02:04  Danny talks about his background and what he is up to these days.

06:52 Lessons learned from Eon Surgical's journey. How did that acquisition happen so quickly? 

10:30 Danny elaborates on the differences between corporate thinking versus a startup thinking?

15:45 Danny shares his experience with the Rad Biomed incubator? What are the main takeaways about his journey with Eon and now Perflow that both started within the incubator's framework.

19:10  The story of Perflow. When did Danny decide to join the team, what were the early warning sign or the signals for that allowed his to know that there's a good technology with a  potential to make a real dent or change in the market. 

23:19  Moments of panic when entering the neurosurgery market. What helped him calm down?

30:00 Danny's invovlement  ina digital health startup called CVAid that is intended or is targeting the problem of early detection of stroke. 

37:00 The future direction in the bundling of diagnostics and therapeutics.

41:00   Danny's advice and tips to companies who are looking to sell medical devices through distributors? 

Danny is currently in quarantine at his hotel room in China. Thank you for joining us, Danny. So, tell us how are you holding up after 12 days alone in a hotel room?

Danny Farin: Actually, I thought it would be much worse than what it is. I have a little bit of peace and quiet here. And also, had a lot of focus on work, reading, playing a little bit; used it for the positive side for quiet and peace and it was quite efficient. But I'm finishing it tomorrow. Thanks, God. I have a hectic schedule from tomorrow and on.

Tell us about you? A little bit about your background and what you are up to these days.

Danny Farin: So, I'm in the medical device business for quite some time now. Started my career in a company called Sunrise Projects, which deals mainly with international collaboration, business development and also non-equity fundraising. I had the privilege of working with a team of very, very talented people, friends, bosses. And I was exposed to the high-tech in MedTech industry from the industrial side. During this work, I had the chance of working with a lot of very talented entrepreneurs, inventors, managements of tech companies. And then, worked there for 5 years and met my first partner; which I co-founded my previous company, Eon Surgical, together with Shaul Shohat, was my partner and my mentor, a very, very talented man. Amazing human being with a lot of credits, in general, in the medical device industry in Israel. And we co-founded Eon Surgical in 2010. And developed the whole system for micro laparoscopy tools, which was quite fast you know, the dynamics was crazy. After a year and a half, we were in contact with all the big companies and it was an amazing journey. A real roller coaster with a lot of ups and downs all along the way. And many challenges both on the funding, the development, the business development. And at the end of this process and roller coaster, we sold the company to Teleflex Medical on June 2013. Then, I was committed to stay for half a year in this company to make sure that everything is transferred in the right way to Teleflex. And during this half year, it was very interesting because for the first time, I witnessed, you know, the differences between how a startup works and decision-making and, you know, analyzing risks to how the American corporate works, which is entirely different.  I guess, maybe we will speak about it later. And then I joined Perflow in 2013, after having great chemistry with the two founders. And, you know, we will talk about Perflow later on. But this is, in general, my story of how I joined the medical device industry in Israel.

I'm very curious about what you're sharing around Eon. Because it really is unique to go through a three-year process and then sell to a large corporate, especially in the medical devices space. It sounds like you did it quite early in your journey. Can you kind of put the finger on how this happened so quickly? Many CEOs come back and say, 'Oh, it was you know, it was a chance, right. It was just luck'. I'm assuming this wasn't just luck. So if you can share, you know, what you think you did right in this process?

Danny Farin: There are many questions in this question, so I'll address them one by one. First of all, it's important for me to say that 50% of it maybe even more was luck. When you sell a company, there are so many stars, which need to be arranged the perfect way. It's not modest to say that you need a lot of luck, because there are many parameters that is not up to you entirely. And we can talk about them by the way after that. But at the end of the day we want to learn something, so luck doesn't teach us anything other than modesty. I think one of the reasons which enabled us to develop the company so fast and make the right decisions retrospectively was actually to understand that we made some wrong decisions pretty early in the process. We actually established the company based on an entirely different idea of how to enable micro laparoscopy which was a very complicated system. Almost, I would say a medical robot, which contained a lot of subparts and subsystems that we needed to develop. And then pretty much after three months, we understood that the scale despite the fact that we already had the initial funding.

