Clair Labs revenue, CEO Adi Berenson, team size, customer count, churn, and more in 2022.

hey folks my guest today is adi berenson he's the co-founder and ceo of claire labs prior he was three years as human interaction designer and prototyping at apple and before that eight years as vp of business development and marketing for prime sense the leader in 3d sensing technology behind microsoft connect and apple's face id cameras prime sense was acquired by apple audi are you ready to take us to the top yeah thanks a lot great to be here you bet so claire labs at c-l-a-i-r you're building contact-free remote patient monitoring systems what got you into that space so um actually it's all started from our work in apple uh which i cannot get too much into it so my my background is coming from consumer electronics but in my days in apple i got to work a bit with them on digital health projects that was back in 2017 and i realized what a monumental um challenge it is for modern societies and uh once i started getting into this and and learning about our old-fashioned workflows uh are there we realize that technology can make a huge difference i mean we we very very quickly even before we started the company we narrowed in on a horizontal workflow which is patient monitoring and i can get into it more but i'll follow you around yeah so patient monitoring there's sensors that are installed so there's is there an iot play here do you pay for the sensor installation so it is an iot play you got it right the unique part about it is that it is not touching the patient so clinicians are calling it passive monitoring because the patient doesn't need to do anything so contact free is not wireless it's actually collecting the signals environmentally without touching your skin um it's not about it what is it though is it like a lamp you sort of sit next to your bed like how do you think about it yeah it's a beautiful comparison it is like a lamp yeah so it does need to have some kind of line of sight to your skin okay and then by looking at your skin in two waves of near infrared it can see movements of superficial arteries so arteries that are very close to the surface by looking at those arteries we see volumetric changes and we see tone changes and then we are actually uh recreating or regenerating the plus signal pulse rate oxygen sat respiration rate and so on interesting what does the physical device cost okay so i'm not gonna i mean forgive me for that i'm not gonna expose our costs because we're not selling it to the consumer the way it works the business model is that our customers are providers or health care providers and they're offering it under i will call an umbrella of rpm remote patient monitoring services which is reimbursed by medicare and all major health care payers so it is a prescription service the device is fda cleared and the way it works is the payer is paying for it as long as you are recognized as a chronic patient or a patient at some kind of you know are you manufacturing it directly did you have to go source in china the manufacturing plant or is this someone else's technology like heart no no it's how hardware so we are it's our own hardware we are sourcing it exactly as you mentioned we're fabulous of course so we're sourcing it in china and we're building the device itself yes when did you ship your first device so we we are currently actually in clinical trials so the devices that we are shipping into facilities in the us for clinical trials are actually not built in china they're built in israel in a low volume prototyping facility uh the trials are going on for two months already um and so it's not in production how many have you produced for all the trials combined fifty five zero okay yeah five zero that's it it's very low volume yeah okay 50 for testing um got it and the healthcare providers are obviously the customers um tell me about how you make money from them what do they pay you on average per month so i'm not going to get into numbers but i'm going to get into the business model so basically the components that the payer is paying the health care provider is made out of installation is made out of the what the clinician is getting to review the material and is made out of the actual monthly payment for uh for collecting digitally collecting the signals from the patient i'm getting most of this now i'm i'm going to explain a little bit so i'm not going to get into my revenues but the way it works is that if you have a chronic i mean just be fair you're like i mean you're basically pre-revenue you're doing clinical trials right absolutely we're pre-revenue but we do have a plan so i can give you yeah i mean so when you say you don't want to get into your revenues and you just tell me your pre-revenue right that's a much better way to say it makes it very easy no no but i thought you were referring to what are our plans regarding revenue so today is zero yeah fair enough yeah but if you want to know how how how big is the market and what is our plan for future revenues and i can a little bit i can give you one data a chronic patient recognized as such under an rpm program can generate revenues for the care provider in the order of magnitude on of 150 dollars per month it makes out of several components so this is 1800 dollars per year we believe that we're going to