For entrepreneurs developing medical devices and digital health technologies, Medevice is much more than an investment firm. Founded by successful entrepreneurs, the company serves as a business development partner, providing advice and access to international networks, as well as financial resources.
An Atypical Investment Fund
The investment fund Medevice was founded in 2011 by successful entrepreneurs from the healthcare sector to help French entrepreneurs to develop medical devices and digital health products.
At Medevice, we respect entrepreneurship because we understand the unique challenges associated with creating and developing companies in this space first-hand. Beyond simply providing financial resources, we work with management teams as an active, everyday partner, bringing our expertise and forging close mentoring relationships. We understand that each entrepreneur has an unique set of talents, and our strategy is to build around those talents to create a winning team.
A Unique Background
The Medevice team is made of a unique blend of entrepreneurs, tech transfer specialists, and senior managers from large pharmaceutical and medtech companies. We have a track record of launching successful companies from start-up phase, to raising both dilutive and non-dilutive money and designing, industrializing, and implementing successful go-to-market strategies for innovative products. We also have strong experience in corporate development and M&A, both from the acquirer and seller position, giving a unique perspective and support to our portfolio companies in their strategic partnerships.
Focus on Two Growing Markets
The medical device and digital health markets are expected to experience strong growth for the foreseeable future. The global medical device market is expected to reach a value of $432.6 billion by 2025, growing at a CAGR of 4.1% from 2020 to 2025, according to global market research firm Luceintel.1 The market includes surgical and infection control devices, general medical devices, cardiovascular devices, orthopedic devices, home healthcare devices, and other devices.
Important trends include the increasing use of artificial intelligence (AI)-optimized medical devices, the growing acceptance of wearable medical devices, the expanding use of miniaturized devices, and the greater adoption of 3D-printing. We are also seeing projects related to guided interventional surgery and radiology and the use of AI in diagnostic applications.
The value of the global digital health market was estimated to be $106 billion in 2019 and is predicted to expand at a CAGR of 28.5% through 2026, reaching upward of $639.4 billion.2 The COVID-19 pandemic has accelerated the adoption of e-health solutions and created increased demand for novel digital health technologies. The growing use of smartphones around the world, advancing healthcare IT infrastructure, and modernization of healthcare systems are important enablers of growth. The health analytics and digital health systems segments are projected to experience strong growth.
Choosing the Right Target Firms
Medevice works with early-stage medical device and digital health start-ups that need seed funding (€500,000 to €2 million) that are located in, or near, France but have an international focus. Their solutions should be innovative and differentiated from currently available products and provide improvements for patients — either directly or indirectly by benefiting physicians, surgeons, or other healthcare providers. The products must be economically viable; healthcare systems must be willing to pay a price for them that will afford some level of profitability for the company.
The leadership team must comprise true entrepreneurs who can drive projects forward while also being open to new ideas. They need to understand their strengths and weakness and be willing to build on the former and compensate for the latter. They must be agile and able to adjust rapidly to change, because the medtech and e-health fields are evolving at a breakneck pace.
To partner with Medevice, company management teams must be willing to receive advice as well as share their experiences. There must also be a cultural fit between the management team and our team at Medevice. Growing a new business is a multi-year adventure; our teams must mesh well so a symbiotic partnership can be formed, lest the relationship won’t work.
Building Around Investment
One additional important differentiator for Medevice is our commitment to building around our investment fund. As our portfolio companies develop strategies and have experiences — both successful and otherwise — that information is shared across the group to everyone’s benefit. We provide the companies we invest in connections to our global network of industry and business key opinion leaders, including surgeons and doctors in different specialties who are helpful in evaluating new ideas; finance and innovation organizations; lawyers and auditors; third-party service providers; distributors to help launch new products; and large biopharma and other life science companies for developing long-term relationships. By granting our partners access to these specialists, we can ensure that all of the companies we invest in have the best resources available.
Investment Strategy Based on Partnering
Indeed, to transform innovation projects in fast-growing companies, it is necessary to have daily support. Medevice is looking to work with start-up medical device and digital health firms that realize they need help and want more than financial support from an investment partner. Each member of the Medevice team is responsible for assisting with different aspects of a company’s activities, such as finance, structuring of partnerships, and commercial development. We believe close relationships enable collaboration. Problems are anticipated before they arise, allowing the proactive development of solutions. As a result, key functions are accessed at the appropriate times, enabling the development of the company without the need to hire full-time resources before reaching critical size.
When our portfolio companies require large investments, Medevice also helps them find the right partner to take them to the next level. In some cases, with work together with the new partner, while other times we exit the company.
Current Portfolio
We have worked with 10 companies to date, investing a total of €10 million. Since our founding, we have exited two of these investments, and currently work with eight firms. We have helped to create 250 jobs over the last 9 years. Our current portfolio includes entrepreneurial companies developing medical devices for diagnostics and drug delivery applications, producing chemicals via environmentally friendly fermentation processes, and offering web platforms for data tracking and telemedicine.
Preparing for Future Growth
Presently, Medevice is launching a further fund targeting €20 million. Our intention is to keep the number of companies we invest in within the range of 10 to 12. That will enable the entire Medevice team to continue working closely with each of our partners. In addition, with this larger fund, we will be able to invest more money in each firm and finance our portfolio companies for a longer period of time.
References
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The medical device market is expected to reach an estimated $432.6 billion by 2025, and it is forecast to grow at a CAGR of 4.1% from 2020 to 2025. Report Linker, 31 Dec. 2019. Web.
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Digital Health Market Size By Technology [Tele-healthcare {Telecare (Activity Monitoring, Remote Medication Management), Telehealth (LTC Monitoring, Video Consultation)}, mHealth {Wearables (BP Monitors, Glucose Meter, Pulse Oximeter, Sleep Apnea Monitors, Neurological Monitors), Apps (Medical, Fitness)}, Health Analytics, Digital Health System (EHR, e-prescribing System)], By Component [Hardware, Software, Services], Industry Analysis Report, Regional Outlook, Application Potential, Price Trends, Competitive Market Share & Forecast, 2020 – 2026. Rep. Global Market Insights, Jun. 2020. Web.