Shar Matin, CEO of Cordis, has over 20 years of medical device experience from Fortune 500 companies to leading commercial and technical teams in the U.S. and overseas. Along with his current role as CEO of Cordis, he serves on the Board of Directors of Koru Medical Systems. Previously he was COO of ViewRay, Inc. and Spectranetics. In these roles, Shar helped disrupt the healthcare market by building exceptional teams.
On February 21, Shar joined us for a conversation moderated by Nancy Sullivan, CEO and managing director of IllinoisVENTURES, to discuss Shar’s journey, Cordis’s acquisition of MedAlliance and where he plans to push Cordis in the future.
About Tales from the Trenches™
MATTER’s signature Tales from the Trenches series is an opportunity to hear the early stories of some of the global businesses we read about in the news — straight from the founders who led them to greatness. This series invites seasoned healthcare entrepreneurs to the MATTER stage to share learnings, stories and key takeaways from their journeys.
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Steven Collens, CEO of MATTER (00:13):
Hello and welcome to MATTER's Tales from the Trenches. I'm Steven Collens, the CEO of MATTER. We are healthcare technology incubator and innovation hub with a mission To accelerate the pace of change of healthcare, we do three things in service of our mission. First, we incubate startups. We launched in 2015, and since then, have worked with more than 800 companies, ranging from very early to growth stage startups, and we have a suite of services to help them at every stage of development. Collectively, our companies have raised almost 5 billion to fuel their growth. Second, we work with large organizations such as health systems and life sciences companies and payers to strengthen their innovation capacity. We help them find value in emerging technology solutions, empower internal innovators to unlock the value of their ideas and create a more human-centered healthcare experience through system level collaborations. And third, we are a nexus for people who are passionate about healthcare innovation.
We bring people together to be inspired and learn and connect with each other. We produce a lot of programs, including large scale events for the broader community, as well as small forums exclusively for our members. Tales From the Trenches is our longest-standing series here at MATTER, where accomplished entrepreneurs share their journeys from how they got started to what they've learned along the way. Um, today we're joined by Shar Matin, who's the CEO of cardiovascular leader, Cordis. Um, Shar started his career at New Me, which many fellow MBAs in the audience will recognize as the subject of a well-known case study, but quickly moved into medical devices and has been leading teams and companies in the space for the last 25 years. I wanna give a shout out to a longtime friend of MATTER's and Shar, uh, Steven Morales, who introduced us to, uh, Shar Steven's with, uh, a firm called the Bluefin Group, a life sciences strategy consulting firm that, um, brings its clients science to market and helps ensure that patients have affordable access to needed products in a timely manner. Uh, SHA Shar will be interviewed by Nancy Sullivan, who's the CEO and Managing Director of Illinois Ventures. She has deep experience in commercialization and entrepreneurship, specifically in the biotech and therapeutics industries. Shar and Nancy, thank you so much for joining us today. Uh, we are very much looking forward to the, uh, to the conversation. And, uh, Nancy, I will turn things over to you.
Nancy Sullivan, CEO of Illinois Ventures (02:54):
Wonderful. Thank you Steven. And Shar, welcome. It's great to have you here today. I am really excited to get a chance to hear a little bit about your background, your career track, but what really intrigues me on the front end of things is people get to know you. And we have lots of folks joining us today. Everyone gets to read the bio we send around. I'd like to go through the icebreaker and start off with you telling us a little bit of something about yourself that people who might have known you early in your career, folks who joined today, would never expect the CEO of Cordis to tell. What would they be surprised to know about you?
Shar Matin, CEO of Cordis (03:30):
Great. Thank you Nancy. And it's a pleasure to be here with all of you today. And, uh, um, I mean, to to, to kick it off, uh, if you look at my team or you know, someone like myself who, who's had the career I I've had and being so lucky and fortunate, um, you'd never imagine that in the moment. Sometimes I lose my, my train of thought. Uh, I actually forgot my own sister's name, so I was introducing her to somebody else and, and totally blanked. And I can tell you she was not amused with me when she's like, we've been together for this many years, and you still don't remember my name. So I, I thought that was a fun story to share with all of you.
Nancy Sullivan, CEO of Illinois Ventures (04:06):
I'll tell you what, Cher, I'm glad that happens to people besides me.
Nancy Sullivan, CEO of Illinois Ventures (04:12):
So this is gonna be an important conversation we're gonna have on our call today, A number of aspiring entrepreneurs, active entrepreneurs, and people are thinking about what's next in their career, as well as how are they gonna build their business. And our q and a today is gonna cover lots of different subjects to help answer some of those questions from you Sha and the lessons learned. I want the audience to know, I'm watching q and a, feel free to add questions at any time, but Shar I'm gonna kick it off and ask you the generalist question of really what inspired you to enter healthcare? How did you get here?
Shar Matin, CEO of Cordis (04:44):
Yeah, I would say part of it was, was by chance. And, uh, um, you know, I, I think the opportunity to, to build things. I've always been passionate as an engineer, uh, to build things. And, and the opportunity to do that and save lives was, was just a great, uh, situation Early in my career. What if you'd asked me when I was in my twenties, what I'd be doing? I thought I'd be designing cars or airplanes. Uh, and reality is, I, I signed up for an interview with a company called Guiden at the time, that made medical devices. And a friend of mine put me in touch with Steven Morales, one of your members. Uh, and if it weren't for him, I wouldn't be in it. And it's been a, an incredible journey since. And, uh, what a privilege it is for me and, and my team and all of us in this industry. And as we put it at, at Cordis, we're the people behind the people that keep saving lives. And that, that's, that's what it's all about. It's about the physician being this all-star and how do we provide the tools that level the playing field and bring the best care to patients each and every day.
Nancy Sullivan, CEO of Illinois Ventures (05:46):
I love it. Um, but what I really like and I wanna hear more about is chance, how has Chance played pivotal roles in your life and chance on its own sometimes doesn't pay off, but I've watched many accomplished careers of people like yourself, Shar, take advantage of chance. Can you talk to our entrepreneurs who are in the middle of taking advantage of opportunity and chance, and how you see that and what your willingness is when you said yes to that chance?
