S2E6 - Jean Nehme, Founder & CEO @ Touch Surgery

Jean Nehme is the founder & CEO of Touch Surgery, a health tech company shaping the future of surgery through the convergence of surgical expertise and technology. Jean, a trained surgeon, founded Touch Surgery in 2010, in a bid to offer patients educational surgical simulations for more than 200 procedures in 17 specialties. The company was acquired by Medtronic in 2020 but Jean’s continues to be at the centre of the healthtech boom and was even recently involved in a new SPAC. 

Jean sat down with us to explore the hurdles he and the company faced to unlock growth, the similarities between surgeons and entrepreneurs and the company's first big win.

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Transcript

[00:00:00] Hector: Welcome everyone to episode six of season two of Riding Unicorns. This week we have Jean Nehme who was a trained surgeon, who then founded Touch Surgery, which was a, an app to help surgeons, in their training, which was bought for hundreds of millions last year by one of the biggest medical device manufacturers in the world.

[00:00:32] And he is now. Raised, an almost 1 billion dollars SPAC in the same space applying compute to healthcare, which is something that Jean is super passionate about. His big thesis that he has is all around, using tech to move healthcare forward.

[00:00:48] Welcome everyone to riding unicorns. we are thrilled to have Jean Nehme on the show. Jean's got an awesome story. He founded a business, which sold recently for [00:01:00] hundreds of millions of pounds.

[00:01:01] job. Great to have you on the show.

[00:01:03] Jean Nehme: Thank you for having me looking forward to having this very uncertain. podcast interview. I don't know if it's a good thing or a bad thing, so we'll see.

[00:01:11] I think that it

[00:01:12] Hector: be a good thing, but we'll see where the conversation goes. So to start with, it's always good to hear a bit about your journey up until now, if you don't mind.

[00:01:20] Jean Nehme: Yeah. Um, Came out entrepreneurship from a clinical background. So, you know, I started medicine. I was trading and surgery and plastics in London and, uh, yeah, I always come engaged in research.

[00:01:37] What else? The Imperial, okay. Research and surgical technology as a master's and you continue to develop my interest around how can technology have an impact on healthcare and surgery. And, at the time the iPhone was just coming to play and, myself and a colleague, um, Andre ended up, , building a [00:02:00] building a business.

[00:02:00] And so we came at this very much from an angle of, frontline healthcare professionals trying to solve what we felt was. A problem that we've fully understood. and being curious and inquisitive and having, that kind of academic discipline, we got came up trying to, to build a solution on a problem.

[00:02:19] So that was really my background and how I got into building.

[00:02:24] Hector: Cool. And tell us a bit about, touch surgery and what it is that it does or how it started and how it developed and you iterated towards what was then

[00:02:31] Jean Nehme: sold. Yeah. So, what we started with was really kind of trying to build a data framework around surgical process and trying to take over and turn it in.

[00:02:42] Yeah, a structured data. Step-by-step how to do a procedure. And then we put that on your own mobile device, added kind of interactivity and virtual kind of like patients and made it like almost a very engaging, tool that surgeons could use to, prepare rehearse [00:03:00] tests, themselves procedures, and actually we have, we started, I mean, the first product kind of output of this.

[00:03:07] Unique data structure that we put together was essentially a training tool for surgeons. And that's pretty much how it started. And it went from there.

[00:03:14] Hector: So did you get lots of uptake with the surgery, training app and, what were the sort of hurdles that you came across and the big unlock of growth with that?

[00:03:23] Jean Nehme: and in the beginning, the big huddle for chemicals was actually trying to getting funding. and so we built, and funded ourselves. And back then, it was literally, it was the first iPhone that was out. And so we were very early and.

[00:03:39] We spent a lot of time in the beginning approaching fundraising, like, you know, academics would with an entire thesis or, an intro methods and conclusion and a discussion. And it didn't go down too well with investors, our favorite slide was a slide that basically outlined our business model, which was free with fireworks.[00:04:00]

[00:04:01] And as you can imagine, what seemed like a very philanthropic go out and just train the world assertions tool, didn't really ring bells with any investors. And actually we couldn't even raise any grand capital back then. But that was kind of like the first hurdle of the first hurdle was trying to understand and embrace, , how do you build a sustainable business and how.

[00:04:23] Do you create value and measure value and then know, would you translate that value into just something that people understand and want to support? Right. And so it was a mindset change for us as clinicians, stepping into the watermark fellowship. That was a really big, big challenge at the outset.

[00:04:37] And then I guess a second challenge was, from a growth perspective was, we released this product and we had traction and downloads and usage and, we just had so many opportunities in front of us. It was about, how do you maximize a time that you spend on certain activities to deliver the most value you can [00:05:00] and what was the best way to prioritize those things?

[00:05:02] And so that was also quite a challenge for us back then.

[00:05:06] Hector: Sure. And, and interesting hearing you talk about that mindset change. We episode one, you, you were the first surgeon that we backed. And, and in that star top, and we've since back to another, so I'm interested in whether there are character traits that are shared across surgeons and across entrepreneurs.

