Announcer:
From the Library of the New York Stock Exchange at The Corner of Wall and Broad Streets in New York City, you're Inside the ICE House, our podcast from Intercontinental exchange on markets, leadership and vision, and global business. The dream drivers that have made the NYSE an indispensable institution of global growth for 225 years. Each week, we feature stories of those who hatch plans, create jobs, and harness the engine of capitalism right here, right now at the NYSE and at ICEs Exchanges and Clearing Houses around the world. And now welcome inside the ICE House. Here's your host, Josh, king of Intercontinental Exchange.
Josh king:
Last week on the show, we were talking about the skiing industry and how it tried to adapt to those first few weeks of the coronavirus back in March of last year. The weekend of March 7th and 8th, I was at a ski race with my son watching one of those early White House COVID Briefings on my iPhone in the lodge, unsure really of what to make of it all. There weren't any prohibitions about people gathering in the lodge. No N95 masks within 20 miles, I suspect.
Josh king:
There was Dr. Fauci on stage with Dr. Birx's Secretary Azar and President Trump. "We need more testing." The doctors said, and within a week, the ski season would be stopped dead in its tracks.
Josh king:
Now that same day, March 7th, starting at 8:54 in the morning, a thread of tweets begins from Dr. Jonathan Rothberg. You always need images to punch up a tweet. And Dr. Rothberg uploads a shot of his pristine office laboratory aboard his yacht, the gene machine. It looks like red inlay leather on the desk with an ocean-going lamp affix to it. And instead of a credenza, a stainless steel countertop laboratory with an array of machines and devices for any manner of tests, no matter the changes in latitude.
Josh king:
Now here's how the tweet went. I'm thinking about a low-cost, easy to manufacture home test for coronavirus. It begins outline nasal swab with a Q-tip with freeze-dried reagents for isothermal DNA amplification with COVID 19 primers. Cal metric readout by iOS or Android App with geolocation and HIPAA compliant reporting. The thread of this tweet goes on and on, covering 12 hours of work until about 8:00 in the evening. And it has continued from there really throughout the year. He writes at the end of the first day, trying to figure out how to do COVID 19 test in one tube so people at home don't mess it up. But I just figured out how to do an internal control and get two colors, so it's clear when test is done right. Then he noted in a later tweet that the gold standard for COVID testing is a $25,000 machine that requires a dozen steps by a technician and two hours to run tests and get results.
Josh king:
So back to me in the ski lodge, scratching my head at what Dr. Fauci is talking about. And this guy is on his yacht musing and taking action pursuing the holy grail that will get the virus under control, and such is the contrasting life of a man, me, and a Renaissance man, Dr. Rothberg.
Josh king:
Now some say that a casualty of the digital world is the edging out of the Renaissance man or woman for the specialist. Today, most of us find ourselves in niche occupations that require an army of coworkers and business partners to complete our jobs. It works to an extent breaking down the complexity of the modern world to allow individuals to dive deeper into their own special expertise. This isn't a new idea. In the Wealth of Nations, Adam Smith in the 1770s opened with his thesis that specialization begets prosperity. You can draw a straight line from Smith's Philosophy to forwards assembly line to see how the modern economy uses its network effect to leverage resources and talent.
Josh king:
That's not to say that the age of the polymath, an individual with a wide-ranging field of expertise, is over. If you stroll through the feed of our show's archives, over 220 episodes, you meet a mix of guests whose singular focus drove them to success contrasted with others whose careers take them all over the map. Our guest today, the estimable Dr. Rothberg, certainly falls into that latter category, began his career-changing how DNA is sequenced. And he used that to seek cures for disease. And later ran a project to map the Neanderthal genome. And he was just getting started, moved on to a variety of life sciences pursuits, including revolutionizing medical imaging.
Josh king:
In a minute, our conversation with Jonathan Rothberg, Founder and Chairman of the Butterfly Network, on how he's going to make health care accessible to everyone, how science should respond to COVID 19, and the path that took Butterfly Network from an outer space idea to a New York stock exchange-listed company. That is right after this.
Announcer:
Whether it's markets, exchanges, or networks, connection makes everything possible. The connection between data and technology, innovation and expertise, and most of all, between people and opportunity. For over 20 years, ICE has transformed markets, products, and processes to make things work better, faster, smarter, from modernizing energy and commodity trading to revolutionizing the bond markets, whether it's the world's largest stock exchange or the dream of homeownership. We do more than see the big picture. We create it. You may not know our name, but we bet you know our network. ICE, make the connection.