Shar Matin, CEO of Cordis (06:14):
Yeah. And, and you call it chance, you can even call it risk. And it's almost in every decision that you make. And, and as I reflected on my career and, and all the, uh, different opportunities that if you ask someone early in their career or when I give career advice to folks, um, you know, someone wants it mapped out. You know, how do I go from this job to that job to the next one? How do I keep getting promoted almost in a linear format? And if you look at my career, I started as a manufacturing engineer in, in, uh, Santa Clara, California, ended up in Ireland. Next thing I know, I was out in Southeast Asia and then in China, and then back to Europe and then the us And every one of those with both large companies and smaller companies, wa was someone providing an opportunity and for me to say yes.
And, and I didn't even think it was a risk. And for many entrepreneurs or entrepreneurs that are out there, you know, going from a steady job to start your own business, that's a risk you're taking. That's a bold move. And you should be very proud of that. Um, and, and perhaps we're, we don't realize the level of risk we're taking, uh, but it's by taking that risk that, uh, you know, someone like, uh, your, your, your, uh, um, members or myself, that opportunities are created, then you've gotta have the right skillsets. You've gotta have the right team, you gotta have the right culture. You know, you build an organization that then can take advantage of, you know, that opportunity or that chance. Um, and I don't think you can map it all out from the get-go. It's really situational. And you've gotta have an organization that can be nimble enough to recognize that opportunity and then take advantage of it.
Nancy Sullivan, CEO of Illinois Ventures (07:59):
Thank you for that. It's kind of cool. Cause I do think, uh, chance is really about knowing opportunity and having the fortitude to take the risk. And that's really, I think for those people today, many are taking that risk. And it's nice to hear from you Sha, about how it pays off and what you get to learn from it and given yourself a little credit for taking that risk. Uh, I'm gonna switch gears a little bit. Um, I do love to read people's bios and part of your bio, there's a line that intrigued me. It was, Shar, help disrupt the healthcare market by building exceptional teams. That's an intriguing line in a bio. How do you think about leadership at Cordis as the CEO? How do you think about building teams, what you know now and earlier in your career? Can you give us a flavor of that?
Shar Matin, CEO of Cordis (08:46):
Yeah, absolutely. And, and, and the further you go on in your career, the more you realize it's the team and the talent that you have in your organization that that's the most important. And, and, you know, once you have the team, it's the culture and then it's about the strategy and the execution. But it's those four elements that really drive whatever enterprise that you've got. And, and a lot of folks talk about talent. I mean, GE and the cycle of what they do and how they build leaders, everyone's trying to emulate it. But really to get to the root of it, of how to do it has been an apprenticeship for myself. And I can tell you early in my career, uh, I'd look at a resume and I was looking for the level of experience they had either in a function or in an, in, in that specific, you know, med tech sector that I was recruiting for.
And it was all about their experience level. And I didn't take it to the d n a of, uh, an individual. And and that's really the foundational, you know, transformation as I've recruited and built teams, uh, has been to get to the place where, you know, there's things you can teach and there's things you can't, you can't teach smarts, you can't teach integrity, you can't teach drive. Um, so recruiting for those as, you know, the non-negotiable items and then looking at, you know, the pluses or, you know, do they have a set of experiences or track record or success in your specific industry, but taking it to that core element and then understanding are they compatible with the culture you're trying to build? So that's been a lot of the effort and and focus that I've, um, put in the teams I've built in the last decade that were very, very different from what I did in the first decade of my career.
Nancy Sullivan, CEO of Illinois Ventures (10:24):
You know, it's interesting when you talk about team, cuz in the venture world we say the same thing, we'll invest in a b technology and we want an A team. It's almost become, you know, overused and over said, but it's that drill down. It's, when you talk about the d n A of people, how do you get to that? How do you assess passion? How do you assess drive? How do you assess that d n a you talk about when you're looking to hire so people as they build their teams and teams matter on resources. How do you get there? How do you do that work?
Shar Matin, CEO of Cordis (10:53):
Yeah, and the, and the way that that, you know, we've done it and, and I've, uh, you know, you started using this first, and, and there's, there's, uh, I'll, um, put in a, a, a word for a book that that was transformative for myself as well. Um, you know, it was the who by GH Smart. And it totally changed the way I looked at both teams and, and you know, how to assess talent. And, and the key elements to it is, you know, early on, again, in my career, I'd look at the team that I had, uh, and I try to get the most out of every individual that I had. And then what could we do collectively? And in that book, it talks about if you're playing poker, do you just settle with the hand that you have or do you make changes and move things around or try to pick two more cards to make, get a better hand so that you can win the game.
And so it's not about building a family, it's about building a high performing, you know, sports team. That's the best correlation to what we're doing in business. Business is a sport. So first and foremost, you gotta find the best athletes you can find out there. And then you gotta, you know, to determine what you know, who is that best athlete. What we do is we build something called a scorecard. You know, what's the mission of that job over the next three to five years? What are the real key accomplishments you expect that leader to come in and achieve in the first 12 or 24 months? And then interview that individual that you're, you're that candidate you're considering to those key elements and see do they have a track record of success that demonstrates, you know, uh, that Doug, they're gonna be successful in this role. And, and one of the examples is, if you get a vice president of sales, if they're really good at turnarounds, uh, they may not be great at market development if that's what your business needs. So even in a job description, you need that specificity of what you expect and then really interview to those key elements to find, do you have the right talent that's gonna stack the deck in your favor to win with the rest of your team.
Nancy Sullivan, CEO of Illinois Ventures (12:53):
Okay. So now just get to the action on it. You've stacked the deck, you've got the team you want. Tell me about some of the outcomes those teams have helped drive for you. How, how does that complete dedication to the right leadership, growing people, building a team? Tell me the outcomes, interesting things that you've been able to take, you took the risk, you built the team. How did that work for you?
Shar Matin, CEO of Cordis (13:14):
Yeah, and, and before I go to that piece of it, I'll say as important as a team, as the culture, right? And, and personally, I didn't know what culture was until I started changing companies. And you can see there's different successful companies with different cultures. You've gotta figure out what culture you build because that's what's gonna attract the talent that you want and keep it there. So, so as important as the talent is the culture, and if you've got those two, then you get everyone in the room, you figure out, uh, you know, what are the key, uh, strategic initiatives and the tactical actions that you need to take around that to win in the marketplace and, and really achieve the vision and the mission that you set out for your organization. And to give you an example, uh, of how we did that, um, you know, to pass company, um, you know, we, we were a 250 million medical device company.
