Healthcare Startup Physician Angel Investment Group with Luke Sheen

About the Episode

Episode 24 of the podcast features Luke Sheen, Founding Executive Director of Halo Health, discusses his role in connecting physicians with healthcare startups for investment and advisory opportunities. He highlights the organization's selection process and the benefits for both startups and physician investors. Focusing on fostering community, enhancing healthcare innovation, and providing investment returns.

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Objectives and Discussions

• Two-Way Community Benefit
• Role of Healthcare Startups
• Intake Process for Doctors
• Physician Engagement and Platform Features
• The Role of Collective Intelligence
• Investment Mechanics and Physician Discretion
• Halo Health’s Unique Position in the Market
• Getting Started and Criteria for Joining

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More Resources:

LinkedIn: https://cherryhealth.co/linkedin

Facebook: https://www.facebook.com/cherryhealthinc/

Instagram: @cherry.health

Twitter: @cherryhealthinc

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Have questions? We want to hear them!

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Transcript

Speaker Identification:

[Host]: Dr. Jordan Vollrath

[Speaker]: Luke Sheen

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Jordan Vollrath (00:06.391)
Today we are joined by Luke Sheen, co-founder and executive director at Halo Health, a physician angel investment group here in Canada. Luke, thank you for joining us.

Luke Sheen (00:17.526)
Yeah, thanks for having me. Great to be here.

Jordan Vollrath (00:20.151)
So I've been to some of the Halo health events. I mean, to summarize it sort of in sophisticated manner, it's like shark tank for doctors. How would you describe it? The events are super fun, really cool. How do you typically pitch it?

Luke Sheen (00:34.174)
Yeah, sure. So it's a physician angel group founded by physicians for physicians to build a community of like minded folks that are, of course, all practicing but want exposure to healthcare innovation in a very direct visceral manner where they can get involved to be compensated to advise healthcare startups match with their subspecialty, but also participate to further that experience by directly investing.

and reaping the benefits of helping the startup succeed, but also in the meantime, get their returns when the startup succeed. So it's not only just community, it's not only a way to get compensated for advisory, but really together as a group, be effective in impactfully moving forward healthcare innovation as a whole.

Jordan Vollrath (01:29.091)
So it's that two way street really is the difference, right? You guys have the community, it's the business opportunity, you can actually get involved and invest. You can also start just connecting with the startups, get involved in that advisory role as the domain expert. And then there's actually paid opportunities on the other side of things where they're actually leveraging your connections and your knowledge to help them out in more of a formal method.

Luke Sheen (01:51.234)
Absolutely, yeah. And for the healthcare startups, they're definitely a big part of our community as well. So we definitely employ our internal resources, our full-time staff and ecosystem partners to help them succeed even beyond the point of our investment or our initial advisory. If we can't do it at Halo Health, we'll refer them out to various commercialization partners or other funding groups to ensure that they succeed. Because again, we all succeed.

when the startups that we fund and support and advise and succeed.

Jordan Vollrath (02:27.855)
rising tide lifts all boats. So how do the actual events work? Let's say I'm a doctor, I'm signing up. What does the intake process look like? What do the events look like? How does the community and the DLM platform behind the scenes work? What should a physician expect when they're actually joining the Taylou Health team?

Luke Sheen (02:46.002)
Sure, yeah. So, you know, as a startup founding team member myself once upon a time, we at Halo Health built our platform and our group much like a startup would. So we interviewed a bunch of physicians, we interviewed a bunch of healthcare startups, and built it from the ground up to facilitate our users. So from a physician standpoint,

We do require all of our physicians to be accredited investors. That's just the securities law in order to invest into these private placement healthcare startups, of which if you're attending a staff physician, most of the folks dialing in will be. And then of course, we like to curate a community of like-minded folks. So we are very careful about who we let in, and that takes time for us to get to know each other.

And that's really for a purpose. It's so that our members can meet truly like-minded colleagues who see eye to eye in terms of taking risk, being more innovative, and really not reserving what they have to say. Perhaps in an academic environment, that may be challenged, although it is getting better out there. So once you're onboarded and you're a member, then we offer couple software.

