On the morning of PAVmed’s market debut earlier this year, Purchase-based co-founder and CEO Dr. Lishan Aklog rang the NASDAQ opening bell with his team. By the closing bell, shares for their barely two-year-old medical-device commercialization startup jumped 400 percent. Dr. Aklog says cultivating deep networks across Westchester helped make the successful IPO possible.
“I often find myself at social events and think, ‘Hey! We can have a PAVmed investors meeting right here!’” says Aklog. Most of his investors hail from Scarsdale and Edgemont, where he and his family initially lived before moving to Purchase.
PAVmed has come a long way since Dr. Aklog’s days of testing and tinkering with devices from his townhouse office in Edgemont (the firm is now located in Manhattan). In 2012, he decided to leave his position at New York’s Mount Sinai Medical Center to focus on medical devices full-time. Two years later, he founded PAVmed with Dr. Brian deGuzman and Michael Glennon. The company guides medical inventions from concept to commercialization through clinical trials, the FDA, and other hurdles. Their mission is to get the devices to market, and into physicians’ hands.
Its most recent product is the CarpX, which treats Carpal Tunnel Syndrome. According to Chief Medical Officer Dr. DeGuzman, this condition “is expected to further grow as a result of aggressive thumb-typing and phone use.”
While PAVmed’s founding team includes two Harvard-trained doctors, any aspiring local entrepreneur can draw useful lessons from their entrepreneurial journey, like the following.
Tap Into Your Local and Social Networks
For any company to be listed on the NASDAQ, it needs a minimum of 500 investors, so PAVmed couldn’t just shoot for two or three big checks. “It was a lot of work, and a lot of talking to people that I knew here in the community within our social networks,” explains Aklog.
He even recalls when the restaurant lobby at the Ritz-Carlton in White Plains felt like a second home. In the months leading up to PAVmed’s IPO, he’d set up hundreds of meetings with potential investors at the lounge. After a marathon of lunches, dinners, calls and PowerPoint presentations, news about PAVmed’s innovative work began to spread across the county via word of mouth. One investor even convinced his wife and three grown children—as well as a handful of co-workers—to invest. Eventually, PAVmed raised $5.3 million from two institutional investors and about 500 investors.
Be Bold, Be Audacious
The most important connection Aklog made within the Westchester finance community was David Weild, former vice chairman of the NASDAQ who now runs Weild & Co, a Colorado-based investment firm. The crowd-funding expert helped guide PAVmed through the IPO process.
“The experience taught me the public markets are not just for the Facebook and Twitters of the world,” says Aklog. “They can deliver capital to smaller, early stage companies.” Weild’s advice also taught Aklog another lesson: “Entrepreneurs don’t always have to follow the script of how businesses need to grow.”
While fundraising, Aklog ran into some investors who questioned whether PAVmed was ripe enough for the markets. Some thought a company needed to have millions in revenue and several milestones before going public. “We went public in a situation that’s highly contrarian,” says Dr. Aklog, though he affirms that confidence in their vision and solid industry experience helped clear the path to gaining access to capital.
Many prospective investors also thought a private company needed hundreds of employees before going public. Even post-IPO, Aklog admits that he continues to run PAVmed in a capital-efficient mode with only five full-time employees. And even though Dr. Aklog shares that the company plans to eventually expand (his team hasn’t ruled out moving some operations to Westchester), he stresses, “A lot of what we do with design, development, and manufacturing is done through outsourced experts. We want to stay lean.”