Um, there was Medtronic and um, um, uh, Cian we're coming together and merging. I don't know if you remember that one of the biggest MedTech deals, uh, uh, of the last couple decades. Um, and they had some antitrust issues and they had to divest an asset. And there were a couple players at the, uh, at the table for that asset. Uh, a couple very large ones in your neighborhood. And we outmaneuvered those players in one, we got in front of the FTC and we outmaneuvered, uh, the competitors. We got the deal done with Medtronic and we were the underdog, but it was our team that came together, um, and figured out what we needed to do in order to win. And we were nimble enough with the process. And I'll give you an example of, uh, you know, our, our counsel that, um, on, on that, uh, project, uh, who was a, um, formerly at the ftc, she said, you know, we got on a call with, with, uh, um, Medtronic. They said, we're ready. Put us in front of the FTC tomorrow. We're good. We'll be ready. We got on a phone an hour later and she goes, you guys are not ready. Okay.
Nancy Sullivan, CEO of Illinois Ventures (15:14):
Those are not the same conversations.
Shar Matin, CEO of Cordis (15:15):
That's right. We need to build a full execution deck. And so this team, and it's just, it's not a hundred people, it, it, it's a half a dozen liters. We put a 250 page deck together of how we're gonna carve this asset out and how we were gonna, uh, build it, get the regulatory approvals and launch the product just as good as what cavidian would've done with their infrastructure in place. And that's what a great team gets you to do. Versus if you've got someone, if you've got bloated team or folks that can't rally around a single cause it just, you couldn't turn on a dime that quickly.
Nancy Sullivan, CEO of Illinois Ventures (15:52):
How exciting was that for you and your team when you locked it down, when you actually,
Shar Matin, CEO of Cordis (15:56):
It was fantastic. I mean, it was, it was, it created a, a ton of value and I would say in many ways it made that organization relevant. Uh, and, and suddenly we were, you know, in a different category when we were partnering with our physician partners on, uh, on the journey ahead, uh, for the betterment of patient care.
Nancy Sullivan, CEO of Illinois Ventures (16:16):
Amazing Shar, those are the things, uh, you know, everybody looks at success that you've had various parts of your career and think, oh, it's linear, it's easy, it happens. And those are the moments people realize it's taking that chance, working hard, and actually being able to out-maneuver. So, ha, hats off. I I'd like to talk a little bit about other pivotal moments in your career as well, because I think those are where we learn who we are, learn how we lead and where we go. So are there other lessons in parallels that you can draw upon and share with this group as they're thinking about and as they're living it themselves?
Shar Matin, CEO of Cordis (16:51):
Yeah, a absolutely. I mean, a, as I shared, I I think talent is number one. Culture is right there. Um, you know, I think all of us have to be purposeful with culture. And I remember when, uh, someone asked me the qu question of, well, yeah, you've written these values on the wall, how do you make sure that it sticks, uh, or that folks are living it? And it was a great question because I was like, you're right. I, I don't know. And you've gotta build a closed loop. You've gotta have a reinforcing way of doing it. So we actually have culture awards. You can get a spot award for an accomplishment, but you can, uh, honor, uh, one another. And it's very powerful when teammates are honoring one another. And that's how you build the culture into your dna. N so that, that's a critical element.
And, and I know a lot of startups don't even, you know, think about that. That almost feels like it's a, uh, um, uh, a nice to have, uh, when, when money's tight and you're ra raising the next funding round, but is, that's what drives how everyone behaves and works together, how you recruit great talent. And that's a critical element of it. And, and the other one that, you know, as I reflected on, on the question, um, I, is it's around your relationships both inside your organization and outside. And, and, you know, I, I can't say I had the fortitude or the foresight to, to know this, but when you're in a specific segment of a market for many, many years, you start to build both a reputation but also a, a network, uh, uh, individuals that, you know, kind as, as time goes by and folks go into different roles, you can collaborate with one another, with one another.
So keeping those relationships, uh, alive and strong, you never know where you might partner with one another, where someone might be your investor or your on the other side of the table negotiating for on a deal, um, with a former, you know, classmate or a former colleague of yours. So, you know, for, for me, I, I, I've been lucky enough to be in the med MedTech space and specifically cardiovascular and having built that network. So that, I thought that was incredibly valuable. Uh, as all of you are looking at, you know, the various entrepreneurial opportunities you've got.
Nancy Sullivan, CEO of Illinois Ventures (18:58):
So before we take it towards maybe some of the unique financing and the structures on Cordis and sort of what we talked about in our pre-meeting, I wanna ask you, we've talked about a lot of the successes, right? Um, where you've been able to bring the teams together, where you in, but sometimes we have failures or we've had opportunities, pieces that we've learned a lot from. Can you talk a little bit about maybe one or two of those in your career and what you gleaned from it, how going forward?
Shar Matin, CEO of Cordis (19:27):
Yeah, I mean there, there's, uh, uh, there's always you learn as much about, uh, um, about leadership or about, uh, business through your failures as you do from your successes. Because as I look at it and I look at, uh, you know, why do you go to the great physicians that have done a lot of cases? Uh, I if, if the case is straightforward and easy, you know, the, the the newly graduated, uh, um, physician can do the case, uh, but it's when issues occur that you want them to have learn with someone else and not you on the table. So, so I think business is very much in the same way, and, and I I think there's a lot of, you know, reflection around talent. Uh, you know, you, you're hoping that someone who's not making the cut is, uh, gonna turn it around or you can coach 'em and train 'em, uh, to really change.
Uh, and to me, those, those have been, uh, some of the ones, whereas I look back, it's like if I had only gone sooner, uh, on getting my team to the right place, it would've been a benefit to both the organization, but to the rest of my teammates. I think there, there's a lot of those and that's, that's more general. Um, and then personally, I think, um, you know, there was some management changes at a previous company, and I was a candidate for the CEO job. And, uh, I went in, I was interviewing, I was in my mid thirties excited about, look what I can do. Um, and it was that piece around the relationships that I talked about. Um, what I hadn't done is I was doing my job and I was doing great at the strategy, the execution. I didn't build the relationships with the board.
