Zynex CEO Thomas Sandgaard discusses leadership transition – ICYMI

Zynex Inc (NASDAQ:ZYXI) CEO Thomas Sandgaard talked with Proactive about his decision to step down from his position after nearly three decades leading the medical device company.

He described the challenges of starting a company with no funding, navigating public listings, and expanding operations to help over a million patients manage pain.

Sandgaard explained that a failed effort to take Zynex private eventually led to identifying Steven Dyson, a seasoned healthcare executive, as the ideal successor.

Proactive: All right, welcome back inside our Proactive newsroom. Joining me now is Thomas Sandgaard. He is the CEO of Zynex. Thomas, it’s good to see you. How are you?

Thomas Sandgaard: Yeah, thanks. I’m doing well. How are you doing?

I’m doing very well, thanks very much. You’re here for a very significant purpose, and that is to make an announcement. So I’ll let you do that.

Yeah, thank you. After nearly 30 years, I’m excited to announce that I can finally have someone else continue the great work and continue to build Zynex that I have been working on day and night. I remember moving from Denmark and literally sat on the floor in a one-bedroom and began to build this business. It’s been interesting. When you start a business, especially in the medical device industry with no money, and you just build it with your bare hands, you go through a lot of ups and downs. I remember about eight years ago, we finally got uplisted to the OTC. That was a big deal because I couldn’t get the business financed. I had developed our first product, the IF-8000. Great success. I hired a few salespeople, went down to Office Depot, bought a typewriter, and started doing insurance billing and slowly built that. We started growing really fast, and I couldn’t keep up. The only option was to go public on the OTC. There was no payday for me, so it still felt bankrupt every single day to keep the lights on. Over the years, with great people, we built a great business with hundreds of millions of dollars in revenue and helped a million patients with pain so far.

Yeah, I can imagine. Thomas, I’m sure it was a tough decision to step out of the CEO chair and remain as Chairman of the Board and Chair of the Technology Committee. Why the decision to step away from day-to-day CEO operations?

It started a couple of years ago. We took the initiative to see if we could take the company private, rather than being publicly traded on Nasdaq where we have been for many years. That was triggered by too much shorting interest, and shareholders were not really getting the value, including me, as I still own about half of the company. We started a process with an investment bank to entice private equity firms. We had decent interest in the beginning. One particular company in England, Apax, one of the largest private equity firms in the world, did a lot of due diligence. They probably know the company better than we do now. Eventually, the deal didn’t come through. Starting about ten months ago, I began talking to the head of healthcare, who knew our company well, about coming to work for Zynex. For ten months, we worked on putting something together. He will be heavily incentivized by creating a much better market cap and valuation for the company. He has about 25 years in the medical industry, not only transacting, buying and selling companies, but also building them up to be much stronger. He has fantastic experience that will be helpful for us. It was just a perfect fit. One of the main things is that Steven and I agree on 90% or more of any business issues that come up. It’s been very easy to work with him early, and I look forward to seeing the same quality of work we’ve seen from Steven in his past career. I’m very excited about it.

Yeah, Steven Dyson, the new CEO, of course. He’ll be taking over officially in August. A couple more questions here. As you look back on the work you’ve done, you mentioned the lean days at the beginning and how you had to fight through that. What are you most proud of as the CEO who built this company?

There are so many things I’m proud of. We were able to, depending on the size of the company and the situation, attract really quality people who helped build this business. You can’t build a company of this size just by yourself. That has been the most important thing. Without those people, we wouldn’t be where we are today. On the personal side, I’m proud of having done the impossible hundreds of times. You’re basically counted out so many times—the bad days when the bank calls and says you’re out and has people in the building taking over. How do you get through a day like that and turn things around to eventually work with them and get back on track? Those ups and downs have been maybe not stressful, but painful. You learn to muster a lot of stress.

I can imagine. Let’s talk about the move now to Mr. Dyson. While the leadership may be changing and you’ll still be a big part of the company, I think it’s important for people to understand that the philosophy of the company and how you move it to the next step is the focus moving forward, right?

That’s right. I’ve come to know Steven so well now that I don’t need to worry about if we get someone in with ideas that maybe sound good but I wouldn’t agree with, or that would take the company in the wrong direction. I’m very comfortable with that. That’s probably the main feeling I have about this now. And of course, being Chairman of the Board will mean I’ll have a finger on the pulse. I own half the company, so I still have a very vested interest in making sure we make this a continued success.

Quotes have been lightly edited for clarity and style