We understood that the scale of this project is too big for the funding, too big for our experience. And then we scaled it down; we narrowed it down to, I would say, the core value of the project. And then after three months, also we changed additional concept based only on this for business. And then we felt that we're on the right track with that, and full steam ahead, we continued developing this concept. Another thing that enabled us which must be said is, the fact that in laparoscopy and specifically in the abdominal cavity from the medical perspective, the gap between pigs and humans is very small; unlike most of the other indications, clinical indications, in medical device. Proving that the system works in pigs makes a lot of difference because it will decrease the risk perception of the potential acquirer. And I would say the clinical proof of concept.

If you mentioned about the differences between corporate thinking versus a startup thinking, then I'd like you to elaborate a little bit more on that. Because most of the listeners will be startup companies who have the dream to one day access the market and potentially be sold.

Danny Farin: I'll start with a story, that may tell us all the differences in a very short story. The first time after the company was acquired. One month after the closing of the deal, I was invited to North Carolina to the Teleflex surgical division headquarters. They did a project kickoff, they called it "Inside the Corporate". They invited more than 100 people to initiate this project inside Teleflex and they wanted me to be the one that "rings the bell" or something. And describe the journey that I went through and then this will be the starting point for the project. So, I prepared myself to talk in front of 100 people with all the top executive management. I kind of was excited a little bit. And then, after I did my thing, I went down and then they started three days of sessions correlating between among all the verticals of organizations; R&D, engineering, IP regulation, clinical, sales marketing, whatever you can think of. And each step of the way, there was so many discussions. Now, not only did I come from a startup, I'm also an Israeli like you. Sometimes you want to get up and shout ... And excuse my French, "Cut the bullshit" guys, let's move forward. We're not moving forward, we're not making any decision, we're just discussing. But after two more sessions like that, I understood that, with all due respect to my point of view, the way that the corporate manages its risks, manages its resources and its potential, is entirely different from a startup and it should be. Because when a startup fails in an animal study, so it fails. You're telling your board and then two months later you're doing that. But when a project fails inside the corporate, there are so many disciplines which are involved in it. And then not to mention, of course, the clinical risk, what happens if ... "God forbid", something happens to a patient. So of course, it's terrible either way if it's a startup or a corporate. But just imagine the huge damage that is caused to the stock price or to the reputation of a corporate, unlike a startup. So, this was a very educational experience. And I learned a lot from it. I also learned that I will probably not be working in a corporate in my life, but you'll never know.

Both Eon and Perflow were grown in RAD BioMed incubator, right. I'm correct in that. And I think we know the incubator model in Israel a little bit. But outside of Israel it's not as well-known. And RAD BioMed is a bit of a different incubator in that it began as a government and became a private incubator. Can you share a bit about your experience specifically with that incubator? And if you have any kind of takeaways about your journey with Eon and now Perflow, and the advantages of being part of a system like that?

Danny Farin:  Absolutely. First of all, I would say that I had the privilege of working with RAD BioMed. The RAD BioMed incubator was owned by the Zisapel family, which is an amazing family of entrepreneurs, which support the Israeli industry; in the high-tech industry, the MedTech industry, the pharmaceutical industry. They've invested in many companies, established many companies, went through an IPO with many companies.

Working as part of this group actually brought a lot of value. Because all the services, that kind of disturbing or distracting, maybe is the right word. At the beginning of the process of a company, like the legal, like the financial, administrative, was completely taken care of by the group. Where we got the best lawyers possible with very low cost. We got the best financial support; very good offices. Also, the staff of the incubator helped us a lot with the business development with, I would say, shortening the learning curve of a young CEO or a young entrepreneur that sometimes makes mistakes. Not because he doesn't understand the industry, but because he's not experienced enough. They can save him so much time and efforts and money, while directing him in the right direction. Although it's important to say that at the end of the day, the most important thing is the core team of the company; there is no replacement for that. The incubator can be the most amazing incubator if there is no angel in the shape of the entrepreneur or the management of the company, that innovates, that strives to be better and to achieve the goals. The incubator cannot really help. It's the combination between the two that brings the value. And this is what was my experience in RAD BioMed.

Let's transition now to what you're doing today, you sold Eon. How did Perflow come to be? I understand that you joined an amazing team, a very strong team. Because this is your second journey and turning an idea into a successful product. What are the early warning sign or the signals for you to know that you have a good technology that has a potential to make a real dent or change in the market? What do you look for?

