Infection is a major problem for long-term users of catheters. Souvik Paul saw the problem in his family and founded Aurie. Based at Harvard’s i-lab, Aurie has a design that promises more safety and convenience. The reusable self-catheter is backed by a grant from the Department of Defense. Do listen to this committed and capable founder.
Highlights:
Sal Daher Introduces Souvik Paul
The Problem Aurie is Solving
"... Essentially, what we're doing is we're increasing access to the safer life-saving technology by making it safely, automatically, and portably reusable..."
How Aurie is Reducing Infection Rates and Costs
What Stage the Product is At
Funding
Balancing Online and In-Person Care
"... Our whole model is partnering with people living with disabilities to develop products that help improve quality of life, improve health in everyday contexts..."
Souvik's Entrepreneurial Journey
Advice to the Audience
ANGEL INVEST BOSTON IS SPONSORED BY:
Transcript of “Aurie: Fewer Infections”
Guest: Souvik Paul
Sal Daher: I'm really proud to say that the Angel Invest Boston podcast is sponsored by Purdue University Entrepreneurship and Peter Fasse, patent attorney at Fish & Richardson. Purdue is exceptional in its support of its faculty, faculty of its top five engineering school, in helping them get their technology from the lab out to the market, out to the street, out to the clinic. Peter Fasse is also a great support to entrepreneurs. He is a patent attorney specializing in microfluidics and has been tremendously helpful to some of the startups, which I'm involved, including a startup, came out of Purdue, Savran Technologies. I'm proud to have these two sponsors for my podcast.
Sal Daher Introduces Souvik Paul
Welcome to Angel Invest Boston, a conversation of Boston's most interesting founders and angels. This is Sal Daher, an angel investor in Boston who is just very curious about how to build exciting technology companies. Today, we are very privileged to have with us, Souvik Paul. Welcome, Souvik.
Souvik Paul: Thanks for having me, Sal.
Sal Daher: Souvik, that's spelled S-O-U-V-I-K, Paul, is the founder of Aurie, which is building a multi-use, no-touch, intermittent urinary catheter. Now, everybody, don't just run away because this is really important, and Souvik is going to explain to us why someone who is not 85 years old might be interested in a urinary catheter and how he came about this product choice to focus on because it's a very compelling use case for someone who's not 85 years old.
Anyway, I should also mention at this point that we are very grateful to Chrissy Glover, the inimitable Chrissy Glover, for connecting us with Souvik. They share things in common, they are design people, founding startups in the healthcare industry. I find that really amazingly compelling. My sound engineer, Raul Rosa, opened up my mind to the ability of these creative, artistic people, how they are really, really, really good at perfecting things. Art is all about perfecting things. Chrissy and Souvik all fall into the same category, the same area. Anyway, Souvik, let's talk about the startup, and then the second half, we'll talk about your founding journey.
Souvik Paul: Sounds great.
The Problem Aurie is Solving
Sal Daher: What problem is Aurie solving?
Souvik Paul: Today, there are around 600,000 people in the US who use intermittent catheters to urinate. The standard of care that's covered by insurance is basically a plastic straw. As you can imagine, infections are incredibly common when you're using a standard intermittent catheter.
Sal Daher: Let's just define intermittent catheter. That means it's something that's put in for part of the day when urination is required. What's the definition?
Souvik Paul: Sure. Intermittent catheters are only inserted into the body when the person is in the restroom just as they're ready to urinate. They're kept in for as long as urine is draining. Then they're removed and they're typically thrown out. People living with spinal cord injuries, multiple sclerosis, spina bifida, they have to do this six-plus times a day. These same folks will be catheterizing for decades of their lives. What sounds pretty innocuous, a UTI, these can actually worsen to the point where they become life-threatening, and in fact, it's a leading cause of death for people living with spinal cord injury.
Sal Daher: Explain that here, the difference that's possible with the state of the art and what you're shooting for, what your product is offering.
"... Essentially, what we're doing is we're increasing access to the safer life-saving technology by making it safely, automatically, and portably reusable..."
