Kevin McDonnell’s Post

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!

There have been several significant HealthTech failures recently. Why did they fail? Each company I mentioned had specific reasons (see visual). But more generally, a few months ago, I compiled some observations about the do's and don'ts in #HealthTech. After reviewing them today, I believe they are still 100% relevant. I also added some more. ↳ Find allies: Healthcare is not a market, it is a (political) allocation of resources. You will need incumbents to back you up. ↳ Don't make too much noise. In #healthcare, making yourself bigger than you are will eventually lead to troubles. ↳ Avoid words like "#disruption", "revolution", ... Healthcare is too complex to be disrupted. And it will scare incumbents (that you need). ↳ Be aware that incremental innovation benefits established players with distribution, efficient processes, and economies of scale. ↳ But be also aware that there is often no market (yet!) for disruptive innovation. How can you enable the transition? (while still winning today) ↳ In fee-for-service, solutions must demonstrate a >5x ROI. Doctolib, Europe's top scale-up, charges 140 € / month and generates over 5x ROI through reduced admin costs and increased revenue from fewer patient "no shows." ↳ Contingency-based pricing is effective. Example: an accounting start-up that enhances hospital revenue by optimizing booking codes. This start-up solely takes a commission from the additional revenue it generates. ↳ Distribution! Distribution! Distribution! “The most significant bottleneck in the adoption of healthcare technology to date has been distribution." (Andreessen Horowitz) ↳ Due to the inefficient distribution of innovation, key decision-makers in hospitals and payors experience vendor fatigue. Hence, single-point solutions will face challenges. ↳ "FDA approved" doesn't equate to "HCP approved." Often, FDA-approved algorithms exhibit around >15% false positives, making them less likely to be embraced by healthcare professionals due to the excessive false alarms. ↳ A lack of understanding of HealthTech at senior levels (C-level or LP) is a significant challenge, often leading to closures as soon as difficulties arise. ↳ Overpromising to meet VC expectations leads to short-term prioritization and under-delivery, ultimately resulting in #failure. Healthcare is a long-term game. ↳ Your product won't scale until you have convinced key opinion leaders (KOLs) and scientific societies with robust scientific evidence. It typically takes up to 3 years from the first scientific paper until it really picks up (= there is a wide adoption). Anything else? ------------- I hope to see many of you at HLTH Europe in 2 weeks in Amsterdam! We can then talk about HealthTech failures and lessons learned. Feel free to reach out!