BoneChat #65 - New Venture Studio Model created by OREF explained by Lee Grossman, CEO of OREF.

All right, welcome to Bone Chat Discussion Number 65. Uh, so if you've worked for an orthopedic device company for any length of time, you've run into ORAF. Uh, they were founded in 1955 by surgeons to fund independent research and education in orthopedics. And when Lee and I talked a few weeks ago, I realized that, that OREF had a fund and an accelerator program called Horizon. So I invited him to BoneChat to discuss. So welcome, Lee. The mic is yours.

Well, thank you. Thank you for inviting me to be part of BoneChat. I really appreciate it, Tiger. I've been, since I've been at OREF, which has been the last 6 years. I've been following your e-newsletters and your, uh, the information you put out and, uh, love your perspective on, on just about everything and, and share what you're doing. So thank you for doing what you're doing and also for putting on Bone Chat. Um, I could talk a lot about OREF, obviously. Uh, I'll get down to, uh, the main reason we're here, which is to discuss the Horizon Fund, uh, and it was a logical, logical progression out of what OREF has done over the last 70 years. Uh, it's kind of surprising we haven't, haven't done this, uh, before. Uh, we have funded 4,700+ grants, uh, over our 70-year history. Wow. And, and many of those have gone on to be very successful multiple commercial entities. You know, one that comes to mind right off the top that everybody's probably aware of is Martha Murray's invention of the BEAR implant, which is handled by Mia Orthopedics and Mia Orthopedics. And the— almost all of the initial funding that went into that research was from OREF grants, and that's just one of many, many grants that we've funded that have gone on to commercial realization. But with that said, there are so many more that have not, and it's the conundrum anybody that's in a startup mode or has a great idea, you know, how do they get this to actually become a commercial product? And when we looked over our portfolio over the years and our active portfolio, we handle about 100 active grants a year. We were thinking there's some great ideas in here that, how do we get people from idea to, into surgeons' hands to improve patient outcomes? So we decided, well, let's start exploring how we would start a fund to do that. To do that, to take the grants that we have provided to people, because we know they've already been vetted, they went through it, they went through a very rigorous peer review process, they've done the research, they have data, they've proven themselves. So here you have this tremendous researcher with a good idea that already has data. How do we capitalize that and help these ideas go on to get over that valley of death and getting more funding. By the way, I should say that we have a really great history. About 20% of the grants that we fund go on to get more significant federal funding, which— and I don't know of any other foundation in all of healthcare that has the success rate that we have. Of our career development grants, 50% of those go on to get NIH funding. So we— and that is, I think, very much a aspect of the fact that we do have a very rigorous peer review process. We have limited funds that we can give out for grants. So we're very careful on what we select and As a result, those are usually very high-quality researchers and research projects that go on to get that. But so we looked at that and we decided that we were going to start this fund that would be focused primarily on those individuals that we've already awarded grants to. So we've limited it to this point. We started in May of last year. And after the Academy meeting, we're probably going to open it up to anybody that has good ideas to come forward. And what we're looking for is early-stage opportunities primarily. That's, that's what we— what our initial emphasis around that may evolve. What we did at OREF when we decided that we would do this, we started interviewing a number of venture capital groups to see if they'd be interested in working with us, noting that we have some deal flow in the people that we've already funded and how we can work through that. We met with a number of groups, decided on the one that we're currently partnering with, and together with that group, we created this Horizon Fund. So it follows somewhat of a venture studio model where people come in, bring their ideas in there. We have a management team that will work with the inventor to take this through all the aspects that it takes to get it to the point of either flipping it over to a strategic or even taking it to market themselves. And what we— the way it works is that we will negotiate with the inventor up front so that there's a guarantee of what percentage they're going to get. So they know at the time that it is flipped what they're going to get, which we find is somewhat different than what typically happens to an inventor where they— where their percentages of ownership are diluted with every funding round. We want to guarantee that the inventor will have a certain percentage, that they know what that is from the get-go, and how the waterfall of monies that would come in if at the time it is, uh, uh, uh, the idea is sold to like a larger company, where the money would be dispersed and how that water flow would, uh, waterfall flow would, would materialize. Uh, our management team would be very involved in the marketing, uh, the regul— the regulatory, uh, funding for the research to get it to the point of commercialization, all aspects there that go into bringing a product from idea to market. When somebody comes to us with an idea and let's just say it's regardless of if it's fairly well developed or even not so, our management team will sit down with them and develop a pitch deck. And educate them on how to do that. And then after that is completed, the onus is on the inventor to sell us on the idea that this is the group that we want to fund. Those are kind of the nuts and bolts of how we've started this. The venture group that we're working with is very well funded. They're looking at probably providing upfront anywhere from $500,000 to maybe as much as $2 million upfront. And then, you know, certainly whatever is necessary from what everybody believes will be the funding levels to get it to the point of commercialization. That's a great that, that there's an understanding of, that the funding will continue to get to that point. So that's what we've done. As I said, for OREF in our history, it flowed very well. We've, we wanted to find another opportunity to, to develop innovative ideas, innovative products, and get them into surgeons' hands. So that they can improve patient outcomes and provide— this is just one other opportunity for those brilliant clinical researchers out there to be rewarded for their hard work, for their dedication, for their passion, and for their brilliant ideas.

