Founder and CEO at Sanii
Mike is the Founder and CEO of Sanii, a company improving aging in Brazil by promoting physical, mental, and social activity for purposeful, healthy, and autonomous lives after 60.
I tend to listen to a lot of podcasts. I'm just reading a lot of news, like New York Times, news podcasts to see what's going on in the world and talking to a lot of entrepreneurs. I actually just got off a call from an author of a book that I really want to read. It's called Unit X, how the Pentagon and Silicon Valley are transforming the future of war. I thought this was very interesting because we got to talk to the author. He was a former F 16 pilot and he became a venture capitalist. And it's so distant from the kind of companies I built that it would be something interesting for me. In terms of TV, just trash TV, my wife has been watching a lot of reality TV shows, like Love is Blind, and what I've learned is just how much I appreciate my actual relationship, my married relationship versus what I see on TV.
I spent a lot of time in the rural mountains here in Brazil and things that I absolutely love doing is anything agriculture related. So the gardening, I have a bunch of chickens that I bought, so I'm doing that. And I love doing some automations, like automatic irrigation and sensors and things like that . Being able to grow something and then cook it up. When you can work remotely, you can work a little bit, then you can go, plant some carrots or play in the garden and then come back for another call. So it's good. It keeps you sane as well.
VITALK was the first company that I started when I came to Brazil, ran it from 2014 to the sale in 2022. So it was about 8 years doing it. It started off as healthcare chatbots, and this was all done at the beginning through SMS texting.
It was a solution that helped us do patient engagement. So, in other words, educate patients, remind them and gather information on large patient populations, whether chronic patients or infectious diseases. And we sold it to insurance companies, government, hospitals. We pivoted the company about the last three years, where we took our core chatbot technology and focused it specifically on mental health care.
We saw a big opportunity to provide mental health care at scale. And we thought that chat was a really good format for this. Now, keep in mind, this was before chatGPT. So we had to develop our own non AI based conversational tools, and then eventually introduced a couple natural language processing tools to make them a little bit better. We used all types of psychological tools that we developed in house, and allowed an end to end treatment that we sold to corporates. So we sold into HR departments across Brazil, and it was very nice that we could apply more accessible treatments to folks with different types of mental health care issues from preventative and subclinical all the way to more clinical issues. And then that company, we were able to sell to Gympass. After that exit, I stayed on for a year and about a year ago, started a new company also in health care called Sanii, which is focused on elderly care. Very, very big market in Brazil and Latin America, but still a lot of room for innovation and improvement of quality of life for those folks.
At the time, chatbots were pretty innovative. So even SMS, text messaging and things like that, and then eventually WhatsApp messaging and then our own app, the big issue with them generally is engagement over time. So it's kind of interesting the first week and then you kind of get bored with it, right? So unless the chatbot can really be personalized and create content which is relevant to you and learns from you and can continue to surprise and create value, you lose engagement over time.
So people stop responding, people find it annoying and so on and so forth. That was a very big challenge, and there's a couple of ways that we overcome them. We had a huge user experience team that would create really interesting story like experiences for people around their healthcare.
We would also tie the chat bot to real humans. So you would eventually have a therapist. You talk to your therapist every once in a while and the chat bot would be something that the therapist can see some of the aspects of your conversation. So there'll be a human connection to the digital connection. I think whenever you can kind of do digital with physical, that's where you have the highest engagement over time. The other big issue, it's more of a structural issue. That was quite difficult for us at the beginning was a lack of incentives in general, in healthcare in Brazil, around preventative health. I'm going to teach you about your disease, get you to eat healthier to do these things. It's very difficult. First of all, for you to prove that your chatbot is actually having an effect. It's very good at taking symptoms and identifying problems, but it's very difficult to prove that you're changing behaviors and you're making someone lose weight or eat healthier.
However, we were able to show this very effectively in mental health care. We invested early in a lot of studies. We published a lot of research in journals, work with other research organizations and some international governments like U. S. Government, Canadian government to show that specifically in vulnerable populations, a chat bot is very, very effective.
And so this helped. And we also sold into HR, which cared a little bit about prevention because the incentives are more aligned. So any entrepreneur that's in healthcare, it's always good to think about, are the incentives there? Just because you have a good product, you have to first of all prove that it works, and second of all, you have to make sure the incentive is there from the organization to actually invest in it.