Souvik Paul: There are safer no-touch catheters on the market. They basically work by preventing contact contamination during insertion. The problem is as single-use devices, these no-touch catheters cost $20,000 a year, so less than 10% of people get insurance coverage for that. What we're doing that's different is we built a system that enables automated reuse of a no-touch catheter, and that allows us to commercialize it at the lower price point that's equivalent to the standard of care at $5,000 a year. Essentially, what we're doing is we're increasing access to the safer life-saving technology by making it safely, automatically, and portably reusable.
Sal Daher: Quantify for us the difference in the infection rates between the regular plastic tube and the safer technology which is very expensive.
Souvik Paul: Clinical studies and academic literature peg it at a 30% reduction in urinary tract infections, which is obviously pretty significant. When you think about that compounding over time, that is a huge difference in the life of someone who uses catheters.
Sal Daher: If you do the arithmetic, 30% a year, you take 1.3 and raise it to the 10th power, can't be right, 1.3, raise it to the 10th power, cannot be 13.7X.
Souvik Paul: That's the power of compounding returns, or in this case-
Sal Daher: Astonishing.
Souvik Paul: Yes, making it that much safer for patients.
Sal Daher: I can't believe this. 1.3 times 1.3 gets us to 1.7. That's a 70% increase, right? Then the third year gets us to 2.2. Wow. In the third year, you're basically getting half the infection rates.
Souvik Paul: Exactly.
Sal Daher: That three-year span. Then, in a 10-year span, we're talking about 1/10th the number of infections over that 10-year span.
Souvik Paul: Exactly. When you consider that each of these infections requires the use of antibiotics and the fact that within the world of urinary tract infections, antibiotic resistance is a major issue, that ends up becoming really, really significant, even more than just the missed infections. It's also about the reduced utilization of antibiotics, the ongoing urinary health of an individual who catheterized--
Sal Daher: Is that for the general population or for the specific patient?
Souvik Paul: It's generally speaking a big problem with the general population, but even more so with this particular user demographic because they're so prone to developing these complicated UTIs.
Sal Daher: Okay. Basically, they're likely to be infected by the same bugs. If you're treating it a lot, the bugs mutate, become resistant to the existing antibiotics for that, and then you have something that's really serious.
Souvik Paul: Exactly.
Sal Daher: Oh, wow, this is amazing. People say 30% reduction, they don't understand that this is on an ongoing basis. This is 10X in 10 years, more than 10X in 10 years.
Souvik Paul: Exactly.
Sal Daher: Awesome. Explain to us how it is that you are achieving this reduction, first, how you achieve the reduction and infection rate with this design, and second, how you achieve the reduction cost.
How Aurie is Reducing Infection Rates and Costs
Souvik Paul: Absolutely. Basically, hopefully, this shows up in the camera, but this is our reusable catheter. You can see here at the top, there's a tip that the catheter has to advance through in order to enter the body. Then as I'm handling the catheter, I'm never touching it directly, I'm using this plastic sheath to advance it. That is what reduces contact contamination, it reduces infection potential because the only part of the body that's being contacted by the catheter is inside the person's body. Doesn't touch skin or any other pathogen-inoculated surface.
Sal Daher: The microbiota that's there is the microbiota that's there, you're not-
Souvik Paul: Introducing new things, yes.
Sal Daher: New things, okay.
Souvik Paul: You'll be able to see-- hopefully, I'll line up the camera properly, you can see light coming through the back end of the catheter. That unique design allows us to automatically pump cleaning and disinfection fluids through the catheter contacting every surface that will ultimately end up contacting the end user. That allows us to build an automated system that cleans and disinfects a catheter within 30 minutes using tap water and prepackaged cleaning supplies.
The end-user has to do very little work. What they're doing is they are emptying wastewater, they're filling the device with about a cup of tap water. We actually tested this, this takes about seven seconds to fill up under a regular sink in your typical bathroom. The end user is able to start this cleaning and disinfection process very easily with minimal effort. They get to use a safer catheter that helps reduce infections without any increased costs associated with it.
