Dave Sheppard is Managing Director and co-founder of Medworld Advisors, a conglomerate of mergers and acquisitions (M&A), business development, and financial advisors specializing in the medical device, biotech, and OEM medtech industry. With a background in the commercial side of multinational medical device companies, Dave has done business on every continent except Antarctica! Medworld Advisors grew out of that vast experience, with a unilateral focus on helping small- and medium-sized medical device and technology companies leverage a faster pace of innovation.
Medworld advisors believe that “value = strategic fit plus timing” when it comes to:
Small companies simply don’t have the same resources as larger corporations, according to Dave. As their outsourced M&A specialist, Medworld Advisors handles negotiations and valuations, optimizing term sheets and detecting “hooks” that larger companies try to insert into deals with smaller companies. And it seems Medworld Advisors has indeed found its place: co-founded in 2015, the company has grown into nearly 20 employees worldwide.
Unlike most M&A advisories that sell across industries, Medworld Advisors focuses solely on medical devices and technologies. Just like their client companies, specializing in one vertical segment means they must expand into other countries to grow. Partners like IR Global – a network of international lawyers and accountants throughout the world – make that possible.
Early-stage companies will sometimes say they’re going to “launch in Europe,” says Dave, and his first thought is “do we need to define Europe a little bit?” There are over 25 countries that each have their own regulations, requirements, language, culture. He recommends starting with a “big 5” strategy – UK, Germany, France, Spain, Italy – and expanding from there.
Whatever your strategy, Dave believes that “positive mergers start with relationships.” Plus, good legal advice, clear communication, and a regulatory structure that meets the needs of both companies.
Relationships differ around the world, ranging from the transactional (US) to team decisions (Japan). Dave describes a recent experience with a Japanese company:
Japan says “yes,” but not “yes, I agree” rather “yes, I hear what you’re saying.” You have to ask the “next-level” question, the purchasing question. The US is all about “win-win.” In Japan they don’t like to say “no,” it’s uncomfortable. So, you think of questions that make it easier for them to say yes. And instead of saying “no” they will go silent or give you a soft “no.” For example, you might ask for the sale with: “When would you like to receive this order?” And the response: “It’s not possible for us to receive it until next year,” is a softer way to say “no.”
Cultural leanings affect communications throughout the sales process, and arguably every business interaction. Asian countries tend to rely on interpreting services more than Europe and Dave has found that “when people are interpreting in real-time, it’s noticeably more literal.” Yet on the flip side, when doing business with the “Mittelstand” (Germany’s small- and medium-sized businesses), be clear and direct, even more direct than in America.
Culture also affects purchasing decisions – in China, for example, purchasing is influenced by both tradition and economics. The Chinese healthcare system works on multiple tiers: the highest, first tier does not purchase or utilize Chinese product, only American or European goods; the second caters to the middle class and will use a mix, and the third tier average clinic will use product “that’s as cheap as it can get. The same thing happens in India with government and private hospitals, the latter of which most can’t afford. Medtech strategy must take this all into account.”
Likewise, strategy encompasses regulatory clearances and risks to market inroads. Dave finds that companies often overlook their reimbursement model – or that they understand the first but not the second market: “They get to market but no one’s buying because they can’t afford it, or because the government doesn’t understand the greater efficacy of the product and will not subsidize it.”
So, how to manage a product launch in a country where you don’t know the rules of the game? Dave’s advice is to learn how to “navigate the system”; in other words, how to work the regulators. There are risks, of course, and there are long-term implications connected to where your company is headquartered, and the regulatory requirements of every new market. So, it helps to work with a company in the expansion country – they’ll understand the market – so long as you structure the partnership with an eye on the regulatory requirements of all the countries involved.
Similarly, global sales and marketing require a “[t]hink strategically globally, execute tactically locally” approach. Dave says that “Americans are spoiled,” in a sense, because people in other countries speak English, especially those within multinational companies. When it comes to written communications, too, “business English” makes it easier for American companies in international settings.
Here, too, cultural awareness can prove competitive. Wendy describes how a Rapport International client won a Korean account simply because they were the only bidders to bring with them a translated presentation. In Japan and China, too, it’s common to send presentations in advance so they can be translated, says Dave. The countries rely more heavily on interpreting and translation because they want to be sure they’re understanding the information clearly.
They usually use someone on staff, or an in-country service provider, he adds, but the Rapport International story is testament to having an American agency translating content stateside before sending it to a potential overseas partner. At the same time, when the content involves marketing or anything that could affect your brand, a US agency can translate the content, but it requires a local eye to confirm its accuracy and efficacy.
Listen to the full episode to learn more about launching your medical device or medtech product/service internationally, with a deliberate strategy and meaningful impact. Find out where it’s hardest to do business, the nuances of regulatory requirements across the globe, and which country has the best food!
Connect with Wendy - https://www.linkedin.com/in/wendypease/
Connect with Dave - https://www.linkedin.com/in/dave-sheppard-cmaa-3423305/
Music: Fiddle-De-Dee by Shane Ivers - https://www.silvermansound.com