Slicing the market for the best ROI pitch

Slicing the market for the best ROI pitch.

Situation: A start-up company on the brink of clinical trials wanted to better understand the target market for its new surgical tool. The tool is designed to facilitate during a common ophthalmological procedure, and the company hopes to attract a major investor.


Background:

  • Until this point, the company relied on general, mostly anecdotal market data
  • The tool targeted a relatively low-cost and highly successful manual procedure for a medical condition that predominantly afflicted people aged 60 or older
  • Medicare covered the majority of procedures being done for this medical condition

What our analysis uncovered:

  • The market was strong, but not expected to grow as quickly as the company originally believed; based on the rates of population growth and disease incidence, the need for the surgery would remain stable and predictable over the long term
  • Surgeries for most of those affected by the medical condition were extremely successful using the manual method and were covered by Medicare, therefore, for these cases, the incremental cost of the tool would be a major adoption barrier
  • However, for three high-risk groups associated with the medical condition, the tool would significantly minimize risk and thereby prove to be a major benefit
  • Only a certain percentage of U.S. ophthalmologists regularly treated the three high-risk cases

Recommendations:

  • Pursue only the surgeons and surgeries associated with the high-risk groups to interest investors in predictable, strong return on investment
  • Assume the rest of the market will only adopt the technology once it has proven beneficial for the high-risk patients

Results:

  • The start-up company accepted all the findings, and armed with the unassailable market data is seeking a strategic multinational partner