Tony Koblish: Well, Robert is going to jump into the meat of your question, but I’m glad you brought that up. That’s a superb observation that I think you got to focus on the fact that we drove the revenue bulk and growth with 55 reps with a chunk of those six months, right. Certainly, there’s a longer tenured rep but that’s a pretty powerful impact, right. So we got 25 new ones idling and we lost probably 13 or so, 14 or so in this upgrade process. So I think you can just see that this thing is set up, right, to have the full complement of 79 or 80 reps now being at the level of the previous 55 again, as we start next year, right, so.
Roberto Cuca: And Matt, I realize I didn’t hit the first part of your first question squarely, which was did we lose a lot of high performing reps? We didn’t. So we retained all of our highest performing reps, you might think about it as us reaching up higher from the lowest performing reps, and taking out reps that, while not obvious underperformance cases, we’re maybe at higher than breakeven revenues, but we’re not on the growth trajectory that we needed. And so your question about the cost of making these changes, so of the 25 reps that were within — were with us for less than six months, about 13 of those were turnover reps, and the remainder were new hires to fulfill our growth goals for the year. In the turnover category, we typically provide severance of about three months and so the cost — the incremental cost would be how much overlap there is when we get the new reps in.
And given that we did end the second quarter was 75 reps, there’s probably some overlap, but that that base pay amount of overlap is not going to be a huge amount affecting our P&L.
Tony Koblish: Yeah, I mean, one more comment, Matt, since this is the strong, heavy topic here, is of those 55 tenured reps, they did an excellent job of attaining forecasts, right. And if you look at the underserved or turnover territories, right, most of that shortfall was due to the vacancies or the transitions. And we had a target that was higher than consensus, so the loss was probably a smidge higher than consensus, right. So there’s a powerful, productive sales force that’s coming together here. I’d say this is a timing, dislocation or growing pain.
Matthew O’Brien: Okay. And I’m sorry, Tony, to keep harping on this and monopolize everything here.
Tony Koblish: Bring it, we love it.
Matthew O’Brien: Was the productivity of this group, that 55, up double digits from Q2 to Q3, because that’s what I’m getting in the model, in a seasonally soft quarter?
Tony Koblish: I will have to think about that.
Roberto Cuca: So we had, yes, very strong performance in the existing reps. One thing to know is in the turnover territories, the new reps were coming into territories that previously had revenues, so it’s not like they achieved zero.
Tony Koblish: Actually, we constituted, yes.
Roberto Cuca: So there was continuity in some of those territories. But, yes, our existing reps had very high performance levels.
Matthew O’Brien: Okay, thank you.
Tony Koblish: Thanks, Matt.
Operator: And thank you. And one moment for our next question. And our next question comes from Michael Sarcone from Jefferies. Your line is now open.
Michael Sarcone: Good afternoon, and thanks for taking the questions.
Tony Koblish: Thanks, Michael.
Roberto Cuca: Thanks, Michael.
Michael Sarcone: Just a follow up on Matt’s question about the sales reps. So you just mentioned your internal targets were maybe a little higher than consensus, which was a little over 16 million. So I guess that’s around a $1 million shortfall in 3Q and you took guide down by 4 million at the midpoint. Does that mean the original expectation for 4Q was just kind of midpoint of the 4Q guide plus that 3 million? Is that a fair way to think about it?
Roberto Cuca: No. So I think Tony didn’t specify exactly what our internal expectations were. So, yeah, so we — yes, we have very high performing reps, as I said. We had some turnover that we didn’t expect at the beginning of the year, we did it for the right reasons. We set to sales force, we have reasons to believe that the newly recruited RMs who come in and who are very high quality, had good enough eyes to bring in new reps who are going to perform even better than the reps that we already have. The reps that were onboard continuously in our territories, as was pointed out in the prior question, did perform at a very high level, to achieve what was achieved in the third quarter and I think it’s worth reiterating at least one more time that we had 35% growth in the third quarter. So, yes, we had high expectations, there was a disruption to them. We believe we fix that and we continue to have high expectations.
Tony Koblish: We set a high bar, we push ourselves. And we’re constantly focused on analyzing, continuous improvement and doing the right thing. But Michael, I want to point out some qualitative thoughts, right, the qualitative positive indicators for the company right now are through the roof. They’ve never been better, right. I already talked about the LPR and it’s update. But you know, we just came out of the American Hernia Society meeting, we sponsored a lunch and learn, which are really usually pretty sparsely attended, we had well over 200 surgeons packed, every seat was filled, they were standing room only against the back wall. That to me is a massive signal of interest in the company, interest in the product.
And that’s been our biggest challenge is getting the visibility and the validation. We are running a super aggressive and sophisticated medical education program. Our target was to train and educate 1000 HCPs this year, we’re already over 1100, right. So that’s both on the plastic side and the hernia side, so the exposure and interest in what we’re doing is huge. And the message is being promulgated in a big way. Well, we just came out of the ASPS meeting in Austin and again, we had a huge showing there. We had hundreds upon hundreds of Docs and participants in some of our sponsored events. Our booth traffic was super high, we ran two ad boards. I think we had something like 30 different surgeons through those ad boards. So again the validation and getting to know us is huge.
But I’m really excited about the fact that we are accelerating our penetration and relationships with robotic surgeons that are KOL trainers and proctors for the major robotics company. So we’re starting to set up case observation sites now, every time one of these educators, mentors, and surgeon, they’re going to be exposed to our product. So I kind of think that if we can get into that robotic platform from the grassroots ground up through surgeons, that’s a huge footprint and opportunity, and we’re just starting that out but we’ve made a tremendous amount of progress in the last quarter. So I offer that up as some ancillary qualitative assessments, they are through the roof, all those metrics have never been higher.
Michael Sarcone: Got it. Thank you for that, that is really helpful. And forgive me on this one, because I know, Roberto did give us a little teaser and said hold on for the questions, but I’m just curious, because I get a lot of inbounds on the consensus right now models continued cash burn at a $25 million to $30 million range for the next few years. I was wondering if you could give us any incremental color or tidbits on your ability to drive leverage in the model?
