Each startup comes to life with specific strengths and weaknesses. No orthopedic startup is perfect. The strengths are great assets in the early years. However, if weaknesses are not addressed early, they can become a “weak link” that can stymy growth.
Think about it. Why do some startups:
– reach profitability quickly, while others burn cash indefinitely?
– run a smooth operation like a Swiss watch, while others live in chaos?
– have a great product, but cannot seem to gain sales traction?
The Founder Effect
The Founder is the person who starts the business and typically leads the business in the beginning. The Founders strengths are the Founders weaknesses.
The thesis of this article is… The training and background of the Founder determines both the strengths and “weak links” of the company in the early years.
This opinion is derived from decades of pattern recognition following hundreds of orthopedic startups. The Founder only knows what the Founder knows. Below, I’m going to share the patterns that I see for each type of Founder. Please don’t take the examples literally. I’m talking about general tendencies, not specific companies.
Let’s jump in.
7 Founder Backgrounds
#1 – Founder has a SALES/MARKETING background, usually either an Independent Distributor or a Marketing executive from an organized orthopedic company.
Strengths: Closeness to the customer. Know how to build the distribution model. Practical understanding of what the customer needs. Strong messaging.
Weak Link: Unrealistic expectations for cash burn rate and timelines for Product Development, Regulatory, Operations. Poor understanding of manufacturing and timelines to make the product. Sales/Marketing Founders tend to build operational systems late in the game.
My Advice: Hire strong operational leaders early.
Examples: Choice Spine, Degen Medical, Osseus, 4WEB, OsteoRemedies, ExtraOrtho, In2Bones, Soteira, Danek Medical, and Met 1 Technologies.
#2 – Founder has a CLINICAL background, usually as an orthopedic surgeon working in a full-time practice.
Strengths: Closeness to the customer. Solving real clinical problems.
Weak Link: Unrealistic expectations of funding and timelines for Product Development, Regulatory, Operations and Sales. Also surgeon founders are sometime driven first by trying to impress their MD colleagues. Most want to continue their full-time practice.
My Advice: Hire a CEO early with operational expertise to lead the company.