Medsider: Learn from Medtech and Healthtech Founders and CEOs - Execution Beats Flashy Funding: Interview with AccurKardia CEO Juan C. Jimenez

Episode Date: December 4, 2024

In this episode of Medsider Radio, we sat down with Juan C. Jimenez, co-founder and CEO of AccurKardia, a startup developing software that uses ECG data to help doctors detect heart conditions more accurately and efficiently with AI. Juan started his career as an investment banker specializing in M&A transactions, then moved on to become President of Puerto Rico’s largest non-emergency medical transportation company, TransCita. Now, he’s making waves in the ECG diagnostics space with AccurKardia. Leveraging his background in finance and healthcare, Juan brings unique expertise on efficiency and scale for medtech startups.In this interview, Juan talks about how to scale sustainably with optimal dilution, giving your team space to establish a solid product, forging authentic relationships with potential customers, and leveraging your credibility to move your business forward.Before we dive into the discussion, I wanted to mention a few things:First, if you’re into learning from medical device and health technology founders and CEOs, and want to know when new interviews are live, head over to Medsider.com and sign up for our free newsletter.Second, if you want to peek behind the curtain of the world's most successful startups, you should consider a Medsider premium membership. You’ll learn the strategies and tactics that founders and CEOs use to build and grow companies like Silk Road Medical, AliveCor, Shockwave Medical, and hundreds more!We recently introduced some fantastic additions exclusively for Medsider premium members, including playbooks, which are curated collections of our top Medsider interviews on key topics like capital fundraising and risk mitigation, and 3 packages that will help you make use of our database of 750+ lifescience investors more efficiently for your fundraise and help you discover your next medical device or health technology investor!In addition to the entire back catalog of Medsider interviews over the past decade, premium members also get a copy of every volume of Medsider Mentors at no additional cost, including the latest Medsider Mentors Volume VI. If you’re interested, go to medsider.com/subscribe to learn more.Lastly, if you'd rather read than listen, here's a link to the full interview with Juan C. Jimenez.

I guess the best way to think about it, from my standpoint, is if you're staring down $50 million in capital to get to a point where you're actually selling product, if 80% of that capital was used in the development versus maybe the opposite, or 80% is now being used to actually commercialize it, there's going to be a much stronger ROI in the latter scenario. Welcome to Medsider, where you can learn from the brightest founders and CEOs in medical devices and health technology. Join tens of thousands of ambitious doers as we unpack the insights,

tactics and secrets behind the most successful life science startups in the world. Now here's your host, Scott Nelson. Hey everyone is Scott. This episode of MedSider, I sat down with Juan Yaman and as CEO of Accurcardia. One started as an investment banker, specializing in M&A transactions, then moved on to become president of Puerto Rico's largest non-emergency medical transportation company Transcita. Now as MedTech founder, he's making waves in the ECG diagnostic space with Accurcardia. Leveraging his background in finance and healthcare, Juan brings unique expertise on efficiency,

and scale for MedTech startups. Here for you the key things that we discussed in this conversation. First, capital efficiency can often be more valuable than flashy oversized funding rounds. Focus on scaling sustainably without unnecessary dilution by keeping your organization lean and focused. And don't forget to make that a point of emphasis for your company as it will make finding capital that much easier. Second, focus on developing your product and thoroughly understanding your market before inviting investors to join your venture. Allow your team's space to develop a solid foundation before bringing in external opinions to ensure that early investor feedback doesn't misaline or dilute your core vision.

Third, prioritize genuine relationships, transparency, and rigorous standards to build credibility and lasting partnerships. Be upfront about both your strengths and limitations. Embrace a proactive approach to validation and industry recognition, particularly if you're an unconventional player in the field. All right, quick note before we jump in. If you're a MedSider listener, I'm guessing you're pretty serious. about leveling up your game, right?