Speaker 3:
This podcast episode may include forward-looking statements regarding Butterfly Network Incorporated. These statements are subject to various risks and uncertainties, and actual results may differ materially due to various important factors, including those described in Butterfly Networks, SCC Filings. These forward-looking statements were made as of the date of this interview and not as of any subsequent date.
Josh king:
Our guest today, Dr. Jonathan Rothberg, Founder and Chairman of Butterfly Network is a scientist and entrepreneur who's awarded the National Medal of Technology and Innovation by President Barack Obama for inventing and commercializing high-speed DNA sequencing. He's the founder of multiple life sciences and medical device companies, including CuraGen 454 Life Sciences, Ion Torrent, RainDance Technologies, clarify hyper find research Quantum-Si AI Therapeutics for catalyzer for bionics and the recently listed Butterfly Network. That is NYSE ticker BFLY on the New York Stock Exchange. Dr. Rothberg, welcome inside the ICE House.
Dr. Jonathan Rothberg:
Thank you, Josh. And thanks for the flattering introduction.
Josh king:
Tell us about that day, March 7th, 2020, aboard the Gene Machine.
Dr. Jonathan Rothberg:
I had gotten a heads up on COVID on how serious COVID was. And so, in March, when our first testing was supposed to be rolling out, I was literally caught off guard. I had seen how well South Korea had responded to the threat with massive testing. And I had assumed given our infrastructure, our biomedical infrastructure, our clinical lab infrastructure, we would be able to respond in a similar fashion to South Korea, where people could get a test and four or six hours later would understand whether they had COVID or didn't.
Dr. Jonathan Rothberg:
So I was caught off guard, and I decided right then that I had to switch my pet project, which was to use my onboard lab to develop new enzymes to clean up plastics in the environment to do gene editing. And I have to tell the team while we have some beautiful aspirations in re-engineering molecules for gene editing, we really now have to focus on what the world needs now and what the world needs now is accurate fast testing.
Josh king:
I'm a longtime fan of Dr. Joseph Priestley, who's the discoverer of oxygen and the accidental inventor of my favorite beverage seltzer, always an open-source guy publishing his pamphlets as he went along his lab and leads England. Is Twitter the new open-source to share ideas and solicit feedback from all over the world instantaneously?
Dr. Jonathan Rothberg:
I think it is. But what's really interesting is both for this idea as well as for Butterfly, as well as for sequencing on a chip, there is that aha moment. I was walking by my laboratory. I looked at it and said, "Look how privileged I am to have this laboratory. Let's use it for something that matters." And that day, I began working on that project, and I literally was talking out loud, how would I solve this problem from first principles? And that's what I shared on Twitter. And as I'm speaking to you now, we're awaiting FDA approval for a test that's easy to use.
Josh king:
Did you have a well-refined enough network to watch you go about your business on that day, sending out those tweets and say, "Rothberg is on a tear, we got to jump in and help."
Dr. Jonathan Rothberg:
That's a great question. And I think again, because of what I was doing with Butterfly. And Butterfly Network loves working globally in the same way that we had a beautiful network of physician-scientists around the world helping on Butterfly, I would be able to tap into a similar network in testing. So when I put out that tweet, I immediately did tap into an analogous network of people who understood testing, understood the issues. And in fact, that tweet led to us building a team because initially, we had close to 50 immediate volunteers with expertise from molecular biology to writing applications on Android and iPhone, including executive help people who had done supply chains. And so that tweet really launched an army of 50 volunteers because at the point, we had no money. And again, I learned from Butterfly that it does take an army to make a difference around the world. So the Butterfly experience with the COVID lung had me prepared, and then we just reenacted it in diagnostics, molecular diagnostics starting with that tweet.
Josh king:
I just have to insert a digression for a second, Jonathan, because the image of you doing this from the salon of the green machine calls to mind images of Dr. Spock on the enterprise, roaming the universe to do similar things. And I was reading one of my recent issues about international. And you talked about how your mom bought her first yacht, the Lucky Seven named for you and your six siblings when CuraGen went public. Were you always a child of exploration in the sea?
Dr. Jonathan Rothberg:
Definitely a child of exploration. I grew up thinking that all of my friends also had laboratories in their basement because my dad had a chemistry lab in our basement where he developed thesis for his business, Laticrete, which is now run by my brothers and my nephews. So I had assumed two things. One, everybody had a lab in their basement, and everybody talked business over the dinner table.
Josh king:
They went on the Laticrete website, saw the picture of your parents. The company's up to about 265 billion square feet of tile, stone, and flooring installed using the Laticrete products. And looking down the list of some of the 1500 team members, many of them are Rothberg Daniel, an Industrial Flooring Systems Manager. Samantha, an Integration Project Manager. Rebecca, an Architectural Sales Manager. It says she was grouting before she could read. Is it fair to say that few families appreciate the floor we walk on more than yours? What's the secret sauce there?