We have our membership platform that's kind of like our Facebook where you can message other members. It highlights all opportunities as well as upcoming events and then in recording of our investment events as a video on demand as well as educational material and Recordings of our due diligence sessions case-based case based learning

And then we also have a DLM software that houses all the deals that we ever looked at. And it's very detailed. So it has their duck, it has their cap table, their financials, our proprietary investment memo, of which we have dedicated people writing that and conducting a lot of research to come up with that. As well as anything else we're looking in the pipe or have invested in both as educational resource, but so that everyone can take a look at the deals.

Luke Sheen (04:57.35)
In terms of our investment event, we usually host one every other month. We are now back doing it in person, but it's also hybrid. So live telecasted on Zoom, it's also recorded. And we revert back and forth between our two main offices, in person in Calgary, but also in person in Toronto.

And the startups that are showcased consist of four startups usually, and they represent less than five percent of all the healthcare startups that we see. The reason why we're different in that way is because we're the only physician angel group out there.

Unlike other angel investment groups, our folks are trained in medicine. They may not be trained in finance. So we protect our people. And the first step to do that is exhaust our resources and time to only list the top 5% of the startups we see through our six-stage rigorous process. So it's a lot of fun. Jordan, you've definitely been to one and a lot of the

And it's a nice way to network, you know, good wine, good food, but more importantly, it's like physician shark tank, you get to meet the founders in person, they present live right in front of you. And also we include our people by having an interactive question and answer session where you can actually ask questions directly to founders on the spot. And then we also usually have a keynote speaker.

someone who is prolific and very well versed in this industry, who is a healthcare innovation leader of which Jordan, you were one of our speakers. So thank you for that. And certainly we learn a lot from those opportunities as well.

Jordan Vollrath (06:43.611)
And so a lot of work goes into actually putting these events together. So you wind up, you see the pitch, the companies go through their, um, their spiel rates that talks about what they are, what they're trying to raise, what their path forward looks like, how you're going to help, but then there's a lot of background work, there's a lot of due diligence that actually takes place before these companies get there. Could you talk a little bit about that and what's actually going on behind the scenes before they get to that stage?

Luke Sheen (07:10.214)
Yeah, sure. So I'll start with the due diligence process. We've built a proprietary six stage process where on the top of the funnel, we get healthcare startup referral from trusted friends, so institutional VCs, family offices, academic institutions, credible institutions, and organizations and firms that we have worked with, co-invested with, and trust. So right off the get go, we're getting

really high-grade health care startups that have been vetted by firms who've been doing this 10, 20, 30 years. From that point on, we actually match the health care startup on a screening call with our team. That includes myself, our two full-time PhD analysts, and then our fellows, which are all graduate students or recent grads in MD, PhD, JD, or MBA programs, as well as our select members and board members.

So after that first one hour screening call where we ask questions, we read the deck, we'll do a group vote and that's the first gate. And that process usually eliminates about 50% of the startups that we see. After that point, we utilize our proprietary investment memo template, in which case we will call upon a self-specialist from our membership. Currently, we have about 413 physicians across Canada that represent 40 plus different

So chances are, whatever health care startup comes to us, we have a world expert who could take a look and give us a very accurate medical assessment as a practicing physician. And then of course, we'll draw from our fellowship class and our internal PhD analyst to conduct.

further research into things like competitive startups, market sizing, their financials, etc. And throughout that process, which takes anywhere from five to 20 hours, we generate an investment memo. It's about 10 to 15 pages in length, very detailed. After that, we take the completed files.

Luke Sheen (09:16.606)
to our investment review committee, which consists of myself and select board members who are quite often dual degree holders, MD MBAs, most who have invested in 10 plus healthcare startups or and or business owners and or startup founders themselves they exited, people who really know how to look at a quality startup. And from that badge, we'll select the final four. And those final four.

are then put forth to our investment event to expose them to our members. And through this rigorous process, we make sure that these are the most de-risked, high quality startups that we can find out there.