get a big chunk of it that's the business model so we're not charging the provider for the the device itself we're actually uh getting recurrent revenues out of the reimbursements so let's just focus on israel for a second how many patients do you believe should have this lamp next to their bed right that should be sort of paid for with you know the government money right medicare medicaid whatever you guys have an integral for that so i will actually answer you in the in in newest numbers because that's the that's the uh that's the market that we analyzed and that's the market we're targeting so the way it works is that i can picture for you right now a dream of all the chronic patients but that's going to be a little bit superficial so there is for example one condition that we're doing active clinical trials on and we are showing act actual clinical outcomes which is copd for example so it's a respiratory condition i mean it's a chronic obstructive pulmonary this is there are 16 million patients um recognizing one six one one six zero okay no no one six one six million recognized as such there's a lot of um talk in the industry about the un uh yeah the undiagnosed but diagnosed there are 16. so you have 60 million people on you can get on an rpm program should you guys them should be all of them should be yeah sure sure so 150 bucks a month that's 2.4 million a month or about 30 million run rate for you getting 100 penetration of this market that's actually not that big right for what you guys are building that's very small actually i will i don't know how you got to it but if you have 16 16 million sorry sorry sorry you're right i missed a bunch of zeros there 16 million so so how do you the the test you're running right now on the 50 devices you're targeting the us market exclusively yes right now exclusively yeah okay okay got it um yeah sorry that map is obviously much bigger right so 16 million patients at 150 bucks a month is like 2.4 billion a month right exactly per month well the reason i bring this up right is that's almost 30 billion dollars per year right which effectively is going to come out of my pocket right it's me paying it's the u.s citizens paying into medicare medicaid or the us government printing more money to cover these expenses actually saving a lot of money and i will explain so an average copd patient which is diagnosed as such is having an average uh incident office hospitalization at least once a year and this hospitalization is costing 20 12 000 the reason why we are enrolling them on rpm programs is because we are showing data that we can raise the flag an alarm to the clinician taking care of them seven to eight days before such hospitalization event and with simple intervention of antibiotics or steroids you can prevent the whole hospitalization incident so it's it's a it's economically uh money-saving so how many hospitalizations are there right now in the u.s from copd patients exclusively every year 16 million because it's almost it's once a year yeah so every single sea person in the us with copd goes to the hospital at least once per year on average so some more some less that's the average rate yeah i i see i see interesting um what you're arguing what you're arguing though is that with your early indicators right via the veins and the skin and the early things seven days early you're basically saying no none of your you're not gonna replace all 16 million hospitals no no we're no no we're we're not and it's very it's going to be very irresponsible of me right now to say exactly how many we are but we are what we are showing and we're going to be very accurate with you nathan what we are showing is that we are raising the an accurate alarm flag seven to eight days before very i mean in very high rates like 95 percent okay 95 percent of the ex uh the the hospitalization cases of the clinical trials of the sample we we sampled we are showing a very obvious deviation of a score combined out of oxygen sat heart rate and respiration rate out of norm and and then and we know that there is an effective intervention uh so we believe there is going to be we believe and that's what we are pitching that there is going to be a substantial economical benefit to this rpm why why does it happen why does it have to be your iot device i mean listen i use woop and i look at resting heart rate i look at respiration look at the exact same things you're talking about and i could tell when i was getting covered because my resting heart rate was jumping through the roof it was very obvious they put a little warning in the app that said you probably have coveted and sure enough i did why can't somebody else do this for much cheaper okay so it's a it's a it's actually a very good question so you are asking me to compare yourself to wearables because wearables are everywhere so number one problem with copd patients and with other chronic patients especially elderly is compliance everything that requires them to take action which is charging putting it back on tolerating it even pairing it with the phone is is going to lead to low compliance so there is going to be there there are a lot of attempts to use wearables with them it just doesn't work isn't it harder to convince all of them to install this thing on the desk next to their bed and make sure their skin is exposed for at