Entrepreneurship is The Future of Healthcare

Entrepreneurship is tough. You have a little bit of craziness to be an entrepreneur. But entrepreneurship in healthcare, some would consider that suicide. The industry is known as extremely slow to adopt innovation, ruled by hundreds of regulations, with many players attached to status quo and opaque revenue streams. Take all the typical challenges that entrepreneurs face and amplify them, a lot.

Corporatism is evil for innovation. Corporatism is when a profession masters a vast amount of knowledge and is certified by an institution. In this case, doctors have an established monopoly when it comes to treat and heal a patient. It’s the same situation in the legal industry where lawyers are the only one able to provide legal services and represent an individual. Most of entrepreneurs encountered high resistance from those professions when trying to implement innovative solutions, even when they are doctors themselves.

« The blame for the losses of innovation behind slowdowns in productivity lies with the spread of corporatist values… Politicians have introduced regulation that stifles competition; In the process, they have impeded those who would innovate or reduced their incentive to try. With less competition to fear, companies are emboldened to raise their markups and profits. That lifts share prices and thus the wealth of already wealthy shareholders. » argued Edmund Phelps.

Launching a business in healthcare is also a challenging matter since startups are dealing with highly sensitive personal data. Startups have to ask for permission even before launching a product that interacts with patients because of privacy regulations, which makes Eric Ries’ lean startup methodology hard to implement. Beyond this issue, hospital and clinics sit on a massive amount of unstructured personal data that remains unexploited. But since health is literally a matter of life or death, wouldn’t it be crucial to seek for radical innovation? Doctors have to “apply, for the benefit of the sick, all measures which are required” as they took an oath.

Empowering patients is fundamental. And that’s where technology is highly convenient to collect, manage and analyze personal data on patients. The proliferation of wearable devices such as Fitbit or the Apple Watch is a new way to get a tremendous amount of data about someone’s everyday life. Based on those inputs, startups like Lark help patients monitor their health and treat themselves without having to see a doctor.

In fact, IBM Watson algorithms can monitor much more knowledge on healthcare than any medical practitioner, questioning the absolute necessity of seeing a doctor everytime you’re sick. This means doctors could focus on what makes a difference, the human connection. « This is a useful reminder of what doctors really can do: not simply fix us—we’re not objects—but heal us, since we’re people who naturally crave empathy. » As summarized Euan Thomson, partner at Khosla Ventures: “What can make a company fail, I think, is not understanding the existing infrastructure. And by that, I don’t mean knowing how to work within it. I mean sometimes knowing how to work around it.”

This explains why much more capital has been invested in digital health startups recently, driving a new era of innovation in healthcare. Healthcare venture fundraising represents more than $6 billion this year solely in the U.S. I’m looking forward to seeing how doctors, institutions, and regulators will adapt to this trend.

 

 

References

• https://www.inc.com/laura-montini/khosla-ventures-vc-why-health-care-entrepreneurship-isn-t-all-that-scary.html
• https://hbr.org/2014/05/health-care-becomes-entrepreneurial-finally
• https://www.svb.com/healthcare-investments-exits-report/
• https://www.ft.com/content/54411224-132c-11e4-8244-00144feabdc0

Users who have LIKED this post:

•