Building the Best Team that Delivers and that Investors Love

TEAMWORK MAKES THE DREAM WORK:

DEFINITIONS • Team = people contributing to product and its interface with

medicine

• Investors = people / organizations supplying capital to enterprise in return for ownership

WHO IS YOUR TEAM?

Founder/ CEO

Employees

Management Team BOD

Advisors

Consultants

Investors

Suppliers

Legal (Corp. &

IP)

Insurance

SPECTRUM OF INVESTORS

Seed / Angels (F&F)

Series A Series B Series C… / IPO/ M&A

Private / Family office

Venture Fund

Strategic

TOP 5 THINGS INVESTORS CONSIDER • Need • Solution • Protection • Market, Investment and Return • Team

INVESTORS KNOW THAT THE MANAGEMENT TEAM IS MAJOR SOURCE OF RISK AND FAILURE • VC survey: 65% of failures within their portfolio companies due

to problems with the startup’s management team. • Investors report 61% of problems in their portfolio companies

involved issue within the team.

INVESTOR TEAM RISK MITIGATION • Work with people and teams with whom they had success (exits) • Work with people and teams they know • Work with people and teams that had success (exits) for others • Work with teams that have worked together before • Work with teams with lots of experience

NON-DILUTIVE FUNDING SOURCES

BUILDING A TEAM DILEMMA

TEAM YOU NEED DEPENDS ON:

Seed / Angels (F&F) Series A Series B Series C… /

IPO/ M&A

Where you are in product development

Where you are in fund raising

Concept generation

Proof-of-concept

First-in-man

Filing/ Approval

Market Launch

TEAM NEEDS BASED ON PRODUCT DEVELOPMENT STAGE

Concept generation

Proof-of-concept

First-in-man

Filing/ Approval

Market Launch

Medical need Technology solution expertise Market recognition

Product engineering Preclinical expertise Regulatory expertise

Market understanding Clinical expertise Manufacturing Quality

Supply chain Marketing Reimbursement

Pipeline Sales Finance

TEAM NEEDS BASED ON FUNDING STAGE

Medical expert* Technology expert* Market expert* IP attorney* *can be consultants, advisors, Board members, contractors…

CMO CTO CEO Engineering/ science team Preclinical* Regulatory* IP*

CMO CTO CEO Engineering/ science team Clinical team Regulatory IP* Manufacturing* CFO Quality Supply chain Marketing Reimbursement*

CMO CTO CEO Engineering/ science team Clinical team Regulatory IP* VP Manufacturing CFO Quality Supply chain Marketing Reimbursement* VP Sales

Seed / Angels (F&F) Series A Series B Series C… /

IPO/ M&A

TEAM TAKE-HOMES FOR INVESTORS • Experience matters

• Industry/ devices, investors, startups, covering all the bases

• Network matters

• Co-founders/team, investors, Board and advisors

• Success matters

• Prior marketed products, prior startup successes, prior exits

EVALUATING TEAM STRENGTH A structured approach to

RELATIVE MINIMUM TEAM STRENGTH FOR DIFFERENT INVESTORS & INVESTMENT STAGES

Seed / Angels (F&F) Series A Series B Series C… /

IPO/ M&A

Private / Family office

Strategic

Venture Fund

12 36 48 80 16 40 60 88 24 52 72 100

THE EARLY TEAM

START WITH FOUNDER CEO • Pick one as CEO:

• King • Famous • Rich

If you didn’t pick Rich, don’t seek funding You don’t have investors’ priorities

SCORING THE EARLY TEAM Founder experience

First time 2nd 3 or more cos.

0 8 16

Operating experience or MD experience

12 8

Investor relationship

Strangers Introduced Known – v. positive

0 4 12

Made money for an investor before For this investor before

12 20

Other team members

Regulatory Clinical (CMO) Consultants known

8 8 4

Product Development Commercial/ Market Advisor(s) known to investors Board members known to investors

8 8 4

8/ea

• MD - idea from practice experience (8)

• Does not know investors or angels (0)

• Other team members not from medical device industry (0)

• No well known advisors (0)

• GOING TO HAVE A DIFFICULT TIME

• Usual Solutions:

• Raise money from friends & family (12)

• Others:

• Outside advisors or Board members (4-8)

• Co-founders with industry experience (12)

• Executive with idea from industry experience (12)

• Knows investors (12)

• Other team members with clinical (8) and regulatory (8) medical device industry experience (tot = 16)

• Highly credible outside Board member (8)

• TEAM WILL MAKE FINANCING MUCH EASIER

HYPOTHETICAL FIRST TIME FOUNDERS

THE FUNDED TEAM

SCORING THE “A” TEAM Founder experience

First time 2nd 3 or more cos.

0 8 16

Operating experience or MD experience

12 8

Investor relationship

Strangers Introduced Known – v. positive

0 4 12

Made money for an investor before For this investor before

12 20

Other team members

Regulatory Clinical (CMO) Consultants known

8 8 4

Product Development Commercial/ Market Advisors known to investors Board members known to investors

8 8 4 8

Series A

SCORING THE “B” TEAM Founder experience

First time 2nd 3 or more cos.

0 8 16

Operating experience or MD experience

12 8

Investor relationship

Strangers Introduced Known – v. positive

0 4 12

Made money for an investor before For this investor before

12 20

Other team members

Regulatory Clinical (CMO) Consultants known Sales & Marketing Quality (QA)

8 8 4 8 8

Product Development Commercial/ Market Advisors known to investors Board members known to investors Manufacturing/ Supply Chain

8 8 4 8 8

Prior investor(s) Unknown 4 Highly credible/ well known 16

Series B

SCORING THE “C” TEAM Founder experience

First time 2nd 3 or more cos.

0 8 16

Operating experience or MD experience

12 8

Investor relationship

Strangers Introduced Known – v. positive

0 4 12

Made money for an investor before For this investor before

12 20

Other team members

Regulatory Clinical (CMO) Consultants known Sales & Marketing Quality (QA)

8 8 4 8 8

Product Development Commercial/ Market Advisors known to investors Board members known to investors Manufacturing/ Supply Chain

8 8 4 8 8

Prior investor(s) Unknown 4 Highly credible/ well known 16

Series C… / IPO/ M&A

MOST IMPORTANT… • Getting your medical innovation to the market where it can help patients

Who do you need to get the job done?

Can you work together synergistically?

Can you inspire confidence in investors?

THINGS WILL GO WRONG! • Inevitably there will be ups and downs

• During the downs, how does the team work?

• Pulls together – steps up – no blame – make it work – accepts help

• Finger pointing – factions – effort slacks – insular and secretive

• If someone on the team does not deliver or respond constructively to the downs, must deal with it IMMEDIATELY!

• Change attitude, roles

• Leave company

TEAM TAKE-HOMES FOR ENTREPRENEUR • Experience matters

• Network matters

• Success matters

Trust and respect matter most

Team that can get the job done will be the team investors (& patients in the future) love!

MICHAEL J. WEICKERT

632 Sylvan Way

Emerald Hills, CA 94062

Phone (650) 568-6125

Cell (650) 218-1840

mweickert@gmail.com

www.witcreek.com