What drew you to this role at Intuitive?
I always had a long-held respect for Intuitive and its success story for bringing about medtech innovation and transforming a field. I got to know some of Intuitive’s leaders over the years and they recognized that they were at a size and scale to begin interacting and supporting early-stage startups in a meaningful way through an ecosystem strategy underpinned by VC. It was too good of an opportunity to miss: getting in on the ground floor to build a best-in-class corporate venture arm that can help meaningfully impact patient care. And I could work closely with Julian Nickolchev too (Julian is President of Intuitive Ventures and SVP, Corporate Development and Strategy at Intuitive).
Today, most people see Intuitive as the large public company with a market cap of +$120B. Launching a venture fund completes the circle and it brings the company back to its startup roots. How does Intuitive view this investment?
Intuitive is borne out of entrepreneurial beginnings and that is how we think of Intuitive Ventures. It is our mission to accelerate the future of minimally invasive care. Our company’s leadership is still largely the original entrepreneurial team that was involved with the very first patient. We have seen the shift from an early startup to becoming a public company. It is a privilege to set up a corporate venture arm where you can learn directly from that level of experience. These are leaders that have built a company that has touched millions of patients’ lives and generated enormous value.
What is the mission for this $100M fund?
Through our inaugural $100 million fund, Intuitive Ventures invests in and is advancing the digital, device, therapeutic and diagnostic ecosystems of minimally invasive care and beyond, fostering a disciplined and sustainable investment platform that will offer strategic and financial returns for the long term. The mission is about impact across the patient journey from diagnosis to patient care journey optimization to wellness. We have a very broad range of investment themes that we look at, but we need to tie those deals back to positive patient outcomes across the patient journeys. We are looking for a win-win where we have strategic relevance in our shared mission to advance minimally invasive care alongside a great financial investment opportunity, because that is ultimately what is going to sustain us.
How does Intuitive Ventures support an early-stage startup’s best interests?
When we started Intuitive Ventures, we felt strongly about adhering to corporate ventures best practices. Simply put, all the stakeholders should be aligned around the success of the company, its mission and vision. That’s why we created a $100 million venture fund with a structure and a team that is aligned to the financial success of the investments we make – so, we don’t tie companies we invest into to strategic terms that might limit their future value or options for growth. We will proactively help our portfolio companies collaborate in all manner of ways with Intuitive, but we do so when it makes sense and through direct channels.
How is Intuitive Ventures differentiated versus other life science companies’ venture arms?
We are looking at a much broader range of themes than many would assume and we’re very comfortable investing in this earlier stage. Also, our unique access to industry-leading knowledge, business model and care delivery innovation, and a robust customer base empowers us to cultivate the potential of startups that are advancing positive outcomes for patients, providers, healthcare systems and payors.
It is not uncommon to hear that working with strategic venture arms of top tier strategics can be a slow and drawn-out process. How does Intuitive seek to engage with startups?
To be competitive, we must be nimble and fast. You see how much capital is available now. Startups are not waiting around for an answer. Our benefit is that we are structured to make decisions quickly. However, that doesn’t stop us doing deep due diligence.
What investment areas are you most interested in?
On the digital side, I would say that we are looking at the opportunity of connected lives and business models with the ability to help drive better patient outcomes via digital delivery, software and analytics. It is incredibly exciting to find ways to reduce cost and help improve outcomes e.g., clinical decision support, care navigation or analytics that would leverage proprietary data sets, be it on the imaging side or patient specific real-world evidence.
Another area that I am very excited about is one where we have already made several investments: focal therapeutics, where we see the convergence of minimally invasive platforms providing an opportunity for access with precision and accuracy to the sites of disease and complex anatomy. There is a whole plethora of opportunities to change the treatment paradigm, including in many chronic diseases, cancer and brain pathology in conjunction with a diverse range of therapeutic payloads, including energy delivery, immunotherapy, cell and gene therapies, for example. It is where that proximity to disease and delivery component can be a real differentiator on the outcomes, if achieved. So, we are looking through our proprietary lens of where it might be possible to one day access through existing or future platforms to really accelerate these external therapeutic innovators. Intuitive Ventures can help bring them closer to what’s possible in terms of innovating on delivery.
You are not limited to investments around the robot; your mission expands much further beyond?
Absolutely. We have a broad mandate. We get to review, understand and make informed bets in areas which could be transformational to what Intuitive does today. Our goal for Intuitive Ventures is to be at the forefront and cutting edge of transformative trends that impact surgery over the long-term. That might include prevention and cure of conditions that could minimize or even eliminate the need for surgery all together in certain circumstances. We are looking at these trends, but we also do look at the exciting shorter-term opportunities in medical devices and digital that will connect and add value to the minimally invasive care ecosystem today.
You mention that you are looking at opportunities in innovation in technology and business models. These are very different investments; how do you view them as a portfolio?
We are diversified on many fronts. We want to balance risk across a portfolio of investments – Ventures 101. It does give us that clarity as we look at device, digital, therapeutics and diagnostics. We are naturally taking varying risks in different buckets. These different domains have different timelines and risk profiles. We might be more comfortable taking a seed stage bet on a digital company that has some revenue and a path to scale versus a medical device company which is years from first in human data and pre-clinical evidence showing that it has been appropriately de-risked. That said, we are excited to support at an early stage when there is a big enough opportunity and clinical need to support those companies taking big risks. This is a long-term commitment to venture capital for Intuitive.