Do 100%— oh, just a minute, Elizabeth, sorry. Do 100% of the ideas come from surgeons, surgeon researchers, and there's no industry ideas that that bubble up?

Where we are right now is that we were requesting ideas from researchers, so that's usually MDs or PhDs. As I said, we've already gotten some people approach us that are industry or, or let's say non-MD or PhD. People, and we're beginning to look at those as well.

Okay. Lee, I was wondering what types of questions the VCs might have had before committing to this. You know, I'm thinking that this is a different perhaps kind of fund than they're used to. Was there anything interesting that they asked about?

That they asked us about? Yeah, that's a good question, Elizabeth. If it— when we started reaching out to the VCs, we were somewhat selective. We wanted to find ones that were familiar with the MSK space, because that's certainly what we're dealing with. And surprisingly and happily, I believe all the ones we approached already knew of OREF. They perhaps had some dealings with one of our board members. They felt very comfortable talking to us because they knew our board was going to be intimately involved with this. They all commented on our reputation, our credibility, and they were impressed with the opportunity to have access to our grant recipients. So there wasn't a lot of questions that came from their side on this. Uh, OREF, uh, is, uh, been putting a lot of staff time, uh, into this. Uh, that's our contribution to this. Uh, we feel that we've already, uh, contributed, uh, by funding the research. So, we, the VC partners that we have, aren't having us expend any more money into this other than our board volunteers or staff resources. And that was important to us as well. We want to be— OREF needs to be, and certainly we want to be, good stewards of the donor monies that come into us. We're 100% donor funded. So as a result, we have to be extremely cognizant of, of, of that and, and be, as I said, very good stewards of how we take care of the donors' gifts to us. So, yeah, so that we kind of felt like we had the best of both worlds here where we had a VC group that was willing to fund the ideas and, and we would benefit from it as well by getting a certain percentage of, of the, uh, assets at, at any time that the, uh, idea would, uh, turn into a commercial product. Yep.

Go, go ahead, Mark.

So I've been to a few meetings, you know, OREF over the years, and I always felt like I was going to church. I just had great respect for the, the work that was being done, the scientists and physicians who came. And I've been asked a couple of times through the years to give talks to groups about how physician entrepreneurs can get their ideas developed and so forth. And I generally always start with warning them that they're probably going to get screwed by industry if they're not very, very careful. So my question is, How are you protecting and coaching and nurturing those scientists and physicians that come forward, uh, and, you know, as sort of an— in your role as incubator, developer, and helper?