I didn't spend that time to build that trust so that they could see what the changes they needed to make that I should have been, you know, that I, they trusted that I could execute on, on a new direction for the organization. And, and so to me that was, that was humbling. When, when someone else is picked, I learned a ton from through the process and also working for that leader. Um, and we're very, very close friends now, uh, but it, it, it's always those kinds of setbacks when you don't get it, um, or, or that promotion that you can look back and say, well, what skillsets did I not have? And, you know, first you go through, you know, the different stages of, of, you know, denial and, and grief and then anger. And then you say, okay, what can I do to become better? Um, and so I, I see those elements a as key learnings, uh, through the journey.
Nancy Sullivan, CEO of Illinois Ventures (22:00):
Fantastic. And Shar, we have an audience question that was taking us exactly where were we going? Steven Zelensky is talking a little bit about Cordis and kind of the things that happened in the nineties, the hostel takeover by j and j and then sold to Cardinal. Now under this new holding company, what's different with the brand? What is this time around? And as you think about it, where do you wanna take Cordis? What, what's going to occur? And Steve's also looking forward to seeing in April, apparently you're talking at a med tech s m mg talk. So <laugh>, he wanted to say he is looking forward to that.
Shar Matin, CEO of Cordis (22:33):
Steve, Steve and I work together there and, uh, uh, are are at a previous company. And, uh, you know, you, as you look at, um, uh, Corti, the, the way that I positioned it for folks is, and, and I love talking about Cordis more than I like talking about myself. Um, it's the first time in 36 years that Cordis is led by MedTech leaders, not by pharma, not by, uh, supply chain executives, but by MedTech focused on our customers. And that's the advantage of being, you know, carving out and becoming an independent company. Our focus is our teammates and our customers. And so what we, when we were, uh, looking at acquiring Cordis, first thing that we were, you know, looking to make sure of was, is the brand intact? And is, you know, is the business stable? And then can we bring innovation to the table?
And we were surprisingly, uh, we were surprised in, in a pleasant way that the pride and the passion with the team was incredible. Um, everyone remembers Cordis internally, folks remember the days where we were innovating. Um, many of our physicians would tell you that, um, you know, they wouldn't be where they were today if it weren't for Cordis and what Cordis did for them and their fellowships. Um, so we had that foundation in the same breath. They would tell you, um, that their fellows don't know you. Uh, so that's what we've gotta change. And the best way to do that is to bring innovation to the table. So that's where, from a business model perspective, what we're doing differently is, and this was the grandchild of our, uh, executive chairman, uh, duke rok, uh, is, we've got Corti as a chassis, and then we've got, uh, an incubator that h and f and K K R are investors put 300 million into, uh, that's an accelerator incubator that's gonna spin out startups.
Uh, and when they get close to getting regulatory approval, we acquire those startups into Cordis and we launch 'em. So it's taking advantage of product development and innovation, uh, in a startup environment, but having the scale and global reach, uh, of a brand and a company like Cordis and bringing the best of both worlds together and doing this in a symbiotic relationship as opposed to, Hey, this startup fails that startup's successful and everyone's gonna bid on it. We're doing it in an environment where we build the strategy across both, and then we figure out how we can maximize the opportunity to bring new innovation to our customers.
Nancy Sullivan, CEO of Illinois Ventures (25:06):
Okay, sure. I mean, that has to be one of the most innovative models bringing together the, as the established brand, the innovation internally external. Talk about this for this group, because so many on the call are in med tech and innovation and acceleration. How did that strategy come together? How did you convince the KKRs of the world that they should be financially backing this? This is unique in many ways.
Shar Matin, CEO of Cordis (25:29):
Yeah, absolutely. And part of it is, you know, it, it's unique. It's got a little bit of, I'll say the flavor of the whole, uh, I'll say, uh, pharmaceutical, biotech, you know, sector that we're transferring to MedTech. And the way that I say it is, when we're successful with this, it's gonna be copied. Uh, and, and you know, what we're really doing is we're giving ourselves internal innovation as one pillar. Um, external innovation, um, through Cordis X is what we're calling our accelerator incubator. And then we've got m and a and licensing. So we've got one more shot on goal. And the way that we persua persuaded, and I'd say much of the credit goes to Duke, is that as we talked about, what is the challenges with innovation right now? And everyone could relate to that in a large company, right? You've got competing priorities, um, that, that are pulling you in different directions.
You've got 50 different r and d projects, uh, everyone's, you know, looking to get some sort of financing for some, you know, for their project to move forward. So in many ways, you're just allocating a little bit of capital to each one. Um, and then when business reality hits, you know, China Covid occurs, you've gotta put a pause on your expenses, you slow everything down. So by doing this, um, off balance sheet, we protect that innovation, but we also have each one, each one of the entrepreneurs is living or dying by that project, as opposed to having to worry about competing projects that I gotta, you know, compete for assets or, or, or headcount or whatnot. Um, and the other thing that we're doing is we're taking all of that overhead. And this is more for the entrepreneurs that many entrepreneurs that love innovating, maybe not great fundraisers, they may not be great, uh, hr, you know, uh, folks that, that wanna recruit but don't have that infrastructure.
So we're building that back office infrastructure that's leverageable and the entrepreneurs can focus on designing innovative products, getting it to regulatory approval, uh, for, uh, you know, uh, handing it off to us to scale it, and then they can go back and do it again. And it's got this preset model where they can focus all their energies on the innovation as opposed to all of the overhead. And I think our competitive advantage over time as we talk about the innovation flywheel, is we're gonna do it again and again, and we're gonna get better at it cuz we're not gonna get a perfect the first time. But we've got nine development companies that we've spun out so far. Each one of them is at a different phase. We'll learn from one another from each one and, and as we integrate 'em and go do it again, we're gonna build this symbiotic relationship and partnership that we think is gonna be an innovation competitive advantage for us.
Nancy Sullivan, CEO of Illinois Ventures (28:18):
Hey, do you take board positions in these companies? Do you have pre-negotiated terms for Cordis? How do you make sure that that connection is there for you and for Cordis going forward?
Shar Matin, CEO of Cordis (28:28):
That's right. So we've got a steering committee and, and really it's the Cordis X team that, uh, manages those. So it's a different skillset from, you know, running and building, uh, an organization and then through the steering committee that that's where we're, we monitor how we're doing to all the different elements of it, what key decisions we have to make.
