Florian Wegener
Very often. It's not about giving the right answer, but asking the right question.
John Simboli
That's Florian Wegener, co-founder and CEO of Zageno. Listen in now to hear the conversation I recently had with Florian at his office in Cambridge. I'm John Simboli. You're listening to BioBoss. This morning I'm in Cambridge with Florian Wegener, co- founder and CEO of Zageno. Florian, how did you find yourself here at Zageno?
Florian Wegener
I am In my fourth career. I'm a physician by training, a cardiologist. I was trained in three different countries, namely the United States Canada, and Germany. And I performed specific so-called EP studies and measured the electricity in the beating heart of my patients. If we would detect signs of arrhythmia in the patient, I would insert an ICD, so-called, implantable cardioverter defibrillator, to prolong the life of the patient and increase their quality of life. My second step, actually, was joining the Boston Consulting Group. I worked with BCG always between big pharma and med tech. I also learned about payers in different countries, but at some point I felt that I was lacking expertise in, you know, finance, accounting, et cetera. And BCG was kind enough to sponsor my MBA, to IE Business School in Madrid. And IE business school in Madrid is a great place. It's, you know, located in the heart of Madrid, a vibrant city. And it's really the entrepreneurial school in Europe. And I usually say I got infected with a virus called entrepreneurship there. And then moved on and joined Qiagen, one of the leading biotech companies. And, you know, being at Qiagen, I was an intrepreneur, I was a manager and I really learned that I have a passion to build and develop businesses. I actually was allowed to hire 70 people. We built, globally, e-commerce capabilities for Qiagen. We launched web shops in 16 countries at that time. And, we are offering a digital customer-user experience to researchers. During this period, I met with David Pumberger, who became my business partner and co-founder of Zageno.
John Simboli
What's the life of a cardiologist like compared to the life of an entrepreneur?
Florian Wegener
I left the hospital for two reasons. So I left the hospital because I felt very lonely sometimes. And in fact, I was a young physician. I was also a researcher and I felt like 24 hours, seven days per week, I was either with a patient, mostly very tired, or I would have to focus on my research and get a paper out. And so that was, on top of that I felt like my career for the next decade was clearly a long and dark tunnel. And this is where I really listened to myself and I took some time off and decided to leave the hospital. And coming from the positive side of things, I always wanted to create something that helps people. I always wanted to build something large that would impact many, many people. As a cardiologist, the two people that you operate on, on a day, you know,, your work has a lot of impact to those people. But, in fact, today I feel, being an entrepreneur with such a great platform, we can influence and better the life of thousands of people. And I was always striving for something and looking for such an opportunity and I'm very glad we came up with the idea of Zageno.
John Simboli
How did you decide you wanted to lead an enterprise life sciences company? As you were thinking that through, did you say, did you find anything that was close? In other words,"You know, I could go to this existing thing and I could help to build it" or, I imagine the answer is,"Did you realize that you had to create it in order for it to exist?"
Florian Wegener
It is so easy to understand that there is a need for an Amazon-like marketplace, that there is a need for digital aggregation on the researcher and purchaser side. You just have to speak to people who work at the bench and start asking them questions, not only about the work they do and the success they have, but also about the pain points. And when you do that, they will start speaking about how painful it is to find the right product and to order it. And I sometimes feel there is such a clear need, it is interesting to me that no one ever before really realized that and started a Zageno-like endeavor earlier, I thought about this many times and, in fact, all investors ask us,"So why are you the guys changing this industry?" And I think one explanation is that you find highly educated and very intelligent people in the life science research industry that are so driven around or towards the goal that they are trying to achieve with their research that they sort of do not invest time in bettering other processes. And I feel when you go to the supplier side, and this is where I worked for a supplier for several years, you will easily find out that the sales process and the marketing and the service processes are also broken on the supplier side. And one of the drivers for that is that the needs of the researchers have changed. Everyone wants to have an Amazon-like experience also at the workplace. And on the other side, I think the founders and managers of life science companies have also understood that value creation of their company happens in the lab. So, in fact, most researchers are not so happy if they see a salesperson interrupting them focusing on their work. And so this is where, where I feel Zageno can really help those two sides to come together and create a win-win situation.