Sal Daher: That is tremendous, a very promising development. My understanding then is that what you're doing is you have a catheter that is-- I guess no touch means that the functional part of it is contained in a place where you don't touch it with your hands, doesn't add any additional bacteria to the urethra when it's inserted. We're just losing audience right now. [laughs] Urethra-- When you mentioned-- first I did arithmetic on the podcast and then urethra. Now we're down to the 300 Trojans here.
Souvik Paul: It's certainly not for the faint of heart, that is for sure.
Sal Daher: Then the extra component is that the design is such that it's very simple to add water, seven seconds, and to go through the disinfection cycle, which is basically running water through it for 30 minutes. Then you have a sterile catheter for the next use.
Souvik Paul: Yes. We've developed a piece of portable hardware that the catheter stays in. It automatically pumps the catheter with anti-medic detergents, a high-level disinfectant, and then it rinses it out. Again, this is something that a user can carry around with them. It's a really low footprint. It's less impact than the amount of space that a daily supply of catheters would take up in that person's backpack. We've been really consistently focused on what is the end-user experience. How do we make this as less burdensome as possible in order to really deliver a lot of value to the end user?
Sal Daher: Can you, for the website, in addition to providing a full resolution portrait of your visage, of your [chuckles] headshot, can you also provide some images of the catheter and of the container, the disinfection machinery, and so forth? That would be really helpful if we could add that to lend some-
Souvik Paul: Context.
Sal Daher: -context there, yes. What is the Shakespearean line? "Local habitation to airy nothing," or something like that. A location and address to an abstract thing.
Souvik Paul: Yes, absolutely.
Sal Daher: Yes, it's helpful. You have this design, where are you in terms of adoption of this? Are people currently using this?
What Stage the Product is At
Souvik Paul: We are pre-market. We have built prototypes. We've tested them at the University of Notre Dame with really robust uropathogens, so we know that the approach works. We are planning to submit to the FDA in June of next year. We've actually received the FDA Safer Technology designation. Part of the benefits of that program are advanced ability to communicate with the FDA as well as expedited review timeline, so we're expecting to be in market by the end of next year.
Sal Daher: Safer Technology Protocol, that means that, basically, if you can demonstrate that your device operates more safely than the existing device or as safely as existing device, then it's cleared for you to sell it in the market. Is that right?
Souvik Paul: It's close. Basically, if you're familiar with the Breakthrough Devices Program, it's a way for the FDA to provide additional support to early-stage companies and products to help them come to market, especially when they're potentially improving safety profiles relative to what currently exists. What we did was we shared test data with the FDA. We provided a rationale and we said, "We really think that we're going to be able to improve the safety of intermittent catheterization relative to what's out there." They agreed and we've been on the Safer Technologies Program since 2021.
Sal Daher: Okay. When would you project that you could have a go-ahead to start marketing?
Souvik Paul: We're anticipating that in October or November of next year.
Sal Daher: October, November next year. Well, let's make a date to make another podcast at that time.
Souvik Paul: Yes.
Sal Daher: Check in to see how things are progressing. Now, when you say that you were doing these trials against aggressive pathogens at Notre Dame, these are in humans or in animals?
Souvik Paul: This is actually bench testing. The specific lab that we partnered with at UND, they specialize in catheter-associated urinary tract infections. They have stored pathogens that have been explicitly bred to form aggressive biofilms, and what we've done is, we've exposed our catheters to those biofilm-forming pathogens in concentrations way in excess of what you would see in a clinical environment. Then we allowed them to sit at room temperature. Again, worst-case condition testing. Then we were able to demonstrate complete cleaning and disinfection, even after repeating this process 100 times, which is the anticipated lifetime of our catheter.
Sal Daher: Very good. How did you design this product? What kind of team did you put together?
Souvik Paul: That's a great question. We have a team of four full-time individuals, three part-time. Our team includes medical device development experts, basically. Our VP of engineering has spent 20 years working in medical device design. He's been at Boston Scientific, Becton, Dickinson, you name it, he's probably been there. Our Chief Operating Officer, Marjorie, she is an incredible expert in regulatory quality and manufacturing, and engineering. She spent the last 16 years in med-device startups. That combined expertise as well as our development partners at Goddard Technologies, that's really combined to help us advance really quickly against development milestones.
Sal Daher: Wow. Excellent. How did you fund yourselves?