From the patient side, you're never going to get a full adoption, right? You're typically going to get a certain percentage of folks that like the solution and others don't. And this is especially the case in mental health care. There's so much heterogeneity in the symptoms that you have and the kind of solutions that you have, some people want to talk in person.
Some people want to do a chat. Some people want to read, listen to something, meditate. There's no one size fits all solution. So naturally you have to come up with a solution that's multifaceted. In fact, our company didn't just have chatbots . It had number of different other solutions, tests and games and audio and physical therapists and like actual therapists that you could speak with and you could chat with as well. There were some populations where it was much more effective than others and those populations tend to be younger. So tend to be more adolescence sort of maybe like Gen Z who were more accustomed to texting and who felt like they could they could talk about their mental health care struggles without their parents hearing, without having to pay for it. And this is particularly the case with more low income and vulnerable populations. Populations like more marginalized communities like LGBTQ community and things that couldn't openly talk about it. So you have a technology, which is more confidential.
You could resolve some of these issues but when we applied the solution in the corporate setting, it wasn't enough. You have to do other things to try to keep folks engaged, you don't just download an app and then there's some incentives there. We have to constantly do additional things with the clients to engage them, whether those were webinars or group therapy sessions and bring more and more content to keep it top of mind. Because at the end of the day, folks may use your solution and in fact, they may stop your solution for a good reason. They got better. And so you want to make sure that the other folks that haven't had access also get access.
And then on on the side of the the actual healthcare professionals, we made it very, very clear that we weren't substituting therapists. In fact, we hired many therapists for our platform. We said we gave therapists superpowers. It gave them the ability to track symptoms when they weren't in the actual therapy session because the chatbot would ask about what actually apply mental health questionnaires that were proven to be just as effective in measuring depression, anxiety, stress, burnout, or this measuring risk of those disorders. It gives the therapist the superpower to provide sort of homework, so these are the things I want you to work on and notate. And so oftentimes they saw this as the next step of their profession. This was generally well accepted.
Definitely in health care, the human touch is very, very important. You may have the best app that provides you with the right information, but oftentimes this is not exactly what patients are looking for, right? They're looking to actually speak with a doctor. To be convinced of what they need to do. So much of health care is behaviors, right? And how people actually act. And so that, unfortunately, is very tough to do. It's very difficult to do via zoom. That's why you need in person. We definitely felt that at Vitalk. We had a more generalized solution. Obviously, we had personalized trails or journeys that people would follow through the app. But then we would have a system of escalating things. So not everyone needs a personalized high touch, but if we began to see that there were problems, we can connect them to a person and that person can look through the history and can better treat them. Now at Sanii is a less scalable solution in the sense that we're dealing with the elderly and you definitely have a technological barrier. But we're evolving the company and we're starting to look at more and more fragile, elderly folks. You need a person that you need them to help them activities of daily living, taking a bath and providing company and helping them eat. You definitely have the struggle of how do you maintain quality at scale? How to use technology in a noninvasive way. Both businesses in health care with very, very different visions of how they think about personalization and scalability.
For my first company, I had a co founder, but we had sort of a falling out. So I actually ended up running the company for most of the time by myself. But I had a very good senior team that I was able to provide stock options with, and they supported me. That co founder I found through alumni network, and I should have done a bit more diligence in terms of compatibility and visions of values and things like that. That would have saved a lot of time, would have been a lot better
We got it to work in the end, but I think it was very difficult. We could have grown the company faster because this was probably the biggest hurdle. In the case of Sanii, which was my second company, the first co founder I knew already for some time because he had helped me with my previous company with some fundraising in the past. And we spoke for a long time. We're open about what our goals are, vision. And then, in the first two or three months that we were talking, we were introduced to our third co founder.
We really spent a long time trying to figure out what does each of one of us like to do, doesn't like to do, what are priorities? We ask really the tough questions, around the kind of conflicts that will happen, right? Like how we'll settle conflict, financial questions. These kinds of things that sometimes you're sensitive to ask about, did reference checks on each other. I called up and I interviewed people who my co founders all worked with in the past, made notes, shared those notes.