Well, if that's you, we just made Medsider Premium better than ever with a recent site relaunch, and I think you're going to love what we've added. Here's the scoop. With Medsider Playbooks, you've got thematic collections of hard-won insights from some of the brightest founders and CEOs in our space, covering topics like fundraising, risk management, regulatory reimbursement, you name it. And Medsider mentors, these are e-book volumes full of best practices and insider secrets from the same top-notch founders and CEOs that join our program, all downloadable for easy

access. Then there's the popular investor database that now includes over 750 life science VCs, family offices, corporate investors, and angels. You see, raising capital can be one of the most grueling aspects of running a startup. So we created three custom packages, whether you need just the database or you want us to manage investor outreach for you, the Medsider team is ready to support your next fundraise. Just head over to medsider.com forward slash investors and send us a note. And don't forget, Medsider Premium members get access to every single interview dating back to 2010. That's over 200 episodes packed with expert insights from proven founders and CEOs. So if you're ready to dive into all of this, check it out at medsider.com forward slash subscribe.

All right, let's jump into the episode. All right, Juan, welcome to Medsider Radio. Appreciate you covering down a little time in your otherwise busy schedule to make this happen. Thank you, Scott, for having me. Excited of being here. Yeah, this should be a lot of fun. So with that said, first question on the docket is, give us that. One of getting two part of the weeks because we'll certainly use the next 30, 45 minutes to go back

in time. I want to learn a little bit more about your journey from recovering, recovering consultants, if you will, to founding a startup. But give us a high level sense, an elevator pitch of your professional career leading up to starting the company. I got into healthcare by accident initially, and then I got into tech startup by a friend. But I started my career in investment banking, doing M&A, capital markets transactions in a now defunct bank called Credit Suisse, acquired by UBS just a a year ago, traditional capital markets, MNA transaction junior banker that then the 2008, crisis hit, and then I moved to do some real estate,

the stress credit investment. And I was recruited to be the CEO for a large non-emergency medical transportation company. It was weird why they wanted to bring someone with a more financial background. And the shareholders of that company, wanted to bring someone with a more financial engineering perspective to be able to take the company and grow that company. So I helped scale that company from 5X in terms of revenue.

And when I left the firm, I was managing around 700 people. And I had agreement with most of the commercial payers, Medicare, Medicaid. And that's where by accident, I got it, I got it to love it to healthcare. It's for me, right now I don't see myself in other sector because build the shareholder value, but at the end helping people and helping life and improving patient outcomes is what drives me and get me motivated. So then I, one of my best friend for business school, wanted to start a company that became Acucardia.

I got involved. I invested for a love with the technology and the use case and the fact that we could literally save live with technology and that's how I got into here. That's awesome. be kind of the atypical kind of backgrounds for founder, CEOs like yourself. There should be a, I think, fun to lean into that throughout the rest of the discussions. Acucardia, you started, it looks based on your LinkedIn profile. You started it back in early 2019. So pre-COVID, we're reporting this in late 24. So it's been roughly half a decade or so in the making.

Give us a high-level sense for kind of your products as well as where you're at in terms of life cycle. In Accu-Cardia, what we have built is an ECG interpretation. platform to fully automate the cardiac technician interpretation for the traditional holder extended holder of mobile cardiac telemetry in a device agnostic manner and also leverage ECG as a broad biomarker with implicates biology and beyond. Even if ECG can give more information that is currently used for. And we are sitting on millions of data points from patients and we can help identify screen and manage diseases more efficiently

and improving outcomes than before. In terms of product development, we have one FDA-C-C-G, which is a class-to-soft-prosmedical device, with device agnostic and can integrate with FDA-clear-holder, external-halter, a mobile cardiac telemetry, and that product is meant to help

cardiac monitoring companies in reduce interpretations, time, improve margins, and deliver more quality in the interpretation component. I don't know if you are aware, but most of the ECG-Holtter-extended Holtter-MCT data obtaining nowadays in the U.S., they are not reviewed by the cardiac monitoring company. Most of that data is outsourced, sent offshore for cardiac technician labs to be analyzed, and our product is meant to keep unsure that data and improve the quality of that interpretation.