Well, that was very important to us, uh, as, uh, uh, as you mentioned, going to ORF, uh, uh, I've never heard of be described like that as going to church. But we're, we feel very strongly about our role in the orthopedic community. We're body part agnostic. We are willing and wanting and needing to collaborate with everybody in the MSK space. We know that that's the way to leverage our collective power to be able to fund greater grants and utilize the key opinion leaders and subject matter experts that drive our rigorous peer review process. And when we were thinking about this, we know how inventors usually get the short end of the stick. You know, by the end of— by the time it you know, industry is interested in, in purchasing them, or they've gone through various rounds of funding, their percentages just get to low single digits of ownership, typically. And we felt that we wanted to make sure that there was a fixed percentage that they would be guaranteed to get at the time of the sale of of their idea. So that's upfront and put in writing for those that we, that we decide that we're going to work with. It's done on an individual basis, but I think it's one that people will be happy with, particularly since we have a management team that comes in, is going to be doing a lot of the work and their experience. They know how to do this. Um, and, um, um, uh, did that answer your question, Mark?

Yeah, pretty much. Uh, do you guys do like, um, do you have like any kind of an internship program for, um, young people that want to get into this end of, you know, sort of combination research, philanthropy, and so forth? And one of the reasons why I always felt like I was going to church is that I met so many really great physicians through the years that one of their most noble donations was to the OREF, and they were getting nothing for it other than their dedication to their profession. And I thought that was cool.

Yeah, I think I, I, I agree with you. I was in the industry for in the orthopedic industry for over 2 decades. And I, through family and other circumstances, I got very involved in nonprofit work. And in 2005, I went into nonprofit work full-time. I was at the time at the J&J distributor. And so I moved on from there and I've been doing that for the last 20 years full-time. And I have to say that in the, in the, as a volunteer and as staff person in the nonprofit space, I've never had a board as dedicated, as passionate, as expert and willing to support a mission like I have at ORIF. I tell people it's the best gig I've ever had because it combines my passion for nonprofits and the career I chose to be in orthopedics. So it's a really great gig for me. And that's what we find from our, the people that we fund as well. We, there's so MSK research right now, I believe, is in crisis mode and more so now and recently with a lot of what's happening on the federal level as well. And there's It, it, I'm very proud of the fact that OREF is perhaps the only option that they have for funding their ideas as, as young clinician scientists. So I'm very proud of that, but I'm also very sad by that because I know for every RFA, request for application that we send out, we get maybe 40, 50 or more responses. We can only choose one, and we may end up with 6, 7, 8 that are above the payline that are worthwhile projects. So there's so much more that's left on the side, and, you know, that saddens us because we have limited resources as well. But the people that do receive these grants, it, it, uh, I say this to my board and my staff. Every meeting I go to, and I go to a lot every year, somebody comes up to me with this fascinating, what I describe, OREF origin story of how this idea that they had as a resident got funded by OREF, and it launched their career as a clinical scientist. Or their academic career. And I can go down an endless list of people that we all know that are leaders in the field right now that credit OREA for that beginning.

That's pretty cool.

Thanks. Does the board— do they— what's the incentive for them? Are they just on salary giving back, or did they get a piece of the equity also?

So the board is, uh, so there— so the ORF board is, uh, isn't involved with this. There's a separate Horizon board, and it's, it's on the— if you go to horizonfund.com, you'll see who's on the board. Uh, currently on the board from ORF is Josh— Dr. Josh Jacobs, who's the president of ORF. He's He, the last 16 years, was the head of the Department of Orthopedics at Rush. And I'm also on the board. So that was to give OREF a strong say in the matter of really every aspect of how the Horizon Fund is, is operates. The Horizon Board does receive remuneration for what they do. The OREF representatives on those on the board have developed a policy at OREF that any monies that we receive from that work that we do on the Horizon Fund Board is donated back to OREF.

Good. That's good.

Yeah, so I won't, I won't benefit from it other than being able to see a great idea become, uh, part of a surgeon's armamentarium and helping patients.

Well, and one big exit could really help the fund too. It's one event. Yes.

Yeah. And, and, and OREF, uh, is getting a percentage. I, I mentioned before about the waterfall. There's a, a percentage of, uh, that waterfall that goes directly into OREF and We, the OREF is part of that, is already committed that that money will go directly to fund more research.

Oh, that's terrific. So you said you're agnostic to the whole body, obviously musculoskeletal. Are you, are you guys funding the, the new whizbang stuff, you know, AI and genomics and imaging and all the crazy new stuff? Or are, is it pretty traditional? I know MIAC is a pretty cool technology for sure.