Danny Farin: That's a great question from several perspectives, not only from my personal perspective, or how one can understand what's a good technology but I also invest in startups. Also from an investor perspective, to say that in one month or two months, you're able to really learn about the company, about technology, about industry would be, I would say; Let's say I’m modest, okay. 19:49    And it doesn't matter how skilled you are and how experienced you are because there are so many parameters that should be analyzed that at the end of the day, the most important thing is the people that are involved in it. Because this thing, usually, at least some of us can evaluate in a very good way. Because if you find someone who is very skilled, very honest and he puts all his energy, and believes really, believes in a specific company or an idea or technology, this is the first sign that there is something to it. From my personal perspective, I was introduced to the two founders of Perflow, Avi and Gilad, who are also very good friends today; I didn't know them.  And in less than a week, we felt that there is an amazing interpersonal chemistry, which is very important. The second thing is I understood that these guys are super talented, very honest people, which, made quite a long way on understanding the connection between the clinical indication to the ability of the technology to solve the needs.

This was the first thing that drove me into joining this company.

The second thing was the fact that it came out of RAD BioMed. It was only natural for me to stay in the same personal environment.

And the third is that, after these two things were fulfilled, I flew around the globe, mostly Europe and US, and met physicians. And it was just about to start the stroke revolution in this industry. And actually, a year and a half after I joined Perflow, the revolution happened. And I would say the rest is history. Because now stroke is one of the most current medical indication in the media. The awareness is very much increased since last year, during last year sorry. And there are many developments in this field. And yeah, this is what made me join the company.

I'm going back to your comment about the pigs and how that they mirror the human anatomy very well. They don't really mirror the human anatomy when it comes to neurosurgery very well. When you were looking at that, and learning from the market and the neurologist, wasn't there a moment where you said, Oh, my God, neurosurgery is so difficult. How am I going to do this? And if there was that moment, what helped you kind of calm down and say, 'This is where I need to be'.

Danny Farin:    I'm actually glad that you asked this question, because I would offer a little bit wider perspective than my personal experience. I read, I don't remember the name of this, he's like a superstar coach in the US. He said that entrepreneurs have to be a little bit stupid. Because when they come to analyze a complex problem, they usually downsize the challenge. They're not grasping the real size of the challenge that lies in front of them. And this is, in many times what actually causes them to take the challenge and deal with it. Because if they had the ability to grasp the full complexity of the problem, most of them would not approach it.

I have to say that I really understand where he comes from when he said it. Because when they showed me the preliminary (premature) prototype they had, I said, 'Boom, in a one year from now, we're going to treat patients all over the world'. And I was so enthusiastic, and I met physicians all over the world.

And I can brag how much I understand the industry, and I know how to evaluate technology, but let's say that this was not the case. It's not that I was afraid of entering a complicated situation or challenge, I just didn't understand that it's so complicated. And then I started this journey. And after half a year, I understand that the situation is not quite as I imagined it. Danny 26:20              Now, when you yourself are dealing with that, this is one thing you say, 'I pay for my own mistakes'. But all the investors from Eon Surgical, my previous company, came together with me to Perflow. Now you ask yourself, as a responsible person, my mom taught me that I should be responsible, especially for other people's money.  What am I going to go about it now? They put the money based on what I believed in, and they believed in me. I'm in an unpleasant situation. But luckily and fortunately for me, the group of investors that invested in Eon and also in Perflow, are all entrepreneurs and very experienced investors. And they all understand the risk that comes together with the investment. And one of the investors which I respect very much, Avner Gilan, is a super angel. He said, 'Danny, we're not investing in riskless companies, were investing in entrepreneurs that knows how to manage the risk and how to turn failure into success if needed'. And it kind of changed my perspective, I have to say. Because I have to admit it, I was in real stress during this period of time, because like I said, the responsibility led me to feel bad about it.

But I have to say that since then, retrospectively, we solved a lot of problems. We have sales of $2.5 million. We have two products in the market, many more to come. There were a lot of challenges along the way, a lot of problems. But we take it one step at a time.