John Simboli
Florian, what were you hoping to achieve at Zageno that could be done here and not at another company?
Florian Wegener
Believe it or not, in life science orders are still being placed via fax, email, and phone. We, at Zageno, accelerate innovation by enabling the scientists. We have this saying... Eureka moments... let's create Eureka moments. And the Eureka moment is when a researcher or someone internally at Zageno experiences a brilliant breakthrough or a happy moment. And at Zageno we are creating a brand new market. That's a unique opportunity and it's a completely new model for the industry. So Zageno is a market maker. And by the way, being a market maker sounds cool, but comes with a lot of pain because you have to explain to everyone what do you do?
John Simboli
You carefully give the story, as you're beginning to with me right now, in many different venues. And that at the end you kind of test that to see if they understood it the way you intended it. And sometimes they don't. Sometimes they've got it all backwards or they've filtered it in some way. That person then says,"Oh, you are in this business" and you help them, gently, and say"No, we're actually in this business." What are the misunderstandings and how do you help them to understand what it really is?
Florian Wegener
Zageno is a marketplace. We think of us as a digital matchmaker and I feel it's easy for people to understand; one day go on Zageno.com, that we offer an Amazon-like ordering experience. However, what is not understood at the first glance is really that Zageno is way more complex. We are, in fact, an enterprise software that offers many additional business processes including approval processes, invoicing and payment processes. Why is that important? It is important because in the B2B world researchers make the decision on the product they want to use for the experiment. However, there are entire teams, procurement teams that need to fulfill those wishes and they need to establish relationships with these suppliers. These can be hundreds or thousands of suppliers for a research institute. And without having approval processes in place, without offering one invoice, one payment to our customers, that's exactly what we do, these processes are very time consuming, and people on a daily basis have to repeat the same work steps over and over again.
John Simboli
So when you clarify, as you just did, and they say,"Ah!" Is that a Eureka moment for them?
Florian Wegener
I feel that is a Eureka moment for the researcher because the researcher just places an order on Zageno. It's a cart with as many brands as you like, as many products that you like. And then there's a Eureka moment for the purchaser because they just have to click once to accept the entire cart and they know they won't get 15 or 20 invoices from different suppliers for just one cart, but they will get one aggregated payment statement from Zageno and then they will transfer one payment, to Zageno, and Zageno transfers the money to the suppliers. So there's a lot of complexity behind the easy-to-navigate Zageno website.
John Simboli
What have you learned in this period of time about what works for you? What way of working with people and managing Zageno have you found is your style, that's you?
Florian Wegener
I feel that leading a team, bringing so many diverse people together... one thing I learned, I think during my time as a consultant, but maybe also as a physician is there's a certain art of asking the right question. And very often it's not about giving the right answer but asking the right question. And so I see myself as someone that, hopefully, spends enough time with all team members and, hopefully, helps them to come to a better outcome of their work based on smart questions.
John Simboli
Can you remember when you were eight or nine years old? Can you remember what your child view of what you wanted to be as a grownup was? And does have anything to do with what you're doing?
Florian Wegener
I do, actually. From that age, I knew I wanted to be a physician. I always wanted to be a medical doctor. And you know, at that time a friend was doing deliveries for a pharmacy and I thought, hey, this is a great idea. He made a bit of money, he would bring medication to elderly people who were not in a situation that they could easily access the local pharmacy. And so I visited a separate pharmacy and explained the concept and I must have been very persistent because they eventually agreed to let me do it. And I guess you could say that was my first experience in life science. In one form or another, this is something I've been connected to ever since. I remember exactly how that woman said," Why would I pay you to bring medication to people if people just come to my pharmacy? And I said,"But think of the people who don't come to your pharmacy." And she said,"OK. Let's try it."