[00:05:24] And beyond that, what was what the penny was that dropped, that then allowed you to raise that. Round of funding. Was it a, a realization that you kind of needed to sell the dream bank rather than sticking very much to the fact so, or what was it?

[00:05:38] Jean Nehme: I think we always very much stuck to the facts. I think, myself and my co-founder Andre, we were naturally very committed. , and competitive, I think in a positive way, I think competition can sometimes be not necessarily the healthiest thing. But competitive in terms of, we were prepared to risk our entire social career and, a lot of years of dedication [00:06:00] education and, blood, sweat, and tears, the powerful exams, right.

[00:06:04] For. What we felt was an opportunity to make an impact that could be big and surgery. And, if you look at what investors and people look for from an alignment perspective, I think we were the most aligned entrepreneurs you can find because we literally bet our entire career and existence and by existence.

[00:06:24] I mean, and when you go into the water surgery, you, you, you know, it's certainly defined. Your character almost becomes a definition of your identity. And we took that entire identity and just put it on the line for what was an opportunity back then. And now if I think about it now, with a very sensible mind, I don't know if I would have done it.

[00:06:45] You know, if I, if I actually, wasn't kind of a little bit. Super risky. I don't know if I would have done it again, but that I think was one of the things that from a character trait perspective, we had, which was this ability [00:07:00] to take a lot of risk, but do so in a way where, , it was all about executing.

[00:07:05] And so for us, we put ourselves into a position where execute or really fail. And for us, that failure was, was going to be. Pill to swallow. and you know, I, I think that that was one thing. Another thing is within surgery and within kind of medicine. Yeah. There's a lot of transferable skills that you've done as there's lots of skills that you don't learn as well, which you have to learn, but there's all the things that I think were transferable in terms of just, always trying to self criticized self-assess, , never really believe it.

[00:07:37] Your own, assumptions always be testing and will be critical of your own assumptions. and those are the things that I think within healthcare, those are examples of things that I think were transferable skills that we brought into the world of entrepreneurship with us.

[00:07:53] Interesting. I can see why you did manage to raise funding when you talk about it with that level of commitment That's what investors want to see in [00:08:00] founders all in, which is

[00:08:02] Hector: great.

[00:08:02] Jean Nehme: What was the first big moment where you realized we're onto something here?

[00:08:07] Hector: What was like your first big win?

[00:08:09] Jean Nehme: good question. I think, we never felt that if I'm really honest. and although externally people were like, oh, you've just raised money. You've raised millions of dollars. Oh, you're just on this contract. We never fell. Like we weren't winning. If it's where to say, you know, we always felt like, oh, it's just like more stuff to do now.

[00:08:31] And even more that we've just committed ourselves to do, whether it was doing a contract or whether it was signing bigger contracts or whether it was, it was always like the, the fear that we had, like just committed ourselves to an even bigger, task. And so that was. The, the journey.

[00:08:50] Really. I look at it now and I see, okay, there were milestones, which redefined things, but when you were, when we were in it, , it was never, oh, aha. Where [00:09:00] that, it was always like, we've just committed ourselves to doing even more work sounds like it's sort of reluctantly being fooled by all the great success,

[00:09:10] Hector: as

[00:09:11] Jean Nehme: fascinating to hear that.

[00:09:13] Hector: And,

[00:09:13] Jean Nehme: now that you've been acquired, what's that like to be working at another company it must be very different from being a founder, working across the entire business.

[00:09:24] Yeah. I mean, our acquisition, wasn't an acquisition, not just, just happened. It was something that ran through a process that either was one that we pretty much ran because fundamentally for us, it wasn't about this transition of an acquisition. It was about a transition of being able to continue to work that we're doing.

[00:09:42] In a way that was even more scaled, even more leverage. And pretty much feels it feels similar, but we have obviously different divas right now, within a bigger organization. But, we spend all the time with Medtronic, talking about how combining forces would have a net,[00:10:00] mega positive impact on the direction of travel.

[00:10:05] As it comes to data, as it comes to, really being able to impact surgery. So that, that was a, the reason for that, for the acquisition B we were very deliberate on team and structure and how that would work. And that continued and then the third thing is, for us, we never saw the acquisition as a, an end point.

[00:10:26] And I think a lot of people have some misconstrued view. And I think sometimes, maybe the label, the exit, I think gives that. Yeah. I don't think there's any such thing as an exit. I think if you are okay, this is like almost like a graduation. And so, I'm working within the bigger organization, we have big leaders and we have, the opportunity to do more.

[00:10:46] And it's just about being, thoughtful and then smart about how you integrate it and also doing a lot of the work upfront, drew an acquisition process to really map out, how value is going to continue to be created even more. So,[00:11:00] once an acquisition.

[00:11:01] Hector: I think it'd be worth clarifying to the audience.

[00:11:03] Just the John now works at Medtronic, which is the company that acquired touch surgery. I think it would be a good, good time to move on to the, to the spec. Cause I know lots of, lots of our listeners will be fascinated by it given all the. The SPAC hype in the press. And so it'd be great to hear your story, how you came across it, how you got involved, what it actually means to raise a back.