Funding
Souvik Paul: It's been challenging. I think early-stage medical device startups aren't for the faint of heart. Our first round was in 2018, we raised $65,000 from friends and family.
Sal Daher: Wow.
Souvik Paul: Yes. [chuckles] Really, really had a ton of money in the bag. Honestly, I wasn't able to pay myself for the first two years of working on the company. I'm really fortunate to have the support of my parents in helping me do this. I'm incredibly privileged to have that support. We've basically made incremental progress and then raised more capital a bit at a time. I would say our breakthrough came in 2020 when we raised a 750K pre-seed round led by Lakehouse Ventures, in the midst of the pandemic.
Sal Daher: Wow. Would you say that name again?
Souvik Paul: It's Lakehouse Ventures.
Sal Daher: Lakehouse Ventures.
Souvik Paul: Based out of New York City, primarily focused on early-stage pre-seed, seed deals focused on founder market fit, and consumer-facing brands. We're not their first regulated product, but we're probably their most highly regulated product to date.
Sal Daher: Okay, but I think there's a very strong founder market fit here, and we'll discuss why that is in the second half. This is interesting. You said that your parents are helping you with this. There's a lot that's been discussed about the amount of discoveries that were made during the 18th and 19th century by clergy of the Church of England, who had a modest but sufficient income from their parishes, and not extremely demanding jobs.
A lot of these people didn't do anything very productive, but a few of them managed creative stuff or scientific development. There is the danger, the downside is that somebody just shrinks-- I think Richard Branson said that if you have a steady income, you shrink your life down to the size of that income.
Souvik Paul: Yes.
Sal Daher: However, there are exceptional individuals who, with that base support so that you know you're not going to starve, you're going to be okay, but you have a mission, you have a drive. Then you can just focus fulfilled on your mission, and not be worrying about where the next meal is coming from or how to pay the electric bill. That can be creative for a very small percentage of humanity who is internally driven by some type of mission.
Souvik Paul: In our case, it was a little bit the other way around. It was like really starting with the mission and then frankly not really appreciating the sacrifices and the amount of effort it would take at the outset, but then discovering that along the way and making those adjustments so that it's like, "Okay, I'm not going to be drawing a salary, let me utilize my savings."
Again, my parents were very generous in helping support me for part of the time, and eventually, working my way up so that I could start drawing a salary, start building a team, and things like that. It's been a huge learning process throughout the last couple of years.
Sal Daher: Yes, this is tremendous. I think we underestimate. The extent to which the support system that exists for the entrepreneur is extremely important. The entrepreneur is the little bit of the iceberg that you see above the water, and there's this massive support system. It could be parents, very frequently spouse, in the case of Tim Spong, for example, we had a conversation about how much his spouse supports him, his wife supports him.
She is also in the pathology area as he is, so she understands the business. She's kind of a shoulder to cry on. She was initially a skeptic then a big supporter, gives strategic thoughts, bounce ideas off, and so forth. I can see how parents and other family members and friends and so forth are also a huge, huge support-
Souvik Paul: Absolutely.
Sal Daher: -to founders. Souvik, the idea here is to create a consumer product.
Souvik Paul: That's correct.
Sal Daher: Is a prescription going to be needed, or is it going to be sold over the counter, do you expect?
Souvik Paul: Prescriptions are needed for intermittent catheters, so definitely working with clinicians, working with nurses to drive awareness of the product, that's a huge part of our go-to-market. Another thing that we have been actively working to incorporate into our commercialization strategy is how do we reduce barriers to adoption.
I think that one of the things that we feel very strongly about is the role that telemedicine can play in terms of helping people-- once they know that they want to use the Aurie system, and we've done surveys and over 80% of people have indicated that they really are interested in what we're building, can we connect those individuals to physicians or registered nurses to renew their catheter prescriptions online so that we can facilitate the adoption of our product?
That's something that we're really intentionally looking into. We don't want to necessarily completely remove the connection between the physician and the end user because that is an important ongoing relationship.