Dr. Jonathan Rothberg:
Actually, the secret sauce is my father taught me, "If you love what you do, you'll never work a day in your life." And my father and my mother knew that from an early age, I loved science, and I loved engineering and encouraged me to pursue those pursuits. And I had my older brothers who had gone into the family business, and I had the freedom to get undergraduate degree from Carnegie Mellon and Chemical Engineering. I had the freedom to do to graduate school and study molecular biology. And I knew from my dad and my mom that you do what you love. And what I wanted to do was help the people I love by creating things that would be there when they needed it.
Dr. Jonathan Rothberg:
So that was the lesson. It wasn't the floors. Sure, anytime we worked for an airport, my dad would point to the terrazzo and say, "Hey, that's a Laticrete job." But the real lesson was, you love what you're doing so much that you bring passion. And that passion is key.
Dr. Jonathan Rothberg:
So at Butterfly, no matter what somebody does, whether they're doing sales or engineering, what unites them is, they're passionate, and they're purpose-driven. And I think that's what I learned from my parents. You have to have passion, and you have to have purpose.
Josh king:
But also Jonathan has to be commercial. I mean, shortly after CuraGen's IPO, you helped solve the $1,000 genome barrier with a side project that had its roots in a stressful personal incident. How did a night in the ER lead you to start 454 Life Science, and later Ion Torrent?
Dr. Jonathan Rothberg:
So I want to answer that in two parts. I want to discuss why I think commercially, and I want to discuss why I do what I do for those I love. So first a commercial aspect. When you're in a family business, and this is a real incident, I remember my mom opening an envelope with a check and telling my dad they could now pay the employees. And I've never forgotten that lesson. You have to have this flywheel that powers anything you can do. And so when the company was just starting, it really was, you opened the envelope, you got the money for the sale, you pay the employees, and you repeat. So, that's the first. The commercial is just because I grew up watching my mom and my dad build from nothing a company.
Dr. Jonathan Rothberg:
In terms of the personal moments, I thought I was literally on top of the world in 1999. I joked to people that I was CEO of a public company worth $5 billion when $5 billion was a big market cap. But that evening, when my son was having difficulty breathing, I realized that I was less interested in the human genome as a map of what we have in common and much more concerned with my son's genome. What was in my son's genome that was making him have difficulty breathing as a newborn? And that night, I saw on the front of industry magazine in the waiting room for the intensive care, the new Pentium chip. And I realized that everybody who had been working on the human genome project had been going the wrong direction. They had taken a Henry Ford approach and created giant assembly lines to do that first genome.
Dr. Jonathan Rothberg:
So whether was the public effort or the private effort by Craig Vater, it was either a $3 billion effort or a $1 billion effort, but it was still assembly lines. And I realized the answer wasn't going big. The answer was what Jack Kilby and Robert Noyce of Intel taught us, which was you go small. And that night, I came up with the idea of putting DNA sequencing on a single substrate or a chip. And so I saw my son realize that the future was personal medicine and realized that the answer was putting it on a chip.
Josh king:
So the Butterfly Network, Jonathan is an example of where your interest in improving your daughter's medical care was inspired somehow by the MIT Professor Max Tegmark's work. How did professor Tegmark's presentation on connecting images from thousands of radio telescopes to measure energy from distant stars inspire this solution to revolutionize the half-century-old technology behind the point of care ultrasound devices?
Dr. Jonathan Rothberg:
It's actually pretty direct. So I had just come off-putting DNA sequencing truly on a semiconductor chip with Ion Torrent. It was a DNA sequencing machine on a chip. So I understood the power of the semiconductors. We had all in real-time witnessed what happens when you put image on a chip with the camera in your iPhone. And so I had my personal experience, and I had watched microprocessors, and I had watched what it did to DNA.
Dr. Jonathan Rothberg:
Now, when I was watching Max's talk, he had tens of thousands of antennas, and he had worked out a way to create a single image from those thousands of little antennas. And so, I realized if I could put thousands of little micro machines on the surface of a chip, I could link what each of them heard into a coherent image.
Dr. Jonathan Rothberg:
So I approached Max Tegmark, and it's one of these people. Max is super warm. He's one of the world's great physicist, but he is also a hugely warm individual. So we immediate at lunch within 45 seconds I knew here's the commercial bent. I would start a company with him. I made a joke that I could not come up with a business plan for imaging the universe outside of maybe identifying some secret from alien intelligence, but I could use that technology to image the human body.
