Vital Signs: The Future of Healthcare
Conscious Collective Journal: 3rd Edition
Welcome to our VSQ Conscious Collective Journal. We bring you updates from our portfolio companies along with thematic commentary on ideas and ventures that have transformative potential. Informative and nifty, this serves as a companion to your journey as a conscious investor.
While COVID has converted us all into armchair public-health experts and OCD-fuelled germaphobes, it has also laid bare the existing systemic problems within our societies ranging from inefficient healthcare policies and societal inequities to work regimes (or lack thereof). The challenges of healthcare systems manifest differently for the developed and developing world. While developing nations suffer from lack of healthcare, developed ones suffer perhaps from too much of it, namely inefficient and costly systems that most consumers can’t afford. In the end however, the roots of the problems for healthcare markets are the same across the world—poor diet, poor air quality, a lack of timely preventive medicine and questionable lifestyles. Despite path-breaking innovations in pharmaceuticals and treatment, “healthcare as a system” is antiquated and is ripe for disruption. Technology will play a major role in giving the healthcare system that long overdue overhaul it needs by bringing down costs, driving data-based efficiency as well as improving access to healthcare resources in both urban and rural areas. If anything, the pandemic has provided us with enough ideas for our New Year resolutions for 2021 (we’re trying our best to find positives too!).
From the endless digital chatter that surrounds our lives this year, we’ve compiled a few recent articles that have provided us with the most food for thought.
The Cost Conundrum: what a Texas Town can Teach us about Healthcare
Although the healthcare landscape has evolved over the past decade, lessons from writer and surgeon Atul Gawande’s 2009 New Yorker piece still hold true—accessibility and affordability should be the pillars of healthcare systems across the globe. Four key takeaways from Dr. Gawande’s piece include:
Overuse is the primary cause of extreme healthcare costs: extreme costs today are driven by overuse of medicines across the board. Patients are getting needlessly more of everything—more diagnostic testing, more hospital treatment, more surgery, more home care, and there’s little incentive to drive resulting costs down
Physicians are incentivised to request high-cost treatment options: when doctor pays are tied to the costs of treatment and prescriptions—the more, the merrier for them (the more, the miserable for the patients)
Mayo Clinic is the gold standard: Mayo Clinic runs what experts call ‘an accountable-care organisation’. It blunts harmful financial incentives for doctors and puts patients’ health outcomes first by pooling revenues and paying doctors a fixed salary
There is a battle for the soul of American medicine: The damning question remains... ‘is the system set up to meet the needs of the patient or to maximise revenue?’ There needs to be a fundamental rethink of the system’s accountability.
Telehealth Will Become the New Reality
Has COVID-19 pushed Telehealth to the mainstream? Will consumers prefer to open an app before seeing a doctor in the near future?
This McKinsey Report outlines all the main impacts of COVID on Telehealth across the consumer, provider and regulatory fronts. The changes are far reaching: Telehealth now just doesn’t cover a simple migraine but has also taken onboarding urgent care and medication online.
Even if the change is by compulsion, Telehealth has arrived on the main stage for good. COVID has forced regulators to do a hard reset of the healthcare system and set the field for Telehealth to roll out and scale quickly. The US has already put forward a new legislation on Telehealth (here are some considerations to think about), China has been revamping its regulatory system for Telehealth to play a bigger role in the healthcare sector and India passed in March the Telemedicine Practice Guidelines.
Leaping from Seed to Series A for Digital Health Startups Proves Difficult
As journalist Christine Hall highlights in this recent Crunchbase piece, digital health is a complex industry. Working at the intersection of technology, healthcare and life sciences brings with it a unique set of challenges for founders— product market fit has to be right, sales cycles are long, and gathering enough data is tedious. Gaining access to providers and consumers is difficult and clinical outcomes take months or even years to show. Unlike a SaaS platform that just needs to roll-out a platform with bugs that can be fixed on the go, digital health startups need tangible outcomes that take time to show that they are working—that’s what makes investors cautious, but in no way uninterested. Bottom line, a good digital healthcare offering is like good health itself, it is hard and takes time to build.