If you go through, if you go to our website, oref.org, there's a place where you can go where you can see what we've funded over the years. And if you just go in the range of, what is it, the last one, I guess, what would be 2020 to 2024. You'll see the full gamut of what we have funded. And it, it is everything. Uh, trauma, it's pediatrics, it's spine, uh, arthroplasty. But in there you'll see that it's cellular, uh, technologies, biologics, uh, robotics, patient registry, uh, data collection, uh, AI. Uh, yeah, it— we, we are interested in what is going to drive the field forward. Where's the innovation coming from? And we don't do any implant comparisons, for example, companies' products versus company products. It's more on where's the science going, where does it need to go? I would say that we have a very big interest, and you'll hear hopefully more about it as the year goes on, and looking at mechanisms of pain. We're going to be involved in a couple of consensus conferences later this year around MSK pain. We're looking at infection. We just— a grant that we gave a few years ago just completed and should be published very soon. That was headed by Dr. Tom Ferring from North Carolina. It was a multicenter study on looking at one-stage versus two-stage revision surgeries post-infection for, for total, total hip or knee joints. And it's, it's definitive in, in what its conclusions were. So, so yeah, it runs the full gamut. There's probably no aspect of MSK that we that we don't touch. We also have been looking at societal issues like healthcare equity and accessibility because that's very important to, certainly to MSK. MSK has the largest by far healthcare burden. Nothing comes close to it in terms of cost expended and numbers of procedures. So it dominates healthcare. And yet there's so little given in research monies to that as compared to many of the other, you know, well-needed and well-meaning medical conditions. But we are comparative to our burden of disease, we get pittance in terms of research funding. And that's— we feel very responsible for that. So the money that we get in, we want to spread it around so that we're covering a lot of different areas as well.

You know, I just have, as I've said here before on some occasion, in the last 10 years or so, I've been heartened to see an increase in the number of articles regarding either physician mental health or the interaction of ortho conditions and mental health conditions. And then that gets into sort of social determinants of health. You know, that's not so sexy, right? SDOH. But a lot of times, you know, outcomes can come down to things like that. And I mean, is there any consideration given to what extent a study is going to address that, you know, all those factors, the surrounding factors?

Uh, yes. Uh, so, uh, we, uh, sponsor 6 resident research symposia a year, uh, and, uh, we hold those in conjunction with, uh, a, uh, university or medical center that's hosting it. This year we're going to be doing University of Miami, University of California San Francisco, Hospital for Special Surgery. These are the ones that are already lined up. Pitt, University of Pittsburgh, and sorry, I'm forgetting the last two, but they're in the fall. And that has been a— so we issue out a request for applications from residents, and we may get 70 Responses to that, we choose 20 to 25 to present. And we, I've noticed in the last few years that those social determinants of health have been part of those presentations that the residents have been giving. And which is great. It's good because it's again, going back to this extreme burden of healthcare that MSK dominates. People don't realize the general public doesn't realize that if you have a, if you have an orthopedic injury or condition or an issue, that your chances of having diabetes, having, becoming obese, becoming depressed are dramatically, dramatically, dramatically increased. And, and our cardiovascular issues as well. So that I would say that when we're out presenting the issues that we find most important in orthopedics, the social determinants of health is something that frequently comes out of either something I'm talking about or our board members are talking about.

Yeah, that's good to know.

Thank you. Well, really interesting.

Move or die, you know, you have to keep moving.

Yeah.

Or, so, how would it take me through the process? So you have a young surgeon maybe with a friend in industry and they've got an idea. And how would they qualify, get, get to the level to qualify for an ORSAN lease application? What, what's the minimum bar?