So therefore, doctors could get data faster so they can initiate. treatment promptly. And that's your notion of that product. We just obtain breakthrough device assignation for our model to screen for our textanosis. You just were in TCT a few days ago, and I bet you follow the new clinical trial study announced about the value of treating severe growth asymptomatic our tick stenoise patient. And how could you find asymptomatic patients without the ubiquity, the help of the ubiquitous ECG. We're sitting on, there are 100 million ECGs performing the US per year, and if we can help screen with that data, screen for patients, you'll be able to identify asymptomatic

patients with heartic stenosis, and they could be directed to treatment, therefore improving the quality of life of that population. But that's in a nutshell what we have, one FDA care product already with one paying customer and a few others not going to wood in the next few weeks. And a second product with break-to-device designation, hopefully we filed for clearance in mid-2020. And we have a few other use cases in the pipeline leverage ECG for novel use cases, like cardiac amelodosis, electron like dysfunction, cardiomyopathy and heart failure, etc. Got it. Got it. Super helpful. I want to ask you a follow-up question on current state of of

kind of ECG monitoring that you mentioned, because I don't think I fully understood that previously. But AKAVS, what the kind of the aortic stenosis screening tool that you just touched on, breakthrough to those Ignatian Cress on that, by the way. That's like not, that's not, those aren't easy to get, right? There's very few of those awarder these days. So that's pretty cool news. But does that, just don't understand that, does that, is that part of the software as a medical device platform then? Yes. Yeah. That is a different use case of our platform to ingest ECG data. what we call for traditional use case,

which is the typical arrhythmian management with Holterx and the Hortor-R-R-C-T, and novel. And the first use case that we are going in the novel is aortic stenosis screening using ECG is currently the gold standard is pursuing two approaches. Oskultation, which is a dying art form, having a doctor listening to your heart, and if there is, if the heartexenosis is absent of a murmur, it would be very difficult to find,

or echocardiography, Not every patient on the rest gets an echo. So our product fits in the middle of the unscultation and acopt, and leveraging ECG is already obtaining the clinical workflow. Our proposal is you don't need to get or prescribe new ECGs. Let's use data already stored in the electronic medical record or already stored in the ECG repositories, scan for that data, and let's find patients with moderate to severe stenosis,

so they could be follow-up and be directed to treatment when time comes. Okay, got it. And I guess that's a nice transition into kind of current standard of care. You mentioned that most interpretation analysis is outsourced these days then. And is that correct? And for the traditional use on the Holter-extended-Holter-Yutter-use case, that data is outsource either onshore or offshore services. The way industry have managed the reduction in reimbursement rates for Holtter-extended-Hulter,

and also the fact that these devices are becoming smaller capable of recording more and more data, the way to manage that demand for analysis as well as reimbursement rate reduction has been outsourcing that analysis. So either cardiac technician labs in the U.S. or cardiac technician labs abroad, mostly in Southeast Asia, far as Asia or even Eastern Europe, performing that analysis to assist in this particular workflow. And this data, this process can take days to even several weeks because of the backlog of data. So software is meant to solve this problem, to manage growing demand, improving consistency, and keeping that data out short. Got it. Okay. That's super helpful. And so your software, does it sit then in epic kind of EMR then?

Is that kind of where that's like pragmatically how this works? Is right? Like data is an EMR and your software is kind of part of that. It depends on the use case. For long duration, ECG will be very difficult to coexist in the traditional EMR setting. For the novel use case, that could be a good solution. But on the longer recording, long duration, it has to be deployed in a cloud environment, traditional providers like AWS, Google Cloud, which are our preferred cloud providers.

But it could also be compatible in Azure, et cetera. Okay, cool. It's very helpful. And I look at the website now of Curricardia, A-C-U-R-K-R-K-R-D-I-A, cur-Cardia.com. We'll link to it in the full write-up on MedSider. For those listening, that want to learn a little bit more about the technology and the various indications that are either cleared or that one in the team are working on,

definitely encourage you to check out that site. It's a cur-C-R-C-C-R-K-A-R-D-I-A-C-R-D-A-com. And, again, we'll link to it in the full write-up. So, with that said, let's spend the next, a half hour or so kind of running through some kind of various functions that most most startups have to have to nail right in order to achieve a certain level of success and the first one i guess the first kind of topic i wanted to cover though is really your more more your background which is a little bit atypical not a little bit fairly atypical right you have most med tech startups are