Nancy Sullivan, CEO of Illinois Ventures (28:48):
Fantastic. We, we have another audience question. Um, and I'm gonna try and, uh, maybe paraphrase it, so excuse me if I don't get it perfectly correct, but we have, um, on the line a software medicine and, and has a product in the field. And the question goes really to, what's a good rule of thumb when you launch a medical device in the us And actually, apart from having a good team, what, what, what other pieces should you think about and when the gut's pretty specific? So this may be helpful for the listener when you're selling a, in sort of an area of both a hospital, a home, and maybe geriatric, thinking about all the different areas for treatment and pains that you would have to do. Do you do it direct or do you think about distributors?
Shar Matin, CEO of Cordis (29:31):
Yeah, I I think every business and, and I, I can't say I'm an expert in that area to be able to give you the specifics around it. Uh, I, I think there, there's three key pieces to almost any medical technology that are critical. And I, and I've been in enough different areas to say they're always almost the same. So once you've shown the clinical value, you've gotta look at, uh, the economics of it. What are the economics, uh, what's the ease of use, uh, and how much does a relationship drive the sale? So when you take those three elements, so the ticket to the game really is, it's got value, it's got clinical value, then depending on what, uh, the medical device or technology is, uh, how much do the other three play a role in, in driving that conversion, um, from whatever that that physician or that patient is doing today.
So, you know, tied to, to the question you're asking is if, if, you know that sale process really depends on a very close relationship between a salesperson and that geriatric clinic, then you should get a distributor or you should hire direct reps that, you know, have that relationship. If it's economically, um, it, it has incredible, you know, returns that is just a no-brainer. Um, then maybe you can use a different model and not have to have a portion of your profit margin given to a distributor, but those are the three elements that you've got away. And really be brutally honest with yourself of how does your product compare to the competition and how does your, you know, what's that channel, uh, that's gonna drive the most adoption,
Nancy Sullivan, CEO of Illinois Ventures (31:14):
You know, that's right off the cuff. Well done. Shar <laugh>, <laugh>. It actually takes me a little bit back to Cordis and some of the work you're doing from that steering team. Are you getting into the strategy of each of these companies as sort of that steering group? Do you help them think about the, the they're the best at the innovation and then coming wrong with strategy and taking it to market in pieces? How do you work? So many of the companies in MATTER look for that expertise as well and are look seeking it. It'd be great for them to hear a little bit about how you do it from a steering committee
Shar Matin, CEO of Cordis (31:43):
Perspective. Yeah, the way, the way that we did it is we actually brought Cordis and Cordis X together and we built our, uh, broad base strategic plan, um, of what we would need to win in the marketplace, um, and really, uh, achieve our vision. And our vision is to, you know, save billions of lives by innovating on cardiovascular technologies, uh, pioneering cardiovascular technologies. And so we didn't want to just be, uh, a niche player. We didn't wanna just be a me too, so how do we do that? And then we looked at the strengths of what Cordis has, and we looked at what other portfolio ads we needed to do, and then who were the best of the best out in the marketplace that could bring in. So instead of waiting for folks to come to us, it was really, we were purposeful around what our product strategy was.
And today I'd say it's a product strategy. Longer term it's gonna be, i, I think beyond a product strategy as we figure out and take it to the next level of what can we do for cardiovascular care. Uh, and that's how we, we, the steering committee kind of came together and figured out what pieces we needed and then we went sourced it. So it was more of a, you know, let's go pull it, as opposed to, you know, who's available and who's got what ideas, you know, we do that we see from an m and a and and licensing perspective that's more, uh, I'll say from a, um, the traditional way that people just, you know, if someone's got a great idea, they bring it to us. Um, so that, because we know that, you know, we're not gonna have all the ideas, so we leave some space for that as well.
Nancy Sullivan, CEO of Illinois Ventures (33:14):
I just find it fascinating that you have private equity investors supporting this area of your business where, um, it's a little different. It talk to me. Absolutely. Talk to us a little bit about that, that I, I'm an early stage investor often looking to get private equity involved, and this is not the model I typically see. I be thrilled to hear a little bit about that
Shar Matin, CEO of Cordis (33:35):
And, and that you've gotta have the right private equity investors, right. And we were, I could say for Cordis, uh, from what I remember, there were, you know, I could say close to 10 bidders early on. Um, and everyone had their models, uh, of what they thought would create value and, and credit to, uh, Heman and Friedman and K K R, uh, and we're in K K R'S Growth Fund, uh, it, it's, it's, you know, h and f invests and they're typically investing in high growth businesses with growth capital, that that's just the model that they go after. And KK r's you know, growth fund has some very similar, uh, elements to it. So a as an early in the discussion, if it was Cordis as a standalone, uh, they would not be the typical investor in it. If it was venture investing like the, the Essex, they would not be a typical investor.
It was the combination of these two that they were ready to, to back, you know, seasoned executives that, that had a thesis. And, and we all believe we could create a ton of value by bringing these two together. And when I talk about value, the only way to create, you know, shareholder value is really to delight your customers and have great teammates. So doing those two right will really drive that, that value. And, and we thought this was a unique opportunity for us to do it, and it didn't hurt that we got in at, in my view, at at a pretty good price as well.
Nancy Sullivan, CEO of Illinois Ventures (34:56):
Sure. I can tell you come alive talking about Cordis, there's no doubt about it. Um, <laugh> and, and it leads me to ask a question. When you were thinking about Cordis being an option for you personally and what you want it to do, you, you talked a little bit about when you hire teams, you're looking for passion. What was this that was passionate for you? What, why Cordis?
Shar Matin, CEO of Cordis (35:16):
Yeah, great, great. Uh, uh, great question because, because I can tell you when you look at certain opportunities, face value, a lot of folks see like risk and oh, that's gonna be tough and it's gonna be a slog and all that. And, and you know, again, it goes back to like your past experiences and, and you know, I I was at a former company that, you know, stumbled, went down dramatically, stock price went down 90%. And then as I mentioned, you know, I was, I was a candidate for, for the CEO position. And then we got a new CEO and together we re you know, we basically turned that company around and created a ton of value. And the, the, I loved the idea of building and we took that company from a hundred million to 300 million internal innovation m and a.