Yeah, I think that's a, that's a great question, and we don't have what I would say a template for that, but we do have a, we do have a mechanism on how this would progress, and the first thing that I'd say is that they go to the horizonfund.com website and there's an area there where they can— they don't have to submit any information except that they're interested in talking with somebody at the Horizon Fund. The person who's head of the management team will, I would say, get in touch with them almost immediately. And begin discussions with them, you know, talk to them about what NDAs might need to be signed and what the process is. If even just through that initial interview they feel that this is something we'd want to pursue, again, if there's NDAs or other aspects that need to be signed, take care of that. And then that— those members of the senior management team begin to work with them to to develop a pitch deck to really more fully develop what the— excuse me, I'm going to turn off my phone. Sorry. Develop a pitch deck and I would say just handholding on how to best present their idea because at some point they're going to have to present it to the board and the board will make a decision on the funding. And there is a lot of handholding during that process. This group has done this with others that we know of, and the— even those, because we, we talked to those that went through that process and did not get funded, they were very appreciative and very happy with the materials that were, that were developed by the management team and how they were able to use that going forward, perhaps seeking other sources for funding. So, and, and that's— I, I think it's a fairly short— can be a fairly short timeline from that first, I'm interested, putting that on our website until the, the board is considering funding it.

So, Lee, what have you found? What areas do they most need handholding?

In? I think because they're not trained, uh, certainly the surgeons, they're not trained to do this. They're, they're brilliant people. They're trying to do, uh, uh, trying to be medical doctors and to be surgeons. Uh, they're trained in their area of expertise of science so they can conduct this, uh, the research and develop the ideas that they have. But taking it to the commercial side, the business side of it, it's, it's an extremely rare animal that you're, that you'll find that has that level of expertise to make that happen. And that's where the management team comes in to, uh, uh, assist them with that.

And what, what have you found is the areas where they really need to say, no, no, no, you need to do it like this, where they're really off track?

Probably everywhere. Oh my, okay. I mean, it's, um, uh, it's— I, I think every circumstance would be different, but, uh, it, it, it's, uh, really teaching them much about how to— or, or helping, assisting them not so much teaching them on how to best represent their product, how to more develop their idea so that it is commercial. Having them understand this, that's one of the, that's one of the important aspects that I think of the people we've interacted with have minimal understanding of what the full scale of the process needs to be to get to commercialization. The regulatory side to make sure that it's going to be something that can be reimbursed. So you have the whole reg— the whole CMS side, you know, the marketing aspects of it if it's really going to have an appeal, and then just making the product as well. So yeah, there— I, so yeah, if I was to more directly answer your question, if there was one aspect, it's just understanding the entire process of the steps that are needed to get to commercialization. That makes sense.

The handholding sounds great because I'm sure the researchers get a lot more feedback from ORF than a VC. A VC says, thanks for coming in today. That's really great. Yeah, I've dealt with in industry a lot of naive surgeons with every— like everybody, you know, they're really good at one thing, but they're, they're not good at commercializing. I'll never forget at Wright Medical, we, I bought a surgeon's patent, sent him the check, and he goes, great, when can I start putting this in? Whoa, whoa there, chief. So yeah, it's, it, I, surgeons aren't privy to all the, you know, or, you know, the mechanical testing and the FDA discussions and market research, and, and they're just not privy to all that. But we can't touch the patient. We can't get in there and really touch the patient and treat the patient. So we, we have a huge weakness too. That is interesting. I'd love to hear from Colleen Gray if, if, because she's been both a startup founder and now she's a capital allocator. She's been on both sides of the desk, and I know she's got some thoughts.

So I say thanks. I'm gonna have to go to another meeting.

Thanks, Mark.

Lee, thanks for your time. I have great respect for the organization.

Yeah, thank you, Mark.

I appreciate it.

You can say you've been to church today, Mark.