Dr. Jonathan Rothberg:
But I told Max because I always have actually a resistance to starting a new company. I tried to not start a new company. So I told Max I would only start a new company to use his algorithms behind putting ultrasound on the chip if he gave me the best student from MIT to do it because it's going to be very hard because no one's been able to do it before.
Dr. Jonathan Rothberg:
Max immediately told me that's easy because he put himself on the Admission Committee at MIT. So he could presort the best students in the world. Not only get him to MIT but make sure they got shoveled right to his lab. And so he introduced me to Nevada Sanchez, who had multiple five-point OHS and multiple degrees from MIT. And I said, "Okay, now we can do it." There is a little bit of a Marvel superhero origin story here because the algorithm and the problem that he solved to put all of these images together was known computationally as a Butterfly Network problem. So I said, "Good. Now we have the name of the company too."
Josh king:
Before we dive too deep into your work at Butterfly Network, as a parent, I hear ultrasound, and I think of my own experience living in Hartford, Connecticut, not far from your hometown back in 2004, I think of one of those first visits to Hartford Hospital hanging around uselessly while my wife is strapped up to an ultrasound machine to get the first images of our child in a room, the big revelation for me at that moment, a boy. I got gender out of that experience, but bring us deeper into the wonders of ultrasound beyond what we all sort of know as parents. How is it typically used in treating patients, and how do they work?
Dr. Jonathan Rothberg:
That's really a great question. And it's profound because it's been 200 years since the stethoscope. And as part of general practice, a doctor listens to you. Our goal at Butterfly Network is not to replace the $50,000 carts that are in corners of hospitals and that you have to fight to get access to and then hope somebody didn't drop the probe and break it.
Dr. Jonathan Rothberg:
Our goal is really to bring a tool as simple to use as the stethoscope to the 40 million people around the globe that touch patients. We know that two-thirds of the time, when somebody has something wrong with them, imaging, medical imaging solves that problem. That two-thirds is a pretty interesting number because two-thirds of the world has no access at all to medical imaging. And so Butterfly Network is really about making the Butterfly iQ an additional pillar to that general exam where you wouldn't see a patient without listening to them with a stethoscope. You wouldn't think of seeing a patient without your Butterfly iQ and doing an exam. So that's really what the Butterfly iQ is about. And that's what our strategy is about. Making it as low cost as possible, making it as easy to use as possible.
Dr. Jonathan Rothberg:
Now, while right now, of course, you can only use it if you have a legitimate medical use and your medical profession. My son did pick it up the same son that had invented DNA sequencing because of. And he immediately did the ejection fraction, measuring the heart utility of all of his cousins, five minutes after opening it.
Dr. Jonathan Rothberg:
So while we can't do that today because we have to validate that, we have to have all the necessary regulatory approvals on that artificial intelligence. We have shown that the path is there. We can go from the 40 million people around the world that touch patients to the hundreds of thousands of people at home that have to self catheter to the millions of patients at home that have chronic heart failure. And it costs $11,000 if they have to rush into the hospital. I wish that was an error when I said $11,000, but it's not.
Dr. Jonathan Rothberg:
But if you had a prescription ultrasound and you're monitoring the use of your drugs, you can prevent that. So our vision is really to have something as ubiquitous of the stethoscope. I like talking about my proudest moments, New York Times, putting us on the front saying, "Hope in the palm of your hand." Another wonderful moment was when the University of Irving Medical School, at their white coat ceremony, where you traditionally get your stethoscope, gave all the students a Butterfly iQ. We really want this to be part of medical education. We really want have this as part of every exam. And we do want to work hard to get this into the home first under prescription. First, for example, with the catheters. Second by example, for chronic heart failure patients. But how about sending it to people to check for aortic aneurysms if they're at risk? Aortic aneurysm, if it burst, there's a 90% chance you die.
Josh king:
Sir. Jamie Dimon on that, right?
Dr. Jonathan Rothberg:
If you catch it with a Butterfly iQ, there's a 99% chance you live.
Josh king:
I know from some personal experience that the medical profession can sometimes be hard to adapt to new ways of doing things. My dad, now nearly 90 years old, was the go-to pediatrician in Newton, Massachusetts, where I grew up. I look at a picture of him in his prime, and there he is, wearing the sweater. And even in the height of summer, he's putting the sweater on, and he has the stethoscope around his neck. How difficult is it to get the medical profession to hang up this stethoscope and take the new technology?
Dr. Jonathan Rothberg:
I love that question, and I love it because it's why we have a Medical Doctor, Todd Fruchterman, as our CEO, because Todd was instrumental in changing the practice of trauma care. And he understands what it takes to change the practice of medicine. And you're are right. You have to be part of the greater medical community. You can't be a Renegade, and you have to do it in a proven way. And that's exactly what Butterfly is doing. We are the best set selling Butterfly in the world. We are all working with 70 NGOs around the world, but all the time, we're working with physicians to bring them up to speed, to educate them, and a big part of Butterfly, and a big part of our website is that education because we are the friends of the establishment. We're not pirates.
