As CTO and co-founder of a novel robotic start-up, you braved hell, high water, and a pandemic to get your part of the $55b already committed in 2020. Your seed investment was received not on the proverbial ‘better, faster, cheaper’ platform, but to a device that is truly transformational. Now the plan is to move quickly – developing clinical support while simultaneously building an engineering prototype. You, and your funding, are at the mercy of milestones, and success or failure will be determined by the team you assemble.

If you are an executive at a medtech startup, none of this is foreign, especially if it’s not your first rodeo. But even as funding in your company continues to increase, so too does the scrutiny of dollars sent your way. However, the scale up of your organization needs to be strategic, determined, and thoughtful to ensure continued milestone achievement and eventual commercial release.

Scale too fast and you might be caught in a web of inefficiencies, over-spending, and managerial dilemmas that slow your pace of innovation – leaving you with either layoffs or going back to the well to raise more money. Scale too slow and your milestone achievement will slip along with your investor’s patience. With such a tight margin of error, it’s no wonder that 75% of US-based medical start-ups fail. So where is the balance?

Innovate at pace

Our experience shows the best dollar for dollar spend on people comes down to three objectives. First, ensure that all growth activities still allow you to innovate at pace. Given that human resources is not something that is usually added to early-stage start-ups, the hiring process will fall solely on you and the rest of your executive team. Even if a bench of ideal targets has been gathered through the funding phase, there is still considerable time, attention, energy, and dollars needed to make sure the right people are brought on board in a timely fashion.

The balancing act comes with making sure these distractions do not come at the cost of innovation nor achieving the next technical milestone. Most early-stage medical device executives will admit they at some point were concerned with losing pace as they scaled up. However, those that kept the primary focus on the speed of innovation while they grew will admit they scaled appropriately and maintained milestone targets as they went.

De-risk your personnel growth

Now objective two: the ancillary benefit to ensuring that pace is constant is to strategically de-risk your personnel growth. For example, a complex robotic platform will need strong teams of electrical, mechanical, and software engineers to achieve the next few milestones. The common trap is to hire them all at once. Just last week I saw 28 open requisitions at a start-up looking to hire everyone now, thereby doubling their current number of employees.

I wish them nothing but success, but I wonder – is there enough work today to keep all 28 people engaged, challenged, and moving in the right direction? And will their new hires all come from medical device backgrounds such that they don’t require training on medical device development processes? If the answer is no, then perhaps half as many hires are needed, and the selection process is no longer one size fits all but rather you fit us.

A clear plan and understanding of technical progress speed should allow you to recruit and hire an appropriately sized team based on what is needed today as well as 18 months from today. This keeps you from scaling too fast to 50 or 100 engineers, then being faced with sweeping layoffs or lack of funds to get to your next milestone.

And let’s not forget the managerial dilemma of quickly growing a team overnight. According to Bob Sutton, organizational behavior expert at Stanford’s School of Engineering: “There is a lot of evidence that as a team gets bigger than five, and the closer it gets to 10, things get bad – you end up spending more and more time on coordination chores and less and less time doing the actual work. You also start having all these interpersonal problems because you’re trying to track the personalities and moods of 10 or 11 people. It’s like going to dinner and having a conversation with that many people all at the same time. Impossible.”

Don’t get me wrong – growth is vital to the long-term viability of your company. But a structured growth plan that is done while the technology is being pushed forward ensures a controlled burn, higher efficiency, and perhaps the long-term preservation of corporate culture from not having to eventually scale back people.

Upskill your growing team

Which brings us to the third goal for your growth, constantly upskilling your growing engineering team. To be transformational will require creativity of thought, design, and execution. To think you can hire all that upfront will probably mean your seed money will be gone in the first year. Hiring junior is ok so long as the individual is ambitious and open to development. The seniors in your organization need to understand that it falls on them to be the expert and the teacher and effort will need to be allocated to both roles in order for the organization to continue to thrive.

Your new team should be hired for their transferrable skills, but your current employees should own the education of your new hires on the task-specific skills for your device. The faster you upskill your new talent will determine how quickly you can create autonomy and an even faster pace of innovation. And if you are hiring correctly, people who are continually challenged and driven intellectually will carry the boulder from where you have it further uphill.

In the end, all of this will allow you to continue to push your product forward while you scale your organization, hire what you need versus what you want, and teach, motivate, and drive your talent from the moment they join your organization. As we continue to explore the topic of bringing transformational medical products to market and advising start-up companies towards profitability, we will be sharing our thoughts in future installments. We look forward to having you join us for those discussions – and please email meif you’d like to continue the conversation right now. Here’s to innovating at pace, de-risking, and upskilling your way to successful commercialization in 2021 and beyond!

Andrew Savarese
Vice President, Surgical Robotics & Advanced Surgical Systems

Andrew has spent the past 15 years helping start-ups with the growth and utilization of surgical robotics and image guided systems. He currently leads the commercial effort to help clients realize the robotic platforms of tomorrow.

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