You know, Tiger, and the whole group, I see you know, musculoskeletal companies at all stages. And I do actually just speak to some inventors that really have an inventor, you know, an invention, a patent, and a desire to build a company. But those are just way too early stage for us at US Capital. You know, I think kind of looking at early-stage companies in general that maybe are a little bit beyond an invention and a desire. You know, what I see as some of the biggest gaps are there hasn't been a lot of thought given to the exit. I mean, they talk about, oh yeah, we're going to sell to a strategic fit in terms of crafting an actual plan. This is what we want to do for an exit. Here are the, you know, our first round of funding, our second round of funding. This is what we have in mind. I mean, they're just not thinking about how do they connect with an investor who's only investing because there's an exit in the future. And I think sometimes that's overly optimistic financial models and forecasts as well as You know, the idea that they have to be really good stewards of the cash they already have and demonstrate that, that, you know, I see, I see founders come in and, you know, they want to make $250,000 a year or they want to pay a management team, you know, $1.5 million a year in total. And that just doesn't, you know, fly with investors in the market today. Because they're competing with so many other companies for scarce capital allocation dollars. And, and so I think that's where, you know, when we agree to work with a company that is early stage, we really also coach them on, look, you've got to change your financial model. You've got to tweak things a bit. And you really got to articulate, you know, how are the investors going to win? As well as, you know, articulate how your product really is going to reach the revenue goals that you're forecasting. And so I think unrealistic expectations are the biggest challenge in general. And I'm guilty of that as a founder. I learned the hard way.

Sage advice.

Yeah. I feel like I just went to church there.

Yeah, Colleen's rare. She's one of the few people who's been on both sides of the table. You know, she's been a scrappy CEO of a startup looking for money, and now she's evaluating companies on the other side of the table. Interesting. Andrea, if you're there, I'd love to, I'd love to jump into, I was thinking about how does intellectual property handled early, you know, when you register on the website, when and how is intellectual property handled? And I don't know, I'm not asking the better question. Andrea can ask better than me.

But yeah, I mean, I was wondering, I'm sure the inventors don't come to you already having done that kind of homework. So is that done by OREF? How are you handling that side of things?

Well, that's, that again, is part of our, the discussion that the management team will have with them. And you probably could appreciate that this could get very tricky because these researchers are working at a medical center who is claiming that, that, that, that IP belongs to them. And it may. So we're cognizant of that and the fact that any discussions around that will have to involve the medical center, for example, the academic center, and that they too will have an important say in how we move this forward. It's We've, we, we've come to the conclusion that sometimes we just won't be able to work with the medical center or the academic.

Yeah, I was going to ask if that has ever been a problem and a roadblock.

So far it hasn't been for us, but we're very, very early on and we haven't, we haven't crossed that bridge yet, but we, we had, so, so almost everybody on my board is, has run a department at a medical center. And those were some of the questions that they were throwing out, like, you know, my, my institution would never allow this idea to work with Horizon. And our response was, well, you know, it's We'll just have to deal with that every time that it comes. And realizing that there are institutions that we just won't be able to work with.

How about the sort of— how are you balancing patentability and freedom to operate? Again, these usually come— sometimes they're done very early to evaluate if someone is going to work with an inventor, and sometimes they're sort of pushed later on?

Yeah, we, we try to get as much upfront, uh, figured out as possible. Uh, I mean, Colleen, uh, was talking about the exit strategy. That's something that is discussed upfront as well. Uh, again, if, if we're going to be investing, um, in an idea, we want to make sure that everybody's on the same page and has the same expectations and And as much as we can put those up front— exit strategy, the way that the IP will be handled. And then we make a weighted decision on, you know, something that is good for the inventors, is something good for us, and is this viable?

So are those things sort of conditional to the application being accepted?

I think that that's all work— that's all worked out during the, what I'll call the pitch development phase, which is early on. So, and that's all done before, certainly before decisions are made on the actual writing a check to funding it.

Yeah, it's always interesting because it's such a challenging— you know, it's just one part of a whole, but it can be a roadblock and everything else can be great. And if IP is not sort of aligned as well and a bit of a green road ahead, then it can be a major determinant.

Yeah, and that's why we want to get the IP matter settled and agreed upon upfront before any funding decisions are made. And I want to make sure that it works for everybody.

Yeah, Elizabeth.

All right, so I have my magic wand question. So aside from the money aside, which is hard to do, right? If you could wave a magic wand and change something about the program, what would it be?

