EP07 - Co-Investing in the Storm: Rethinking Capital Partnerships in Early-Stage MedTech

In a recent strategy discussion with Peter M. Kovacs and Thijmen Meijer, we kept returning to the same tension. Everyone talks about funding rounds. Few talk about what truly determines whether a medtech company survives the first real test.

In early-stage medtech, money is necessary. It is not decisive. What makes the difference is disciplined execution, aligned incentives, and the character of the people around the table.

We often describe founders as the critical stakeholder. We analyze their resilience, their visibility gap, and their path to exit. But if we are honest, there is another stakeholder just as decisive for outcomes: the co-investor.

The real question is not what type of investor we prefer.
The real question is whether we are aligned in how we build.

Skin in the Game Is Structural

From Peter’s side comes deep medtech know-how, clinical research, regulatory navigation, and capital. From ours comes venture execution, building investment-ready, lean, high-performing organizations.

If we fail, it hurts all of us.

This is not symbolic alignment. It is structural alignment. It creates discipline. It creates credibility. It removes spectators from the cap table.

Professional de-risking and risk mitigation are not complementary services. They are the core offering. That is the anchor around which we select partners.

Two Archetypes of Strategic Co-Investors

In medtech and biotech, two investor archetypes can create meaningful synergy.

1. The Broad Deep Tech Investor

This investor includes medtech within a wider thesis. They are not purely vertical specialists. Their portfolio may span robotics, AI, or other deep technologies.

What they lack in domain depth, they compensate for with scale and capital efficiency. What they require is a partner who understands regulatory pathways, clinical validation, reimbursement logic, and the operational sequencing that determines survival.

We can bring that depth.
But not as consultants.

If we remain service providers, value remains peripheral. It must be embedded in ownership and execution.

2. The Domain-Embedded Specialist

The second archetype is already deeply rooted in medtech or biotech. They know the regulatory terrain. They understand clinical risk and market access.

Here, the opportunity is not education. It is amplification.

We combine networks. We compress timelines. We refine regulatory strategy and clinical execution. We accelerate the path to strategic relevance.

In both cases, labels matter less than execution intensity.

Angels, Corporates, and the Spectrum of Capital

At the pre-seed and seed stage, angel investors still play a vital role. Their advantage is not ticket size. It is proximity.

The right angel is hands-on, engaged, and capable of contributing beyond capital. In early-stage medtech, intelligent support compounds faster than money.

At the other end of the spectrum, corporate venture capital, particularly from pharmaceutical players, offers strategic foresight. They understand what makes a company acquisition-ready seven to ten years ahead. They know how integration works long before a founder does.

The mistake is to romanticize one and dismiss the other.
Each has a role. The cap table must reflect stage and horizon.

The Family Office Factor

Family offices operate differently from institutional venture funds.

Their diligence often begins with character, not spreadsheets. They spend time observing how you think, how you react under pressure, and how you handle tension. Many are anchored in personal histories, often tied to specific diseases or technologies.

Impact is personal for them.

Approaching family offices transactionally is a mistake. Introductions matter. Trust must be vouched for by someone within their circle. Business follows values.

In Asia, this dynamic intensifies. Relationship-building is not a prelude to business. It is the business.

Many family offices tried direct venture investing and discovered the operational burden is real. Due diligence, portfolio construction, governance. Increasingly, they act as limited partners in focused funds rather than investing alone.

That shift is not cosmetic. It reflects maturity.

When Capital Mindsets Diverge

Not every high-net-worth investor understands venture capital logic. I have spoken with sophisticated real estate investors who could not reconcile large capital commitments with minority ownership. The power law felt counterintuitive.

This is not a criticism. It is a signal.

Alignment cannot be forced. Sometimes the honest answer is simple: we respect each other, but we operate differently.

The pragmatic path is staged collaboration. Invite participation in a single portfolio company. Build familiarity. If alignment deepens, the conversation can evolve toward fund-level commitments.

Trust compounds. Or it does not.

The Incentive Question in Modern VC

Large venture firms now manage billions. A two percent management fee at that scale becomes a significant business on its own.

When management fees create comfort, incentives drift.
Return multiples compress. Bureaucracy expands. Distance from founders increases.

Smaller funds, often below fifty or eighty million euros, frequently outperform. Their survival depends on performance. They are closer to founders. They are focused. They cannot afford complacency.

Limited partners are reading the same data. Increasingly, they allocate to emerging managers running focused, domain-specific vehicles.

Breadth is losing to depth.

For us, this is not theory. It validates our thesis. A vertical, execution-driven fund with embedded de-risking capacity is not romantic. It is competitive.

Choosing the Right Partner

The ideal co-investor is not defined by geography or brand.

It is defined by their ability to understand real risk in medtech and biotech: clinical failure risk, regulatory delay risk, execution drag, and founder misalignment.

If they understand these risks and see how structured co-building reduces them, alignment is possible.

If they remain anchored only in spreadsheets, the conversation ends quickly.