Um, and we got it to a place where, you know, strategic came and acquired us. I believe we can do that with Cordis on a much, be on a much greater scale. Uh, it's got an incredible brand, it's got incredible infrastructure, and it was lacking innovation. And we're bringing innovation in a new business model to the table. And I see it as actually a lower risk when we purchase a, a company at, you know, 1.3 times sales, uh, than, than more risk. But there's work and you need teammates and, and other leaders that are willing to go through the build process and love to build because, you know, for every two steps, you, you go forward, you might take a step back, but net net you know, you're gonna build something of incredible value over time.
Nancy Sullivan, CEO of Illinois Ventures (36:57):
You think that's what attracted you to the strategy of having Cordis a tied to it? Cuz they're builders. Every entrepreneurs on this call, they're builders. That's what everyone is trying to do. Is that, talk a little bit about when you talk to an innovator, how do you assess if they're builder, how they're putting it together?
Shar Matin, CEO of Cordis (37:12):
Yeah, it, it, it goes, you know, the the way I even, uh, in my career have looked at assessing talent is, you know, there's stewards of businesses in my view and there's builders of businesses. Uh, and you can have an incredible career in either, um, you just have to know what your skill sets are and do they, uh, align with being a steward or a builder, um, because that's what will get you excited when you wake up in the morning. Um, that's what, you know, the, the, the, your calendar speaks differently if you're a steward of a business than if you're a builder of businesses. So it, it's having that conversation, but it's looking at the track record of folks. And it doesn't matter if you're a large company or a small company, um, if you're a part of a large company, but you always went to small division and you, you built it and then you went, you got bored when it was more of a, you know, single digit grower and you went to another division that, that, that's, uh, uh, evidence that you love building.
You may enjoy the security of a larger organization, but you're a builder. Um, so tho those are the pieces where as you have conversations and you, you talk about historical experiences, to your point, you start seeing where people come alive. Uh, and I, simple questions I ask is every role, what do you like about the job? What did you not like about the job? And what, what made you decide to move on in those simple questions? After the fifth or sixth one, you can figure out pattern recognition, uh, what drove that individual to make decisions one way or another. Um, and, and it tells a lot about are they builders or are they stewards of businesses?
Nancy Sullivan, CEO of Illinois Ventures (38:45):
I love the analogy of look at the calendar, see how people are spending their time. <laugh>, I I wanna ask you a little bit, I put your futuristic glasses on, put your, you know, next 24, 36 months. Where do you see Cordis? How do you see under where you're taking it, the innovation piece, maybe it's five years, don't put a timeframe, but as you're looking forward, share with the audience a little bit about what you're thinking and seeing.
Shar Matin, CEO of Cordis (39:10):
Yeah, it, it's, I I'll put the timeframe longer because I think the real value is created over a longer period of time. And, and you know, what, what I tell folks is, uh, uh, the beauty of cardiovascular care right now is there's no silver bullet. So there's space for, uh, disruption. So the same way, you know, if you look at Cordis history, it had a lot of firsts. Uh, and, and you know, first nylon balloon first, uh, you know, they brought the Palmer shots shot stent to market first stent, first drug-eluting stent. Each time Cordis was disrupted or market share was taken by a competitor, and Cordis came back with a new innovation. So that's, for us, it, it's really, let's separate from Cardinal Health. Let's optimize our, our core platform. Let's have a couple, you know, shots on goal in the near term that accelerate our growth rates.
So could it be markets where we can be one of the top three players, which, you know, in some cases we are today and we can make iterations on our products. But really, what's the next one or two disruptive innovations that will really change the standard of care in cardiovascular? And, and if you saw recently we purchased a, a company called METAlliance, or we announced the deal, we'll close later this year that's around, you know, our thesis wasn't bringing a drug eluting, a drug coded balloon to the peripheral vascular. It was, could the sirolimus based drug eluting balloon change the way cardiovascular medicine is done? Could it bring the leave no metal behind, uh, um, uh, I'll say algorithm that's been used in the peripheralvascular to the coronaries. So it's those kinds of bets that we're gonna make to really become that innovator. We were historically, and, and as we put it, it's we're building, you know, the, the foundation on our legacy, but really we're invested in the future of innovation.
Nancy Sullivan, CEO of Illinois Ventures (41:04):
I mean, it's so interesting you started this conversation about the D n A of the people you hire and understanding what's in them. It sounds like Cordis had the d n a of innovation and building and that's what you were looking for. Talk a little bit about when you do look for, cuz you've talked about three strategies, right? We've gone into Cordis quite a bit. You've also talked a little bit about internal innovation. What's the strategic m and a thought process around Cordis and some of the activities that you've just mentioned? Give a little more detail on that for us.
Shar Matin, CEO of Cordis (41:30):
Yeah, and, and you know what, what you've gotta do there, and it, I wish you could say you, you create a strategy and it's perfect and you don't have to iterate it. Uh, I'm a big believer in a management process called, uh, you know, H P M S, we call it the Cordis business system that we've adopted. You know, Danaher's got its model, everyone's got their model, but you gotta have a, a process in which you're constantly looking at your voice customer, your voice teammate, your voice, shareholders, taking those as inputs and then figuring out how can you move the willingness to recommend for each one of your stakeholders. And then, you know, making decisions quickly, uh, getting it about 80%, right? Going out and executing and then getting the feedback and then saying, okay, what do I need to do? I keep doing what I'm doing cuz it's working.
Do I need to change or do I need to scrap what we were thinking of and do it totally differently? And, and to me, again, for medicine, a new, a new clinical paper comes out and might totally drive the direction, uh, um, what will really impact patient's lives in a different way. Um, and you've gotta be ready to pivot and look at, uh, what that is. So for us, uh, that's what, when we look at m and a, it, it's a lot of those pieces. It's, it's as we're doing our own strategic product development for the current unmet needs that we see, how do we keep an eye on what's happening in the marketplace and what's disruptive? Uh, and could that drive a shift in our strategy ultimately to fulfill our vision? Uh, and so that's how we're looking at m and a and keeping an eye on what's new and what is it that we haven't thought of, it's ideas we haven't thought of that's really gonna drive our, uh, our m and a strategy,
Nancy Sullivan, CEO of Illinois Ventures (43:10):
Which I, you know, I my words not yours, but you have a three-legged school stool and innovation, external, internal and m and a. How did the internal innovation arms of Cordis interact with or help seek out some of the external pieces you may be thinking about? How do they interact with one another and how do you make a decision whether you're gonna do it internally or seek it externally, whether it be m and a or through Cordis?
