The Achieve Podcast - Ehsan Vaghefi (Toku Eyes)

Welcome to the Achieve Podcast, the show where we highlight the leaders, creators, and entrepreneurs who are building meaningful businesses and shaping their industries. My name is Jesse Warner. I'll be your host today. We're excited to have Ehsan Baghafi, the CEO of Tokku Eyes, with us today. Ehsan, it's a, it's Yesen, it's a pleasure to have you on the show today. Tell us a little bit about yourself. Give us a background, kind of quick backstory on your business.

Well, thanks for having me. So my background is in ophthalmology and vision sciences. I started from an academic role. I was an associate professor in ophthalmology and optometry, and then sort of started my company. It was a research project really at the sort of university that I was teaching at. I spun it out, created my company, which was called Tokul Eyes, and that was the start of the journey. That was back in 2019. I've always been interested in vision and blindness. That has always been sort of my career and education. And, you know, I at some point I thought that I want to make a bit more impact than just being an academic and a clinician scientist. So, you know, I think we made that happen. So yeah, uh, it's been a journey with Toku. We, um, entered the US market back in 2024 because originally we started in New Zealand. That's where the funny accent is coming from. And, and, um, you know, we took two products through the FDA. We can talk about those. We sort of had— we had sales into 200 eye clinics. We can talk about those. And then we sold the company, or I sold the company, to KKR, uh, back in November last year. So I've been through the whole sort of, you know, science, lab bench, you know, startup fundraising and exit in 5 or 6 years' time.

Well, congratulations on your success and selling your business. Um, how has the business changed as it's grown? What did it look like when you started, kind of versus what it looks like today?

That's a very good point, a very good question. So at the beginning, I think, um, at least, you know, tech startups and sort of medical technology startups, at the beginning there are science projects. It means like there's a lot of science, there's a lot of tech, and, and, and, and it's almost like an academic sort of project with a bit of a sort of a just side commercialization. As the sort of company moves on, the company gets bigger, you bring in investors, you start to commercialize, it becomes more commercialization heavy, less tech heavy, and essentially it becomes more of a commercial endeavor Um, as I said, you know, we started like a team of 2 people. Um, when I sold the company, it was a team of, um, I want to say 25 people. So there was a lot of, you know, just company-related stuff. As a CEO, again, because I had a, I had a, I had a tech background, um, so because I had a tech background You know, I was more focused on the science. Very quickly I realized that I have to learn about the legal aspect of a company, the, the HR component, the taxation, you know, investor relations, all of those. So at the end, when I sold the company, I had very little to do with the sort of core technology and tech development. I had a lot to do with you know, legal and transactions and financials and that sort of thing. So, you know, I think most founders will go through that phase of just being the core of the business towards more of a, you know, out-facing part of the business.

And how many— how big is your business now? How many employees do you have?

We have about— at the time that I exited, we had about, I want to say, close— getting close to 30 people.

Okay. Yeah. So you went from just kind of yourself? Was it just you or did you have a partner as well?

So it was me and my co-founder. He was also an ophthalmologist, a retina specialist. So it went from 2 people being clinician scientists focusing on the technology to like a team of, as I said, close to 30. And I was not involved in the science anymore towards the end. I was more on the fundraising and legal and tax and all that. So, so yeah. Yeah.

Well, what a fun adventure. Congratulations on that. When you look at sales, marketing outreach, where are you seeing the most traction? What's working for you and what's not?

Interesting. So I'm going to talk only about the medtech, medical technologies and healthtech industry. The most difficult sales are to large healthcare systems, and I think everyone knows that. The large healthcare systems have very low, very slow process. You know, there's a lot of sort of hurdles. As a startup, you want to run fast, you want to sell quickly, so you have to figure out the part of the market that can move fast, as fast as the startup wants them to. So, so to me, the biggest part that we had tractions with were smaller clinics, you know, 1, 2 clinics under a single doctor's name, um, and it's a bit of a work. You have to just keep going around, but that's— and but there are decision makers that you talk to immediately, so you don't need to go to a CEO or CMO of a large healthcare system. And even if they did agree, it will take a long time before you can close that. So the biggest traction to me are the, you know, the smaller parts of the market that you can quickly capture because you can quickly engage the decision maker.