The ecosystem does not need more passive capital.
It needs capital that understands how to build.

From Transaction to Collaboration

Venture is shifting.

From institutional scale toward focused specialization. From capital allocation toward capital collaboration. From transactional funding toward shared exposure.

The future belongs to those who combine skin in the game with domain mastery and relational trust.

In early-stage medtech, that combination is not optional. It is survival.

We are not looking for investors who watch from the shore.
We are looking for partners willing to sail.

Because in this field, you cannot control the wind.
But you can decide who stands on deck with you.

Timecode:

00:00 Introduction to Key Stakeholders

00:22 Types of Co-Investors

01:09 Value Proposition and Commitment

02:10 Investor Specialization and Synergies

03:26 Role of Angel Investors

04:02 Corporate Venture Capital

04:44 Family Offices and Personal Touch

08:56 Challenges in Different Regions

09:32 Building Relationships with Investors

10:34 High Net Worth Individuals

18:02 Micro Funds and Emerging Managers

19:51 Conclusion and Future Outlook

Links:

Karoly Szanto LinkedIn:  https://www.linkedin.com/in/karolyszanto1/

Karoly Szanto Personal Website: https://www.karolyszanto.com/

UniPrisma: https://uniprisma.com/

Guests:

Roswitha Verwer: https://www.linkedin.com/in/roswitha-verwer-b2b636137/

Peter M. Kovacs Personal Website:https://www.petermkovacs.com/

Transcript:

Peter M. Kovacs: So we talked about the very important stakeholders, which are the startups and spinoff companies, how they are suffering, how we can find the gap, how we can solve the gap, and how we can build them up and support them to reach the visibility and the exit level. And also to get attractive for the investors.

We also have a very important stakeholder in our model: the co-investors. What kind of co-investors do we work with, what kind of co-investors are we expecting to collaborate with? What are the main differences for us between the different types of investors? How do you see this?

Károly Szántó: I would start maybe not with the types, because as we discussed earlier, there are ways to work together with angel investors, institutional investors, VCs, and in some cases corporate venture capital and other investor types. I think, again, it's about the value proposition—whether there are strong synergies between the investor partners. We collectively invest a lot of time and professional services, as well as capital from your side, Peter. So we have skin in the game. I think this is the most important part: how you can prove that you believe in something. You have skin in the game. Otherwise, if we screw up, it'll hurt all of us. This is the commitment and dedication apart from everything we have said. Our professional de-risking and risk mitigation is our core offering.

I see two kinds of investors that could be interesting. One is not so much domain-specific, but maybe in their investment thesis, med-tech is one focus among other deep tech interests. Because they're not so specialized, they need a partner who does specialize in this to provide the knowledge and experience.

Peter M. Kovacs: And the experience.

Károly Szántó: Exactly. Decades of experience in that segment to validate and to de-risk. So we can bring that to the table, but not purely as a service provider, because then that would be weak.

Peter M. Kovacs: There's no additional value. Not enough additional value.

Károly Szántó: Yes, exactly. And then the other type is deeply embedded into the med-tech or biotech domain already. We can double down on the segment, and most probably we'll find strong synergies in the execution part—in the regulatory, the go-to-market, the clinical, the testing, and all that. So I think these are the two ways to approach it.

And because we are dealing with early-stage investments like pre-seed and seed mainly, at least in this region, angel investors have a place on the cap table. One great thing about angel investors is they're usually very hands-on, and we need hands-on support. There is no such thing as too much support. But then if you look at the other extreme on the scale, which would be corporate venture capital—perhaps from a pharmaceutical company—again, they are very valuable. From that perspective, they can provide professional input and guidance on how to navigate and how to build a company that will eventually be very attractive for a pharma company, maybe seven to ten years down the line. How do you see the other conditions of an ideal partner?

Thijmen Meijer: I would also like to loop in family offices that are very specific on deep tech and med-tech. Usually, they are run by somebody that has exited actually, or has family wealth deep inside biotech or med-tech, and doesn't want to go blindly with a VC but wants to have professional investors to mitigate that risk completely.

Peter M. Kovacs: I see that family offices are extremely well represented in Singapore. In Singapore today, there are over 2,200 family offices for a 6 million population country. It's a huge number. I see that family offices focus more on the personal part. I accompanied one of my biggest portfolio companies to a family office event, and they want to spend a couple of days with you to know you very well. The personal touch is very important for them.

Also, it was very interesting that I've seen many times family offices focusing on a dedicated disease or a dedicated tech because they have some relationship in the past or their family is related because of some illness or some other experience—positive or negative. I see family offices as significantly different from VCs and institutional investors. Their financial due diligence is a bit different, and this personal touch is a bit more important. I see that very early-stage companies could be more successful not because of the ticket size, but because of this personal touch. If you find a very good founder and CEO with the personality that can present this impact, it's more touchable for a family office or angel investor than VCs. Based on my own experience, VCs are often just about numbers.

