When I meet founders of healthtech startups, I often – luckily – meet savvy entrepreneurs hellbent on flipping the table to solve a significant problem within healthcare and potentially revolutionize the world, perhaps sometimes even provide a lasting legacy. This is by no means bad; after all, it’s this spirit, ambition and tenacity that has brought us previous incredible startup success stories.
But different from almost every other type of startup for HealthTech startups there is a big, angry elephant in the room: You need to adapt to fit within existing healthcare systems and programs to have any chance of success. If you don’t – and no matter what you think of the need for a system revolution or reset – you face a an astonishing uphill battle that will in all likelihood lead to oblivion.
The daunting challenge
The healthcare sector isn’t your typical industry. It’s a centuries-old behemoth, with layers of protocols, regulations, and an entire ecosystem of players who aren’t too eager to change their ways. On the other hand it is also an industry with it’s own set of huge challenges – change in demographics leading to more patients in need of treatment, lack of doctors and nurses, spiralling costs, poor infrastructure etc.
It is by no definition an easy industry to be in let alone try to win in. And I’ve seen startups crash and burn because they tried to reinvent the wheel without truly understanding the complex machinery they were operating in.
Apart from this being a disaster for the individual startup, it also potentially has negative ripple effects in the HealthTech ecosystem. Because when startups crash and burn, it is a reminder to investors about the potential risks and pitfalls of investing in this industry. And when the odds seem like they overwhelmingly point towards failure, getting to a ‘Yes’ from an investor becomes harder.
When that happens, we’re all potentially a lot worse off because it risks killing great companies in the craddle due to a lack of proper funding opportunities. And that’s not where we need to go.
Play the game
So what is needed to win? First and foremost, I think it is a matter about reframing the opportunity:
HealthTech startups are not here to replace and revolutionize, but to augment and optimize. They’re the much-needed oil in the existing rusty gears.
Now, what does that mean?
Simple: Fit in to stand out. Those who’ve made some waves – telehealth providers like Kry or digital coaching platform Liva Healthcare – didn’t do it by picking fights with the establishment. They did it by showing how they could enhance what’s already in place.
They proved that they’re here to help, not to replace. They did not impose disruptive models on users. Instead, they adapted somewhat to what users know and are comfortable with, thus facilitating adoption. And most importantly they learned to work within the legal and regulatory boundaries, turning a hindrance into a competitive advantage.
The intelligent approach
Succeeding in HealthTech is not a zero-sum game. The future of healthcare isn’t HealthTech OR traditional systems, it’s HealthTech AND traditional systems. They influence each other, evolve together, and ultimately build a robust, efficient system that benefits the end-user – the patient.
The advide to HealthTech startups should be super simple: Understand the jungle you’re stepping into. Instead of charging headfirst at the old guard, learn their language, respect their rules, and show how you can make their life easier. Your success in the healthcare sector depends on your ability to fit within existing structures. Be the maverick that works with the system, not against it. If you don’t, the system will kill you. Squash you like a bug. Or, perhaps more fittingly, eradicate the virus, you – in their optics – bring.
Remember, a strategy of collaboration and adaptation is not a sign of capitulation; it’s a sign of intelligent entrepreneurship. That’s the inconvenient truth of HealthTech – adapt, fit in, and only then can you stand a chance at future success.