So it's a little bit different kind of depending on the size of the company. It sounds like in bigger organizations you get into those longer enterprise sales kind of motions. With small organizations, you can get sign-off quickly and, and move forward. Is that right?

That's very true. That's very true. Say, for example, everybody wants to sell to Kaiser Permanente. I'm making that up. The, the sales cycle is measured in quarters, maybe years.

Whereas if you wanted to sell to sort of a clinic in the same sort of geographical area but much smaller, like maybe they have 1 or 2 clinics, you can close the deal in less than a month and just get going.

So now you have to repeat a lot of those because of the size, obviously, but as a startup you have to show traction. You know, going after one large deal is not necessarily traction. Going after smaller deals and incrementally build up to that large deal, I think that's the traction that most businesses would want to see.

So obviously there's a lot of buzz around AI and automation. You're using AI in your, your tool, you know, your, your actual scan of the retina and other areas. Tell us a little bit more about how you're using AI in the business side of things.

A good point.

So AI, to your point, has many different flavors. I think people have to be very specific about AI, you know. So yes, we use AI clinically as— so AI as a medical device, which is sort of regulated by the FDA, you know, you go do clinical trial, that's one thing. On the business side, we use AI for, um, people management, for just scribing all of our sort of meetings, project management. We use a lot of AI on the project management side just to make sure that we are efficient I mean, when I said we are or we were a team of 30 people when I sold the company, if it wasn't for the AI, we would probably be a team of 40 people. So we were like on a 20% to 30% smaller team because we had AI doing a whole lot of jobs for us. Now, on a personal level, as a CEO, I use AI to pretty much do a job of a PA, a personal assistant for me.

You know, I don't necessarily read all of my emails.

You know, I use the AI to sift through all the emails that come through, figure out which one needs my attention.

And then when I figure that out, I don't necessarily, you know, type the whole reply in full context.

I just give AI my brief thoughts. It will write an email, I will proofread it, and I'll send it away.

If there are meetings that I want to have, it's all me telling the AI that, book a meeting, da da da da.

So Essentially, if I, you know, if it wasn't because of AI, I would have a personal assistant to do all of those things for me, but I don't need that because I got AI. Okay.

Uh, and it's changing rapidly, right? How, how AI is— we're using it, um, more of the Gentic AIs, the, the motion, all of that's evolving pretty quickly, right?

Absolutely. So I think we were, we are very quickly within the span of 2 years, we've gone from LLMs, which is just something you chat to or you compose an email using that tool to Agentika, which is like you tell them to do something as in like book a flight, as in like, you know, run this meeting for me, those sort of things. And I think it will become more and more prevalent. I think it will lead to much leaner companies, and it's gonna save a lot of cost for companies and startups.

So, you mentioned selling your business, November. Are you still actively involved as the CEO of the business?

Not actively.

I'm only sort of transitioning out of the business because I think I want to start my next thing. One of the reasons I'm here in San Francisco today is I'm looking for my next venture. Again, as one of the lessons that I learned as a founder is, and I think your audience will relate to that, your sort of startup is your baby. You, you, you know, you nurture it, you grow it, and at some point you are selling it. When you're selling, um, your company, it's almost like your baby is leaving the house. So it's sort of, you have to give that responsibility to someone else because the nature of the business will change.

Now, if you've sold your company, you probably got integrated to another organization, that sort of thing.

So there's a transition period, but at some point you have to sort of let go. Otherwise, you're not a founder anymore, you become an employee. And, and it wasn't really what I wanted to do. Um, if you're like me and you like being a founder and building things, you'll probably go back and start doing something again. And so that was a lesson that I learned that I did not expect that. I thought that, you know, when I sell my company, I'm going to keep doing what I'm doing. And then I realized after a while that that's not true. You know, my company has got a life of its own now and it's part of a much larger organization now. And I enjoy building, so I have to go back to building something new.

Yeah, we definitely see that a lot with entrepreneurs, right? Yeah, it's kind of serial entrepreneur. You you get the rush in the building, right? That's the enjoyable part. And so when you sell it, sometimes there's a little bit of an identity crisis, right? Of, okay, this is who I was, right? I was the founder of Tokyeyes, and now it's like, okay, now what am I, right? Trying to figure out who you are, correct? Um, you know, looking back on your journey, you mentioned some learnings. Uh, talk to me a little bit about some of the wins and maybe some of the mistakes like what are the lessons that have stood out as you went through this journey?