We interviewed Amir Gross that sold Valtech a few years ago, and he said that an entrepreneur must be naive. If you don't have naivety, then you're not able to do this journey. And this is exactly what you're saying. We will go back to Perflow in a second. But I'd like to take a step aside and talk about digital health. Perflow is making amazing tools for neurosurgery. But one of the main issues with stroke is that it is a challenge to detect it early. What happens is that patients exhibit some sort of symptoms. The family are not sure exactly what that is. It takes time to call an ambulance. They're routed to the wrong treatment center. And then it takes some time to reach the tertiary or the stroke center in order to be properly treated. I know that you're involved in another startup called CVAid that is intended or is targeting this exact problem. Could you tell us a little bit about that?

Danny Farin: Yes, absolutely. Like you described accurately, the devastating problem of stroke is based on several reasons. The first one is the diagnosis problem, meaning that all through the chain of evacuation and treatment, triage and treatment, there are very few entities that can actually diagnose stroke. And the problem with stroke is that it has a time limit, like they say "time is brain". Each minute that is passing by with stroke, 2 million neurons are dying in the brain. So you have to diagnose it immediately, you have to transfer the patient to the right place immediately. And you have to treat him the best way and you have to monitor him then after you treat him.

I will just stop for a minute and talk about one thing that I have in mind, that the human brain finds it hard to grasp the concept of irreversibility. Like we're wired to think how to solve problems or how to improve a situation. You have some illness, you go to the doctor, he diagnoses the problem and then you say, 'Okay, what should I do? Give me instructions?'  What should I take, a medicine? Should I practice more, or should I eat less? But the problem with stroke is, once someone has a stroke, the more time passes by, it is more irreversible it is. And people are asking the doctor, 'what's going to happen with my relative?' And the doctor sadly, says, 'This is mostly irreversible, there are very few things that we can actually do'.

What CVAid comes to do, is to make sure that we're not reaching the irreversibility point or if we're reaching this point, we prevent damage in the optimal way. CVAid does a whole algorithmic and AI systems which actually diagnoses stroke with the help of mobile phones. It has image processing that actually takes a video of the patient, analyze his voice and give a very accurate answer whether he has stroke or not. And whether he has large vessel occlusion or not. Now it can work in the home market, the private market which if someone is presenting stroke or potential stroke symptoms. And then his relative can actually scan him and in less than one minute, can say if he has a stroke or not. And then, in the ambulance paramedics, 99% of them don't know how to diagnose stroke. And also, in ER, most of the physicians and nurses don't know how to diagnose stroke.

This system actually brings a layer of orchestration between all the stakeholders. Between the patient, the caregiver, the neurologist, the stroke center and communicate to everyone. And also, give the actual diagnosis whether it's a stroke or not, or large vessel occlusion. It can save a lot of time in the process. It can save entire phases in the process, while sending the patient to a hospital or medical center that cannot treat stroke. Or sending him to the comprehensive stroke center immediately to the Angio Suite, saving two-three hours which are super critical for the irreversibility idea that we just mentioned.

We already treated 300 patients and the results look very promising. We're moving forward now to the FDA process and looking forward to change the face of the stroke field.

You've mentioning something with this digital diagnostic. Specifically, around kind of the bundling of diagnostic with therapeutic. Bundling of a diagnostic and a therapeutic was used to be kind of on the outskirts, but it's now becoming more of a trend that is happening across the health tech space. Probably because of digital health and the entry of digital health. Digital health in the neurology space is not as mature as in other markets.  What are you seeing specifically for Perflow's device and how that connects with the digital health and that bundling concept, both on the product level and also on a marketing level? What are you imagining will happen going forward in that bundling of diagnostics and therapeutics?

Danny Farin: First of all, I would say that the direction of the industry entirely, not only the stroke. But specifically, the stroke even more so, is the holistic approach. All the big players are trying to embrace the holistic approach, meaning that it's not like getting a patient with a specific indication and treat him. The approach should be knowing what the human being even before he's a patient is feeling.

What risks factor does he have? How do we diagnose, maybe risk factors before they're becoming a clinical treatable phenomenon? And then, also along the chain of after he's becoming a patient, what's the best way to provide him within a holistic, personalized solution for this specific patient?

