How networking with corporate attorneys can help your startup
Christina Hernandez Sherwood, eMed Editor, MedCity News
At Novobionics, the goal was to develop a minimally-invasive and reversible alternative to gastric bypass surgery. The company developed an implant that can be inserted and later removed through the mouth. But while Novobionics works to raise its second round of funding, founder and CEO Chandra Duggirala has set off on a new journey.
After experiencing the medical device space, Duggirala recently switched gears. He’s using his knowledge to launch new projects connecting healthcare and the consumer internet, especially in the mobile space. Duggirala shared his thoughts on networking, funding and reimbursement.
Network with corporate attorneys – If you’re just starting out, it’s important to connect with “super networkers” in your field who can help you make more contacts, Duggirala said. For him, the best of these “super networkers” have been corporate attorneys. “I think they’re a bit underutilized,” he said. There are many, especially in Silicon Valley, who have worked with hundreds of startups, Duggirala said. They can help connect you with opinion leaders in your field, such as leading researchers, fellow entrepreneurs, and potential advisors.
Seek strategic and corporate funding partners – Entrepreneurs should consider strategic and corporate funders, such as big medical tech and pharmaceutical firms from the start, rather than waiting until the third or fourth funding round, Duggirala said. “Strategics are easier,” he said. You can talk to the Medtronics of the world. You can talk to Johnson & Johnson. [You want to talk to them] not just as sources of funding, but also to see their interest level in the area you’re working on.” If these strategics want to continue the discussion after you get data, Duggirala said, that’s like getting market validation for your idea.
Try to defer IP costs – Novobionics found an IP attorney who agreed to defer payment until the company raised its first round of funding, Duggirala said. That gave the team more than six months to map out the space, he said, without worrying about the cost. Another arrangement would be to offer equity as an incentive for differing IP costs, Duggirala said.
Don’t just focus on insurers – Think outside the box when it comes to reimbursement and payment systems, Duggirala said. Start early in your talks with insurance companies and other stakeholders, he said. Insurers will be especially interested if you can reduce costs for patients. But don’t aim only for insurers, Duggirala advised. Also consider alternative models, he said, like direct patient pay.
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