founded by an engineer or a physician or maybe a commercial guy's been around for a while that you have unique background right you started at investment banking then ran a very large guess i'm not sure that That's right. A medical transportation company. In Chancita, so, yeah, it's just different. I love to learn a little bit more about how kind of those unique experiences have parlayed into Accurcardia. And what are some key things that have helped really drive your success at a cardio over the past half, half decade? I think what you learn when you start a career as a junior investment banker is the rigor,

attention to detail and working harder than anyone else. I think it's, and typically as a junior banker, you work, even if you're part of an industry, you work with different companies and not all companies are the same. So you have to deep dive and become an expert very quickly in different sectors, different industries, different companies. So I think that intellectual curiosity of becoming, not even an expert, become knowledgeable enough to become dangerous in different sectors. It's what have helped me become smarter on the cardiac monitoring space,

in particular the ECG interpretation component, how to use ECG. But given that I do not come from a traditional background. For me, there are no dogmas that can be challenged. I think all of them can be challenged other than improving patient outcome, patient safety and quality, right? But for me, any particular dogma can be challenged and has to be challenged to see if I have followed the traditional use case, I wouldn't have been the place that we are today. Just to give you an example, when I started a company five and a half years ago, my first trip to the Bay Area to introduce myself to the many players in the space, investors, the consensus was this problem has been solved. there was no issue with it.

And fast forward five years later, it's a different dynamic. It's a different dynamic. Everyone sees the need. Everyone sees the importance of this. And for me, given that I'm not part, I wasn't part of the status quo. I was able to classify noise with the true signal

and be able to follow that signal that led me to where I'm here today. Yeah, that's such a good point. In fact, I think our ecosystem needs more entrepreneurs like yourself that aren't afraid to buck the trend, right, press up against a certain dogma that's existed for a long time. And we're really expecting to see more innovation in this kind of fundraising environment. It takes people like you do things from a different perspective. That's interesting, though, because five years ago, I think a lot of entrepreneurs that kept hearing

no, we don't think Disney exists, right? No, we don't really think this is a big problem. But you stuck to it. You knew it was a clear need. And I think that hits hold for me because I've seen that firsthand in my journey as well, is that if you do truly fundamentally believe this is a problem that should be solved for and it's a big enough market, like, you have to cross that chasm a little bit, like stick to your guns. And was that, has that been difficult? Or like, how did you overcome some of those, the inherent sort of self-doubt, right, that comes along with hearing so many knows. But I think on one side, you hear the many nose, but on the side, you see the defects of the status quo, cardiovascular.

disease continue to be the leading cause of death in the U.S. Life expectancy for the first time in 75 years decreased in the U.S. There are 50% of counties in the U.S. without practicing cardiologists. The cardiac monitoring devices becomes better, smaller, being able to capture more and more data. So the workflow that was established five years ago, having sending data offshore, having humans taking a look, it wasn't effective. It wasn't producing great outcomes. So it's just a matter of time for that to happen.

And given that everything in healthcare takes time because you need to prove efficacy as well as safety and going through a regulatory process in the US, it takes time and resources. So locally, we were able to have a strong patient investor base that helped us navigate through a regulatory process, be able to obtain clearance, and also dealing with the regulator, which in a domain that is changing. that is changing, evolving. If you had a device tier five years ago,

and you're going now, the bar is much higher. And it continues to become higher. So all that, all those things align with what we're here to look. Let me tell you, I have to be honest, there were moments in 2020, late 2020, early 2021, in the middle of COVID, that we had usability studies and we had things planned and were being canceled because of the COVID epidemic.