Jordan Vollrath (10:00.931)
So these companies, they start out, they come to you, small fraction actually make it through that initial screening. And you guys have a whole team of people that do that initial screening. I ran into a few recently, I know a few personally, they're often medical students, people with their MBA degrees. And so they're straddling those two different ecosystems of both the medicine.

and the business world and that investment side of things. So you got a lot of like firepower on the team actually doing that initial due diligence. And then they hit the stage and then that's when the individuals start doing their own due diligence. And this is one of the things I think is super cool about Halo Health is people that are completely fresh and green to the actual investment ecosystem. Maybe you're a doctor who's never done any actual angel investing before. Maybe you've got some shares in Apple or something, super broadly known. But in terms of the startup world,

bit different and where Halo Health actually does that as a team, you guys have your community and your forums on the back end and the due diligence at that point is kind of done altogether and so some of those people who are a lot more experienced are leading the charge, the people that might have the domain expertise and the knowledge there.

you know, because the different companies, I mean, they might be like software, there might be other types of technology, implantable biomedical devices, like the full gamut of things in the healthcare world, anybody with that domain expertise, not just on company and valuation, but just the viability of the device and the different programs and whether or not they seem like they have a viable path forward. Everyone kind of gets together and they start doing that.

behind the scenes, putting together, does this valuation make sense? And then it's up to the individual physicians to actually choose to invest or not, right? It's not like the group think decides one thing and then now you are stuck on that track with everyone. Everyone has their own freedom to kind of go whatever way they want with it, correct?

Luke Sheen (11:51.654)
Yeah, that's absolutely right. And you know, when we built Halo Health, the original ethos was always putting a lot of value in collective intelligence, but also empowering our people. So like you said, our members are intricately involved, but also the fellows, especially the PhDs, we certainly depend on them for, let's say, pharmaceutical or medical device or any kind of very bench-based scientific startups. And certainly they add their expertise as well.

And what I find really incredible is at first our physicians are often somewhat discouraged in a way that they think they're not good enough to look at these deals. And I think that's furthest away from the truth. And we're filling a gap in the ecosystem because no other healthcare VCs will ever have this many access to physicians in one Rolodex who all...

believe in the vision of Halo Health and for all frankly high billable very busy people, but we'll pick up the phone because they really like this stuff. So the nice thing about it is that

because we get quality deal flow, the financial, maybe the computer science, maybe the AI, that's already been vetted by major institutional firms that have their own talented folks who can do that. Where we come in to complete the picture of which sometimes they can't and why they like to work with us is that we're able to empower our people to flex their medical knowledge to the

Luke Sheen (13:26.786)
the medical viability in terms of product market fit, whether or not they would actually use it in their clinic. And I think our folks at first don't realize how powerful that really is and that their training, their expertise, what they work so hard every day is translatable to this industry and in fact, extremely rare and extremely valued. So that's why we not only like to involve them in real cases where it's real dollars and cents.

with real huge VC companies investing, but also through that process, give them the empowerment to feel like a professional, to get into professional medical consulting, of which then we curate more than 70 pre-negotiated cases per year for our folks to get compensated, even beyond the scope of doing diligence, just giving advisory.

Jordan Vollrath (14:22.615)
Well, and so on that input before deals are done side of things, that domain knowledge and that expertise obviously is incredibly helpful. But then also on the post-deal side of things, right? So I don't know if this is unique to healthcare, but where there's investment and domain expertise coming together, this is where the people actually participating have the power to help their money and help those investments and help those companies grow.

Right? So if a physician is interested, if they want to be an early adopter of the technology, if they're just a big proponent of it to the point that they're investing, you can also use your connections, your friends, your clinics, your other doctors, your network, you know, uh, to actually start helping these companies navigate and move through the system. So I think it's really neat that way as well.

Luke Sheen (15:06.566)
Yeah, absolutely. And you know, to circle back to your question before, we're not money managers, we don't take a carry, we don't take management fee. So we will curate these exclusive opportunities quite often pre negotiated, exclusive minimum check size and actual lower valuation exclusively for our people like our latest round that we led called Rodney logic great company out of Calgary.

but we open it up at our physician's discretion. They can invest only when they feel comfortable and it is something that they really love.

So there's no forced investment here. We only do it when you love it. And the reason why we did that is quite often when it is designed that way, we have multiple examples. For example, we invested in a women's health company and 10 of our OB guides participated. And they are there because not only is their money invested, their genuine interest is, and they know for a fact it can actually help them and their patients and their team members. So they really do go out of the way. Some of them even invite them to their clinics.