Company Spotlight
Capsule
Kenya’s Capsule has built an integrated 911-style emergency services platform that links patients to the nearest ambulances or fire trucks. One of 3 African startups selected for Google’s inaugural Startups Accelerator on the Sustainable Development Goals (SDGs), Flare is saving lives by providing timely and cost-effective solutions to link emergency support to individuals and companies. Most recently they were selected by the World Economic Forum as a winning finalist for their first Uplink COVID-19 cohort.
Brave Care
Y Combinator-backed Brave Care is a group of kid-only primary care centers that is building tools for parents to get advice from pediatric care providers at all hours in order to decide whether or not to head to a hospital or clinic. Brave Care also has a network of mobile-clinics and virtual care services that significantly reduce the costs and stress incurred by parents. When the pandemic broke out, Brave Care deployed its mobile-clinics to support all its consumers.
Medinas
Medinas is a Berkeley-based healthtech startup that has developed a suite of software tools that helps hospitals figure out what they want to do with their out-of-service assets. The company helps hospitals manage inventories, price and if need be, dispose or resell over 9000+ different types of medical equipment used in hospitals. Medinas is making the secondary medical equipment market more efficient and transparent. The company’s co-founder Chloe Alpert launched Mask Match amidst the pandemic, a peer-to-peer platform that connected people or institutions with extra masks to healthcare workers and hospitals who needed them the most.
Interviews
We recently interviewed two of our VSQ portfolio company founders about how they’ve each chosen to navigate these unprecedented times.
Patrick Rogers, CEO & Co-Founder of Clara highlights how this pandemic is going to generate an explosion of entrepreneurial activity the likes of which has probably never before been seen. His advice to founders? “We all have blindspots. Do your best to identify and manage them. An inability to challenge your own assumptions is a big cause of business failure.”
For Alaa Fadan, CEO of Telfaz 11, running a business during this pandemic has proven to be a humbling experience, forcing the team to take a deeper look at the infrastructure of the business and to really challenge its structural integrity. His lesson learned? “Have a noble mission for your business, it will always be the north star that will guide you through the noise and distractions and will give you the push to keep grinding when things get rough.”
Conscious Collective Roundtable
VSQ & R House recently co-hosted a virtual fireside chat with the incredible Benjamin Von Wong, a viral campaign creator and host of the popular podcast Impact Everywhere, who is focused on highlighting social and environmental challenges through his work. The reason we invited Ben to speak is because everyone has a story to tell—whether you’re an investor crafting your investment thesis, an entrepreneur pitching your startup or a corporate looking to engage with your stakeholders, storytelling is at the core of what you do—and it’s up to you to choose how to provide, contribute to or support stories that will have a meaningful impact.
We were fascinated and mesmerized by the vision and breadth of Ben’s projects. We invite you to check out his work. For those who missed it, here is the recording of our session.
Tune in
If you are skeptical about technology blending into healthcare, or just want some insight into the blackbox of AI in healthcare, here is a six minute intro to AI in Healthcare by a16z exploring what’s ahead in the future.
Freedom House Ambulance Service (99% invisible)
For those in the developed world, emergency response numbers like 911 are such a given that it’s hard to imagine that most of the world doesn’t have such services. This podcast walks us through the evolution of the paramedical profession from its origins not-so-long ago in Pittsburgh during the 1960s-70s to its indispensable role in present-day medical practices.
The Old-fashioned House Call is Back - and Investors Love it
COVID-19 has pushed healthcare to remote appointments and has brought back with it a favourite old practice: the house call. This time the practice comes together with modern telemedicine platforms, right within many investors’ radars. Listen to this Business Wars Daily podcast for more.
We can’t end this journal addressing healthcare without mentioning the Bill and Melinda Gates Foundation who, through their work on global public health, has been instrumental during this pandemic. They have a treasure-trove of resources on healthcare including short videos that have fed our curiosity and are helping us achieve our 2020 resolution of becoming armchair experts on epidemics. Favourite ones include: ‘You should appreciate germs’, ‘Breathing new hope into Africa’s fight against COVID-19’ and ‘Polio Vaccinators.’
Image Source: Healthcare IT Today