Investors who have backed Paul van Saarloos over the past two decades have been on a rocky ride, but the Perth medical entrepreneur is increasingly confident that his current company is on the verge of success.
Investors who have backed Paul van Saarloos over the past two decades have been on a rocky ride, but the Perth medical entrepreneur is increasingly confident that his current company is on the verge of success.
Dr van Saarloos established CustomVis plc in 2001, just months after being ousted from one of the tech boom’s favourite stocks Q-Vis Ltd.
Both companies sought to commercialise eye laser technology and both racked up big losses, but CustomVis shows every sign of reversing that trend.
The Balcatta-based, London-listed company has achieved rapid growth, albeit from a very low base, in sales of its ‘solid state’ laser system.
It has an installed base of 25 lasers, which have treated 30,000 eyes, and expects to sell about three per month in the half year to June 2008.
Its current success stands in marked contrast to the crisis that gripped the company in 2005 when it was forced to close its London office and slash staff numbers.
Dr van Saarloos says one measure of the company’s success is the attention it is getting from the big players in the market.
“They are doing everything they can to block us,” he told WA Business News.
If CustomVis succeeds, it will be a rare example of a technology company successfully tackling the global market from Perth.
Dr van Saarloos’ experience has also taught him many lessons about commercialising innovative technology.
His number one lesson is about getting the right board of directors in place.
“Going from a small private company to a listing, we had to bring in a powerful board. The board members thought they had to do things but didn’t understand the industry that well,” Dr van Saarloos said. “This was a classic mistake.”
Dr van Saarloos came to Perth in the mid 1980s to work for the Lions Eye Institute, and became closely involved in developing eye laster technology.
His first company, Q-Vis, developed a gas excimer laser, which is still the standard product in the market.
After his acrimonious departure from Q-Vis, which subsequently went into administration, he set about developing the ‘next generation’ laser.
“I sat down and designed what I thought was the optimal laser,” he said.
Dr van Saarloos believes competing products have failed to keep up with surgical advances.
“We now do surgery differently but the technology hasn’t evolved to be optimised,” he said.
“We track the eye using completely different technology that nobody had ever used before.”
CustomVis floated on the London Stock Exchange’s Alternative Investment Market in 2003, when the company was at a very early stage of development with only a handful of sales.
It planned to enter production quickly but needed to make some design changes in order to gain regulatory approval, a process that proved more complex than expected.
Dr van Saarloos said the board rejected his advice, deciding the company should press ahead with production while simultaneously completing the design changes.
“We had a huge board fight and I nearly lost my job,” he said.
“You go into production when you’ve got your device ready and working, not before.”
CustomVis failed to complete the design changes, triggering its 2005 crisis. It had spent most of its money, its potential customers had lost confidence and its board was divided.
Since then the company has been clawing its way back, raising extra capital at a fraction of its 91 pence float price and slowly building sales traction in Europe, the Middle East and Asia.
The company’s current goals include reducing production costs.
It has also obtained a federal government Commercial Ready grant for development of its next product.
Dr van Saarloos is full of praise for the federal government’s grant programs but is frustrated by the state government.
State assistance to the technology sector could include provision of a patent attorney, workshop facilities for prototype development or loans to provide extra funding.
Dr van Saarloos, who employs 35 people, said his number one wish at the moment was a reduction in the company’s payroll tax bill.
His long-term plans include gaining regulatory approval in the US so that the company can enter that market
Dr van Saarloos estimates the company will need at least $US5 million in cash before embarking on FDA approval, which requires intensive and strictly documented testing.
Perth biotechnology company Clinical Cell Culture famously failed to meet FDA standards and has never recovered.
Dr van Saarloos is looking for a stronger share price to help raise extra capital, but to date there has been little progress.
“Most people haven’t realised how far around the corner we have turned,” he said.