Some of them have even helped with clinical trials. Some of them will even speak about it as a KOL at a conference. And even the most recent on Rentalogic example, there's great physician in Alberta who is an ophthalmology member that is directly correlated to that technology. She not only helped us demo the product and do an assessment, but after that point, she said, not only do I wanna invest, but I actually wanna try this technology in my clinic.

And I actually want to advise the founders because I truly believe that this will help my patients. So that's actually a really a symbiotic effect where we're able to give very valuable, smart money investment and continued advisory to the healthcare startups that we serve, but also give an opportunity for our physicians to really roll up their sleeves, get involved, not only get returns, but feel really good about

Luke Sheen (17:10.326)
being part of that process. And that's what makes our investments and our startups unique. It's just an unparalleled unfair advantage that these startups get compared to the ones who may not have 10 physicians on their cap table.

Jordan Vollrath (17:26.423)
Exactly. That's one of the things I love most about it, right? Like the companies that you believe in, you can get personally invested in, right? The things that you just see a gap in the ecosystem and a true need for the things you believe in and you want to actually exist and grow, right? You can take that probability cloud and make it a little bit denser and increase the chances, you know, both with your time, your investments and your connections, that these startups actually turn into these larger thriving companies.

Luke Sheen (17:54.666)
Yeah, absolutely. And another great example is Rocket Doctor, founded by a physician, Bill, who is one of our members. And he built a telemedicine platform for physicians by a physician because he was frustrated. And recently, they just served over 300,000 patients. And a lot of our members actually use that platform on a day-to-day basis to practice family medicine. So it's really exciting to see that our folks

invested six, one, two years ago, but already not only are they using the platform, but it's actually out there saving lives. And I think that quick transition and getting that involvement, satisfaction where there's output from making an impactful change, but also investing in technology that the physicians themselves can use has been the cornerstone and the thesis of our investment.

and why we built Halo Health the way that we did.

Jordan Vollrath (18:56.287)
Impact, impact, that makes all the difference. Well, so physicians interested in getting started, could you clarify what those inclusivity criteria are? What is an accredited investor? Most doctors just by virtue of being a doctor, you're gonna qualify, but what are those criteria?

Luke Sheen (19:07.904)
Yeah.

Luke Sheen (19:11.998)
Sure, sure. So because these are private investment that are not public market, we are very serious about compliance and being up to date on our legal matters. So that's enforced by the Securities Commission, which defer by every province. However, the most commonality in their securities laws are that

Either you have made more than $200,000 in the last two consecutive years, or have a net worth over one mil, of which most staff attending physicians certainly meet that requirement. So that's requirement number one in order to participate as an investor. Number two, I would say is, you know, we like to really collect like-minded, good people. Good just...

integrity driven, innovative, thinking outside the box, but also believe in community, actually like to help each other and ask for help and is open to learning. That really makes for a unique a bunch of docs. So that's another qualitative, I would say, fit that we look for.

But as long as those quantitative, being an outcredit investor and qualitative drivers are met, then we certainly welcome any and all physicians across the world.

Jordan Vollrath (20:37.827)
So the physician joins, they've gone to the event, they've seen the pitches, now they're interested in investing. What's a typical check size? What's the minimum? What does it go up to? What does that actually look like if they're getting interested?

Luke Sheen (20:49.87)
Sure, sure. So our physician can indicate their interest by just emailing us after watching the investment review video or they can vote live during the event. And even after that point, we will now collect those like minded physicians.

invite the VC analyst or associate who brought the deal, and we'll host a one-hour session with the founders to ask granular questions, have an internal discussion, have a chance for colleagues to talk to colleagues in a safe environment. After that point, quite often our deals come pre-negotiated. So usually our deals range from pre-seed to series A, I would say. So then the average is around seed.

And then most startups come in asking for, let's say, in the range of 100K minimum check size. However, Halo Health will always try and most often succeed in negotiating down to 25K. So, for example, for Rinalo Laje, you know, I can publicly say because we led the deal, we actually lowered that all the way down to 10K.