Josh king:
I mean, I'll also say having watched some of the videos of the IQ plus at work, it could be mistaken for an electric razor plugged into an iPhone. And as my wife can attest, I usually have both in the bathroom, but it is a beautifully designed piece of equipment. And how much does sort of device design and the aesthetics of it sort of help with its introduction?
Dr. Jonathan Rothberg:
That's great. And it's a great question because when you create a company, you try to find your weaknesses, and you compliment yourself. So I built the team where people are excellent at operations that really know how to block and tackle and understand design and the importance of design. And I'm so proud of that team. And I love measuring things. And I know we have great design because when Apple had 3 million applications for their Design Award, we won one of them. And it's important not just to like your Blackberry, which nobody uses, but to love your iPhone.
Dr. Jonathan Rothberg:
So we talked about that passion, and I tell everybody, "Look, you have to have the passion. You have to have to be tenacious. You have to take joy in other people's success." But on the end of the day, it's that love that gets you to do things other people can't. And we want everybody to touch our device, to love it, to not want to ever give it back, to not ever think that they would do an exam without looking into their patient's body when they know two-thirds of the time that looking that medical imaging makes a difference.
Josh king:
And on that idea of love, we will take a quick break. And after the break, more with Dr. Jonathan Rothberg, Founder and Chairman of Butterfly Network, on the company's recent listing on the New York stock exchange and his mission to make imaging innovations accessible to everyone around the world. That's all right after this.
Announcer:
Historical data can offer insight into the direction of markets. Get data processing collection and storage could be challenging and costly. To simplify your data access needs and help find efficiencies, we launched ICE DataVault, a cloud-based platform that enables you to access tick history for global exchanges, as well as our proprietary data. Source from our real-time fee.
Announcer:
Backtest your trading strategies to assess performance and viability, conduct transaction cost analysis, and support compliance requirements, input data into surveillance systems to help detect and prevent abusive or illegal trading activities. Access over 10 years of deep tech history across asset classes, get tick data for an entire market or on an underlying list of instruments. Access, additional securities is needed with flexible delivery options to compliment your workflow, simplify your historical data management with ICE DataVault.
Josh king:
Welcome back. Before the break, Dr. Jonathan Rothberg, Founder and Chairman of Butterfly Network. And I were talking about his background and the science behind Butterfly Networks IQ plus. So Jonathan, let's start the second half of our showdown South in Miami. The President of the New York Stock Exchange, Stacy Cunningham, wrote an op-ed in The Wall Street Journal this week saying that the NYC might have to move if New York institutes a stock transfer tax. And it was only a few hours later that Mayor of Miami Francis Xavier tweeted at her to take her talents and the exchange to South Beach.
Josh king:
Mayor Xavier is prolific on Twitter. And at the same time, he was promoting something called Venture Miami, to which you responded in your tweet, "Let's go," looking for Miami molecular biology space, ready to move in and hiring tenacious, gifted molecular biologists and gifted engineers and coders.
Josh king:
Jonathan, the Northeast has MIT, Harvard Yale also. Pennsylvania has Carnegie Mellon, hundreds of other research institutions that have been at the cutting edge of science and engineering for centuries is the center of gravity for innovation shifting to the lower latitudes.
Dr. Jonathan Rothberg:
Stepping back, Butterfly is in Taiwan, Palo Alto, Connecticut, New York, and the locations are all about talent. If you want to do chips, you're in Palo Alto. If you want to manufacture something and get it to the 40 million doctors and medical practitioners that could use the Butterfly iQ, you have to be in Taiwan. Connecticut has an exceptional engineering base because of the military industrial complex. We hired tremendous amount of people that worked on Sonar. Sonar is the same as ultrasound. And so we go where the talent is, and if there's talent in Florida, we're going to be in Florida. If the talent is in Boston, we're going to be in Boston. If the last year has taught us anything, it's that nobody has a monopoly on talent, and we want to get the best and the brightest that our tenacious and take joy in other people's success on our team. So will go to the talent. It's not a contest. Different places have different talents.
Josh king:
Gilford, Connecticut, not far from new London, the home of electric boat, that's where your hyper find startup is seeming to go right in line an inexpensive portable MRI system. Is there any traditionally super expensive medical machine that can't be scaled and reduced in cost to bend the curve of the healthcare crisis?
