F025 How to raise money in the digital health space? (Jack van Lint, NLC Healthtech Ventures)

What are the common mistakes in fundraising? Why does the US seem like a better starting point compared to Europe for early-stage companies? How to look for support in the initial phase of a company?

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The initial stages of a company might be one of the most exciting times in a life of an entrepreneur: you have the idea, you’ve assembled the team, and you’re driven to change the world. The first big challenge though is getting an investment to fuel the development. Especially in healthcare, where sales and development cycles are long, words from investors, such as “Come back, when…”, can be something you should expect to hear often even before you start.

An Amsterdam based investment company NLC is the European healthtech venture builder is among the supporters of early-stage startups. As explained by Jack Van Lint, NLC is currently supporting 23 startups and in the process of looking at 40 new candidates. If you’re wondering: you don’t have to be based in the Netherlands, NLC is supporting startups from other countries as well, by December 2018 local partnerships were set in Finland, Germany and Italy.

Who gets the support?

The selection criteria is the same, no matter where the company comes from:

Is the idea new?
If it is improving an existing procedure, how is it better?
What is the market potential?

Regarding projections about the potential of a solution, Van Lint says, investors always know that financial potentials are exaggerated in presentations and that the startup will probably need more support and investment that given initially.

An optimistic calculation serves for other purposes: it must show, that the founder and the company have a visionary big picture.

Knowing this, an entrepreneur should always have a smaller steps plan in his mind besides the big picture, as an idea of how to grow from a small solution to a big one, is often necessary for a survival and growth of a company, says Van Lint.

One of the areas NLC wishes to find potential in is prevention. Prevention is a challenging space for startups since a company needs to prove what cost a solution is preventing, essentially measure, what will not happen in the future. This is difficult to prove, and usually more interesting for governments than investors.

More in episode 25 of Faces of digital health.

Some of the questions addressed:

What do NLC Healthtech Ventures invest in?
Does a startup need to move to the Netherlands to get the support from the NLC?
What is the healthcare system in the Netherlands like?
What are the mistakes startups are making?
How should startups approach financial projections, when everyone knows they’re usually over-optimistic?
What to learn from the USA? How do investors there differ?

This episode is supported by Technology park Ljubljana — a Slovenian Care4Tech innovation lab, supporting startups from various industries. Technology park Ljubljana is one of the creators of the Slovenian digital health and medtech association Healthday.si, which regularly organizes events for the digital health community in Slovenia.