A clinical stage medical device company, with exciting new technology potentially benefitting many thousands of patients worldwide, relied on RCCB to navigate and complete a complex Series B financing.


THE SITUATION

This emerging company was faced with an opportunity and challenge:  to complete a successful Series B financing, while aligning goals and interests of founders, existing investors, new investors, and executives.

The goal was to transition from a startup performing preliminary pre-clinical tests to a Company conducting full-scale clinical testing in humans in both Europe and the U.S.  The Company needed to raise significant additional funds for the new trials and had identified both existing and new investors who believed in the Company and were willing to invest.  However, the founders and existing investors would experience significant dilution of both ownership and control as a result, and they wanted to negotiate to minimize these effects.

THE APPROACH

The Company had previously engaged RCCB to assist with the second half of its Series A financing after relocating to Philadelphia from another state in the middle of that financing. The founders/executive team and initial investors determined they needed a firm that could offer very practical, yet sophisticated, business-oriented advice at fees that made sense.  RCCB successfully advised on the closing of the remainder of their Series A financing.  RCCB’s team continued to work with the Company on issues commonly faced by startup organizations—including equity compensation plans, licensing arrangements, consulting agreements, corporate governance, and a series of inter-related interim financings.

When the Company started the Series B process four years after the initial RCCB engagement, management, the board, and existing investors understood that the new financing would result in conflicting positions and multiple critical issues.  Navigating the various interests would require a delicate balance to achieve a satisfactory end result for all individual stakeholders, as well as the Company as a whole.  Based on its prior experience with RCCB, the Company turned to RCCB to explain and mediate matters in a manner designed to keep tensions to a minimum and seek results. 

THE OUTCOME

RCCB’s approach, analysis, and quick response times were essential in working with the numerous stakeholders to meet their individual needs and devise compromise solutions that were ultimately accepted by all parties.

RCCB successfully shepherded a business solution to close the financing and position the team with the positive momentum essential to the Company’s future.  Shortly thereafter, using the funds raised, the Company commenced two new multi-site clinical trials to advance its mission of delivering a life-changing technology to patients in need.