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Leader invents a better way

Jude Sauer M.D. was confident his company’s new surgical device would work as he stood in the operating room awaiting its first surgical case. An earlier generation of the suturing technology already had been used successfully in dozens of patients, and this next generation had been subjected to thousands of tests. That morning, it was in the hands of a trusted and skilled heart surgeon.

Still, it was a big moment for Sauer, CEO of LSI Solutions Inc., when the new technology deployed perfectly. His team had succeeded in creating yet another device that would make surgery shorter and easier and help patients heal faster.

“There was a time in that OR where everybody felt absolutely blessed to be part of the opportunity,” Sauer says.

Back at LSI Solutions offices in Victor, employees gathered for pizza and wings to celebrate after working late the previous night to get that product launched and in the surgeon’s hands by morning.

Sauer, 57, asked his executive assistant for an extra cup of coffee. He always works at top speed, sleeping only a few hours a night, but this was a particularly busy day.

“There was a time where everybody in that operating room wanted to do a high five,” Sauer says. “It’s really helped the patient, and it’s a revolutionary product.”

The company Sauer founded 30 years ago, LSI Solutions, designs and manufactures minimally invasive surgical devices, primarily tools to suture and tie knots.

Sauer declined to share revenue figures—he and his wife, Eva, are the only shareholders of the privately held company—but the number of employees has more than tripled in the past five years to nearly 300.

Rapid growth
The company ranked No. 16 on the 2016 Rochester Chamber Top 100 list of fastest-growing private companies.

The company owns vacant land adjacent to its nearly 60-acre campus in Victor, and Sauer predicts the company could double its footprint in the next five years.

“I think that we would be a case study for careful, controlled, nearly explosive growth,” he says.

LSI Solutions devices are used in a variety of procedures, including weight- loss surgeries and hysterectomies, but sales took off in early 2011 when the company entered the cardiac surgery marketplace, says Joseph Nicosia, executive director of operations.

The high quality of LSI’s devices makes a big difference in heart surgery, he says, and when surgeons realized this, they began talking about LSI products at conventions.

“That word of mouth, you can’t buy that,” Nicosia says. “When you get physicians who are the leaders and the experts in their field, and they’re telling their colleagues, ‘This is what you need to do to make your surgical outcomes better for your patients and your practice’—wow. I mean, that was just off to the races.”

It was a dramatic change for a company that for most of its 30-year history rarely had more than a few dozen employees, and that Sauer never even intended to start.

Sauer had his friend’s brother incorporate him as a business just to make it easier for him to get National Institutes of Health grant money to pay for his research.

Knack for inventing
Sauer, who grew up in Lancaster, near Buffalo, was a first-year surgical resident at the University of Rochester at the time. He intended to become a pediatric surgeon. His father was a doctor in internal medicine, and Sauer had lost a brother to childhood illness.

In medical school, though, he discovered he also had a talent for inventing.

“If there was a mechanical problem that needed to be solved, the people I grew up with—my friends, my dad, even my mom to some extent—we just fixed things,” Sauer says.

At medical school, he realized many of the brilliant students did not know or even care how tools worked, he says.

“I can’t look at something without taking it apart in my head, blowing it up, spinning it around, taking a few parts out,” Sauer says. “I’m always at least as fascinated with how you make (things) as how you use them.”

Still, building a business around his inventions was far from his mind. Sauer met his wife, a fellow medical resident, during his third year of surgical residency. He assumed they would move to her native Austria and settle down somewhere to practice medicine.

Instead, the research grants kept rolling in.

“We just kept getting grants, which is very flattering and very alluring,” Sauer says.

In the early 1990s, Sauer formed a relationship with a major surgical company, which he did not name, to develop the ideas that came out of his research on laser tissue healing technology.

Later he decided he would prefer to work on minimally invasive surgical technology because it seemed more likely to revolutionize medicine, and the company continued to support his work.

“We became the extramural think tank for the most progressive surgical company in the world, and we provided most of their intellectual property for a number of years and a tenth of their research budget,” Sauer says.

Unfortunately, that company was penalized for ethical violations in 1995, he says, causing its value to drop from $1.2 billion to $700 million and leading to layoffs. That client had accounted for about 90 percent of LSI’s resources, so Sauer had to let go of the small staff he had built.

