Making Connections: Spouse-Owned Affinity Counts Big Customers
By VITA REED
More than a few of Orange County’s smaller biomedical companies were born of consolidation among the industry’s big names. Irvine-based Affinity Medical Technologies LLC is one of them.
Mary Phillipp, Affinity’s chief executive and founder, was president of Tronomed Inc., a San Juan Capistrano company that made medical wire and cables. When Tyco International Ltd. bought Tronomed in 1997, Phillipp said she decided to set out on her own.
Affinity makes medical cables for patient monitoring gear. Its products link patients to electrocardiograms, blood pressure machines and other medical devices.
Since its founding four years ago, Affinity has grown from five partners and a 400-square-foot executive office to 45 employees and a 24,000-square-foot building on Reynolds Avenue.
Affinity expects to have sales of $4.8 million this year and between $6 million and $6.5 million next year, according to Phillipp.
Phillipp and her husband, David Johnson, own 65% of Affinity. Bob Frank, Doug Henry and Max Van Orden are the company’s minority partners. Frank worked for Phillipp in various sales, marketing and engineering positions while she was at Tronomed. Henry and Van Orden have experience in medical cables and connectors, she said.
Affinity was born after Tyco reorganized Tronomed. Back then, Phillipp, Johnson and the minority owners felt there was a need for an independent player, according to Phillipp.
Seeking outside investors wasn’t in Affinity’s plan, according to Phillipp. Instead, she, Johnson and the three partners put up an undisclosed amount of their money.
“We (wanted to) be completely independent of the influence of outside investors,” Phillipp said.
Being self-financed lets Affinity operate under its own timetable “without having other undue influences, if you will,” said Phillipp, an accountant by training.
Affinity’s customers include some familiar names in the medical device world. Among them: Irvine heart valve maker Edwards Lifesciences Corp., 3M Co., Philips Medical Systems, part of Royal Philips Electronics NV, and SpaceLabs Medical Inc. of Redmond, Wash.
Phillipp said getting customers was easier after Affinity ISO 9000 cerification, an international quality-assurance standard.
“That lent us an incredible amount of credibility with (manufacturers),” she said.
She also pointed to Affinity officials’ long-term reputations in the biomedical industry.
Phillipp said Affinity hope to see 25% to 50% growth within the next three to five years, citing service and general growth in the medical field.
“This is a recession-resistant marketplace,” she said. “When times get tough, healthcare needs (increase). It’s a boon to the business.”
Family owned businesses often feature a great deal of day-to-day workplace interactions between family members. But that’s not the case at Affinity, Phillipp said.
Husband “Dave doesn’t work at the company,” she said, chuckling. “He was integral to the decision to start Affinity and he plays a huge strategic part.”
Johnson, a certified public accountant, is president of First Plus Bank in Tustin. Although Johnson does not have a day-to-day presence at Affinity, he is the company’s chief financial officer.
“He’s certainly been my rock. He’s never, ever wavered,” Phillipp said of her husband.
Phillipp said that Johnson was a supportive ear when she was trying to decide whether to start Affinity, but “he wanted very much not to influence my decision. We would talk about the pros, the cons and the risks.”
Johnson’s insistence that it was Phillipp’s decision to start Affinity frustrated her somewhat at first, she said. But, looking back, she said she was glad that Johnson took that stance.
As for the future, Affinity Medical is looking at expanding either into other medical applications or non-medical cable applications, Phillipp said.
