabilities, but in your perseverance. And as an example, we've, we've had major breakthroughs that were a result of setbacks. And, and that comes from cultivating that teamwork and dynamic. We had one setback early on where our implants would shrink when we put them into for animal testing. And we didn't want that to happen. As a result, we developed a an annealing process to eliminate the shrinkage and we eliminated the shrinkage. But we also created this biologic expansion or void fraction expansion technically on the, on the structure. And it really caused cells to want to infiltrate and grow into our implants much faster. And so solving a problem with the best intentions creates a, a benefit that we had unintended. We had another experience which was a fire.
Jeff (16:12):
One of our pieces of equipment on an overnight production run burst into flames two years ago could have destroyed the company. And because of the team that we had, we were down for 28 days, which was amazing in our lab. And and then the the, the, the science and leadership and engineering team came to me and said, let's not buy another one of these commercial platforms. I think we can build one. We built our own equipment and it increased our throughput by 20% and reduce our cost by 18%. So those are just examples of if you consciously cultivate, and it's really no different than a baseball team or soccer team or a football team. We need a good position players, but we need better communicators. And then we need to really constantly remind ourselves, what's the target, what are we working on?
Jeff (17:10):
And and I'll, I will say people matter, right? That the, not just everyone's smart at this point. You know what, I, I've also, this is the same thing I say to my kids about being in AP classes or applying for school or whatever's next. Everyone's smart at this point. And so we really have to look for people who have a determination and and the right mindset who don't get discouraged by know, who really want to rely on each other. Cause every day is not perfect, right? This is life. And so we have really put a team together that helps us get through. Sometimes you have to lift someone up, sometimes someone lifts you up. And that, that really has been kind of the driving force behind our success is that, you know, we, we didn't raise a ton of money and we don't have, you know, this is not a unicorn company, but this is a serious company doing a groundbreaking work with a serious unmet medical need.
Jeff (18:20): And we think we can help reinvent sports medicine as a, as a result. And even in the product development process, putting a team like that together calls you to then see other problems. And so as we're launching our first product this year, our second product, which is a college and suture line and and, and load bearing sutures for bracing extra articular repairs, and eventually even serious repairs like ACL, those ideas come out of the collective learning of that team. The longer you can keep it going, a group of people together, the longer the more value you get from your time together. And, and so to me, a central part of our success is now a group of 20 people. And as I mentioned, you know, communication gets more complex. It was easy when we were, it was easy when we were all Mmm.
Jeff (19:24):
Focused on science and product development. Now we have a manufacturing group, we have a quality group now we have sales and marketing. Now we have folks in the field who are starting to prepare. And that also changes the culture because now we have to, we have assimilate different groups of people. And so we find ourselves really working on that so that as we prepare to be a M a commercial stage company, we can, we can really take advantage of this. You mentioned partnerships too. I would also say, so there's our core team and I see employees, our employees are all owners of the company. Everyone on our team as an owner invested in our success. And that's really helped us keep everyone focused on our, our serious mission here. But then there's lots of other partners. You know, DARPA is a partner, United States army as a partner. United States air force is a partner. We have an engineering group that we work with Genesis, this innovation group. Genesis is a partner in developing new instruments to put our products into the, into the shoulder. And and, and there are lots of other, other folks here, but it's really about building a community of relationships. And even as an entrepreneur, I'll tell you, technical expertise
Reade (20:48):
Is important. Perseverance, you know, tenacity, dealing with uncertainty, those are all super important. But if you're going to succeed, you've got to figure out how to be a communicator and you've got to figure out how to put relationships first. And so I think that's really been one of the guiding tenants of what we're doing here is that this is about relationship. No difficult people or, or we minimize the role of difficult people and, and and we're serious about what we're doing. So I love that, especially when you say that, and this was a recurring theme in that answer was that, you know, having smart people, talented people is, it's kind of a given at this level, right? We're playing major league ball. What is really valuable is is communication. Having leaders in those positions. I like the very politically correct way. You say minimize the role of difficult people, I would also seek to minimize the role of difficult people as often as possible.