Absolutely.

I think a lot of wins will speak for themselves, as in like, you know, yes, we sold the company. Yes, it was a good outcome for everybody. You know, on the clinical side, we ran the largest clinical trial of its kind in our field, that sort of stuff. So I think that, you know, if people are interested in the successes of the company, they can look at my LinkedIn profile.

It's all there. One of the things about social media is that you just put the good things up there, right? So look at my LinkedIn profile, all the good things are there. Now, on the lessons to be learned, and I think that's much more interesting for your audience, I think, you know, from beginning to exit, it took us like, I want to say, 5 years.

Looking back, I could have done the same thing in maybe 4 or even 3 years.

Now, because there were many lessons that I learned by doing. Now, if I were to do things again, I will bring someone or some people that have done it before at the very early stage to guide me through the process.

So at the beginning, it was me and my co-founder, both clinician scientists.

We sort of thought we know this. And that's not true, that's almost never true for any startup. So first and foremost, bring people in day one, bring people in that know what that process, they've gone through the process.

So that's something that I would have done earlier.

Number 2, we created a very good product or 2 products that we took through the FDA. We created 2 products and then tried to figure out a business model for them. Which we eventually did, but it took us some time and effort and sort of mistakes.

Um, if I were to do that again, I will figure out the business model first and then design a product accordingly. You know, it's again, the clinician scientist inside of me was like, of course this product makes sense because clinically it's going to help people.

And that's true.

It doesn't mean that the business model was correct.

And again, eventually we got it right, but it took a while. Now, a lot of your audience will probably relate to that.

It's like you create a product because it's the coolest thing that you think it can do, but you bring it to the market and it fails because you haven't got the business model right.

So I think if I—

now that I'm gonna do my next thing, I'll probably figure out the business model first, and then I start creating what I want to create.

So let's look forward for a minute. What are you most excited about in your next stage? Maybe for— let's talk about Toko Eyes a little bit, but also talk about yourself. What are you getting excited about?

So on the Toku side, I'm excited about the team just bringing more and more products to the world.

So again, the system that I've set up is efficient enough that— and I was there over and above, I'm still there— 2 products with the FDA.

I'm hoping that they bring more products to be eye clinics around the country. So I'm excited about those.

On the personal side, Again, I'm sort of starting my next journey. I'm sort of, I'm almost figured it out, but I'm super excited about getting back to the early days of me and a team of like 3 people just building the thing. You know, it gets me super excited about creating something that didn't exist the day before. But again, now that I've done it once, I think I've learned a few lessons and hopefully this time will be even more efficient. You know, people that enjoy building LEGO sets understand that, that the starting part is probably the most exciting part. But when you're done, you're sort of done and you want to put it to the side and build something new. I'm at that stage.

Last question here. Any, any final thoughts or advice you'd give to other leaders or entrepreneurs who are on a similar journey?

First, find a good co-founder. That is probably the best thing you can do for your mental health. Um, don't go through the journey by yourself.

Being an entrepreneur is a lonely journey, so get a good co-founder on board. Bring in somebody who has done it before, definitely, to walk the path with you. So that's— I think that's number one. Number two, don't create something because you think it's a good idea. Um, I think you create something because you think it's a good idea and it will be a good business. And those two are very different propositions. And finally, expect the highs and the lows. You know, you've got to enjoy the highs, but expect the lows. You know, it's going to happen. And there are days that you feel very dark, and there are days that you're on top of the world. It's all part of the journey. At the end, you know, you get to the end of that journey, whatever that is. If it's an exit, IPO, whatever, whatever that is, you'll get there.

You just have to enjoy the journey.

Well, Lesan, it's been a pleasure meeting you, getting to know you a little bit more about learning your story and your journey from having an idea to building a business that's sustainable and then, and then selling it. So congratulations on that. For those listening, If you wanna learn more about SN and what TokuEyes is doing, you can visit tokuEyes.com. And that'll wrap up today's episode of the Achieve Podcast. So a big thank you to our sponsor, Achieve Fractional, which provides fractional executives for growing businesses. And if you enjoyed today's conversation, follow the show, share with another entrepreneur who'd also find value in it. And again, thanks for listening, and we'll see you on the next episode of the Achieve Podcast.