Our theory is that for things that are really routine, for writing prescriptions for a lifelong need, you don't necessarily need the urologist. In fact, most of the urologists that we talk to aren't interested in that kind of clinical work. We think that there's a real opportunity here to streamline adoption of our system, but also provide some much-needed assistance to urologists for some of these more routine tasks that end up having a big impact on product adoption.
Sal Daher: Another person who was introduced to me by Chrissy Glover, the incomparable Chrissy Glover, was Jeremy Wiygul. He's a urologist and his company Pelex is a connected health company. There's a device. This is having to do with pelvic floor disorders. I guess the lowest hanging fruit to deal with is urinary incontinence, particularly postpartum after delivery, after birth.
The reason he started this is that he himself is a urologist. His wife had the problem after giving birth, and he of course is a urologist who specializes in this. He had problems coordinating the care because the urologist is only a part of it. There are therapists, there's this kind of follow-up with device, there's lots of things, lots of moving parts. This is what telehealth is really very, very powerful in coordinating.
I'm involved with many, many startups, several startups that are doing this, harnessing the power of connected health or telehealth to improve the care for patients. I can well see that it's having some other players, some providers-- For example, I have used a product called Plenity, which is a pill that helps reduce appetite so that you can help control your weight. The company is Gelesis. They use Ro, the online pharmacy, Ro, to do the prescribing, to maintain the ordering, and all that stuff.
Akili Interactive also has an online prescriber, and they're doing a video game to address infantile ADHD, age 8 to 12, with a video game. They also have an online pharmacy. Jeremy Wiygul of Pelex mentioned to me the online component of this, it's basically flipping a switch on Zoom, for example. There's one-- you can just make it HIPAA-compliant, and it's there, so you can build around it. It's fairly easy. There are a lot of resources available. Excellent.
Souvik Paul: I know Jeremy well. We're both entrepreneurs in the urology space, so we've had the opportunity to build a rapport and build a relationship over the last couple of years. I have a lot of admiration for the work that he's doing. He's definitely someone that I've talked to a bit about the role that urologists play in catheter use.
I think he would echo the sentiments that I said earlier where a lot of urologists don't necessarily want to see a ton of patients who need just catheter prescription renewals because frankly, it's not the most interesting work in the world, and I definitely share Jeremy's belief that solutions in healthcare going forward, especially consumer-facing solutions, they need to be multimodal. There has to be that level of support, that level of access because frankly even in my own interactions with the healthcare system, it's difficult to navigate and access care as an otherwise healthy non-disabled individual. You throw in a chronic condition or two, and it becomes really, really difficult.
I think exactly, and one of the ways that I think our offering can evolve over time is really leaning into that component of providing value-added services, providing that full wraparound healthcare experience for people with a very specific need. Today, someone with a spinal cord injury, unless you live very close to a place like Spalding Rehabilitation or Craig Hospital unless you are geographically adjacent to one of these centers of excellence, oftentimes you have to educate your physician about what your condition is and what it entails and when you have an infection versus not.
Telemedicine is an incredibly powerful way to reduce some of those barriers to accessing care, where you're taking away at least part of that physical proximity component to whether or not you can get that type of care that you need.
Balancing Online and In-Person Care
Sal Daher: Absolutely. I'm a big advocate of in-real-life contact between people for social aspects of things, especially for young people. It's really, really important. But, in medicine, particularly things like this that can be delivered with tremendous efficiency, virtually, I'm a big proponent of that as well. I think we should take the best of both worlds. Developing social connections in real life is irreplaceable, but on the other hand, for providing high-value care that can be provided online. Nothing beats it.
Souvik Paul: That's why I think the approaches that we're taking at Aurie, that Jeremy's taking at Pelex, that Chrissy is taking at Imago, I think they're really potentially powerful because healthcare is fundamentally physical in nature, right? We are physical human beings.
When I think about something like digital health, a lot of it is about increasing access, but I think where there's a ton of value to be unlocked is in pairing that digital health experience with a physical product that changes things, changes how the standard of care is delivered today because again, healthcare being fundamentally physical in nature, I think there's no escaping the fact that you could connect people via telemedicine to urologists, but if they're using standard catheters and they're getting infections at a 50% incidence every single year, there's something fundamentally physical about that equation that you need to change in order to drive health outcomes.
