February 2, 2023

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MedCrypt’s $25M Deck • TechCrunch

In September, the FBI warned that more than half of the connected medical devices in hospitals have critical security vulnerabilities, and these vulnerabilities are fueling a wave of attacks on the healthcare industry. As reported by Carly Page, MedCrypt has raised a $25 million round to help device makers address security-by-design when developing the next generation of medical devices.

The company is an alumni of Y Combinator, which offers software for everything the US Food and Drug Administration would consider a medical device where cybersecurity might be an issue, from insulin pumps and heart rate monitors to AI-based radiology tools and autonomous robots. I’m sure we can all agree that we don’t want to live in a world where people are being blackmailed to keep hackers from shipping their critical health devices to the Fritz, so let’s take a look at the story MedCrypt has with its investors shares to increase his Series B.

We’re looking for more unique tear-off pitch decks. So if you want to submit your own, here’s how to do it.

slides in this deck

The MedCrypt Series B deck is a decent 12 slide deck. The company’s COO, Vidya Murthy, who shared the deck with me, said it was as advertised, except that some of the customer acceptance information was redacted. Makes sense; Security is a sensitive business and I imagine keeping the customer list under your hat is a smart move. The company claims that three of the top five device manufacturers use their products.

Title Slide Problem Slide Target Audience/Market Size Slide Opportunity Slide Mission Slide Product Slide: Vulnerability Tracking Product Slide: Behavior Monitoring Product Slide: Cryptography Product Slide: MedISAO Team Slide Summary/Traction Slide Closing Slide

three things to love

MedCrypt’s slide deck shows that it is a mature organization with a wide range of products and even the beginnings of an ecosystem are having an impact. The deck is quite unusual in that it lacks a fair amount of information that I would expect in a corporation’s deck at this point, but the narrative is clean and (mostly) easy to follow.

A surprising portion of the deck focuses on the company’s product range, with four of the 10 content slides dedicated to it. It makes sense to tell a company’s story through its products, but the deck itself doesn’t do it very well; It is obvious that voice-over is needed to contextualize this information.

industry rally

[Slide 9] Mediwhatnow? Photo credit: MedCrypt

This film is very good and quite poor at the same time. When it first appeared, I was confused as to what MedISAO was and why it was on the company’s presentation page. It shows that this deck was designed with a voiceover in mind, rather than being readable on its own. This slide comes after three slides explaining MedCrypt’s products and uses the same design. Maybe that should have been the clue that this is also one of the company’s products, but I found it confusing at first. Why is it good that the FDA recommends ISAO memberships? What the heck is an ISAO anyway? (I had to google it; it’s an information sharing and analysis organization). Why is it important that MedISAO is good for MDM? (I know, I know. I had to google that too: medical device manufacturer). Yay, sales pipeline I assume?

Finally, when I visited the MedISAO website, it clicked. According to the site’s FAQ, “MedISAO is organized by MedCrypt, Inc., a cybersecurity company that ranks first in healthcare.”

So! In the end we nailed it, which isn’t a very good thing to say about a pitch deck. What is hugely impressive, however, is that if MedCrypt is able to be the central repository for sharing safety information across all medical devices, it will have the ability to keep tabs on everything that’s going on across the industry goes. It’s a really powerful position to be in.

Of course, there’s nothing on that slide about how successful it is so far, and its website states, “MedISAO doesn’t publish a complete list of member organizations, but you can see a partial list of members on the home page.” It’s hard to tell if whether it’s a mature, successful initiative helping to solidify MedCrypt in their space, or a website the company spun up in a couple of afternoons. I would have liked to see some metrics here, specifically on the value of the sales pipeline from the site and what impact it is having.

A belly punch of an opportunity slide

[Slide 4] Yes, that seems important. Photo credit: MedCrypt

This slide is an absolute slam dunk. It doesn’t take much imagination to realize that a huge market with a lot of money is at stake.

One of the big questions an investor asks is whether there is a market for a product or a company. Regulatory changes can be a strong driver for adoption. For example, before the GDPR legislation came into force in May 2018, every website in Europe and every company that wanted to do business with EU countries had to make changes very quickly. This created a booming industry for web development companies specializing in privacy.

Well, it seems like the same thing is happening in the medical device industry; This slide claims that more than $1 trillion worth of devices need to be secured to be compliant. However, unlike web development, this is a fairly specialized industry. If you thought GDPR was wild, get a load of HIPAA. Additionally, updating the firmware on embedded electronic devices is often non-trivial (which is one of the reasons we’re in this mess in the first place).

This slide is an absolute blast: It doesn’t take much imagination to see a massive market with lots of money at stake (and lots of money to spend) – with a ticking clock. It’s a perfect storm, and MedCrypt has built a boat that might be able to weather it.

Strong summary slide

[Slide 11] Great summary. Photo credit: MedCrypt

Personally, I’m not a fan of READING LARGE QUANTITIES OF TEXT IN CAPITAL LETTERS; it’s screamy and reader-unfriendly. It also means that people skilled in speed reading cannot use their speed reading skills. Other than that, this slide is a great ending. There’s a lot of really good information in it: it summarizes the market opportunity, products, number of customers, past fundraisers, and helps set the tone for the Q&A at the end. Another approach would have been to move the summary slide to the beginning of the deck to set the tone, but it works either way.

In the rest of this teardown, we’ll look at three things MedCrypt could have improved or done differently, along with its full-pitch deck!