GuideWell Innovation is part of the GuideWell group of companies focused on transforming healthcare, including Florida Blue. GuideWell innovation creates real world health solutions for commercialization with the goal of rapidly accelerating innovations in healthcare.
Academic arrogance. It’s what you would call a cognitive bias. The way you think is biased in a way that you’re not aware of.
I was a young scientist, and I was co-founder of a company called Biopta. We’d raised money on the strength of [our] patent and created this company to build the instrument. We were focused on cardiovascular drugs. So when you take a drug and it affects your blood vessels, they contract or relax. And depending on that blood vessel change, different wavelengths of light are picked up on the other end.
I then raised [the equivalent of] $1.3 million – it was in the U.K. – to build this instrument that was going to change the way that pharmaceutical companies tested drugs, right? There’s the arrogance right there. And I was so focused. We built this instrument that was awesome … and we manufactured five of them. Each one cost somewhere between $50,000-$95,000. And we were selling them for $450,000. So we embedded three of them. You go to the [pharmaceutical company] and you say, “Here is an amazing instrument, put it in your lab and use it for six months free.” If it [becomes] irreplaceable, they’ll want to buy it.
Well that was where the whole thing came tumbling down. We found out that they loved it, but they weren’t willing to pay the price. We were very close to these companies, so they sat us down and said, “Look, this [instrument] is really clever. We love it. But we don’t really need the machine. We just need what the machine does.” All three of the companies came back and said, “No thanks" – and they all had the same story.
This feeling that we were going to blow the market away – it was all hype.
I’d been so sure of the success that our whole business model was based on [that success]. The staff, all the future investment, everything was based on this one thing. And suddenly I found myself in a situation. This feeling that we were going to blow the market away – it was all hype.
What I learned is an academic doesn’t learn “know your market.” The media and the hype may say, “This is awesome, this is great.” But we never learned to get to know our customers the way we needed to know them. So I told the investors we had to write off everything invested, or "If you trust me, give me six months and I’ll turn it around.”
I learned what it means to pivot. We changed the whole business model to be a service company – a contract research organization. The end of the story is, just this last December, we were bought by a Japanese public company, ReproCELL. Their European headquarters is in Glasgow, and the CEO of that subsidiary is Dave [Bunton], my co-founder. All’s well that ends well, right?
So now, with our [GuideWell] startups, I think I’m in a much better position to guide them, based on my experience. And now I’m sensitized to the point of incandescence to the hype. I don’t try to bring the entrepreneurs down at all. They may be the next Google; they may be the next Facebook. But they need to do the work before they spend the money.
Photo courtesy of Chris Hillier