I am excited about innovation in care delivery and the payer landscape too – often underpinned by digital health solutions. For example, in the self-insured employer landscape you are seeing very transformative models around care navigation and care pathway solutions specific to surgery. It is changing the way things are being paid for and the metrics that might be important for medtech. Biopharma was earlier to the game in chronic care management. When you think about post-operative pain, opioid use, workplace productivity and faster recovery etc., some of these metrics are incredibly important for a broader range of stakeholders.
Medical technologies are converging and you don’t seem to be constrained or limited; this gives you ample opportunity to leverage this dynamic?
My thesis is the future of investing in medtech is in converging technologies; I strongly feel this is where real value will come in the next 10+ years of medtech investing. Part of our differentiation is that we can operate and invest across technologies. We’re comfortable investing across digital, biotech and devices and some transformative opportunities are going to be at these intersections. It is not to say it won’t be tough; we still must play in the world of reimbursement, regulatory and all of those elements, but you are seeing shifts and new mechanisms that will help enable these innovations.
Tell us about your current investments to date.
We have made several investments to date, two of which are public:
This is an early-stage device startup focused on developing device therapies for GI and metabolic disease processes; it is also backed by Sante Ventures and Longitude Capital.
This digital startup, a spinout of Duke University, provides an advanced surgical AI platform and perioperative clinical decision support tools. KelaHealth is taking the patient care journey and leveraging the ingestion and analytics of patient specific data from a host of structured and unstructured sources and using that to power a real-time clinical decision engine and the allocation of resources based on patient specific risk. We co-led the investment with Sante Ventures.
Startup founders want to know - what are your investment metrics?
We are not beholden to specific criteria or metrics and can be flexible, however.
- We can lean into early-stage startup opportunities – we will invest pre-clinical or pre-FDA.
- We invest in seed or series A or B+. Our sweet spot is probably series A.
- We can co-invest; we can lead, co-lead or do follow on investment.
- We typically write initial checks up to $5M.
- We reserve funds for follow on investments.
- We take a long-term commitment to the deals we pursue. That means reserves for follow-ons.
What are the biggest challenges you are facing now?
Is too much opportunity a challenge? With the state of the capital markets creating a somewhat frothy environment there has never been a better time for entrepreneurs and innovators to launch and take risk. And, there are no shortage of amazing ideas, opportunities and startup teams to connect with. It really is a fantastic time to be a medtech innovator and to be an investor.
What does success look like for Intuitive Ventures in the future?
Success for Intuitive Ventures is building something to last. We are looking to become a sustained force in venture capital in the medtech industry and to support fantastic founders and startups in these convergent technologies. We are building a powerhouse portfolio of CEOs and teams to make meaningful impacts on patient lives in minimally invasive care. We are setting up something that will last for the long-haul and we want to be an innovation partner to Intuitive and to the medtech ecosystem more broadly.
What collaborations are important to your work?
We are a member of the Global Corporate Venture Society; this is a fantastic community of corporate venture capital groups in the world across industries; it pioneers best practices, appropriate structures, learnings and how to navigate your mandate as an innovation arm with venture capital best practices.
From your experience with the NHS in the UK and now with the US healthcare system, what are your thoughts on better healthcare access and evaluating investments in other markets outside of the US?
We do have an international focus. For me, the principals of value-based care are a common denominator. It is fundamental to demonstrate that an innovation is not just incremental but that it can reduce the cost of care and drive better outcomes regardless of geography. That is foundational in many markets in Europe; as a result, EU innovators must demonstrate sophisticated healthcare economics to justify value at a very early stage of development. There is a learning there for US-based companies that in a value-based care system, you need to be able to demonstrate healthcare economics, that health system ROI, early. For me, better healthcare economics leads to better value and better access. That sophistication is going to have to extend to communicating the story to regulators and payers, etc., and it means that device players are going to have to have software and digital solutions to capture the data to show the value of their platforms to these stakeholders.
Where would you look for underappreciated assets or investments outside of the US?
Outside of the US in strong medtech, biotech and digital hubs where there is already alignment of payers, population health and public health around prevention and wellness. In many markets, such as the UK, there is a much clearer tie to prevention and cure. It is sometimes hard in the US because healthcare payment is so fragmented.
More about Oliver Keown MD, Director, Intuitive Ventures
Oliver joined Intuitive Ventures in 2019 and leads investment efforts with a focus on identifying future leaders of minimally invasive care, including early-stage startups across digital, medical device, therapeutic and diagnostic domains.
In 2021, Oliver was recognized as a Top 50 Emerging Leader in corporate venture capital and included on the Global Corporate Venturing Power List of the 100 most influential investors in the industry. Prior to Intuitive Ventures, Oliver was a healthcare investor with GE Ventures, driving international-startup deal flow and supporting numerous portfolio companies operationally and at the board level. He also spent a number of years advising an array of UK, US, and global healthcare innovation projects across technology, government, commercial and academic fields. He started his career as a junior doctor and policy advisor in the UK National Health Service and remains dedicated to bringing new technologies, diverse partnerships and investment to address healthcare‘s biggest unmet needs.
Oliver holds an MD and BSc in pharmacology from the University of Edinburgh, Scotland. He is a widely published author in the fields of healthcare and surgical innovation and is an advisory board member of the Newsom administration‘s California Initiative to Advance Precision Medicine.