Shar Matin, CEO of Cordis (43:34):
Uh, great question that, that's part of the, the skillset we're building. Um, and it's iterative again as, as we figure out, okay, what makes sense. Um, so I'd say right now it's loose and it's those teams collaborating together and making decisions. I'd say the core of it is understanding what are the core capabilities that we have, uh, internally and what are we really strong at from a technological or differentiated perspective. Let's do those types of, uh, projects internally and if it's a core set of capabilities that we don't have, uh, have that team externally, uh, drive it and then when it's ready we can bring that capability in-house. So over time, we're gonna build a core, uh, of strengths that we historically didn't have, or maybe we had, you know, 10, 15 years ago when Cordis was, was a different company. Uh, but we've lost over time cuz innovation had become a smaller part of our, you know, future in the past. So it, it, it, I'd say that's really what drives the decision of internal versus external.
Nancy Sullivan, CEO of Illinois Ventures (44:38):
And Cheryl, you, you talked a little bit about sometimes having the right team, you can have a big bloated team that can't move quickly. You had a quick nimble leadership team that put 250 slides together to outsmart and get what you needed. What team comes together on these innovation questions and to answer this strategy at a moment of decision for Cordis?
Shar Matin, CEO of Cordis (44:57):
Yeah, it's a mixture of both our team and Cordis X. Um, so it's, it's at the leadership level right now and I would say over time it's how do we build the infrastructure so we can push that decision making further And we're a more, you know, uh, from an, uh, we're we're playing more of an oversight role, but there's just such great clarity that we can drive a lot of that discussion decisions lower in the organization. But I'd say we're in the early innings of, of building that core competency.
Nancy Sullivan, CEO of Illinois Ventures (45:25):
Um, what's your biggest lesson learned along this way? If you don't mind sharing with this group around maybe great learnings in a good way and hard way. Cuz innovation is what we all, I mean that's what matters. Soul is about, right? It's about innovating in this area. What can you glean from it that might be helpful to everyone listening today?
Shar Matin, CEO of Cordis (45:47):
Yeah, I would say, uh, on the innovation side, uh, always be open, right? Don't be myopic, uh, take those meetings, uh, but be really steadfast on the strategy cuz if you chase each one of these, you're kind of lose, uh, you'll lose sight of what you're trying to do. Uh, but you don't know what may come out of the different ideas. So is there a way to say, look, 80 percent's execution focused on what you're trying to do today and then really leave some space, uh, to forward think or, or, or leave that flexibility around, you know, what else is possible that you're not thinking of. Uh, but, but it's a balance there because that shiny object from far away can, can, can really get exciting but really might be a waste of time.
Nancy Sullivan, CEO of Illinois Ventures (46:33):
And, and maybe that goes to something, I know you've talked a little bit about innovation's no longer just about a product, right? That shiny product object. It, it's about some other things these days, including economic benefit. How do you think about looking at sort of that shiny object and ensuring that there's some economic benefit there? And I'll keep talking while you clear your throat. They're sharp <laugh>, you might need a little drink of water with all these conversation pieces. <laugh> be a bit of a break.
Shar Matin, CEO of Cordis (47:01):
Thank you Nancy. Yeah. Um, a as you mentioned, things have changed over time as well where the economic side of it's critically important for the hospital. And so that's gotta be a key part of when you're talking about what kind of innovation. So it might be the same therapy but a lot more cost effective and that might be the win, especially in different care environments as well.
Nancy Sullivan, CEO of Illinois Ventures (47:26):
How do you get change in care environments? Um, you know, I, for us on our end, we, when we're looking at early stage venture investment, we're assessing what's the opportunity here in the technology? How do we think about the team, what do we think it's gonna displace? And then we have to figure out how do we change behavior. So while economically it might be driving the right answer, we don't know how we're gonna change behavior. How do you put all those pieces together and it, we don't believe, and maybe you can shed some light press, you don't always win on economics because human behavior sometimes will div dictate a very different perspective.
Shar Matin, CEO of Cordis (48:01):
Yeah, absolutely. I mean, it, it's, it's a, I'll say it's a science experiment that we're all living through right now, cuz it, it's healthcare is changing in the us you know, and for me it was a, it was a wake up call where you could actually talk to a physician today and he could tell you his p and l. He didn't know his p and l 10 years ago. Uh, now he actually knows what p and l is and we joke with our chief medical officer, he knows what an EBITDA is, uh, who who, who knew that at, at, at a physician level. So it is changing, um, and how do you become part of that solution? Um, but do we have a silver bullet around it? No, and that's why I go back to the three elements. There's the economics, there's a relationship and there's ease of use and it's a mixture of the three.
Nancy Sullivan, CEO of Illinois Ventures (48:50):
You know, some of our, um, participants today may also be dealing with some regulatory and the thoughts around regulatory and moving things through a regulatory horizon and then to reimbursement as well. Can you talk a little bit about how that is factored into your thoughts of what innovations you move forward? Um, obviously patient care and patient impact leading it, but some of the realities in regulatory and reimbursement.
Shar Matin, CEO of Cordis (49:14):
Yeah, regulatory, it's gotten better, I would say. And, and f d A is far more collaborative, but that's critical element of, you know, what does it take to get approval and then from a reimbursement, that's the economic side of it. So you've gotta have be very purposeful with it of, you know, either build products that can be in existing codes or you gotta build in the timeline of what it takes to change a code or, or, you know, get add-on payments or whatnot. So I'd say that that's a critical, uh, key factor in deciding either if you're investing internally, in our case, if we're ex investing externally or looking at m and a or licensing. But you've gotta be purposeful with both of them.
Nancy Sullivan, CEO of Illinois Ventures (49:55):
So for the participants thinking about this, it's, it's not only about that shiny object, the important product, it is about these other things as you talk to, whether it be a potential strategic organization, an innovation group, an investor, making sure you cover those areas because without all of those pieces coming together, it's pretty hard to actually bring a deal together. And you're seeing that it sounds like in your day-to-day working.
Shar Matin, CEO of Cordis (50:18):
That's right. I mean, it, it, it is, it's what we live day-to-day and it's the discussion.