Dr. Jonathan Rothberg:
Wow. That is a great fundamental question. And that's exactly the way we think. We look at something, and we go to first principles, and recent publications have shown that when you're looking at a COVID rank, our Butterfly iQ for $2,000 is indistinguishable from a $50,000 cart. And so that's definitely a strategy. And in our case, we look for the ability of artificial intelligence and deep learning to enhance that because we have to realize that the skill bases to interpret information are not evenly distributed. And if you want equitable distribution of high-quality medical services, you have to have both low-cost devices like we do. And you have to have a way to aggregate information in the cloud-like we do, you have to tie into hospital medical systems and make sure you can get paid, and you have to complete this virtuous circle with the AI. So you get better and better.
Dr. Jonathan Rothberg:
We do look for places that we can move things to a semiconductor chip that we can add artificial intelligence, where we can create a virtuous circle, and where we can have a long tail of applications. So why would you ever switch from a Butterfly iQ? Sure. We have 500 issued impending patents, and I'm proud of that. Sure, we invented ultrasound on a chip and protected it and have a great supply chain, but it's equally important to recognize that you want the information that you generate to create additional barriers to entry and make it, so why would you ever use another probe when ours has seen so many hearts and understands hearts.
Josh king:
One of the investors that will be receiving shares from the Butterfly transaction is The Bill & Melinda Gates Foundation, whose statement on your company includes that I'm going to quote it, "The device is critical to the foundation's vision of an ecosystem where hardware, software, data, and expertise come together to improve maternal health." You and The Gates go back a long way, Jonathan, the portability of the device lends itself to accessing underutilized areas, but how does that ecosystem really work?
Dr. Jonathan Rothberg:
It's actually super straightforward. And there's incredible synergies between a cardiologist in New York and a Nurse Practitioner in Uganda. And so when the cardiologist using his Butterfly iQ in New York pulls down from a menu on his iPhone cardiac function, no dials and images that heart, it will give him the basis of its conclusion in terms of ejection fraction, how healthy that heart is.
Dr. Jonathan Rothberg:
But a trained cardiologist, when he sees that, can actually question the assumptions the machine made and correct it. Each time that trained cardiologists at NYU corrects our machine, it gets better. So that means the nurse practitioner in Uganda has all of that learning. So, this isn't theory. As I'm talking to you, we are saving lives with our device in 20 or 22 countries where you can go on your website and buy it, if you're part of the medical establishment. And another 40 territories with 70 NGOs, well you can't.
Josh king:
Why is now the right time for Butterfly Networks to tap into the public markets?
Dr. Jonathan Rothberg:
Wow. I love that question. So historically, as an entrepreneur, I create technology first. And once the technology works, you bring on the marketing and the other of parts of a company. But I also usually only have enough resources to create that fundamental technology. In the case of Butterfly, it's an ultrasound on a chip, and just like anything else you put on a chip, a computer, or a camera, there are many form factors. So additional capital will allow us to go from a chip in a probe to a chip in a patch. Additional capital someday will allow us to go from a probe to a patch to a pill.
Dr. Jonathan Rothberg:
Additional capital also gives you the ability to develop those applications we talked about. So instead of just a doctor being able to scroll through presets, we can have additional applications, for example, bladder volume that we'll be sending to people's houses by prescription. And so, for the first time in history, access to the amounts of capital that we can raise, like over $500 million, allows you to build both the platform as well as those applications on top of the platform that create that ecosystem that you talked about.
Dr. Jonathan Rothberg:
So now we can say, "Yes, let's make a better probe. Let's make a patch," but we can also say, "Let's develop needle guidance, which we just launched, let's do bladder, let's have an app for aneurysm. Let's watch those millions of scans and have our deep learning, learn a dozen other applications, and have a true long tail of applications that get easier and easier to use." So the decision-making gets closer and closer to the patient until one day in the future, a pregnant mother can scan themselves and know whether they should change their diet or go into the hospital. So that's the vision.
Josh king:
So that's the vision needs a lot of capital one way or another, Jonathan. It could come in a couple of different ways. You could get money from private equity. You could go public in the traditional sense. You could eventually get acquired, or at least this business get acquired by Johnson & Johnson. You choose to go public through this new thing that's taking the world by storm, the spec combination. Why was that the right path for Butterfly Network? And what was the process to decide that long view acquisition corporation launched by the renowned hedge fund manager Larry Robbins of Glenview Capital was the right partner for it?
Dr. Jonathan Rothberg:
There's a couple parts to that. And it starts off with what I talked about building a team, you'll look in the mirror, you understand your weaknesses, and you compliment yourself. So for myself, it was bringing in people that are excellent at operating. For myself, it was bringing in the physician leadership we brought in. But you also have to understand that I'm incredibly technology-focused and what you need to be, as we discussed, is really part of a medical system, and to do that, I wanted a partner that knew as much about my customers is I knew about my technology, and Larry Robbins at Glenview has spent the last few decades investing. And in some cases being the largest investor in my customers and my future customers.