least five minutes every day so your thing can do the reading no no what you're describing is not passive if i would have pitched that that would have been bad what i'm claiming is is that they don't need to do anything it just happens i mean there is you have to install the thing how you they have to install the thing in their house no no you need to install the finger but okay so that is right just like you have to buy a wearable and put it on your wrist fair enough no no but once and that's and for years you don't need to do anything that's once you don't need to expose i mean what you describe you need to expose your skin absolutely not i reject it completely you need to manage yourself naturally there was in the clinical trials we've done there was no single night we didn't collect quality data over the night in enough samples to feel how close do they have to sleep to your device five feet two feet ten feet five to six feet not ten feet up two to six feet it's enough so you as long as their body as long as their body is sleeping within six feet of your device your device can get the readings they need right on i see interesting okay give me the back story here when did you launch the business so we launched the business in 2018 2018 and have you guys bootstrapped or raised uh we bootstrapped for a year and then we raised a seed round of nine million in two trenches in 2019 and 2020 okay okay nine million and then yeah that's why it takes yeah we're going to raise more for contact in early 2022 okay but nine million total to date nine million total today yes how much have you already burned through uh yeah i mean we're not sharing that yeah i'm sorry for that we're not sharing that i can tell you that we are certain people okay we're not just a big company all of them a part of me are researchers and engineers how many are full-time on the team all of them how many oh thirteen thirteen okay so there's thirteen on the team how many are engineers uh so half of them are researchers half of them engineers and i'm the only one who's doing all the rest i see ng are you the only founder do you 100 no no no we are we're two co-founders so my co-founder was working with me in apple and is the is the brains behind the technology is a phd in computer vision is one of the brightest minds in israel in computer vision yeah okay you guys just split it 50 50 or he gets more smarter no well you should but but all right you guys put it 50 50. obviously you do a seed you take some dilution most folks are raising seeds now and they're selling call it 10 to 20 percent of the business were you sort of in that average we are we were diluted by the two rounds that we entered disease of course naturally yeah but we're very proud of those partners yeah my point is though most people are when you raise that money you're giving up and selling 10 to 20 percent of the business correct yeah yeah yeah well 10 is in the low side yeah yeah yeah but you didn't give up more than 20 for nine million did you yeah i'm not sharing that sorry for that yeah okay i mean that would be a yes uh why why i mean that's my internal business it shouldn't be too interesting yeah well it's what i mean it's extremely interesting the more you're deluded the less control you have it's the number one thing that matters when you're trying to build a business is control so you can execute your vision it's the most important thing any founder can be thinking about when you're launching your business so i totally disagree that it's not important and and i so let's agree to disagree i've done it in the past with what company company no with prime sense we had a beautiful company we entered this is um you're vp of business development correct yeah yeah yeah okay you're not the founder so it's completely but i know how it worked no but i know i would work so i if there is one thing that i will push very hard on is that there is no one formula to build the startups okay they're all different uh so the story which is which is exactly why i'm asking right that's exactly why i'm asking so why are you okay taking 20 30 dilution so early tell me more about the quality of the money where is it coming from why did you need these partners okay the quality of the money i will tell you so it's coming from a very reputable israel if you see called 10d okay then you can look them up i mean it's it was founded by one of the most reputable uh venture capitalists in israel a veteran and the other fund is called super moon capital uh which is out of silicon valley um both of i mean there are other private investors but i will i will just focus on those two because they are the most active investors and i'm working with them only on almost on a daily basis very cool all right did you learn anything about the equity you know how equity was managed at prime sense you know mistakes that you want to make sure you don't you don't do here in your current business i mean your point that my job was very different than everything is than a founder i'm learning every day how different this was so i had some exposure but not complete exposure i was not uh going through what the founders went through i was mostly on the operational side so that's a fair point yup yup i mean no i mean look that company raised 36 million well almost 40 million dollars right and so that that 20 