Coming back from that loss, Sauer decided to shift LSI’s focus and begin manufacturing the surgical instruments he was inventing. In 2000, the company moved to the campus in Victor, and it still manufactures all its products on site today.

“If I want to save 14 nickels by going offshore someplace, I wouldn’t know about the quality,” Sauer says. “I would worry about it constantly.”

Intense work
The work environment Sauer has created at LSI Solutions can be intense. It is not unheard of for employees to stay until 4 a.m. or work 20-hour days to meet a deadline.

James Guelzow, vice president and chief development officer, says he was surprised by the fast pace when he joined the company eight years ago as a designer. There were roughly 15 different projects in design at the time and Sauer was leading all of them, he says.

“How he kept it straight in his head, I didn’t understand,” Guelzow says.

Sauer is a demanding boss, Guelzow says, but he demands even more of himself.

“I don’t think he sleeps,” he says. “We get emails at 2 o’clock in the morning. He’s always working, always thinking of the next big thing.”

Nicosia, who has worked at LSI for almost 15 years, says he is fascinated by how Sauer’s mind works.

“You can imagine someone that just wakes up with a start and just has that ‘aha’ moment,” Nicosia says. “They can’t sleep. They can’t stop thinking about something, and they’re just driven to draw it, describe it, write it, put those thoughts into reality. I think he does that almost every day.”

Sauer says it is true that he does most of his creative work early in the morning. He typically sleeps only two to four hours a night, a habit since at least high school. The week of the latest product launch, he says, he started his days between 1:30 and 2:30 a.m.

It is also true that he challenges his employees to work hard, stay late and adhere to high standards, he says.

“I think most of them think I’m a little crazy,” Sauer says. “I’m sure all of them think I drive them harder than they ever wanted. But for people who want to have the opportunity to flirt with greatness, it’s here, whether you’re an assembler or an engineer or working in our machine shop.”

The shelves lining Sauer’s office are filled with various handheld surgical devices he has invented. Patents line the walls; he holds 139 at last count.

“Right now we are backlogged by years on my inventions,” Sauer says. “I’m just very … prolific. I invent things every day.”

Most of those inventions are not good, he says. He shows only a tenth of his ideas to his discovery team. Only a tenth of those make it to engineering and only a tenth of those ever reach a patient.

He has been resisting offers to buy his company since the earliest days, he says. He considers acquisition as bad as, if not worse than, bankruptcy. He has disdain for his large competitors that move slowly, sometimes push products on inappropriate patients for profit and think only of quarterly returns.

Sauer approaches his work with the ethics of a surgeon. He is interested in a new technology only if it improves patient outcomes in a meaningful way.

“Our life is taking care of patients,” Sauer says.

Now that LSI Solutions is growing fast, Sauer is delegating some management duties to senior staff so he can spend more time inventing. He travels frequently to Europe to introduce products and teach surgeons to use them, often performing surgeries himself in countries that allow it.

He also is soliciting ideas for inventions from people outside his company, as well as his own employees, and planning for a time when he is no longer able to invent products himself.

Yet in the short term, having seen the newest cardiac surgical device perform so well in the operating room, he is expecting the company to grow faster than ever.

“I think it’s the best medical device product launch in the history of medical devices,” Sauer says.

Julie Kirkwood is a Rochester area freelance writer.

Jude Sauer M.D.
Title: President and CEO of LSI Solutions Inc.; clinical assistant professor at the University of Rochester
Age: 57
Education: B.A. in German literature, 1981, UR; Rochester Plan Early Selection Program doctor of medicine, 1985, and surgical residency, 1988, UR School of Medicine and Dentistry
Family: Wife Eva Sauer M.D., secretary and treasurer of LSI Solutions; children Jude Steven, 26; Vincent, 25; Martin, 22; and Ava, 20
Residence: Mendon
Hobbies: Tending the plants around his home; playing tennis; water sports; and enjoying his pets, which include a turtle and a tortoise named Hoppy that comes when it hears his voice.
Quote: “I can’t look at something without taking it apart in my head, blowing it up, spinning it around, taking a few parts out.”

11/25/2016 (c) 2016 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.


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