Reade (21:56):
But that's really great. I love that. So let me transition if we can. I know you guys are or not yet in the market, right. But we, we are leading up to taking this product to market. And, and obviously the focus of this, this podcast, in addition to learning about leaders in the businesses that they're leading it's also very much focused on sales and marketing and growth. What does the plan look like? What, what can we learn from how you guys are planning to take this to market and really grow the business? Yup. Perfect. Perfect. Well, and this is a great segue from the last partnership question because another key group of partners are the surgeons and clinical advisors who've been a part of this endeavor for five years. And so when you consider that we have a dozen surgeon, developers who for instance on rotator cuff repair, have helped us optimize the placement, the process, how do we deliver it?
Reade (22:59):
And hold it in place, how do we fix it? And and those surgeons have helped us through multiple iterations of making sure that the product is going to be what the customer needs, not just what the patient needs but what the surgeon needs. And then also what the health system needs. Because we've got, we've got, we've got to have a product that meets the needs of the patient, which is going to result in a clinical outcome that that that accelerates their recovery and helps them get back to where they're going to be. You've got to have a procedure that is, meets the expectations of the surgeons, both in terms of the steps and the time it takes to do that. And then you've
Jeff (23:46):
Got to have a product that fits the economic construct of healthcare today, which is in most cases I have to have the same or better clinical outcome. And I've got to have a cheaper solution for the health system to incense use of this. So it really starts with, through the product development process and, and even engineering wise, think of design freeze. You have a product that then gets through the process and it's got your your customer input and it's got your surgeons ready to use it. You go, you iterate. And to the point where they say, okay, I could be, I could see myself putting this into a patient now for this need. And and that, that's been a group of partners that's really helped us accelerate our, our relevance. So when we launch, a lot of the nuances are things that will have come from the input of our surgeon developers.
Jeff (24:46):
And and then it has to do with really understanding, okay, how do I understand what the landscape looks like? Orthopedic surgeons are my target market performing rotator cuff repair, ACL repair Achilles repair, pediatric surgeons also in the foot and ankle. And so then you have to understand behavior. So it goes right back to classical marketing. How do I get primary and secondary research that gives me enough of an understanding of not just market trends, but I've got to get, I got to get a micro view of my solution and how it's going to be perceived. And what are the drivers, what, what kind of information to the surgeons want to see before they make the decision to use it? What are the priorities in terms of how I'm going to educate? We have to educate surgeons prior to doing this. Mmm.
Jeff (25:45):
Where do those procedures take place? Are these procedures taking place in the hospital? Are these procedures taking place in an ambulatory surgery center? And those are, that's a, that's a key trend in health care now, the role of the ASC. And so from a marketing perspective, and we started what we've started to look at these questions obviously in product development where everyone's, you know, your, your, your early customer needs start to impact decisions you make. But it wasn't until about 15 months ago, we brought in a dedicated commercial leader. So we hired a chief commercial officer named Rob Brown. Rob joined us from DSM and had been with Depew J and J previously. And so it wasn't until we brought in a commercial leader where we could start to have the same kind of process and foundation and, and in a, not only in transitioning a product development program to something that's a product that's going to be able to be launched.
Jeff (26:52):
And I think of I think one of Rob's biggest contributions has been creating a framework for other people to come in and be successful. You know, and I think of my experience at Abbott laboratories are where each one of us have worked somewhere where you worked at a world class company where you learn how to do things their way. And so one of my takeaways, even though I love smaller organizations and the energy of startups, I still have great respect and appreciation for these world class companies who you do it the Mark way, the Jane Jane way, the Abbott way Medtronic. And so we've really looked to say, okay, we can still be a fast moving, nimble disrupting team, but we can have a basis of foundation of process. So it makes it easier to assimilate new people. And makes it easier to stay on mission.
Jeff (27:51):
It makes it easier to achieve your goals because if, if, if you, you know, and I'm a big proponent of, you know, hire smart people and get out of the way, but you've got to hire smart people into a construct that they can be successful in. And if you, if you don't do that, then you, you, you may have different versions of success. And so again, back to communication and teamwork and shared vision, if you don't know what your vision of successes and what the expectations are, you're going to end up with you know, I don't want a hockey goalie playing second base. You know, we need the right person on the right team. And so that, that's been it. Process from a sales and marketing perspective was first. And then it becomes this iterative process of refining, okay, what are my segments?