That's why I have so much respect and admiration for what Chrissy and Jeremy are doing because I think it's very consistent with that thought process of-- we need to change the physical reality and we need to build an ecosystem of support and delivery around that. That's something that we're trying to do at Aurie as well.
Sal Daher: That is very true. For the transcriber's benefit, Jeremy Wiygul is spelled W-I-Y-G-U-L. Chrissy is just Chrissy Glover, C-H-R-I-S-S-Y Glover. We should also make sure that we have the proper spelling of Aurie, that's A-U-R-I-E, and the website is-
Souvik Paul: livewithaurie.com.
Sal Daher: Livewithaurie, A-U-R-I-E, .com.
Souvik Paul: That's correct.
Sal Daher: Excellent. Souvik, at this point, is there anything else that you want to talk about the company itself before we get into your entrepreneurial journey?
"... Our whole model is partnering with people living with disabilities to develop products that help improve quality of life, improve health in everyday contexts..."
Souvik Paul: Yes, I would say that there are a couple of things that I want to hit on. One is we're looking at reusable catheters almost as a platform technology. What we're really interested in is not just changing the standard of care today, but really purposefully integrating technology into our product in the future to enable things like remote patient monitoring, to enable things like predictive analytics around infections.
We've received some grant funding to develop that next generation of smart sensor-enabled technology which we're really excited about. Our overall mission is to fill what we think is a really pressing gap in the innovation ecosystem around chronic conditions. I think millions of dollars get funneled into research for curing spinal cord injury, curing multiple sclerosis, curing spina bifida, and those are really important endeavors and I'm not trying to argue that they aren't, but what ultimately ends up happening is if you are only focused on a cure, you end up leaving behind people who have been living with these conditions for 20, 30 years who are no longer good candidates for that cure.
That's really where Aurie seeks to make a difference. Our whole model is partnering with people living with disabilities to develop products that help improve quality of life, improve health in everyday contexts. We're really focused on that window of one to five years in the future. What can we do to introduce innovations that make a meaningful impact? We're always open to connecting with individuals who resonate with that mission and who want to be involved somehow.
Sal Daher: It's a very important point that you make. You're relieving a lot of misery until we can have a cure for that. That's extremely important, keeping people from suffering. Just imagine having the same infection over and over and developing bugs in your body, developing resistance to the antibiotics that are first-line for treatment, just horrible.
Okay. Right now, what I'd like to do is I'd like to do a very brief promo for the podcast to invite listeners who are interested in this, the remaining 300, [laughter] to how they can support the podcast. Then let's talk about how you decided to become an entrepreneur.
Souvik Paul: Sure.
Sal Daher: The best way for a listener to support this particular episode is within the next three or four days, go to the Apple Podcast website, leave a rating. We pride ourselves in having mostly almost exclusively five-star ratings and also leave a brief written review. You can be as critical as you want of us. You can say, "Sal talks too much. He doesn't let the guest get a word in edgewise." Sure, that's fine. As long as it's written, we're playing the algorithm here. If there's a written review, it gets prioritized in the algorithm and you'd be surprised.
A particular episode gets sometimes two or three X the number of downloads that would normally get just because of one or two written reviews that are left in the Apple Podcast app or website. I think a similar thing happens in the Google Play universe as well or wherever you happen to be listening. Also, subscribe to the podcast and follow us because you never know what interesting guest is going to be coming along.
Really, this is a learning enterprise. The podcast, initially, it was designed for me to learn more about how to build startups. It also throws off this extra benefit to other people that you can have the benefit of learning how to build startups, how to get funded if you're a founder, how to do due diligence if you're an angel, and so forth.
Anyway, Souvik, let's get to how you decided to become an entrepreneur.
Souvik's Entrepreneurial Journey
Souvik Paul: Yes, happy to share that story. I would say it wasn't a thing that I had planned for. I think going to undergrad at Harvard, you certainly have a lot of peers who are like, "What I want to do is start my own company. I want to be my own boss and I want to make impact that way." That was never me. I've been very happy working in corporate jobs with direct managers and things like that.