Dr. Jonathan Rothberg:
So, first of all, it was a perfect compliment. I understand technology. Larry understands my customers, and there was a second layer. My kids are pretty smart. They tell me I'm what's known as a permissive parent. A permissive parent works really well with engineers and scientists. The more room you give them, the more creative they are, the more they have a sense of ownership, and they do the best work of their lives. And I'm proud to say that I get no letters from my engineer's parents, their moms, usually, that their son or daughter has never been happier working on a project or felt more sense of accomplishment.
Dr. Jonathan Rothberg:
In that spirit of me being permissive, that completely fails when you're making your sales quotas, and you're running a sales team. And I know that from my own experience and my mom saying, "Let's get paid to my dad so we can pay our employees," because my father was that permissive engineer, and my mom was the controller of the company and watch the dollars.
Dr. Jonathan Rothberg:
So I needed a partner to make sure we don't just have dreams, but we trained the dreams into owning a fork in history. I use this term fork in history. When we put an ultrasound on a chip, we changed history. Seven years from now, all ultrasounds will be on a chip. Now we have to turn that dream into reality by the blocking and tackle. You don't just run off and make a patch. You first make sure every hospital system in the nation understands how to integrate that Butterfly iQ into their medical record system. So Larry, as an activist, brought that discipline. So you look in the mirror, you compliment yourself, access to customers and when we looked at different specs, we picked not the best economics, we picked the best compliment, who would make sure we met our numbers, who would make sure we could see the CEO of our customers. And that's why we picked Glenview.
Josh king:
One of your partners on the Butterfly Network is in Kenya Access Afya. It began in August 2020, and there've been 10 times increase in the availability of ultrasound, 177% increase in ultrasound usage, 30% decrease in the cost of exams. Additionally, Access Afya, if I'm pronouncing it correctly, is now offering these complimentary ultrasounds for those presenting with COVID-19 respiratory symptoms, leveraging the lung ultrasound capabilities of the iQ+ just so we leave our conversation people knowing how applicable the Butterfly iQ is to the current crisis we're dealing with.
Dr. Jonathan Rothberg:
Is becoming the gold standard because you do not want to expose people to radiation, ionizing radiation, which CAT scan is. CAT scans are big machines, and you have to bring the patients there, which has the complications with it, and infective disease like COVID. So ultrasound is becoming the standard of care because it comes to the patient. And Dr. Martin has run a series of seminars that can be attended up to 1000 physicians. So it's super important in the... I like saying instead of diagnosing, it's super important in the war on COVID because it allows you to triage patients. It allows you to follow their progression.
Dr. Jonathan Rothberg:
We've had patients outside of the United States following the progression of their disease, understanding whether they have to go into the hospital remotely by an expert. And so it's been transformational. We've had physicians diagnose themselves. So the Butterfly iQ has played a major role in COVID because the most serious complication of COVID is COVID lung. And we're really ideal for that, where CAT scan isn't. In January and February, and March, the standard and the gold standard was CAT scan. Now it's the ultrasound, including the Butterfly iQ.
Josh king:
As we wrap up Jonathan, according to an article that you put out a mid-year COVID-19 stint aboard the Jean machine, you had originally planned to spend this year researching if life on earth originated from space dust. Is there going to be time to get to that topic in 2021? And if not, what is the top of your docket for this year?
Dr. Jonathan Rothberg:
Top of the docket is making sure we really own this fork of history with Butterfly. COVID taught us that we all have to focus. If you look at my companies, four of them immediately pushed their COVID projects, Butterfly on the lung, hyperfine on the brain detect with a rapid test, AI therapeutics with a therapy. So 2021 still about COVID. 2021 is about a Butterfly.
Dr. Jonathan Rothberg:
I have to make clear while I have five children and I have seven companies. I learned from my mother because she used to tell us she had seven only children. And at this moment, Butterfly's the one going to college. Butterfly is the only child right now and that's the focus. We do our job. There will be plenty of time to explore new branches of the tree of life, understand the origin of life. But 2021 is about helping those we love. And there's no better way to do it than making sure when somebody goes in and sees a nurse or a doctor that that nurse and doctor pulls out the black Butterfly iQ instead of a stethoscope. So that's what 2021 is about.