Jeff (28:44):
How do I build a market model? You know, and too often, and this too often we see entrepreneurs who are looking for funding and they have these hockey stick revenue curves. And you say, well, what's your market model? And the answer is while they're, you know, it's a billion dollar market and we're going to get 10% of it in four years and the reality is in, in the, in the medical product, medical device world at least we've got to do very detailed bottom up assumption driven models that talk about what's the volume of an average surgeon, how many procedures a month, how many procedures are realistic that we could get in the early days and what are the assumptions we make about price, what are the assumptions we can make about price declining over time or competitive response to our product over time?
Jeff (29:40):
So things like market share and unit volume and procedure volume fall out of that. Yeah. But I think that part of the earliest piece of preparing to be commercial is the analytics of your market model. And so then it's okay, if I understand what my five year goals are for tapestry, our first product, then I have to understand what's my fair share and can I do better than my fair share. And that may come down to things like product management or or distribution partners back to partnerships. And so we had to, we had to get through the create your marketing process first, create your market model and make sure that you have an intimate understanding. And I really see that market model as an Excel spreadsheet that really has to tell a story. If I'm telling you that there's a if there's a surgeon in Philadelphia who does 20 rotator cuff repairs a month and I'm expecting that he or she is going to do five of those, are going to be our product, I then have to have a narrative to explain to you why, when, which patients are appropriate, what's what, what is their thinking?
Jeff (31:00):
And over time maybe we can get that five to be seven or to be nine. And if we don't execute, maybe that five is going to be three. And so it really links the understanding of an analytical platform to look at revenue expectations and the underlying kind of stuff. Stories of what, why your customers are gonna find you relevant. And then that's kind of pushed us into okay, in, in this industry, you know, you have have very large companies that dominate sports medicine, Stryker, Smith and nephew Depew, MyTech Johnson and Johnson company right Arthrex. And so we don't have the luxury of saying we're going to go hire 50 sales reps, some startups start a company and start a commercial activity. What we have to do is we also have to hire the right kind of people. Cool.
Jeff (32:01):
We have to hire doers who who are used to working generally unsupported. So we've been able to put together a great team. And then we transitioned from marketing to sales. Now we just brought in a vice president of sales. John Rizzo, John John's got a tremendous background in medical device and orthopedics. And the whole idea here is John's a leader who builds our sales organization and builds our distribution network. We're this month signing our first distributors. And so again, we're thinking about launching a product in September. We're signing our first distributors starting education process through the, through the summer. And that hybrid model of having field based reps. And then John will hire the next two reps before launch. And then over the course of the next year, we'll double that team. And so it really becomes, you know, I, I w I look at this like a sound engineer, right?
Jeff (33:08):
I'm sitting in front of a board with a hundred little dials and we're going to turn this and turn that. And so right now we're in constant test mode. Can we find the right distribution partners who have the right complimentary products or who are in the right geography or who have the right relationships with surgeons? And we'll, you know, I think our goal is to, is to make good decisions. Most of the time we won't always. And that's also how you grow, right? We have to make our fair share of bad decisions to get smarter and and perfection is not the goal, right? Goal is operational excellence. Do we get better at with time? And so this is a, this is it's a great question because I haven't really thought about it. We're so into how do we get all this work done?
Jeff (34:03):
Usually we think sales is how quickly can I get a human being in front of a customer, have a conversation that results in a transaction. I'm hungry for that too. But I've I'm living the effectively 18 months before that point. And then also in the, in the, in the Paul of coven 19, you know, the role of sales reps in hospitals is, is in, in question or in flux and in, in in orthopedics and in surgery. That's a critical role in the R oftentimes for cases. And so that's, that's changing. We're looking at an entire market where when when surgery stopped and elective surgery stopped orthopedic surgery stuff that's now starting to come back. So it's, it's in interesting that I really think it prepares a small company that's used to uncertainty to take advantage of opportunities. So we know if we do our foundational, this is just like hockey practice. If we do our foundational work, we'll be, be able to adapt when we're in a game situation. And so I really think of of us now is in, we're in the last period of getting ready to be commercial. We've got a, you know, we've, we're establishing relationships with new distributors where defining the tools we need to train them where recruiting surgeons to be faculty so that
Reade (35:38):
They'll, they'll be a part of our world and help us develop applications. And it's almost like in the tech world, you want a community of users or a community of developers. Usually that community evolves after the product is launched. And in our case, we've got to develop our community of potential users and potential developers as early as possible. And we're doing that now. Well that, so this is such a big project to say the least. There's so many moving parts to this. I don't know that very many people understand the depth and the complexity of bringing a medical, is it fair to say medical device, company to market. But there's so much to learn from. Yes. It's very much to me as you're describing it, you use the idea or the analogy of a soundboard. I mean, it feels very much like planning a military strategy where you may plan for 18 months for, you know, leading up to D day.