It was a very, very long process, because I really didn't want to make the same mistake that I made in the past. And it's been great so far. We've been really, really good. I actually like three co founder company. It's pretty interesting because you can always get two people aligned and then usually the third one will sort of agree. 90 percent of decisions aren't life and death decisions for the company. You need fast decisions and it's always good to have two folks versus one.
It also allows you to have a little bit more flexibility. If one needs to take a vacation or there's some family situation, you have two other co founders who are working really hard and can cut the slack.
It depends a lot on the type of company you're starting. You have to really sit down and think, what is this kind of a company? What's the differentiator of this company and what are the kinds of tasks that I'm going to be doing day to day? So when you look at Sanii, it's a highly operational business. There's a lot of people, there's recruiting. Someone like Angelina, who's a more of a consultant and Operations background, used to run an HR company, it would be very, very good because she's seen these problems and she has this kind of profile.
We're dealing with healthcare, we're dealing with certain go to market strategy that we want to take some of that experience in that. So you assemble a team thinking about the skillsets. It doesn't necessarily mean that all companies need co founders. I'm seeing lots of companies that are one founder who takes the company to a certain level and then can probably attract a very good team of initial hires, pay them relatively well, trust them. I think that's totally doable. That's what I was able to do in Vitalk. I brought my CTO, my head of product, we felt like equals, even though they hadn't officially started the company with me.
But I think a lot of it has to do with your emotional state as well. Doing a startup is very much a psychological game. It's about patience. It's about resilience. And I
like having people I could talk to when I'm feeling down and be open to. I don't want to be bringing that energy into the home and complaining to my wife or to my family.
So it's good to have that relationship there definitely helps. For most people, having a co founder is helpful.
It's values. I think is the biggest thing. Do you have the same sort of values? Why are you in this company? What are you doing? What do you believe? One of the things that we did is I invited all of them, my co founders and their families to spend a couple of days here on the farm and you could kind of see small behaviors as to how people interact. How do people interact with their spouse? How do people interact with the kids? When I saw one of my co founder, who was the more hands on operational go do the dishes put everything away, I said, this is good. I got opinion also from my wife. Sometimes you want the thing to happen, you don't see from perspective. My first company, within the first day, there were clear signs that there was an issue in values and how we think and what was important for us and the timelines. And a couple very core fundamental things that you can easily ask, like, what do you want to do? How committed are you to this? What happens if it fails? And I ignored those signs in the very beginning.
It's about having that resilience, and just being together and say, no, we're not going to give up. We're going to keep going. This is the only thing we care about, and I think that was very important.
In general, the more time you've spent with a person, the better it is. So oftentimes people say, Oh, we worked together in the past, or we were roommates in college. You can kind of pick up on things and sort of listen to your gut, even some small behavior, something from real thing that you weren't quite happy how that person acted, whatever it may be, and even in their personal life, just trust your gut. You're going to be living through hours, months, years with this person. You want to really see what are they like at their worst.
The reason they came in was because of the mission. They were really interested in what we were trying to do, which was trying to provide better health care access for everyone else.
These were people that were clearly mission driven. They could have clearly gotten jobs at consulting firms, at big tech companies but they were interested. They love the mission. That's your job as a founder of the company. You have to be really passionate about it.
Especially when you're fundraising, sometimes you may not even believe 100 percent of what you're doing, but you have to convince yourself that this is what you think is the right thing to do. Then you can bring people on in that way.
Once those folks came on board and they fell behind the mission, be very transparent, open with them, involve them in the decision making, think long term with these people, try to incentivize them as much as possible. Eventually they will bring in other folks that share the same values.
That's how you create a good culture off out of that. Eventually, do everything you can to lift them up. Push your team to go into the podcast, write the articles, get published, show their work, try to sometimes even fade into the background and that way you get a very coherent management team that's motivated by the mission that feels like they're growing in their career, and it's much more resilient when things go wrong.
For the first company, it was a miracle. I'm not sure how we were able to do it. We raised multiple times from multiple different sources of capital and there was a lot of luck. Many venture funds that we spoke to over the years that just consistently rejected us and we just continue to come back rejecting us. What I was surprised with Sanii, which was the second time I thought, well, I had a very successful exit to a well known unicorn. I gave back a 61 times return on their seed money. I thought it was a great, great deal. I just didn't expect how much rejection I've continued to get. I really thought that I'd come in and everyone would give me money. Cause I'm a second time exited co founder tackling a big market. And I've gotten this crack team together. Got guys who have a lot of experience. But the issue is sometimes it's not your fault, right? Sometimes you really have the wrong timing.
