Ardian – A Case Study in Value Creation

Image representing Ardian as depicted in Crunc...
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I’m surprised that there hasn’t been more written about Ardian since their sale to Medtronic last month. It may be the largest venture-backed medical device exit to-date. Ardian’s $800M-plus-milestone-payments may end up being larger than Medtronic’s purchase of CoreValve for $700M-plus-milestone-payments in 2009. Even more unusual was Ardian’s relatively early-stage. At the time of sale, CoreValve had implanted devices in 2,600 patients at 125 centers in 25 countries. Ardian exited much earlier, with about 150 patients treated.

Overnight sensations don’t happen overnight. While Ardian seemed to come out of nowhere in 2009 and exited large in 2010, the truth is that the company had been hard at work for almost 10 years. Ardian achieved more than 10X return on $66M invested – at least $732M of value created, before milestones. While the end of the story is still unwritten, Ardian’s first few chapters form a great case study for medical device entrepreneurs and investors.

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Come Back When You Have More Data

Museum of Bad ArtOver the past several months, I’ve had the privilege of meeting many entrepreneurs who are raising funds for new medical device startups. One common VC refrain they hear: “Come back when you have more data.” Many times this can be a VC’s way of saying no without saying no. Sometimes though, the VC really means what s/he says: the current proof-of-concept data hasn’t proved the concept. It’s not just startups that face this challenge. I’ve seen weak proof-of-concept data in bigger companies too. How can you make sure your proof-of-concept data is solid?

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