Dr. Jonathan Rothberg:
Let's make the Butterfly iQ as ubiquitous as the stethoscope. Let's get it into the zeitgeist. Let's have people go to their physicians and say, "I want to be Butterflied." That's our focus. And if we do this, we will help those we love. And we'll give return to the investors that believe in us because I remember that check my mom opened and my dad being able to pay the team members and employees. And I know we have to have a flywheel. We have to make money for our investors. If we want to go out and give two-thirds of the world that doesn't have access to medical imaging, hope in the palm of their hand.
Josh king:
Totally understand. I'm going to press you then, Jonathan, on 2022 or 2023, just because no one has their hand on the pulse of what the future offers, perhaps better than you. You are in your fourth decade at the pinnacle of life sciences innovation. Give us something, give us in addition to making Butterfly and the iQ+ ubiquitous. What should we really be excited about two, three, four, five years from now?
Dr. Jonathan Rothberg:
So that's fair. So, in addition to the artificial intelligence, taking the burden off the physician, and democratizing the devices we work on, I think the next stage is going even smaller. So we have devices we're working on to scan the eye because why should you really be taking blood when you can scan an eye? Right now, when you're visited by an ambulance, they monitor your heart. Nobody's monitoring your brain, which is much more important.
Dr. Jonathan Rothberg:
So I see the eye as a porthole to the body, I see brain monitors and more and more artificial intelligence as the regulators become confident going from suggesting things to really making diagnosis and also connecting that diagnosis to action. So when you see something, you act on it.
Dr. Jonathan Rothberg:
The other thing that I see happening in the next three years is what I call the long loop. When we talk about Butterfly, and we talk about making an adjustment to the ejection fraction of a heart by an expert, that's a short loop. What you really want to do when you look at use your Butterfly, and you see a growth in your thyroid, you want to know what happened to that thyroid growth. And if it had a mutation in an oncogene, so you can retrain that imaging.
Dr. Jonathan Rothberg:
So instead of telling somebody, they have a lump in their breast or in their thyroid, you can say, "Don't worry, it's just a lump." Or you can say, "Better get it biopsied." So in a three-year time span, much more going out into the medical records, retraining, whether it's the hyperfine information, the Butterfly information, the Tesseract eyes scanner, or liminal brain monitor, retraining for that long loop as we have those outcomes. So when you scan a baby, you don't just say it's cute. You say, "Hey, you better watch your folic acid, mom."
Dr. Jonathan Rothberg:
So allowing people to take action that will change outcomes is really what we're about. You don't want to give people bad news. You want to catch things early to give them good news. Our own Dr. Martin caught his own cancer in his neck with the Butterfly iQ that allowed him to skip radiotherapy. So it can be transformational to catch things early and understand them early. That's what I see the next three to five years.
Josh king:
I think there might be one invention that can't be improved, scaled, or mass-produced. And that is New Haven pizza. Do you agree with Dave Portnoy that the pizza capital of the United States is, and always will, be New Haven, Connecticut?
Dr. Jonathan Rothberg:
Absolutely. I've lived it, but there is no debate between Pepys and Sally's. Pepys is better for clam. Sally's is better for everything else.
Josh king:
Last question. Do you have a wood-fired pizza, a board pizza oven aboard the gene machine, or is that something that you can install next to the lab?
Dr. Jonathan Rothberg:
I would love to, but the regulatory authorities do not even allow gas-fired inside. Otherwise, you don't pass your inspection, but it's a great idea.
Josh king:
Very good, Dr. Rothberg. We'll leave that for another podcast. Thanks so much for joining us Inside the ICE House.
Dr. Jonathan Rothberg:
Thanks to you, Josh. That was excellent. Thanks.
Josh king:
That's our conversation for this week. Our guest was Dr. Jonathan Rothberg, Founder, and chairman of Butterfly Network, now listed on the New York Stock Exchange under the ticker symbol, BFLY.
Josh king:
If you liked what you heard, please rate us on iTunes. So other folks know where to find us. And if you've got a comment or a question you'd like one of our experts to tackle on a future show, email us at [email protected] or tweet at us @ICEHousePodcast. Our show is produced by Pete Ash with production assistance from Ken Abel and Ian Wolff, and Brian Hopkins. I'm Josh King, your host signing off from the Library of the New York stock exchange. Thanks for listening. Talk to you next week.
Announcer:
The information contained in this podcast was obtained in part from publicly available sources and not independently verified. Neither ICE nor its affiliates make any representations or warranties express or implied as to the accuracy or completeness of the information and do not sponsor, approve, or endorse any of the content herein. All of which is presented solely for informational and educational purposes. Nothing herein constitutes an offer to sell a solicitation of an offer to buy any security or a recommendation of any security or trading practice. Some portions of the proceeding conversation may have been edited for the purpose of length or clarity.
