Guest Column | July 18, 2024

Answer These Questions To Guide Your Prototyping Strategy

By Chris Danek, Bessel LLC

Modern technology-GettyImages-1217882713

Part Of The Founders’ Notebook Series: Lessons From Guiding Today’s Medtech Startup Teams

“Where should I focus my time right now? Should I prioritize fundraising or improving the product? How do I make sure investors can see the same potential I see?”

These are just a sampling of the questions I hear from medtech founders in my coaching conversations. After 25 years as an engineer, founder, and CEO, I now spend a good chunk of my time mentoring the next generation of founders, teams, and students.

What are today’s medtech founders working on? What challenges are they facing? In this Founders’ Notebook article series, I’ll answer the most common questions I hear from up-and-coming innovators.

Today, let’s look at dilemmas about demonstrating proof-of-concept with a functional prototype using two real examples, highlighting a decision that challenges many first-time founders: when to develop a working prototype. The answer largely depends on the startup’s key risks.

Question: “I have proof-of-concept from bench testing. What is the best way to raise seed money to develop our device?”

The value creation in a value-creating milestone lies in a meaningful reduction of a key risk to the startup. A benchtop proof-of-concept shows the proposed solution is technically feasible and reduces the risk that the team will struggle to make the device work. Before moving past this step, a medical device company founder should be able to successfully answer these questions:

  • Is the evidence compelling? Would a clinical advisor, the FDA, or investors agree that the experiments demonstrate technical feasibility and shift their focus to other risks?
  • Are all the key risks to technical feasibility addressed? Well-designed and controlled experiments isolate key risks and take them completely off the table. Many times, this will require a series of experiments rather than a single demonstration.
  • Are my bench model and test method representative of my device's clinical use? What are their limitations?

A good solution-oriented approach relies on a critical difference from existing devices. These technical and manufacturing gaps should set off alarm bells to you.

Using this framework, here is an example with a use case drawn from my real-life experience with a founder. The founder’s diagnostic device had strengths:

  • Good clinician perspective
  • Identified market need
  • Clear value proposition

And some weaknesses:

  • Missing proof-of-concept (with the right media at clinically relevant concentrations)
  • Missing confirmation of the manufacturability of their new approach

While the strengths were compelling, the gaps were critical. The founder would need to demonstrate proof-of-concept to get investment. He had validated clear user needs but needed to translate them into requirements and verify that the solution fulfilled them. Creating a solution that is needed, useable, and feasible is critical.

For new technical approaches, making the right prototype and the right test model is key to a compelling proof-of-concept.

Here’s a helpful rule of thumb for startups: Identify your startup’s most significant risk. Then, focus on value-creating milestones that reduce that risk. In the situation I shared above, the startup’s biggest risk is technical. So, the best use of this startup’s limited resources is nailing down compelling evidence to support technical feasibility.

A corollary: as a founder, learn to see your weaknesses clearly. Sometimes, understanding your weaknesses means asking for an independent perspective — from a mentor, a peer, or an investor. It’s hard to balance the optimism and creative confidence required for success with a realistic view of your weaknesses.

The takeaway: In medical devices, you can’t “fake it ‘til you make it.” Instead, know your gaps and approach them from a scientist’s perspective.

The next challenge comes from a founder with an opposite perspective — they wanted to focus their resources on a functional prototype.

Question: “We haven’t shown a working device in its final form, so we’re going to focus our energy on developing a functional prototype to show investors. Is this the best path?”

Before committing to the detailed design and development of a fully working system prototype, ask yourself these questions:

  • Are there questions about user needs and product requirements that still need to be addressed?
  • What can you do about them now, faster and cheaper than by developing a working prototype?

Challenge yourself to learn rapidly from your key stakeholders about any unknowns that will affect your user needs and design inputs before moving forward into development.

In one real-life example, I was conducting a jam session to prepare a founder in the optical testing space for fundraising. When I heard the phrase, “We need to package our system into its final form factor,” I knew we needed to dig deeper. This particular team has a track record of developing innovative optical instruments; it’s a pedigree team with a background at the national labs and breadboard testing and optical simulations showing overall proof-of-concept. This is a powerful combination of physics, track record, and empirical data. They had already moved on to thinking about the functional prototype. But I nudged the founder to take a step back and think about the questions investors would ask before they even looked at the prototype.

The startup would likely get full credit from investors for their ability to develop the solution. But are they working on the right problem? To gain investors’ approval, the startup needs to answer questions about customer discovery and validate their solution's value proposition:

  • Will eye doctors use this?
  • Will this solution improve eye doctors’ workflow?
  • Do you have data from interviews with customers?

The team should use its technical competence and creativity to address these questions.

Consider strengthening your discovery with learning prototypes. For example, consider creating a rudimentary “iPad + Box” Frankenstein prototype to simulate the user interface for richer customer feedback. Or, where the use setting allows, consider a “dress rehearsal” simulating use of the device in a clinic — walking patients and caregivers through the existing workflow and then the improved workflow, without actually using a working system — for a compelling demonstration of the improvement in throughput and doctor-patient contact time.

The biggest risk for many startups is knowing if the customer will buy the device. My advice is to lean into answering that question as early as possible.

The takeaway: Don’t just focus on the part of the problem you’re most comfortable with. Tackle the most daunting risk first. Ask: what’s the fastest and easiest way to solve that risk and move forward?

The medical device space comes with a set of critical risks: market, clinical, technical, regulatory, and IP, to name a few. I encourage founders to review the questions investors will ask about these risk areas. If you don’t have firm answers about how you’ve reduced risk in each area, spend time closing those gaps, starting with the most significant risks you and potential investors see.

About The Author:

Chris Danek is the CEO of Bessel LLC. He is a serial entrepreneur and veteran of the life sciences industry. At Bessel, he works with entrepreneurs, startups, and established company teams to develop breakthrough medical device technologies. In prior roles, he was co-founder and CEO of AtheroMed (now Philips AtheroMed) and VP of R&D at Asthmatx (acquired by Boston Scientific). He is a visiting professor at the W.M. Keck Center for 3D Innovation at the University of Texas at El Paso, an advisor to the Santa Clara University Healthcare Innovation and Design Lab, and an inventor of more than 85 U.S. patents.

[Editor’s Note: You may also like this earlier article by the author: “A Successful Technology Strategy for Medical Device Teams Asking, "Own Or Partner?"]