Ardian Inc. is a startup based in Mountain View, California.
Yet its technology, a catheter-based treatment for hypertension, was created by Minnesota entrepreneurs, funded by a Minnesota venture capital firm, tested by a Minnesota hospital, and recently bought by a Minnesota medical device company for at least $800 million.
So why in the name of Earl Baaken’s Hawaiian shirts is Ardian not headquartered in Minnesota?
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First, let’s review Ardian’s Minnesota connections:
- Dr. Howard Levin, a cardiologist, and Mark Gelfand, a biomedical engineer, founded Ardian in 2003. Levin and Gelfand both help start CHS Solutions in Brooklyn Park, Minnesota, which was acquired by Gambro earlier this year; and Cardiac Concepts Inc. in Minnetonka, Minnesota, which recently raised $27 million from the sale of equity.
- Split Rock Partners, based in Eden Prairie, Minnesota, is a major investor behind Ardian.
- Hennepin County Medical Center in Minneapolis was the first hospital in North America to treat patients with Ardian’s technology, a catheter-based system that uses radio-frequency energy to “deactivate” nerves in the kidneys, lowering blood pressure.
- Medtronic Inc. (NYSE:MDT), based in Fridley, Minnesota, said earlier this week that it acquired the company for at least $800 million.
Anyone with a passing interest in Minnesota’s innovation ecosystem should be slightly disturbed. People brag that Minnesota is home to all of this medical device talent and expertise.
Yet Silicon Valley is emerging as the destination for medical device startups with big-bang technologies and exits. Cameron Health, based in San Clemente, California, is another example. The startup, led by Minnesota medical device veterans, is attracting national attention to its leadless implantable cardioverter defibrillator.
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California’s risk-taking culture, backed by a robust venture capital community, are two major assets that Minnesota lacks.
For example, Ardian was hatched in The Foundry, a well respected incubator in Menlo Park, California that develops promising startups, mentors young entrepreneurs and finds investors for its companies. You will not find such a thing in Minnesota, at least not with the degree of success The Foundry enjoys.
That’s not to say Minnesota isn’t creating worthy medical device startups. But when is the last time you heard a local startup selling itself for nearly a $1 billion?
You may ask, what’s the big deal? Medtronic is buying the company anyway. For starters, we should be creating our own innovations, not buying them from outside companies.
More importantly, an $800 million exit attracts attention and people who want to replicate it. That’s why entrepreneurs and investors flock to Silicon Valley.
Could you imagine what an $800 million exit would do for Minnesota’s entrepreneurial community?
In 1995, Boston Scientific Corp. (NYSE:BSX) acquired SciMed Life Systems, a local device firm, for $850 million. SciMed alumni Mike Berman, Dale Spencer and Dan Sullivan used their riches to launch dozens of companies in Minnesota and invest in countless others.
We should look at Ardian not simply as another Medtronic acquisition but rather one more reason why Minnesota’s innovation culture is falling further and further behind those in other parts of the country.