million series b if you know if they were raising at a minimum 10x it was probably higher than that that's almost a 300 million evaluation and but you are talking about crime scenes right prime sense correct yeah they got at 2008 right then you go out and sell for to apple for 360 million uh you know that's basically the valuation that it was four years prior to the to the exit right so you just lose optionality but i get it you're building a company that requires a lot of capital investment up front there's an iot play there's tech so i get it yeah um okay very cool yeah 13 on the team so when do you guys think you'll have your first paying customer uh early 2023 2023 yes wow yeah i mean i know no no it's because you need in order to realistically and not realistically in order to make business um reimbursement-based business not out-of-pocket business reimbursement-based business in healthcare in the us you need to have fda in order to have fda you need to complete clinical trials you need to do submission and you need to wait for clearance so yeah i mean i'm a very realistic person i can say 2022 but i can guarantee 2023. what uh are you looking to raise more right now yeah we we have a decent runway ahead of us but we are keeping our options open i mean if there is going to be a very very smart money in good terms why not what would you consider really smart money money that comes from the domain that open doors name an investor that you'd consider no name name an investor would be a great partner for you or you would kill to have them involved why is that a why is that a hard question no because uh because what would the other investors say i mean i have yeah i'm not naming names yeah because what if i don't get them did i get my second best so that's why i have my own lists and that's uh yeah and that's the private information yeah who would be very strategic for claire i would describe them and not name them okay reputable visits that are operating in digital health and medical or and or venture arms of the leading medical devices companies yeah who is a leading medical device company ignore who you like i just don't know right who is these these answers aren't helpful to my audience who doesn't know your space right so who is a top medical device company okay so that's easier for me okay because that's clear if you look at companies like medtronic massimo resmed phillips those are beautiful names to have involved in my company now see was audi was that so hard was that really that difficult was that no no it's fine yeah but this is what i'm not gonna do sorry for that nathan no so it's so it was so simple right that's so helpful thank you for answering all right let's wrap up with the famous five number one favorite book wow favorite book wow i i didn't prepare for that so it's actually the corrections by jonathan's friend yeah number two is there a ceo you're following are studying um actually it's phillips i know him for many years i worked under him directly uh stanford houghton yeah when when i lived in the netherlands yeah number three what's your favorite online tool for building clary or claire sorry ah my mentos no no your favorite online tool ah online tool i don't know we're working with monday if that's right but i'm not i'm not too in love with it yeah i mean it's just cool yeah you can't say that roy is another you know israeli engineer you've got to say you love it no no no i'm working with them but i'm not in love with amy online yeah fair fair enough number four how many hours of sleep you get every night oh my god that's a bad one much too little so i i would say to give you a direct answer i don't know four or five four five and what's your situation married single kids married with two kids okay and how old are you 50. that's the toughest one five five zero five zero yeah all right last question something you wish you knew when you were 20. something i wish i knew when i was 20. um wow i was asked in my 50th birthday if i have any grits or if i would have done things differently and i answered no which is probably a lie but i'm happy to believe in this life so i will never this is not a regret question adi it's it's for other people who are 20 who are listening yeah that would love to learn from you right so something you wish you knew when you were 20. um i mean ex yeah uh do relocations explore other cultures as early on uh i did not enough of it and i'm yeah yeah and i should have done it claire labs guys they've invented a way to basically install think of it like a you know a light or a lamp next to your bed for copd patients to understand again early warning signals to try and prevent hospital visits save taxpayers a lot of money uh they're targeting the u.s market 50 devices shipped today in clinical trials they raised 9 million bucks to get this thing to market hoping to get their first paying customers by 2023 13 folks on the team we will see what happens adi thank you for taking us to the top thank you that was super fun i appreciate it one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the subscribe button below here on youtube the big red button and then click the little bell notification to make sure you get notifications when we do go live i wouldn't want you to miss breaking news in the sas world 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