Initial Investment Is Crucial for Products to Reach the MarketBy Miriam Bello | Tue, 03/23/2021 - 10:29
Q: What strategy does Machina Innovation Lab (MIL) follow regarding the projects in which it invests, such as TOCI PT?
A: TOCI PT is Machina Innovation Lab’s (MIL) first project and from this learning process, we developed our own methodology for investment. We chose a technology-based project that targets a human problem. MIL invests in the initial parts of the project until developers access venture capital or external funds to reach the market.
We accessed economic support from CONACYT and for every peso the council invested, we invested another. In that way, we were able to reach a technology-readiness level (TRL) of 6, 7 and 8, which was very close to reaching the market.
BM: MIL has worked on multi-industry projects. However, we have a vocation for healthcare projects and this is where we have most of our success stories. Currently, we are working on around 18 multi-industry projects. As a company, we prioritize one project at a time, which is why we are pushing TOCI PT now. To date, the development is already in clinical trials as a therapy for lower back pain. Before this, private medical facilities were part of the development process. MIL is very careful to always have scientific and medical support, which is why we ally with universities and public health institutes.
Q: What inspired the development of TOCI PT and what kind of technological and medical support does it offer?
BM: TOCI PT is a device that allows probably the most effective way to provide thermal pain relief therapy. I am a user of this type of therapy and before TOCI PT, I would use common products in the market such as gel packs or warm wet compresses. All these methods are uncomfortable and end up burning the skin.
TOCI PT is an electric pad that stays warm for as long as is needed. The development has transformed since we first created it through different R&D initiatives to improve it. TOCI PT is targeted mainly for domestic use, which was its initial target.
Q: What was the most difficult part of scaling the idea into a product?
AR: Investment might be the most significant barrier for entrepreneurs in Mexico. The market players in this country are not mature enough to be able to invest in the initial stages of entrepreneurial projects in the health sector. Most venture capital firms require the project to already be in a commercial stage, with a valid track record in the market and real sales figures. But to reach this point, the product would have to be previously submitted to a research and prototyping process, which requires infrastructure, knowledge, talent and funds to get to a very basic product.
From there you face other barriers, mostly regulatory. The first filters are sanitary, and then technological. After this process comes legal protection. All of this needs to happen before you reach the market, which forces most entrepreneurs to look for equity investors, most commonly known as family, friends and fans.
Q: What is the plan or strategy to bring TOCI PT to the market and grow its presence?
BM: We always try to be very objective with the time it will take to reach the market, which helps us decide if we want to go forward with a project or not. We also analyze the regulatory process, as this can completely stop the development from reaching the market. To bring innovation to the country, we look for the easiest products to position. That is how we chose to push TOCI PT forward. When the product is ready, it will be manufactured in Baja California.
AR: To date, TOCI PT is participating in a seed investment round as the last step before reaching the market. TOCI PT is intended to be marketed to users through the digital platform called Indiegogo. After this, we expect to validate its development at an international level and we will then begin working on the regulatory processes with the FDA, as the US is the first country we are targeting outside Mexico.
Machina Innovation Lab (MIL) offers a pre-incubation strategies for technology-based projects coming from a technological scouting program, taking these developments from the academic sphere to the private sector.