John Simboli
If Zageno develops as you hope it will, what effect do you think that will have on people?
Florian Wegener
Zageno should accelerate innovation. We should be a hub for researchers that are planning the next experiment. When they wake up on a Monday morning, they should open up Zageno,, find the right content, have a community of researchers that they can share their thoughts with. And doing something and building something like this, we feel blessed to enable researchers and want them to be more successful in their important work to cure cancer, to better animal health, fight rare diseases, work on food safety, all those great things that we at Zageno cannot do directly but we can help them to do this important work.
John Simboli
Florian, what's new at Zageno?
Florian Wegener
We closed a significant financing round led by General Catalyst, the leading tech venture capital firm on the east coast, and that brings us into a good spot. We are actually hiring people and are growing the team. We just moved into a larger office and we are expanding our business. From a product perspective,, the product is evolving quickly. Zageno built the first product comparison engine in this industry, which allows people to compare 10 million products from 3000 suppliers for the first time. One very interesting feature in Q3 is our spend analytics and optimization tool. Now when you order all lab supplies through Zageno, our analytics tool allows you to see where your spend goes, at one glance. And it empowers the researchers or purchaser, for the first time ever, to easily identify where cost savings could be made.
John Simboli
Zageno is many things as I've heard you explain it. It's a procurement platform. It's a validation tool. Interestingly, it's also a community. You're building a community in a sense. Can you tell me more about what that means?
Florian Wegener
Zageno offers people to identify the right product for their experiment. I think today we are in the beginning of building a community for researchers around the work they do. We help them to channel their communication within an account, to each other. There are tools for that. We allow them to use our chat function on the website to have one person that they can refer to whenever they have a question about the product or delivery, invoice payment. I feel in the future we need to become way better and we need to offer additional services. One thing we learned over time is that researchers are very intelligent people, very high IQ, sometimes, or actually often, introverted. And I feel like researchers would love to communicate more with each other. They would love to share guidelines and best practices among each other. However, in the exciting world of creating something potentially big that can change the world, there are lots of restrictions for them to exchange information. And while they would like to speak to a competing team or they would like to speak to another small or big pharma player and find out what are best practices they often are not, or they don't feel comfort, comfortable to reach out. And I feel there are many ways in today's technology world how we could help them to communicate in a safe way, within the rules and guidelines that their company allows them to exchange information. And we could, hopefully, based on their knowledge, become a spot or a hub spot for people driving to understand better how they can do the work.
John Simboli
How does Zageno help suppliers?
Florian Wegener
Zageno is an additional channel to the researcher, to the person who really uses a potential product. Traditionally, suppliers would go to individual accounts one at a time. They would try to speak to researchers, not entirely knowing what product might be needed in that very specific account. I don't want to say they were blind, but they still lacked a lot of crucial information. And so we can help suppliers, being there at what Google calls the moment of truth. The moment a researcher makes a purchasing decision, they can actually be guided to the product that they like. And that gives, offers an opportunity to suppliers to not only market their product but really sell it at this point in time. And that is mixed with or paired with lower operational costs.
John Simboli
How does Zageno help customers?
Florian Wegener
So customers win when they use Zageno and what we hear from our customers is that they like the fact that we are independent. They are very critical thinkers. They do not like it if people push them towards a specific product. And so, Zageno, being neutral, i s something that they l ike very much and embrace. I also feel one feature that they love a lot i s the scientific score. The scientific score is an unbiased rating system that we offer. It is basically an objective measurement of the performance of products and how do we do that? We do it in a scientific way. We extract product information from millions of scientific papers. We basically look at the methodology part of papers and we extract the information on products being used in v arious specific setups. And we then calculate a score between one and ten that will ensure a researcher that that brand or product they haven't used before w ill work if it has a certain Zageno score.
John Simboli
What kind of partners are a good fit to Zageno?