It was challenging. There were lonely moments as early stage founder, but luckily I have a strong support of my co-founder, a great team that has been sticking with us for we have very limited turnover as an early-age company, and also good investors that believe in our thesis and patient enough to let us do all we have to do to be able to get what we are today. Yeah, no, that's great stuff. You hit on the importance of having strong support from your investors to be able to navigate a lot of those, a lot of those challenges, especially with developing kind of novel technology, like what you're on to at a

occur cardia. But that's, I love hearing that because I think it's so easy to see stories in various outlets around how this startup had an exit or, oh, this startup just raised another round. And the reality is it's very up and down, right? These journeys and they're rarely, if ever, like smooth sailing. And so I think that maybe that's the big takeo message or at least something that resonates hearing you describe your story over the past five years is that there's a certain level of persistence and that you need without a doubt. But also there's just, there's just, there's There's going to be a lot of ups and downs. And that's to be expected when you're trying to push a boulder uphill and trying to change how care,

how care, kind of the care pathway in medicine. With that said, we touched on this earlier one, but the aortic stenosis, aka ADS, the aortic stenosis screening tool that received breakthrough designation, that, like, that's huge. And again, congrats on that. That's really cool to see just because those are just rare to come by. But for someone that's, someone fairly new to the Ray Clinton process, Talk to us a little bit about maybe what you got right or what you got wrong in order to not only get 5G clearance for your ECG product, but also this new kind of novel screening tool. I think what I got wrong is the speed how things can get done.

I was naive to believe that I was going to move faster than I have moved. In MetTech, even software, with speed, they're the, it's fast. is never an option. So it's slow, slower, stop, right? So that's that, those are the velocities that the speed that the industry move, right? Because they're technical validation, regulatory, quality, and going several iteration. We're dealing with science. Science is never linear, right? Sometimes you move to step forward one backwards, right? So I think it's, I think the, I said the biggest misconception I had was that I could move. much faster that I have moved.

And nevertheless, I have been mentioned by many people that we have done a lot with the time that we have as a company. We have raised less than $6 million and have had one clear as one paying customer, a few more coming and break to resignation, a few more in the pipeline. So that's not common to have. So I think it's well to be lucky enough to be able to move, have a good operation, efficiently building this.

and we have learned how to improve the process to take an idea to prototyping validation. So I think that's what I believe is our secret source, and we have been able to improve the process in which we can take an idea or research into reality in a very streamlined process. We made some mistakes several years ago, but we have improved the process, the software and medical device, ECG space. We do believe right now we have an unfair advantage of most. people in the space because of our experience, of being in the middle of the COVID pandemic,

trying to build the company, having less resources. Even myself, that I don't have a background in the space, I could be dangerous in several regulatory areas that I had to learn from scratch. It's a matter of time after dealing with so many times with regulatory consultants and quality management consultants and dealing with the regulators that you become. dangerous enough to be able to the right process and focus on what is important. Focus on what you deliver value. Focus on how you see a potential partner.

So I think it's understanding where payers and what payers see as well as providers and understand the different pain points and the way you integrate into that. I believe all that is right now all that knowledge of, we have built has helped get where we are. And also, we believe we're going to move faster and I'm going to announce great things in the next 12 to 18 months. Yeah. I love that framework. It's not really fast and maybe fast and then slow. It's no, it's slow. It's slower. I mean, really slower stopped it. Stop at his preaching halt. So that's, that is a healthy reminder, though, because I think it can be really frustrating how slow sometimes

things can feel. But to your point about it, the better way to maybe think about it is how efficient we are with our resource. I think that's what's most important. Sometimes it gets lost, right? When maybe a competitor or someone else in the space raises a huge round. And it's, yeah, maybe that's a good thing, but it also means from a business standpoint, it's a lot of dilution. And can they get to the next major milestone for their company? Do they need that much more money? Or can you do it in a lean fashion? So when you think about efficiency, has there been like one or two things that have been really helpful and how you run your company in a really efficient matter to get to these kind of two significant milestones. It's like very little money relatively.

Hey there, it's Scott, and thanks for listening in so far. The rest of this conversation is only available via our private podcast for MedSider Premium Members. If you're not a premium member yet, you should definitely consider signing up. You'll get full access to the entire library of interviews dating back to 2010. This includes conversations with experts like Renee Ryan, CEO of Cala Health, Nadim Yared is CEO of CVRX, and so many others. As a premium member, you'll get to join live interviews with these incredible medical device and health technology entrepreneurs. In addition, you'll get a copy of every volume of Medsider mentors at no additional cost.

To learn more, head over to MedsiderRadio.com forward slash premium. Again, that's MedsiderRadio.com forward slash premium.