And they already have institutionals that are investing at 200, 300k ranges. So I would say 10k to 25k is the range that our physicians can get involved in these exclusive deals and they're getting the same deals that these bigger firms are signing. It's the exact same deal terms, whether it be a safe or priced equity round. Um, so that's one of the work that we do in the background to make sure that our physicians get

a fair allocation that they get an exclusive deal through a halo health and also so that the minimum check size is greatly reduced to make it comfortable for an individual investor. If it is the case that it's a very large deal, then we will use a third party to do an SPV,

Jordan Vollrath (22:40.759)
So, go ahead, sorry. No, no, go for it, go for it.

Luke Sheen (22:56.682)
the sum of the checks will add up to the minimum. Let's say the startup, it's a later stage company, they enforce the 250K minimum. So then our folks can come in at 25 or 10. And let's say we had 10 25K checks from our members, we'll put that in an SPV, thereby you get to participate in this investment. Whereas you wouldn't have been able to, if you were just a single accredited investor who didn't belong to a group who can facilitate that.

Jordan Vollrath (23:26.179)
So making it easier to come in at those, you know, a little bit less scary, a little bit more reasonable check sizes. On the startup side of things, we've got some SPVs on our cap table. And in terms of securities laws, I think things start to switch over once you get 50 investors on your cap table. Now there's certain regulations that apply. It just makes it easier and less of a headache for the actual companies to have them grouped into these smaller check sizes, into these SPVs. So it makes total sense that you guys do that.

Luke Sheen (23:57.286)
Yeah, absolutely. And I think it makes it easier in providing comfort to our people because these SPVs are actually only open to HALO Health numbers. And we look after that using a trusted third party lawyer.

So then everyone within that SPV are Halo Health people exclusively, folks that you've seen around at the events, folks that you grab beers with, or folks that may even work in your hospital and you know yourself personally. So we, again, we appreciate and respect that most, if not all of our members still practice. So we try to do our homework to reduce risk and liability for our

folks participation and hopefully by doing so increase their comfort.

Jordan Vollrath (24:42.783)
And then so on the outbound side then, deals have closed. You guys have been around for how many years now?

Luke Sheen (24:48.806)
And we've been now we're getting to our fourth anniversary in January.

Jordan Vollrath (24:55.063)
Happy anniversary coming up here. What's the track record been like? I understand you guys have had several exits at this point. Can you kind of explain what an exit is and sort of what those different companies' valuations were and those returns that you guys have seen so far?

Luke Sheen (24:57.052)
Yeah, thanks.

Luke Sheen (25:09.57)
Sure, so our group collectively have invested a little over $6.9 million over the last three and a half years into 45 different healthcare startups.

lucky to report that although pre-seed seed investments take anywhere from five to ten years to mature, in our three and a half years we've already had four exits. And what we mean by the exit is that our investors got their money back via two mechanisms. So two of our companies went public IPO. They're listed in TSX, Toronto Stocks Exchange, and CSC. So then they are able to convert

public market stock shares and an exit that way. And then the other two companies got acquired, bought out by a much larger public traded organization. So the two IPOs were Field Trip Health and Psychedelic Medicine Space, and then CloudDX, a remote diagnostic platform. And then the two acquisition were Inkblot, which is a telemedicine psychiatric platform, got acquired by Greenshield Canada.

And then the second acquisition was a company in the digital health software space that got acquired by Qualifax, which is a publicly traded US company. And that company that got acquired, the startup we invested in is called OnCall Health. And in that case, because the company is bought out, the investors will get their money back in the multiples of the equity that they own from

when they invested early at the pre-seed seed stage and now the company acquisition. The return profile on the four companies vary, but what I can tell you is that the exits occurred in between the range of two and a half years to four years. And the exit multiples on those were around two to four X. So then with the annualized return averaged out, we're looking at

Luke Sheen (27:16.106)
I think last time we computed this 43% annualized return, which to put things in perspective, I believe the 10-year trailing average return of S&P 500 is about 13.1%. Our investors definitely beat the market twofold, if not threefold. But that being said, we're transparent in notifying our folks that this is probably the most high-risk.

and high reward type of investment that you're going to make. So this is definitely not a real estate investment. This is definitely not a guaranteed debt financing where you get a guaranteed annualized return. This is a high risk investment, but that's why you're getting these outsized returns. And also academically, statistically,

in a given fund, on average of 10 startups, it is expected that five will go to zero, three will do okay, one will do very well, and then the one becomes a unicorn. And thereby the average of that gives you the annualized return. From our perspective, we're looking at startups that can return within the next five years. We're not looking for those huge pharma.

