The aesthetics industry has come a long way in just the last decade and today it represents a sizable opportunity for companies who seek to help people feel better about themselves through safe and effective products. We caught up with Nick Teti, CEO of Santa Barbara-based and Polaris-backed Suneva Medical, who shared with us the importance of people, performance, and singing in the St. Monica’s choir from South Philly!
Explain the Suneva business model and how the company differentiates itself in a crowded aesthetic market.
The aesthetics industry has been driven, historically, by companies such as Inamed, Allergan and Medicis and recently by Valeant & Merz. Suneva is a smaller-sized player, which allows us to be more nimble, resourceful and entrepreneurial than the bigger organizations which tend to be slow and bureaucratic, but full of resources. I joined the board of Suneva in 2009, shortly after the company was formed and became the CEO in late 2010. At that time we changed our philosophy and moved our strategic intent to help physicians build their aesthetics practices. Our business model revolves around service to these customers. Because there are no reimbursements in aesthetics, the aesthetics customer business model is as much about building a profitable business as it is around medicine. We work with them not only to deliver strong patient satisfaction, but also to help make their practices more profitable. These partnerships are the key to our success. So we don’t just sell products; we train the physicians and their staff, we bring in patients for information sessions called Suneva Nights, and we help raise awareness for products such as ArteFill, Regenica & Refissa. We are not order takers; we are partners.
Ten to fifteen years ago, no one talked about the aesthetics space. We were a subset of the medical device industry. Then, almost overnight, a light just went on and the aesthetics space was born. The awareness has been increasing ever since. When I spoke to Wall Street back in those early days, I would show them a map – and across that map I would draw a smiley face. Everything below the smile was the aesthetics market – geographies with sunshine, outdoor living and higher per capita metrics. That market has held up very well – but the smile line has moved decidedly north in the last decade. Acceptance and interest in these products are now everywhere – and expanding.
Our target age demographic was at one time 35- 50. Now its 20 -70. The safety and efficacy of the products is attracting younger patients and baby boomers are living longer and more interested in their appearance. The opportunity in the aesthetics market is that you develop lifelong patients who are repeat users of products they like, creating an annuity for the business. The rate at which patients return for treatment is different in the various geographies. I call it the vanity index. Patients in Los Angeles, Florida, Dallas and New York (where there is a higher vanity index) return more quickly for treatment than patients, lets say, in the Mid-Atlantic States, for the same product. But the growth is everywhere.
What are the biggest challenges you face in growing Suneva and how will you address them?
Our biggest challenge – and the macro challenge of any small company — is getting the talent necessary to be successful. We have 85 total employees – and that makes every single job a key position. There is no buffer or safety net for lower performers. Everyone has to produce. Startups need different types of people than larger companies do. So, in recruiting we need to sell the opportunity to be part of something that is growing – and something that is important.
We also need to be resourceful from a marketing standpoint and build awareness for our products in creative ways. For instance, we completed two major scientific studies this year. We did a huge 1000 patient safety study – and another on treating acne scars. These represent foundation blocks upon which we will build our brand. The acne scar treatment is particularly exciting because it is poised to help people who truly need healing – both physically and emotionally. We are very excited about the prospects for this product once approved by the FDA.
What are the key factors of success for Suneva during this phase of the company?
Focus and execution. You can always build a good business plan, but if you can’t execute on it, it’s worthless. We have developed a great marketing campaign for Regenica, a product that has very competitive growth factor technology, but at the end of the day, we need people to try it. When they try it—they stay with it. We must execute on the vision.
Who inspires you? Are there other CEOs or industry leaders you look up to for their leadership qualities?
When I was at DuPont, I worked for Kurt Landgraf in various capacities for much of my career there. He was the CEO of Dupont Pharmaceuticals and the CFO of the larger DuPont Corporation before becoming CEO of the Educational Testing Service. He gave me my first big break and many global opportunities to lead within the organization. I learned a great deal from him regarding value systems, performance, dedication and commitment. Most importantly, I learned about treating people well. Plenty of companies shoot their wounded. Not Kurt, and not me.
I sang in the St. Monica’s South Philadelphia church choir under the same director from the time I was 5 years old until I was 35 years old. We were the best in the city – thanks to Anselmo Inforzato. We called him Al. Al did not believe in being 2nd—he had great and demanding standards. When you work with someone who is so demanding for so long, three decades of my life, you develop a standard of excellence that becomes embedded in you. I learned from him that you can always do better. Next week, next month –you will always be better. Because of him, I am always pointed forward. The other person who has had a great impact on my life and performance is my wife of 30 years, Barbara. Barb never let me forget how special I was and how I could make a significant contribution to anything I was doing.
Lastly, I am truly inspired everyday by the people who work for me. When someone steps up and decides to be a significant contributor, that is a great moment.
Is that the favorite part about your job?
Yes. I love watching people go from A to Z over their career. Seeing continuous improvement over time is so important. If you aren’t better six months from now – we are failing as a company. Folks who have worked for me – started off in smaller roles — have progressed to positions of significant responsibility. I trust over the years I have helped people become leaders. If you don’t care who is getting the credit, there is going to be a lot of success.
If you could give advice to a startup CEO, what would it be?
Values: The first thing every CEO needs when walking into a company is a value system. I have a ten point value system that is instilled at Suneva. It includes ideals such as: 1) Performance – no excuses; 2) being negative is easy, being positive is harder and; 3) this is not a prison camp. People need to understand that if you don’t like where you are, you can leave. Once the value system is communicated, you must do your best to stay committed to those values.
Leadership: When I took over as CEO of Suneva, I renamed the “management team” to “executive leadership.” It is important for these individuals to be empowered to lead. It’s subtle, but important.
Compensation: Make certain that your compensation plan aligns employees to the objectives of the company. We have a detailed point structure at Suneva that assesses individual performance and ties the bonus pool to these financial and qualitative goals. It is all very transparent.
Planning: At the very beginning, create a 100-day plan. Take the leadership offsite and make a collective effort with specific objectives. Then communicate to the entire organization. Business planning going forward can then take place in 6 to 12 months chunks. This method creates focus and allows you to assess progress at the end of the time period. And don’t develop your mission immediately. Do the 100 days first so you can understand where the company is – and where it needs to be.