We raised in 2022, beginning of 2023. It was about a year ago that we really kicked off our fundraising. VC market was bad and it was already burned by companies in the healthcare and B2C space.
So people were very much cautious to invest in a pre seed round with no results no traction, nothing, just the deck. It was difficult. A lot of rejection. Very, very frustrating. We thought of plan B. If we can't raise a big round with VC, then what, how will we do it? Just with our money or with small angel rounds, prove things out. We had a couple options on the table, but because you're a second time founder, I've worked with some of these VC funds before, some of these investors before. So they were more willing to provide more money. So you have this cumulative effect, but it was definitely very, very shocking to keep getting rejected. Founders who have done big companies, they get passed on all the time. You have to get used to it.
But it was very well reasoned, right? They came in and they said, look, yeah, we thought about this and these are the reasons. I totally believe this and this and this, you haven't proved this. If you can prove this specific hypothesis to me, then I'll invest. And I said, yeah, it makes sense. I haven't proved it. This is clearly risky. I understand why that may be. I just didn't like the guys who made up fake excuses.
If you're getting less than 95 percent rejections, you're better than most people. You're going to be rejected by literally everyone. And sometimes it's not your fault. Hustle, conserve cash and prepare for when things get better.
It's helpful if you're building relationships with folks. Before you fundraise, you want to have an initial conversation, start to meet them, ask them to connect you with other venture capitalists, with mentors, just start having quick coffees. Have a general conversation so they know you at least and kind of know generally what you're doing and say, we're not raising. I'll let you know when we open up a round. I think it's very important to have at least an initial touch point, a couple months before you actually kick off fundraising .
It's that entrepreneur thing. Sometimes it's a cold email. Sometimes it's a warm introduction, to start building up that network. And oftentimes you'll talk to one person and see who else can you connect to.
Go through your LinkedIn. Who do I know? Who did I study with? No shame. People who you say were your friends in the past. Hey, can you connect me to this person? Hey, can you do this? You'll get enough. Once you have a good enough list, you want to have probably at least 40, 50 investors, at the minimum, typically a hundred to have on your roster.
Build the deck, test the storyline. What I did with my co founders, we prepped all the potential questions. And it was scripted. It was like a theater play. For the VCs, it sounded like we were super natural. We would make jokes, and we would like finish each other's sentences, and look like super natural, it was all rehearsed.
It was all rehearsed down to a T. They would ask us questions. We were ready for that question. Say, what an interesting question, I didn't think about that question. Clearly we thought about it, and we have all the statistics, and so we were very, very well prepared.
So like initial contact, Hey, I'm thinking of doing something in elderly or something in this space. What do you think? Are you investing? Yeah, I'm investing. Who else should we talk to? Oh, talk to this person, this person, this person. Start building out that list. Okay, my turn. Then, the next three months, build a pitch deck. Test the pitch deck with folks, with people that can be honest with you. Not family. Be very susceptible. If people don't get it the first time around, that's a problem. If you can't do a one sentence, one phrase, that's a problem.
And then the best strategy that I heard is you basically create what's called a blitzkrieg approach with investors. You want to create FOMO, right? When you're ready to fundraise, set aside two weeks, three weeks. And you reach out to everyone and say, Hey, I'm fundraising now. I want to show the pitch for what I'm doing.
And within two or three weeks, you're going to have days where you do four or five calls. What does that do? It creates a huge FOMO effect among the investors. Everyone starts talking about it. Oh, have you heard about that company? Oh, you talked to me. Oh, I heard he got a term sheet. This is very, very important because VCs are getting so many deals coming in, they're gonna put you off. But if they know that these guys are the hot new thing and they could potentially lose out on a deal, they're gonna give you more attention. They're more likely to close, or even write a small check just not to lose out. So that was definitely a strategy that we used.
