With the billions of U.S. dollars of funding flowing into healthcare information technology, one wonders: how can entrepreneurs ensure success for their budding start-ups?
At this year’s Healthcare Information and Management Systems Society (HIMSS) conference, the Venture+ Forum featured talks on the investment and venture capital landscape for digital health. One particular session focused on how funding flowed through large health systems, and one thing is clear: the outlook is bright.
“There’s a lot of opportunity,” said Claire Celeste Carnes, a partner at Providence Ventures. “Healthcare is a target-rich opportunity.”
Todd Johnson, CEO of HealthLoop, added, “There’s a lot of investor competition.” Johnson said this was encouraging for 2016 for healthcare start-ups looking to disrupt the industry.
So what should start-ups pitching to health systems concentrate on? First, focus on interoperability. Vineet Gulati, CEO and founder of HealthExpense, said, “Interoperability is the most important. When it comes to interoperability, think about it from the provider perspective.”
“Provide the tools for partners to integrate. Interoperability is key. I don’t think best of breed solutions [alone] work. That engagement is critical. When it comes to having multiple solutions, you lose value every time you make someone jump from one solution to another.”
Ricky Bloomfield, MD, Director of Mobile Tech Strategy at Duke University, said that his health system feels interoperability is so important that they look to standard, reliable platforms.
“We’ve adopted FHIR,” said Bloomfield of the Fast Healthcare Interoperability Resources (FHIR) specification, a standard for exchanging healthcare information. “We thought about moving to a single platform very carefully.”
Start-ups should look at reducing cost. One big opportunity is shifting care from the health system to the home.
“We’re looking at health and wellness,” said Carnes. “We’re focused on [what consumers can do] before they think of needing care and getting engaged in healthcare.”
Bloomfield’s ACO, Duke Connected Care, is focused on providing the best care at the lowest cost.
“If we can invest in people staying healthy and staying at home, that’s important,” said Bloomfield. “Health and wellness, ways we can engage patients in the healthcare at their home, and leave them out of the health system [where they may face] the inconvenience cost and the risk of infections.”
3. The long haul
Third and finally, start-ups should be prepared for the long haul. Gulati, for instance, stated that his company keeps long-term relationships of 3-5 years. Johnson agreed.
“Everyone knows healthcare is a long game, so it’s just as much about how many patients, doctors, real credible market traction you get as it is about revenue and ROI.”
Johnson also added, with a touch of humor, that marketing in healthcare can be a difficult game: “There’s all the new buzzwords. I was down on the [exhibit] floor, and there was a printer cartridge company there that said they’re a ‘new component in value-based care!”
“I think the marketing side in healthcare, we’re going through a huge transformation, and everyone’s jumping on to the latest thing. I don’t know how investors, health systems differentiate with the torrent of solutions all espousing the same thing. It’s a difficult challenge.”