10-year, 20-year kind of deals. We want our investors to get their money back. And by doing so, we're not looking at, again, those 20, 100X returns. We're looking for things that make sense, that will beat the market and give some returns for our folks. And then from a profile of 45 invested, four exits, and luckily only one went bust during COVID.

Jordan Vollrath (29:04.031)
And so it's very different type of investment thesis compared to, I don't know, you buy some GM stock and you're looking for that dividend and that payment coming out automatically, right? When you're investing in startups, you're anticipating that longer life cycle before the deal returns. And it is the equity, the value of the company itself that you're looking for, those shares to go up in price, as opposed to getting that check and that dividend on the revenue every few months.

Luke Sheen (29:30.562)
Correct. Yeah. So it's all equity. It's entirely dependent on how big the company gets and what the company valuation at time of IPO or acquisition is comparatively to the valuation, at which point you invested early.

Jordan Vollrath (29:48.839)
And so who typically is risk tolerant to that side of things? I imagine a lot of those early career physicians, people who have that higher tolerance for risk. If you're getting near to your retirement, you probably don't wanna have a whole lot of risk in your portfolio, or maybe some. If you diversify, that'd be a good strategy, but you don't wanna go all in on something that might go to zero. You don't have a whole lot of time to recuperate then and how long you have left on your career. Who else tends to be the common demographia

that Halo Health is attracting.

Luke Sheen (30:21.47)
Yeah, so, you know, we definitely slice and dice our data. And what I can tell you is that our people are very diverse. So we have folks who just come to us because, you know, we do compensate our folks $400 an hour for the 70 plus opportunities per year. And younger physicians who just made staff come.

just for that compensated opportunity, which is totally fine. We certainly welcome that. They don't have to invest. And then we have very senior physicians who may have already retired or close to retirement, who are now looking for those perhaps a little bit more risky investment where it just makes total sense to them because they know that area so well. But they're always in between. There are folks that are...

younger generation attending physicians who just made staff and have that liquidity and they want to take a chance and start investing early. So we certainly have those. We have folks that are mid or late career that are looking to actually get into investing perhaps even 80% of their full-time job. So then those folks are very involved and write multiple checks per year into multiple startups.

So I would say it's really all over the place, but that's exactly how we design Halo Health. It was built by physicians for physicians. So we have a little bit of everything for everyone, whether it's that you want to get compensated or get advisory shares by becoming just a consultant or advisor.

can do that. If you want to be a blend where you do 5050 advisory and investing, surely we can find that. And there's folks who are you know, I don't want to do advisory, but here I do want to invest in the company. So here's the investment, but I'm definitely not going to be there every day to advise the startup. And surely we have deals that will accommodate that kind of appetite as well.

Jordan Vollrath (32:19.363)
So we've been chatting a lot about the deal flow and the investment side of things, you know, the shark tank for doctors component of Halo Health. Could you speak a little bit more to the actual advisory role? So your members get paid to actually start looking and helping these companies at what, how does that actually work?

Luke Sheen (32:37.074)
Yeah, so that actually, again, came about with our approach of building things that are needed in the marketplace. And the way we witnessed this is that we had bunch of startups that come to us, and then our folks will take a look and say, look,

I get the vision. Yes, this is a very needed thing, but I just really wish they would have come spoke to me six months ago, because now they're gonna have to go to the drawing board because it's very abundantly clear they never spoke to a physician. And the way that they're gonna integrate into clinical workflow will never work in my hospital or anywhere else. So then some of our folks felt compelled to help them, even at that stage, even though they were not interested in investing, not yet. So.

