Financing a Software as a Medical Device Startup: A Qualitative Study

Software as a Medical Device has the potential to address global healthcare issues such as rising costs and the shortage of qualified healthcare professionals. However, startups in this industry struggle to cover the costs until time to market. In the European Union (EU), especially the expenses in the context of Regulation (EU) 2017/745 on medical devices are perceived as a hurdle. A conceptual model depicting the financial landscape of early-stage startups, including financing strategies, can provide guidance and thereby tackle these challenges. In this paper, we present our overall research design and provide the preliminary results of interviews with experts and startups in the SaMD industry. Through inductive coding, we derive two aggregate dimensions, consisting of five second-order themes presented in this work: key cost drivers, occurrence and duration of costs, cost minimization strategies and general recommendations for cost handling, financing strategies, time horizon for financial planning and financial metrics.