This is especially important in stroke, which has to provide an efficient solution. This is definitely the direction to combine between the healthy benchmark of a patient to what happens to him after he has the symptoms. And also, how he is improving, after he's treated. And this is exactly what CVAid is doing. And also, by the way, Perflow and CVAid speak also with imaging companies, the big names, which also understand that imaging only is something which is very scientific. But they can be combined together with so many other parameters in real time and also the general parameters of the patient. And then make a much better conclusion and improve the lifestyle of patients and the treatment of patients and the recovery of patients.

In which territories is Perflow currently selling?

Danny Farin: Perflow is selling now in Europe. We're also approaching our FDA approval for our aneurysm racing device in the US; We are just about to finish our enrollment for the trial. We're having a multicenter trial for our ischemic stroke device in China, and are working on several geographical opportunities as well as new products to bring to the market.

We work mostly through distributors in Europe.

What kind of advice or tips would you have for companies who are looking to sell through distributors? We're talking about medical devices, of course.

Danny Farin: Luck is always part of the picture, but like we agreed, you don't learn anything out of luck. Before I give any tips and tricks, I will just say very humbly that, our company is not selling like in 10s of millions of dollars.  Each tip or advice or experience that I share, should be taken in a very limited approach. What I learned from distributors, from working with distributors, is that there are many important parameters that you look in a distributor. But sometimes it can be misleading, because there is a distributor, which seems to be very experienced specifically in the field that you're working in. They also have complementary products, meaning that there is a theoretical synergy. And they have several sales reps you say, 'boom, he's the perfect candidate'. But it turns out that it's not necessarily the case. But for it to be the case, there is one thing which is super important for a medical device startup, specifically.

95% of the medical device startups brings something with a new approach to the market. The market should be educated in a way. Sometimes the learning curve is shorter, sometimes it's longer, but there is always a learning curve. Now, if the distributor is not willing to take part in this investment of money, investment of time, investment of learning it doesn't matter how good is and how connected he is, and how much of an expert he is. It's not going to happen. Companies should save time by trying to analyze and examine, specifically, this point, while looking for distributors. It's not easy, by the way, to really understand his commitment to launch a new product and to be part of the learning curve.

When you meet a distributor, and everyone is super nice and blah, blah, and of course, we're committed, we want to work with you. But there are some ways of finding out whether he is committed or not. And it also depends on his nationality. Because things ... It's different to understand it with the German distributor, and with the Spanish distributor; it's different. But this point, I would say is the most important point as I see it of course.

Tell us about your activity in China. Post COVID, everyone is minimizing their travels. Why are you in China? Why is it important? And what can you say about your experiences working there?

Danny Farin: We've been working with China for I think, three or four years. I'm far from being a china expert. Actually, I'm being surprised time after time from China and from working with Chinese. I have to say that I still have a lot to learn. But then again, let's leave aside my impressions of China. Because they are less important than the fact that unlike, I would say five years ago, where a startup could allow itself to focus on US and Europe. China is becoming, not becoming, it's already a superpower in all aspects of technology, and also in healthcare industry and medical device specifically. Any company that wants to maximize its value  has to look on China as well today. There is no other choice as I see it. And specifically for me, if I go down from the very high levels, is the fact that we have a lot going on in Europe, in the US and also in China, and this is why I'm here. I haven't traveled for a year and a half. And we have activity here, a clinical activity, business development activity, we have investors in China.

People asked me, 'So, why do you have to travel and even be quarantined for 14 days?' I mean, high-tech companies were acquired during the COVID period, with zoom only. With all due respect to high-tech exits, and I'm not resisting to be part of a high-tech exit, but there are two different important parameters. The first one is, it's another thing to buy high-tech company which is mainly software-based or algorithm-based. The physical contact, I wouldn't say not important but is less critical for the process of the relationship of the communication. Two, is the fact that specifically Chinese find it very important to physically see you, physically meet you, discuss with you, eat dinner with you. And again, it's not important for Europeans or Americans or Israelis, but specifically Chinese use it more as a weight, I would say in the general picture. This is why I'm here and there are many things to be taken care of. And I can't wait. From tomorrow, I have a hectic schedule, seeing the light again.

It's been a pleasure and wonderful and very insightful talking to you. And thank you for making the time. I'm sure that Perflow, CVAid, everything else that you brush up on, will have a very good story to tell to the stroke market for making patients or patient care a lot better.

Danny Farins's Profile on LinkedIn

Perflow Medical's website

CVAid's website