Reade (36:48):
Right? And there are pieces that have to be in place and they have to be deployed ahead of time and they have to be coordinated with supplies and, and those needs, all of that needs to be funded and it has to get congressional approval. I mean, it's just in, in very many ways you're, you're dealing with that same level of complexity. So to me that's, that's absolutely fascinating how you've been able to keep all of those different pieces on the board and, and ready to be in play when the time is right. You know what, thank you. A great comment. I will say that the, one of the other challenges and eventually the path for us is we'll either, we will well either generate enough revenue so that we become a sustainable longterm grower company and will be an independent company or will attract the attention of a large partner and maybe be acquired or enter into some other type of relationship for distribution.
Reade (37:50):
But before any of those opportunities come our way. The other thing that we don't normally think about in terms of being ready for sales and marketing is that there's an entire piece between R and D and commercial. There's this whole backbone of a company which is in a regulated medical device environment, quality system, manufacturing and supply chain. And if and, and, and even as a 20 person company, when one of those large companies comes to visit us, they have to see systems and processes and people who are serious and that they could imagine as a part of their organization or, and it's very important,
Jeff (38:36):
The impression that we give off is that we're ready for prime time, not just for the sales team to execute and go and have conversations, but for all of the machinations that have to take place for a product to ship in a regulated environment. And so that, that's another piece of, you know, when I think of what are the key success factors for us to become a commercial organization and launch a product in four months, it's again, because for two years we've been building a GMP manufacturing facility. We've been seeking ISO certification, we've been building a quality team and it goes back to Mmm, just like in our world, like a scientific leader with a vision is critical or experts in three D printing or experts in material science, college and science. Then it becomes critical that we have experts in quality systems and we have experts in manufacturing.
Jeff (39:44):
And keep in mind, we're in a manufacturing environment where we've invented the manufacturing equipment. And so we've built it, we run it, we run it in a controlled clean room environment. And then we have to constantly be testing the product to make sure that the product meets the specs that we've claimed to the FDA. And so it's a, it's a, it's a really Mmm. It's a thrilling way to be experiencing entrepreneurship because we've got this serious overhang of regulated environment. And, and rightly so because patients' safety is a, is a, is a big issue. We've got to have products that are relevant for patients, surgeons and fit the needs of the, of the healthcare system. And then we've got an, we've got to prepare ourselves to navigate all of these challenges where pretty much lots of things could go wrong on any given day, right?
Jeff (40:40):
Scientists, scientifically manufacturing, testing wise [inaudible] I'm very thankful. I wouldn't necessarily say I wish we could have done this in two years because I think in our case we needed the adversity training of the last four or five years to understand that, you know, if you're, if you're running a company and you're starting a company and you're a part of a startup team, where do you know where to not your, your company's life is in danger pretty much at all times until you are breaking even or profitable. You're, you're under massive threat and you're, and, and people will question your success. The irony for us is we've survived the development process, which survived a path to submit to the FDA, will soon have an FDA approval. And then the great criticism will be, well, how fast are you going to scale, how fast you're going to sell?
Jeff (41:38):
What's the slope of your revenue curve going to look like? And it's very easy for Mmm investors or out or potential partners or outsiders to look at something and look at something you've built for five years. And in the course of five minutes or 15 minutes form an opinion that says, well, this is relevant, not relevant challenge, not a big opportunity, whatever. So, I dunno, I, I, and, and you're getting, you're getting me onto another point, which is part of being able to move to the sales and marketing processes. We had to fund this long enough to survive. And what started with DARPA and an initial $12 million grant contract to contract from DARPA has now turned into 20 million from DOD in funding. And in two rounds of financing, we've raised 9.3 million. And so, Mmm. In many cases, a company that starts in five years later wants to launch a five 10 [inaudible] FDA cleared product.