Another strategy that we used is we tried to get a couple angels earlier. So people who can give us a brand name. Oh, this is the founder of X, or the founder of Y, or the CEO of whatever. They're on board, they're putting in money. There could be small checks, could be $5,000, we have the CEO of this very relevant company that's committed money loves it. All of a sudden that gives you more credibility because you already have people that are on board. You have here a bunch of very qualified people who believe in you. You can even put them on your deck, right? As advisors, as investors. So all these are different tactics we used to fundraise.
And if it doesn't work, pivot with it, raise less money, try to figure out what to do, try to really understand very quickly what the feedback is, try to ask for honest feedback. Most people, most funds, they're serious, will give you another 15 minutes and explain why they didn't think it was the case.
And then, work off of that. Come back three, four months later. Say, Hey, we heard you, we worked on these things, what do you think now? They may reject you again. That's part of the process. You learn a lot more and you may increase your chances.
The folks that can raise with a napkin or that can raise with just a deck typically have a track record. And whether that may be as an entrepreneurs or as executives in a specific space, they led specific teams, very impressive engineering teams in big companies. Those folks typically will be able to raise on a pitch deck, or especially if they have a pitch deck with a really good idea that they need to be understand the space, and they have angel investors backing them.
You have to think a little bit more strategic. You may be able to get a smaller check at the beginning from angels, but you will probably need to have some sort of traction. And you need to think very clearly about the story you're going to be telling. What are the key hypotheses you need to prove? And do you have the evidence to prove that, right? I mean, in every single industry, there's specific metrics, right? There's specific growth metrics. You have some sort of a B2C app. They're going to look at growth and look at engagement. It may not be the best, but you can explain how extra funding is going to change this feature. This thing is going to accelerate growth or it's going to monetize in this way.
It's like a high school thesis. You have to bring in more arguments to show it like, Oh, well, another company did this way, or we're going to do it this way. The best founders are the ones that are really good at finding all the possible things that could go wrong. If you ask them anything, they'll always have an answer for you because they've thought about it. They thought it's like a chess move. They've thought like five or six steps ahead. So you have to get really prepared and good for that, right? Really bulletproof.
You really have to kind of tunnel your way into all possible things. And then the investor will make a decision based on that. They may say, look, Actually makes sense. I'm just not willing to take that risk yet. Show me in a couple of months. If you can prove it, or if you can close this, then I think I'd be more comfortable. That's a good investor. Then that's one that actually understands your logic, understands what you're doing.
The opportunity was interesting. We had just raised our series A . So it was like 5 million series A and we were fully prepared to scale the business. We had this opportunity to scale business. But we also knew that other competitors had raised also much more money than we had, and it was the mental health care space. And we did have our doubts about whether we were building had enough differentiation.
As a founder I was super burned out by the whole process already because I've had problems with my co founder and then we pivoted. It was really, really tough. And at that time we were lucky because the venture fund of Valor Capital, which had invested in us, was also an investor in Gympass. And they said, these guys are looking into also the mental health care area. Gympass had just come off a 250 million round from SoftBank. They're looking to diversify and then IPO. This could be an acquisition.
So I was already in the mindset that I was ready to sell. In fact, the last couple of years, I was always trying to talk to people and make it very clear that we were potential acquisition targets.
They had money. They wanted to expand the mental health care space. We had a solution, which was at a valuation that was attainable for them in a cash and stock deal. They saw that our solution was more technologically ready than the other solutions and they had already started to develop teletherapy aspect internally.
So it was really a match. We negotiated fairly quickly. It was similar to fundraise in the sense that you have to convince people why you're good. They do diligence and the whole time you're like, well, they could be doing diligence and potentially taking our ideas and understanding how our company runs. I had lawyers, I ended up running the negotiation process, and the final documents much more complex than I thought.
They're very well run organizations. They're very conservative and focused and detail oriented. So there's a lot of details. There's many things that you as a founder, you don't know if the acquisition is going to happen, so you can't be involving your team in all this the whole time, so often times it became a very solitary, like, I have to make this decision. So you have to be very resilient to get it done.
Then we were able to successfully do it in April of 22. And then had a very interesting merging. Our company at that time, it wasn't huge. We had almost 70 employees. Not everyone stayed, but most of the people and basically the entire leadership team stayed. Most of them are still there and helping grow that product. And that makes me happy that there's some continuity to what they're doing.
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