Florian Wegener
Zageno partners with manufacturers and suppliers of high-quality technology products for the lab. We offer an additional channel to the bench. We are very cost effective as we integrate into the supplier's business processes seamlessly and we help them to avoid any manual work. So these are the suppliers we collaborate with. On the end customer side, we work with small biotech companies that are fast-growing, well- funded, that are maybe lacking an IT back end infrastructure to scale their business or scale the operations. We also work with big pharma. We work with academic institutions and the first COOs. So I feel we can really cover most players in the life science research industry and we can help them to make their operations leaner and help them to get better.
John Simboli
And partners in a more traditional sense. As you build out the company and you hire people to be your full time people, what kind of... is it possible to generalize and say, these are the kinds of people I'm looking for?
Florian Wegener
When I look at the teams in Cambridge, Massachusetts, and Berlin, the people who are the most successful people within Zageno are all very smart. They're very driven. They share the passion to change the world. It helps a lot when you're open to diversity. As, at Zageno, more than 30 nationalities are represented and we have very diverse professional backgrounds and teamwork is essential to overcome all of those challenges that we face every day. And so I feel when you're passionate to change the world, and I feel, you're smart and driven and open to you all sorts of different backgrounds, you will succeed at Zageno.
John Simboli
How was it that you chose to build part of your business here in Cambridge?
Florian Wegener
When we started Zageno, it was clear to us that Cambridge is ground zero for the global life sciences industry. And it was only a question of time until one the founders would relocate from Europe to Boston or Cambridge. We started building a team in Berlin; today the team consists mainly of coders and content and customer service people in Berlin serving Germany and the UK. Here in Cambridge,, we have more salespeople, marketing people, communication people because, obviously, the United States is still one of the largest markets in our industry. And being in Cambridge, we are part of the community. We're in close proximity to our customers, both the supplier and the customers, and that allows us to learn from them every day. Cambridge represents an unseen life science ecosystem. There is a community of international entrepreneurs. They're Investors, there's a real community of investors. There are healthcare hubs. Some of the best hospitals. There is a very strong biotech scene and all of this is producing innovation. So when I moved here with my family a year ago, I must say, I was really surprised how beautiful life is here in the northeast.We love Boston. We love the sea. The fact that skiing is possible is amazing. It feels a bit smaller than the Alps in Europ, but it's a mix of very intelligent and driven people, a great place for entrepreneurship and that, mixed with a beautiful landscape, and we feel at home.
John Simboli
From an access to capital view, was your decision to come here to Cambridge... was that an important part of your decision?
Florian Wegener
General Catalyst is located in Harvard Square. General Catalyst led the last financing round. They are a fantastic partner. They help us really build the business; it's way beyond just giving you money. It's a great network that we profit from every day. In fact, the partners and associates we work with really work a few days per week within our company. But we also have fantastic investors from Germany that invest across the Atlantic and they specifically invest in life science companies here in the Boston area and in tech companies in Berlin. I'm speaking of Grazia Equity and Capnamic Ventures and I feel the mix of being in Boston and Berlin, having access to great tech talent mainly in Berlin and having access to great life science research talent here in Cambridge or Boston, gives us a huge advantage.
John Simboli
Florian, thanks for spending time with me today.
Florian Wegener
Thank you John. It was a great pleasure meeting you and thank you for giving me the opportunity to speak about Zageno.
John Simboli
As co- founder of Zageno, Florian W egener set out to do something new: build a bridge between researchers and suppliers. When I meet a leader with a vision for a new idea and the drive to make it happen, I wonder what brought him or her to that moment. After all, CEOs who t alk with me on BioBoss often say something like,"There are easier ways to make a living." The way Florian says it is,"We a re creating a brand new market. So Zageno is a market maker, and by the way, being a market maker sounds cool, but comes with a lot of pain because you have to explain to everyone what you do." One reason Florian stays focused on his goal is his sense of purpose. He told me"We feel blessed to enable researchers and we want them to be more successful in their important work to cure cancer, better animal health, fight rare diseases, work on food safety and all those great things that we, at Zageno, cannot do directly, but we can help them to do this important work. I'm John Simboli. You're listening to BioBoss.