I, I, I, that, that, that answer will definitely evolve over the years as we're more, uh, in line with this. Since we're just starting out, I would say that, uh, my greatest wish now is that we'd have more people coming to apply to the fund. Um, PR, uh, I don't know if it's PR, it's marketing, but it just seems as though we would have hoped or expected more people to do that. But, you know, what the VC group that we're working with, they, they, they've said, well, you know, this is— you're new and there's going to be some hesitancy. You know, really what we need to do is get a few of these under our belt. That should, that should make more people wanting to approach us.

I understand that because you're not there. I mean, Horizon is new, but it's backed by ORF, which gave the VCs confidence, but it should give the potential fundees confidence as well.

Yeah, and it might be just our marketing outreach isn't strong enough. We've talked a lot about this internally among our staff at ORF and We're gonna have another push very soon before we're in San Diego, which is very close to happening with the idea of hoping to talk to people while we're there in San Diego. Okay.

I mean, you certainly have probably the best brand in orthopedics. So it's—

Thank you, Tiger.

Yeah, I mean, it's safe. Lots of smart people, you know, a lot of people donating their time. It's— I think the only, the only negative I could see is you only have one VC partner. So a lot of times a startup, you know, they, they present to 50 VCs and they're looking for the best match, you know, it's cultural match, same goals, same thing. But if you had to just choose one VC, uh, on purpose, it's, it's a little bit like Dating, you, you have to date this one person. You can't go to the party and look around. So I think that, that may hurt a little bit, but I, but I think you're right. It's just going to take time, exposure and time, and more, more base hits, more exits, and it, it will come.

Yeah, well, and I appreciate that feedback too, because again, that, that's something that we've talked about. We are married to the Horizon Fund now, but if this takes off and we find that there aren't good fits for the Horizon Fund, for example, you know, this, this may happen in the future. We've talked about it, you know, that we would open it up to other VCs as well. At ORF, our main goal is what can we do to drive innovation? How do we get more money in our door to fund more research? And how do we improve patients' outcomes? And we've never looked at ourselves as being the gatekeeper to any of that, the arbitrator of how this is going to be conducted. Our, our mission is pretty simple and to a large degree, very altruistic. How do we get more funding so that we can do more research to improve people's lives. And if that means going through the Horizon Fund or something else, it really serves our goals to make sure that these ideas, these worthy ideas are funded and that they get to into the surgeon's hands.

Yeah, that's the goal. I, you know, we, we collectively, we've been in the industry so long, you know, and we, there's so many great ideas that just never see the light of day. It's, it's incredible. And I, I think there's 1,000 ideas that are, that are real unmet clinical needs that, and where there's a better idea and it just never makes it. You know, for one reason or another.

Yeah, I mean, I see that every day with patent applications and even applications that have been granted, right? And you never see the products on the market. And that's often a reason why a lot of, especially surgeons or people who have been working in the field for such a long time and they feel like they know everything that's out there. And it's hard for them to understand that there is 1,000 times more ideas that people have tried to move forward with and have stopped for whatever reason. And, you know, IP is one place where you can find a lot of that. You can see what has been abandoned, what has been patented, but no product on the market. So it's pretty pretty neat from that perspective, but absolutely so much.

That's really, that's really well said.

Yeah, go ahead.

Lee, to the extent that I meet with and am impressed by a particular inventor and wanted to, you know, give them a heads up that they should seek out OREF and apply, should I just drive them to your website? Is that the best way to do it?

Yeah, the, you can drive them specifically to the fund's website, which is horizonfund.com, or, or, or to the OREF website. I think we have a link back over to the Horizon Fund, but either one will be fine.

Yes.

Great.

Yeah, well, I'll funnel people that way also. I get calls from surgeons from time to time. So that's That's terrific. Jesse, you have any questions? You've been, you've been soaking it all in. Jesse, the trauma startup.

Yeah, we're no, just taking notes. I mean, we're, we're, this is something we're much further down the road on the path, but it's definitely interesting to learn, and I can definitely send people that way. I get questions a lot about, uh, how do you break in and how to get, uh, initial funding. So It's good to have a resource.