Károly Szántó: I love that you brought in the family offices. They are very much value-driven and impact-driven, and they are deeply committed to whatever they're committed to because of personal reasons of the founder or the family. But on the other hand, they are very difficult to approach. It's not a quick game; it's a relationship. I remember a couple of days ago you mentioned your event with family offices, and I had similar experiences. When you get in contact with a family office, you must not talk about business first. It's about values.

Peter M. Kovacs: Build a friendship.

Károly Szántó: Absolutely. And then if it resonates and it's built up authentically and there is a match, then of course you will find ways to collaborate. But it's not transactional. Whereas with a VC, it's absolutely New York style: go, no-go.

Thijmen Meijer: And an intro as well. Everybody said to get an intro from somebody else they know—friends or family within or outside of the family office—who can vouch for you and basically say, "This is a good one." No cold emails, no cold calls. Don't send a 14-page slide deck or anything like that. Really build up that relationship. That was quite interesting to hear.

Peter M. Kovacs: Also, I see quite a difference between the same type of investors. For example, a family office in Asia versus a family office in Switzerland. Based on cultural differences, it's even more difficult in Asia because the culture to build this friendship is even more intense than in Europe or the US because of tradition.

What do you see as the best partner for us? I see a difference in that I talk with many potential partners in Asia, as I mentioned before, and some of them understand the model and how significantly we can decrease the risk—the financial risk and professional failure of the company. Some of them understand and are more than happy to collaborate and see something new. But many of them just don't get it. Maybe I couldn't deliver the message well, or not yet. Some of them cannot think out of the box because they are still in the conservative model, just checking the numbers. How do you see it here in Europe?

Károly Szántó: This year I got in contact with some high-net-worth individuals, very successful in real estate. I was introduced to them; it was not a cold call. We started to talk, and our discussion naturally went into the investment side. They considered themselves experienced in investment, and then I found they had absolutely no understanding of how venture capital works, which is okay. I explained it, and they just couldn't get their head around it. They were like, "If you invest so much money, why would you only have 10% ownership or 20%?" The whole logic of venture capital was out of scope for them.

One thing I learned is that I would rather be very honest with myself and the other person: maybe I like you as a person, but the way we operate is so different that it won't work. We cannot force it. Also, I think once we build up something bigger and we can present it, they would be happy to join in later as followers.

Family offices are called "patient money" by many investors because they have patience; they have time. They're not VCs. They want to leave a legacy; it's a whole different story. I think one nice way to build up a lasting relationship with a family office is to suggest they join in from time to time with a smaller ticket directly into one of the startups that we invested in. This way we can learn about each other and fine-tune our collaboration model. If it works and we are aligned, then we can take it to the next level, which usually is launching a VC of our own and positioning the family offices as LPs. Many family offices have tried themselves as a VC, directly investing, and 99.9% of them regretted it. They're not equipped operationally for due diligence or portfolio management.

They still want to be involved, so the best way is them becoming LPs. More and more family offices are realizing they shouldn't do it on their own, so they form syndicates. They join together and work as a fund of funds and invest in several offices. I think this is the right way to go. But then again, it's value-aligned. Does this syndicate share the same values with us? Do they want to make an impact through biotech and med-tech? If yes, that's already good. Then there is the geographical focus and stage. Some are only interested in growth stages, while some will be interested in early stages. We need to go out and spend time with these people, not selling anything, but rather just asking the right questions.

Peter M. Kovacs: Offering an opportunity for them. I think very few players on the market are able to work in this field and provide this objective risk mitigation. If somebody understands what the real risks in med-tech and biotech are, they can understand the support that we are providing.

Károly Szántó: Thankfully, I read a lot of statistics and reports on VC to understand the trends, and our investment thesis is very much supported by statistics lately. What happened in venture capital is that the successful players became giants, but their business model has shifted because they are continuously charging the 2% management fee for their LPs. I just read that Andreessen Horowitz, one of the largest and most successful, pulled in $700 million only in management fees because they are managing billions and billions. The motivation is not really aligned. If your entire business model as a VC is to charge a management fee, then you become comfortable and values are misaligned.

Also, the return on investment decreases. What is interesting is that micro-funds and small funds—below 50 million euros or let's say even 80 million—produce much higher returns. Why is that? Because they're very motivated, effective, down-to-earth, and they cannot allow themselves to fail. The management fee will not save you if you're running a 50 million fund. You need to actually make miracles.

Now LPs are also reading these statistics, so they learn. There is a new wave of LPs opening up to emerging managers managing small funds below 50 or 80 million. I believe these funds must be vertical and domain-specific. The industry-agnostic approach is over. The way we come together and what we offer is supported by these trends. We are in the right direction at the right stage. Our narrative should be that we are de-risking, executing, and eventually producing higher returns and making much more impact.

Peter M. Kovacs: Hopefully, we prove that we were pioneers in this field and we can introduce a successful model for the ecosystem. I can just wish good luck for all of us and we'll continue from here. Thank you.

Károly Szántó: Thank you. Thank you, Peter.