What happened was eight years ago, my then girlfriend, now fiance's sister was in a car accident and sustained a spinal cord injury. At the time, I was working in finance. I was at JPMorgan as an equity finance trader. I was making this transition to study industrial design, which is the design of physical products. My motivation in doing that, as befits a 20-something-year-old was, "I want to design products that help improve people's lives." That was it. That was the broad thesis.
I was in this situation where two weeks before grad school started, I was in the hospital in California with Karina, with her family, and really reacting to this event that would change Karina's life forever because she now lived with spinal cord injury. I had to make a decision. Either I continued to go to grad school, or I stay in California and help my girlfriend and her family.
What I ended up deciding was, I'll continue to go to grad school. That felt like an incredibly selfish decision at the time. The way that I could reconcile that with myself was, let me focus on design for spinal cord injury. Let me try to understand as much as I can about the medicine, about the rehabilitation of someone living with spinal cord injury, and design products and services that help improve quality of life and overall health. I ended up graduating from the School of Visual Arts two years later because my work really focused on healthcare, I worked at Johnson & Johnson as a design strategist with a focus on consumer medical devices.
Sal Daher: Johnson & Johnson, the huge multinational in the healthcare field.
Souvik Paul: Yes.
Sal Daher: Pharmaceuticals, medical devices, everything.
Souvik Paul: Everything. I think in graduate school, you're learning how to design products. My program, products of design, it had a special emphasis on building capabilities and designers to start businesses like doing financial modeling, understanding business models. Of course, I had exposure to that through my work at JPMorgan as well.
By the time I got to J&J, I think I was still laboring under this impression that a designer comes up with an idea, they can find someone like a J&J and sell that idea, and J&J will go off and implement it. What I learned was the innovation ecosystem in medical devices definitely does not work that way. Johnson & Johnson, Medtronic, Boston Scientific, all incredibly innovative companies, but rarely are they home-growing new initiatives.
What they really excel at is identifying companies that have proven out new business models and helping them scale incredibly rapidly. My two-plus years at Johnson & Johnson really served as an education as to what role does a startup play in the innovation ecosystem around med device and what role does J&J play.
I think the longer I spent there, the more I realized, "Hey, if I wanted to see any of the ideas that I developed in graduate school come to fruition, I would have to take that step as an entrepreneur. I would have to get into the ring and really work on proving out that there's demand for this product, that this product could deliver value to users, to physicians, to providers, and really prove all of that out as the first step."
That's what I ended up doing. It wasn't necessarily because I had planned on becoming an entrepreneur. That certainly wasn't the plan coming out of grad school, but it was more a recognition that this was the only way to really explore these ideas and see can they make the impact that I think that they can and that people have told me that they can in their personal lives.
Sal Daher: This is a type of advocacy because the market, the consumer market for these medical devices, and so forth, the mass market for these medical devices is governed by Clayton Christensen's idea of the innovator's dilemma; basically, that it's really, really hard when you are really, really very big in a particular field, it's extremely hard to adopt technologies that in the long run might be disruptive, might be tremendously better than the existing technologies, but initially, seeing to address a very small market share because these big companies are just focused on large markets.
Therefore, the smart large companies, what they do is exactly what you're talking about J&J or Medtronics doing. They look for innovative devices, breakthrough devices, it could be disruptive technologies, to pick up once they've proven themselves-
Souvik Paul: Exactly.
Sal Daher: -because they can only do things at scale. They can't do things on a small scale to compromise their existing business of disposable catheters or whatever they're doing at present.
Souvik Paul: Yes. It's a bit of a systemic structural issue if you want to call it an issue. J&J and Medtronic, they're huge organizations, publicly traded. There's a real focus on what's the quarterly performance looking like, are we driving sales? If you zoom into these organizations, senior leadership, you have these incredibly talented individuals who are spending three to five years running a business, providing for its growth, and then moving on to significantly impact another area, J&J or Medtronic's core business.
Within three to five years, it's really incredibly difficult to take an idea and bring it to commercial realization. I've been working on Aurie for four years, it's going to be five years before we get to market. The incentives simply aren't aligned. The structure isn't aligned because you have this business leader who's incredibly talented, wants to make impact, the best way to do that in that context isn't to start a new project that doesn't exist.
