Building an AI-Powered Pharmaceutical Services Business: VIDA CEO Susan Wood (Part 3)

Sramana Mitra: Did you succeed in raising venture capital?

Susan Wood: Within the state, yes. The last round was a couple of years ago. That was with First Analysis out of Chicago. I’ve got some Silicon Valley money, but mostly from Midwest.

Sramana Mitra: It’s a common storyline where you get the early-stage funding from the state through small VCs, and then the bigger funding from Chicago. This is a common Midwest story.

Susan Wood: The venture funding was mostly at that time when we had enough money to advance the company versus giving you enough rope to choke yourself.

Sramana Mitra: That’s not helpful at all. You can’t get $200 million without getting to product-market fit. Product-market fit is about experimentation and figuring out who’s ready to buy and how much they’re willing to pay. We are now in 2014?

Susan Wood: I got the last round of funding in 2020.

Sramana Mitra: Not the last round of funding. I want to go back when you were seeking product-market fit.

Susan Wood: That was in 2016. We got $5 million in funding.

Sramana Mitra: What happened? What was the journey of finding product-market fit? What conclusions were you drawing?

Susan Wood: It wasn’t enough money to go out and do this on our own. We have a strong partnership. That partnership gave us some operating cash.

Sramana Mitra: What was that partnership?

Susan Wood: It was with Olympus. There were a couple of Silicon Valley companies in the endobronchial devices space in which you would put into the lung for people with severe emphysema. It was therapy. The software determined who got the therapy or who didn’t. If you didn’t do this test ahead of time, a patient could get the therapy and it wouldn’t work. If these biomarkers were positive, then that patient should go to therapy.

Sramana Mitra: So Olympus helped you validate and get to market.

Susan Wood: Right. Sometimes, device companies don’t always value the software as they should. It was a successful partnership, but it wasn’t one that would make us a ton of money. We did a shift and we pivoted. We still work there, but it’s not as lucrative. We did a big shift. We always had this part of our business that worked in the life sciences.

We were working with drug companies and we were finding, for respiratory therapies, that the endpoints were so crude in comparison to other clinical verticals. They weren’t precise measures. They had the longest, hardest, and most expensive drugs many times to get to market. Also, because of the way they’re measured. We always had this side of the business. I would say, “Don’t let a pandemic go to waste.” We made a shift.

Sramana Mitra: Tell me more about how you positioned yourself when the pandemic hit. Who started using your technology in that context?

Susan Wood: It was interesting. All the respiratory companies said, “We’ll give you our software for free.” It didn’t work that way. People weren’t coming to the hospital. People weren’t coming to the office. What really happened was, there was greater awareness. There’s evidence to suggest that patients with COVID or COVID survivors are at risk for interstitial lung disease. There are a lot of patients coming into the healthcare system that we could help diagnose earlier in the process and be able to determine which therapy would be best.

It was more awareness versus an immediate impact. Older people with restricted lung function tend to have poor outcomes. There are also the social determinants of health. People had poor outcomes in a less democratized way. We worked on those types of issues and finding those patients and having a more generalized awareness and treatment of those patients. That kind of awareness helped a lot.

This segment is part 3 in the series : Building an AI-Powered Pharmaceutical Services Business: VIDA CEO Susan Wood
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