Nancy Sullivan, CEO of Illinois Ventures (50:25):
And I wanna ask you a little bit about, um, moving out to maybe macro trends. We've seen sometimes where therapeutics do great MedTech may suffer and this pendulum going back and forth and the different areas. Tell me where you think MedTech sits now and maybe in the next three to six sort of years around MedTech. Because we've watched different sort of cycles, let's say.
Shar Matin, CEO of Cordis (50:49):
I, I look at it and say, because MedTech, there's been a lack of investment in MedTech mm-hmm. <affirmative>, I think it's a unique opportunity. There's just a lot less assets. And as larger organizations look at acquiring for growth, um, you can look at the Abio med deal, you know, very few cardiovascular assets. They got acquired for 17 billion, 17 times sales. So I'd say asset prices are going up because there's not a lot of them. Um, and so I see that as an opportunity for innovators, uh, and financial backers to, to back the right technologies. Now a me too or number six to market's not gonna get investments, but if you can come up with a solution to an unmet need, I think it's a great time because there's just a shortage of assets out there in any segment of Met Tech today.
Nancy Sullivan, CEO of Illinois Ventures (51:43):
It's really funny. I will tell you, you um, basically have said what, five years ago we were talking to a different venture group that was creating this exact thesis because they said exactly was going to happen. The underinvesting was going to provide less assets, and assets would be more valuable. And it's interesting to hear you running an external innovation group and pieces noticing that that has come to light. Um, so we have another audience question and I think, um, that'll be either our last or second to last question today. It it's about innovators and founders to the point sort of broadly, when's a good time for them to bring commercial level expertise to develop that strategy and execution plan? When should they be bringing that on board for them at very early stage, sort of innovators and founders? When should they think about these type of people and expertise?
Shar Matin, CEO of Cordis (52:33):
Yeah, and I think it depends. Uh, it always depends, right? Uh, you gotta get the voice of customer on the product early on. So you've gotta figure out how to do that. So if you personally have access as an entrepreneur to, to KOLs, but don't just do KOLs. Also do like, I'll say high volume clinicians. Uh, get a mixture of voices and those fingerprints and, and from the different, uh, care settings as well. Um, do that early. If you've got access to that, great. You don't need the commercial folks, uh, early on if you don't bring commercial folks on early to be able to build those relationships, open those doors and really get that voice of customer and their fingerprints on your product, that, that's the way that I, I think, uh, um, makes sense. But it all again, depends on both the product and, and your own skillset and experience in the space.
Nancy Sullivan, CEO of Illinois Ventures (53:22):
Do you see for early stage companies that this is maybe a skillset if they can get to the key opinion leaders, they do it themselves, introduce themselves as an entrepreneur, maybe get access in a new way, or bring on sort of the expertise in a consulting role? Do they bring it on full-time? How do you see it being important for their future success? Yeah,
Shar Matin, CEO of Cordis (53:42):
Ideally, if you can make a part of your team, and we talked about the D n A and it's the right person, and they got a vested in trust, I, I'd encourage folks to do that. I mean, consultants are great, um, but they're not gonna live and die by the success of the company. Um, so how do you get that, you know, passion in there with you? And I think that's critical.
Nancy Sullivan, CEO of Illinois Ventures (54:02):
Okay. So building on living and dying by success, is there any, um, advice put at the final end for our entrepreneurs who are listening that you wanna share?
Shar Matin, CEO of Cordis (54:11):
I would say take risks, build a great team and, uh, an incredible culture where everyone wants to work and be in that company. I think, I think that you get those pieces right, you'll, you'll, you'll find your way regardless of what you know, uh, setbacks you have and ultimately with perseverance and grit, you're gonna win.
Nancy Sullivan, CEO of Illinois Ventures (54:30):
Grit's a word we haven't heard yet today, but it's what I often, when we look at entrepreneurs at an early stage, um, we think grit matters only because things rarely go the way you expect. Things rarely go in that linear fashion. Tell me a little bit about how you pulled out some grit on the court deal, cuz normally you assess grit at an early stage, but I think grit happens all the way through. How did you have to pull some of that out, Shar,
Shar Matin, CEO of Cordis (54:54):
Absolutely. I mean, think about the carve mountain separation that we're doing. Um, you know, McKenzie rated a like four out of five on a difficulty scale. I've had people go, Ooh, that that's a, that's a challenging one. You're, uh, you're going through and we're living it, right? Getting it all right. Uh, we have setbacks every day. The team's leaning in, they're, they're figuring out what challenges they've gotta address so that we can delight our various stakeholders and we're working through it. Um, I can tell you that there's days where we've got lots of wins and there's days where we have setbacks, but we know what the, what the prize is at the end of it. And, uh, any of the other folks in, it's a trend in MedTech that are doing separations. It is a heavy lift to, to, as I call it, it's almost like we're doing, uh, spinal transplant surgery. And, and someone asked me and said, how often does that happen? I go, I don't know when it happens. But that shows you how, how, what the challenge is cuz we literally are building our whole e r p separate and then taking, you know, segments of the business off of Cardinal Health onto our own, you know, e R P, which is the backbone of the whole organization. So, uh, that takes a bunch of grit for the team that, that's executing on it.
Nancy Sullivan, CEO of Illinois Ventures (56:06):
Sherry can thank you enough for spending time chatting. You got through all of the audience questions, uh, all of my questions you shared. So honestly, and it's just been such a great pleasure to spend time with you. Thank you on behalf of the entire group. We really appreciate it.
Shar Matin, CEO of Cordis (56:21):
Great. I appreciate it Nancy, and
Steven Collens, CEO of MATTER (56:22):
Thanks so much for having me on with you.
Nancy Sullivan, CEO of Illinois Ventures (56:24):
You bet. And I'll turn it to Steven.
Steven Collens, CEO of MATTER (56:27):
Yeah, thank you both, um, Charlotte, Nancy, it was a terrific conversation. Um, really enjoyed it. Um, thanks to everybody for joining us and if you enjoyed today's program, you might, uh, wanna tune in next week for our inaugural 51 Labs, uh, final showcase, which is our women's health platform, uh, in-person and virtually on March 3rd. Our next Tales from the Trenches program features, uh, Stephanie TIUs, who's the CEO and founder of Vida Health on April 12th. Um, you can learn about those and all of our events on our website matter.health. And, um, thank you both. Again, thank you all for joining us and I hope you all enjoy the rest of your day. Thanks so much. Thank you. Take care.