It's to take an existing innovation and to identify new ways to scale implementation and adoption of that innovation. Like I said, I think it's really a structural systemic circumstance that leads to this delineation of duties between the entrepreneur and the med-tech executive.
Sal Daher: Right. You either have scale or you have product discovery. It's really, really hard to do product discovery at scale. Product discovery has to be done in small markets with very, very small investments. Once you have that product market fit and it can be demonstrated, then these entities that scale, it could be a late-stage private equity firm, but in the medical field, it is really best done by specialized firms who understand the regulatory environment, who understand the particular markets, and have established channels of marketing and sales.
They're far, far better at this than some startup trying to replicate this huge infrastructure that they have. I mean, they know so much more about markets at scale, but the entrepreneur develops particular knowledge about this product, discovers certain use cases where it could be useful, and then proves it to the large incumbent player.
Souvik Paul: Sometimes that proving process takes 16 years and you exit for $15 billion like Abiomed and J&J.
Sal Daher: [laughs] Abiomed has a very special place in my heart because that is the first job that my senior son-in-law -- I have two sons-in-law. His first job out of MIT was documenting the processes of a factory that Abiomed had in Germany and they were moving to Ireland. This kid, six months out of MIT, documented all the processes and they moved the factory successfully. Abiomed LVADs, left ventricular assist devices, it's like a little Impella pump inside the left ventricle of the heart, helping people who have cardiac insufficiency. Awesome. Awesome company.
Souvik Paul: Absolutely.
Sal Daher: Awesome area of the company. Souvik Paul, as we think about wrapping up this really compelling interview, is there anything else that you want to communicate to our audience of founders, of angels, of people who work at startups, people who are thinking about starting a company?
Advice to the Audience
Souvik Paul: I think one thing for other founders, in platforms like this where we're highlighting the successes to date, one thing that's been really frustrating for me as a founder is you look out on LinkedIn and all people share are their successes, and that's by design, right? Because every moment's-
Sal Daher: [laughs]
Souvik Paul: -like a branding opportunity. It's tough. This is not an easy line of work that we've gotten into. It's not for the faint of heart and for-- As successful as Aurie has been to date, that's been paved with several, countless failures, so definitely want to just acknowledge that it's not all sunshine and roses, that it's been difficult. It's been the hardest thing that I've ever done in my professional and personal life. You got to keep at it and keep going.
I think one of the ways to do that is to look for partnerships, look for folks with whom your mission resonates, and I hope that for folks all along the innovation ecosystem, if anything that I've shared here today makes you take pause, and you want to grab a cup of coffee, you want to email, please do. I would love to get in touch with anyone and everyone who is interested in the work that we're doing at Aurie. I love to find ways to work together with people in unexpected ways. Please reach out, let me know if you want to meet and you want to learn more.
Sal Daher: Learning from failure. The inventor of invention, Thomas Edison, used to say that failure is just eliminating another way that something doesn't work. It's getting the inventor closer to the solution that works. In this vein, I recommend, because he's been on the podcast, Tom Eisenman's Why Startups Fail, which is a study of startup failure, which is extremely important. On the investment side, Andrew's thoughts, CFA, my colleague in the CFA world that's used to be a chartered financial analyst, it's a designation for investment.
He has a podcast, My Worst Investment. I've been in that podcast, and people, you have to confess that you make mistakes, and you learn tremendous amounts from your worst investment or from how startups fail or from failed experiments. I entirely agree with you, Souvik. Souvik Paul, would you say the website again, please?
Souvik Paul: It's livewithaurie.com.
Sal Daher: Souvik is S-O-U-V-I-K?
Souvik Paul: That's correct.
Sal Daher: I thank you very much for making time to be on the podcast.
Souvik Paul: Thank you. This is an awesome way to spend an hour. Really great chatting with you.
Sal Daher: Awesome. This is Angel Invest Boston. I'm Sal Daher.
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Sal Daher: I'm glad you were able to join us. Our engineer is Raul Rosa. Our theme was composed by John McKusick. Our graphic design is by Katharine Woodman-Maynard. Our host is coached by Grace Daher.
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