When we saw that, we thought, how can we help these early stage health care startups that are building something that is worthwhile without having them to spin their tires and shoot in the dark because they just couldn't get connected with the right physician. So we work with the likes of the National Research Council, Alberta Innovates, O-Bio, Waterloo Health, where we curate these opportunities for

early stage healthcare startups to engage with us and then for our physicians to get compensated, to get matched with them and help them right at the beginning, at the very early stage. That has helped those startups grow quicker and a lot of them actually listen to what our folks have to say and lo and behold, year and a half, even two years later, they literally build things that our physicians told them they should build or...

do things a certain way to get market share. And now they're generating revenue. Now they're ready for our investment stream. So then they come back and they successfully raise quite often from the same physician who advised them a year or two years ago. Our folks tend to have really good memory. So then, not only are we able to provide that opportunity for healthcare startups who need our folks' help, and then also incentivize our people to advise them, but then...

Luke Sheen (34:45.282)
help the same startup come back at a later stage where they're fit for investment and our folks can now take advantage of that investment opportunity and support them further on. So we try to build something where again, at each stage it's symbiotic, both for healthcare startup, both for the physician, but now we have extended our range to very early stage startup to let's say seed stage startup.

Jordan Vollrath (35:11.299)
Yeah, fun fact, investing in a startup that you're advising or already invested in further on downstream is actually one of the only legal forms of insider trading a person can engage in. So great way to actually get plugged in with these startups and find out what's going on behind the scenes. So let's say...

Somebody wants to advise a specific company. What does that engagement typically look like? Is it a one-on-one thing? Is it a focus group? Are they filling out a form and a survey? How does that actually go down?

Luke Sheen (35:43.798)
Sure, yeah. So on a monthly basis for our members who are up to date on their membership dues, they'll get an email outlining anywhere from two to six compensated opportunities. And those that the 70 plus that we have, of course, we have other ad hoc, those are curated in-house. So we have built a rigorous four hour engagement program where we have proprietary forms that they can fill out.

But also our folks will get the deck and the three questions from the startups that they want to ask the physician ahead of time. And then they can, on live one hour Zoom call, they can give that advice and answer their questions. And we know that intricately that physicians hate admin work. They surely have a lot of that at work to begin with. So this is where our fellows come in. They'll look at that video, and they'll actually dictate all those precious advisory points so that our physicians don't have

hours dictating what they just already said. So we made that engagement very foolproof and very easy so that even first time MD advisors can get involved without worrying about being a professional medical consultant. And also we designed it so that the admin work is extremely minimal.

And if I can be transparent, yes, we do compensate four hours a case of $400 an hour, but quite often our physicians can get through it in two hours no problem and still deliver spectacular results with the support of our staff and the system that we built.

Jordan Vollrath (37:19.471)
They're truly leveraging your knowledge and your brain and your advice as opposed to putting you to work.

Luke Sheen (37:25.726)
Exactly. Yeah.

Jordan Vollrath (37:29.532)
How did Halo come about? You guys have been around for almost four years now. What's the personal connection? How did you actually get into the healthcare space? Why build Shark Tank for doctors?

Luke Sheen (37:33.175)
Ahem.

Luke Sheen (37:38.882)
Sure, sure. So, you know, personally for me, you know, I'm Canadian, but did most of my schooling in the US, was a medical student, and then did a small startup, and then leveraging that as a jumping point, worked in Bay Street as a management consultant.

And although I was in a partnership track, you know, there's always that voice in the back of my mind, which was, I genuinely love medicine. I went to medical school for a reason. And I loved being part of a startup team and building something completely from scratch and making a difference. And then notice now in a position where there's startup founders that are struggling, having the same struggles that I did. And then, you know, once they're in one.

coincidence, I met a really great doc out in GTA area, who's doing this at a very informal level meeting with a couple buddies from med school, they're all staff physicians, obviously very interested in investing. And over beers, they would talk about, oh, this is a latest startup I found. What do you guys think? I'm a radiologist. This is GI. Hey, that's your specialty. Would you use this in your clinic? And, you know, when I met those guys, it was just

like a light bulb where it's like, wow, so I thought that there was a problem in Canada where we can involve physicians and help healthcare startups. These folks who actually practice medicine for 10, 20 years came to the same conclusion. Okay, well now we have to build this. So that was the jumping off point. A week later, I quit my firm. People thought I was bonkers, but

This is something that I wanted to build. This is something they obviously felt passionate about. So I came on board full-time as an executive director, again, starting from nothing, building it from scratch, and then built it up to what we do today, a little less than four years from that point.

Jordan Vollrath (39:41.583)
How did nothing like this exist already? That's, I mean, it just makes so much sense.