Jeff (42:47):
Like we are in tapestry that typically takes about five years and costs $25 million, maybe 22, 125 million for a more complex product. And in our case, we will have done it with about 22 million spent at that point in four and a half years. And so you know, I think we're, we're very proud of the fact that we've been able to do that between employees and partners. Also investors, you know, when you're thinking about sales and marketing, your sale, my sale in 2018 was in a vision of relevance for the future to our investors and the investors who put 3.6 million into this company in 2019 18. And then the investors who put that we just announced that nine point $3 million round, we closed last month. That's because they believe, and we've demonstrated, tell you what we're gonna do. Here's what we did this quarter.
Jeff (43:53):
Tell you what we're gonna do next quarter. Here's what we've done. And all of a sudden, but when you start to have a team that's really hitting and is moving towards your target or being commercial without the sale to the investors and the confidence from the investors, we also wouldn't be here. So it's kind of funny that I think of here we are yet to generate a dollar from from exchanging a product for revenue from a customer. But we had to sell the vision, the first and smartest people who joined this company. We had to keep that vision together. We have a cell division. Our partners
Reade (44:32):
In DARPA and the DOD in competitive environments elect to support us going forward. We had to sell division to our investors through multiple rounds between 18 and 20. Also that now we have the right to, and I won't use the word sell with FDA to convince the FDA with our data that we've achieved the, the the milestone that we're asking them for. Also that we can then say, okay, now we have a sales team. Now we have a marketing team. Now we have process. Now we have people, now, we have relationships with surgeons and now we can put ourselves in a position. So then even ask institutions for the right to sell, well our product there because we have to get a value analysis committee approval before we can sell. And then we can have one on one conversations about exchanging a product that meets a specific need for for an, an economic exchange.
Reade (45:35):
And so it, I, I think you're, you're taking me in a full circle here, which is, you know, it's almost surreal to be a quarter away from generating that first dollar of revenue when we've been selling our vision and selling our ideas for five years. If, if we, if we hadn't been committed to communication and we hadn't been committed to teamwork and we hadn't been committed to uncertain gene adverse adversity we, we would have packed up and gone away. So to me now, I ended up being excited that our, only, if our only challenge now is how do we sell it more? That's a, that's an algebra equation that we can, we can address next.
Reade (46:26):
Yeah. So it's, it's like at this point to sell to a willing customer who has this glaring problem. Back to your point of bringing this conversation full circle. They already have this problem. They know they have this problem you set out to create the solution to the problem. Seems like it'd be a heck of a lot easier then the sales that you've already made. So so look, this has been a really fascinating conversation. Really interesting. I love the look inside of an industry that I don't think people get to see very often. So I really do appreciate this. We have to bring this to a close, but I want to give the audience a chance to be able to follow this journey a little bit more and to learn more about what you guys are doing. What's the best place for them to to do that?
Reade (47:20):
Sure. Well, our website is embody dash inc com and and as we get ready to launch, we'll expand our social media presence. But for now, we're really just focused on heads down, get an FDA clearance and, and get on with the sales and marketing process. That's great. And so we'll leave the link to the website and then when you guys are ready to to really expand that presence. Mmm. Wow. Well, we'll be in touch and I'll make sure that the group and our listeners are able to do that so that they can, okay. They can see the business grow and all of these five years of, of hard work come to fruition. So I'm excited for that. I imagine that our audience will be as well. I really appreciate it, Reed. Thanks for the opportunity and enjoyed the conversation today.
Reade (48:14):
Absolutely. As did I, and for those of you listening, thank you so much for joining us today. If you're watching this live on Facebook, just leave a comment down below that says live. And if you're listening later on to the replay, just leave a comment that says replay and do the same if you're listening on the podcast or on YouTube we thank you so much. Please give us some feedback. We always want to hear what you guys are thinking about the interviews and how we can do these better. I want to thank Jeff for being here once again, and thank you all for watching. We'll see you on the next interview. Thanks so much. Okay.