And let me, let me make a comment. Another thing that I hear from surgeons, and I've heard it both when I was working for a large company and now as an independent, is they take their ideas naturally to the big companies, you know, the Zimmer, DePuy, Smith Nephew, whatever. And, and then they just get it, they get stuck in their system, you know, and just months, years go by. Nothing happens because they don't realize there's a, you know, there's 257 projects, you know, and it through triage, their, their interesting idea never gets really worked on. And so they, they call me sometimes and say, how do I, I can't get my idea back. You know, I need to, how do I, so, and, and they get burned and they, they sort of, and I kind of tell them, don't ever take your idea to a big company because They are not, they don't know how to innovate anymore. You know, they're just these giant engines of sales and inventory and contracts. They're, they're not innovators anymore. That's why they buy startups. And so I, I mean, wow, this would be way better than making that mistake. Have you, have you seen researchers that have gone to the big companies and then step back?

I would say that we haven't been really privy to that sometimes. My own experience of while I was in industry and the surgeons would have friends of mine who were surgeons would approach me with a good idea. I was almost every and every time telling them, don't go to the big companies, you know, either seek out VC money or go to a smaller company. I refer to it, I said the big companies will slow walk your idea, and it's because there are a lot of projects going on and a lot of other priorities. I would, I, in our experience right now at OREF, no, I really haven't, you know, seen that, but I'm sure that happens quite a bit.

I, I mean, it's also that the big companies are not unbiased towards them, right? So they want to work with the surgeon. They don't want to damage that relationship. Again, from my experience being in-house, and so they have to walk that fine line of, of keeping the surgeon happy and engaged and working with them in the future. And so they're, yeah, they're not, they're usually not going to say no, or they try to say no politely, and surgeon just doesn't, 'cause they really want this idea to move forward. And so it's much better to go to a third party that is unbiased.

Yeah, that's a huge advantage, I think, for Arisen.

Yeah.

In fact, I would market it like that. I mean, without naming names, I would just say, if you, I mean, because one of the things you offer is speed, and that is a big value. Surgeons wanna know if, my baby's ugly or my baby is pretty quickly. And with the, with the, you know, world-class evaluators that I think that's a big advantage.

See a campaign like that, you know, learn early if your baby is ugly, get it over with, pull the bandaid off.

Well, sometimes it's a great idea. It's just not you know, it's too, the cost is too high. You know, you could never make a profit, or it's a Class 3 device and you can't fund it for 10 years, you know, but it's a great idea. You know, there's, there's reasons, um, sometimes, and they just need to, surgeons need to hear that, uh, rather than get teased along. I like that slow walk analogy. That's, it's a good way to say that.

Yeah, well, I had a good friend that I advised him not— this is a long time ago, but he took it. He did take his product to a company, and I thought it was a brilliant idea, and it never saw the light of day. And I had warned him about, about that, and every time I talk to him, I have to hear about it. But that's not— yeah, that's the— that's how the business is now. Uh, I, I, and, and then certainly, uh, people that have been associated with ORF on our board have done very, very well by industry, uh, with their, with their ideas and their products that they've brought to market through industry. So, you know, it— there is no, uh, one answer for any of these, uh, questions.

Yeah, another, another reason they, they slow walk you is because they they, they have to protect their legacy products that they, you know, they have to sell, they have to meet earnings every, every 90 days with selling the existing product. And it's really hard for them to disintermediate that product. And, and, you know, it's going to mess up their financials for a few quarters if they— and that, and they just, they just can't do it. You know, they live and die every 90 days. And that's why they buy startups. Well, this has been, this has been fascinating. And I've learned a lot. Hopefully you've gotten some good questions, Lee, and I appreciate your time.

I really, I'm so appreciative of you inviting me and Tiger. Everybody's ideas and thoughts and suggestions here I thought were fantastic, and I'm going to talk to that— talk to the Horizon team and to the staff about this. But I— so this has been a great learning experience for me as well.

I'll send you a copy of the recording, uh, so you can pass along. Um, well, if anybody's in, uh, San Diego, you know, stop by and see Lee. I'm sure he'll be presenting many different times.

Yeah, we'll be all over the place.

I'm sure. Well, thank you again for your time. Appreciate it.

Thank you.

Thank you.

Keep it going, Lee.

Thanks.

Thanks, Lee.

Bye-bye.