[00:11:26] Jean Nehme: Okay. So I guess, firstly, just to define us back here, I, I came across that. , two years ago, two or three years ago, a good friend who's, worked for a pretty kind of successful investor was mentioned the structure.

[00:11:39] And, when the acquisition I spent a lot of times begging to Omar Ashrak who was a chairman of Metronic and previously a CEO, and I had just become the chairman of Intel. And then we spend a lot of time talking about the direction of travel and healthcare. And, as we had these conversations, it was really around, discovering together that we thought [00:12:00] the impact of kind of computational power and healthcare was just going to continue and continue.

[00:12:05] And, Omar was really passionate about this space, as was I having built a competitional business in surgery. And so. We ended up then having a view and a thesis that we started to build together, which was, one of the things that we felt were going to be materially impactful in the space and how could we be involved and, consequentially, we thought, well, know they're all vehicles out there which would allow us to be involved.

[00:12:34] And then Omar got interested in facts and I connected him with an investor at all. And, Josh Frank, who then really was, important in instructoring and helping putting the vehicle together. And so what's a SPAC. Well, a SPAC is a vehicle that, that allows a group. The promoter group, to, essentially capitalize a business, and, in doing so bring it into the [00:13:00] public market.

[00:13:01] And it allows reverse listing into the market for the acquired company. And companies have different options that, that the, in that life cycle of capital raising, and it obviously continues to raise private rounds.

[00:13:14] They can end up getting acquired or they can go public, but going public, the options are yeah. To IPO or to go to list through a spec and, fundamentally for us, our entire approach. So listing his back was, to be, a team of, promoters that can be very helpful for, the business that was distinct.

[00:13:38] And by having him all involve myself and Josh, it was really around bringing, a dynamic partnership of, operators and capital. Kind of capital market financials to table who could help companies in the next part of that life cycle of growth. And that's really why we put it together.

[00:13:57] Our aim is to work with great companies [00:14:00] and great, management teams, as they transitioned from being private companies to being public.

[00:14:06] Hector: Interesting. So would it be a sort of advisor type role for the acquired company?

[00:14:11] Jean Nehme: It could be, I mean, it could be, it could take many shapes.

[00:14:13] It really depends on the conversations with the companies, but ultimately we want to understand the company. We want to be valued, valuable. We want to be value added. I need that. We want. To be supportive, so it's almost the same way that every investor in the private market, especially in venture thinks through that thesis, try and make investments into companies, you understand, and companies, you also want to be helpful.

[00:14:35] And so it's the same philosophy, the same approach, but on a larger, public scale.

[00:14:40] Hector: So if you were the CEO of a, business, why would you want to be acquired by us back?

[00:14:46] Jean Nehme: Yeah, that's a great question. So, the way to think about this. Every time that I was involved in fundraising, I would always ask myself the question of, okay, who are the people that I'm bringing now to join the board [00:15:00] ultimately, and to be part of the journey of the business.

[00:15:03] And in my mind, and most entrepreneurs today, there's so many options out there for capital. That's a really important question to ask yourself. What does the capital come with? Who the people behind the Capitol and what's the value they're going to add? I think if I were to see the company today, in the market, as it is what I would be always asking myself is, who do I want to work with?

[00:15:25] And who can help me in the next kind of iteration of growth that I need. Through different stages of the company, different things and different leaders are available to you to deliver. So when I look at kinda like specs and I think about specs as a founders, as we thought about this back, it was like, who would I like if I was a healthcare entrepreneur, who would I want.

[00:15:47] At that stage of the business as I transitioned from being a private business to a public business. And that's why, working with Omar has been so incredible here because, he's, one of the veterans of the healthcare world, he knows everything there [00:16:00] is to know about how healthcare businesses at mega scales.

[00:16:03] Hector: So John, that's fascinating what you've done so far and what you're getting up to now. and I'm sure the audience and listeners will feel exactly the same.

[00:16:10] So just want to say a huge thanks for coming on the show and, hope to stay in touch.

[00:16:14] Jean Nehme: Cool. Yeah, we'll see.

[00:16:15] to entrepreneur to now being involved in huge deals and public markets. Very exciting stuff. So hector what's next So this week's startup spotlight is the future forest company. Who exists to remove CO2 out of the atmosphere at an enormous scale, and our businesses and consumers to offset their carbon emissions, really excited by what they're doing. They are buying up huge areas of land, around the world to plant millions and millions of trees.

[00:16:50] And on top of the reforestation, which isn't in itself enough to extract enough CO2 out of the atmosphere to reach on that zero goals. They place on top [00:17:00] of the reforestation, a number of technologies, which means that about 10 times the amount of CO2. Is extracted from the atmosphere.

[00:17:08] So super exciting use of technology and, and fighting global warming. I entered the vest a few months ago and I'm really excited by that progress. Think they're an amazing team credited mission-driven and super excited to see how they get on. So, yeah, take a look@thefutureforestcompany.com and let us know what you think.

[00:17:26] That's all from us this week on riding unicorns. Please do subscribe on your favorite podcast platform And we'll catch you next time