Luke Sheen (39:47.074)
Yeah, and I think, you know, that's something I, you know, hold my head in shame, which is, you know, I'm a proud Canadian, but I have the fortune to study in the US and see all the innovation out there. And these things exist there. It's just in Canada, we didn't have it yet. But the funny thing is, it's not like we don't be at bad water. We have a lot of brilliant physician scientists, innovators, but they just haven't found the supportive

scratch-built group that could support them in a meaningful way. So, you know, it was not only something that I felt passionate about, where, boy, I wish I had this when I was a startup founder, but we must start now in order to help the health care startups in Canada today, so that five to ten years from now, we will not be behind the US or where else, and actually

help these brilliant folks who are taking a huge risk, build products that can be used in Canadian soil by Canadian physicians to serve Canadian patients. So, you know, that was a huge driver and you're absolutely right at the time, we're like, why does this not exist? Yeah.

Jordan Vollrath (41:02.015)
like many facets of Canadian healthcare are a little behind the times, but we're getting there.

Luke Sheen (41:07.702)
Yeah.

Jordan Vollrath (41:11.328)
Where do you see Halo Health going? What's the 10 year vision?

Luke Sheen (41:15.326)
Yeah, so you know, I think the biggest driver for us is to make healthcare, start with investing accessible. We like to demystify it. We like to get more physicians involved.

So, you know, right off the bat, we always welcome any referrals and definitely hope to grow to every province in Canada. Right now, we have our HQ in Toronto, our office in Calgary, and have representation from our members from all provinces except Yukon and Northwest Territories. So one day, hopefully we get there as well. But I think the next progression for us is building new products. So, you know, this might be a...

Cherry Health exclusive, but we're working on a product where our physicians can get a somewhat of an ETF approach. So same 25K, but that buys you not only one startup, but four startups at the same time, thereby distributing your risk and your dollar goes further because you're investing the same dollar amount into four different startups that you really like.

And I think that will make it very appealing for a lot of docs who may be more risk averse, but really want to get involved. I think that will give them an opportunity to finally get involved because the risk profile is significantly lower. And I think...

Down the road, yeah, a private fund is definitely in the interest of our board and myself, but you know, we are very critical of ourselves as well, and we're very transparent. That's always been policy from day one. So we definitely want to build our books. We want to hone our skill set.

Luke Sheen (43:00.73)
and get to a stage. We've luckily had four exits, which is stellar, but build more success stories, be very good at picking the right startups and supporting them the right way. And eventually, even amongst our members, some that want to go into fund management, we certainly welcome that involvement as well. And when all of that comes together, I think we can further our impact by pouring more millions of dollars into Canadian healthcare startups.

Jordan Vollrath (43:31.043)
Awesome. So people, where can they find you?

Luke Sheen (43:35.026)
Yeah, so you know, you can just shoot us an email at membership at halo health.ca or can go to our website www.halohealth.ca and many of our team members are ready to engage with you and welcome conversation and we're happy to help.

Jordan Vollrath (43:57.615)
Awesome. So thank you so much Luke for joining us today. Halo Health, incredible investment opportunity, incredible place to learn, get more connected, not just on the angel investing side, but with the tech and the innovation sphere here within Canada. If people are interested, I highly recommend reach out to Luke and check it out. The events are a lot of fun. You meet like-minded people. It really is just a good time. Any final comments? Anything else you'd like to pass on?

Luke Sheen (44:22.894)
Yeah, thanks Jordan. And yeah, I was just gonna say I forgot to mention, you know, Cherry Health is a community partner of ours. And those advisory opportunities, you know, I believe that's on Cherry Health platform as well. So there's another channel via Cherry Health to get connected with us and get involved. But overall, you know, I think...

your guys' vision of providing more value to physician is something that we share and something we certainly look forward to working together to grow and reach out to more physicians. So again, thank you for this opportunity. It was really fun to be here and looking forward to seeing what we can do together and what we can do to help physicians.

Jordan Vollrath (45:12.727)
more connectedness in the medical system, right? Amplify those voices and those people trying to do good. I love it. Thanks again for joining us, Luke.

Luke Sheen (45:20.554)
All right, thanks Jordan.

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