Health 2.0 NYC, Healthcare Kickstarter
New York, NYU Stern 17 August 2011
Your reporter: Donna Cusano
Ed. Donna attended this three-hour event which was a ‘reverse pitch’-eight New York City-based early-stage financing people (and one provider/corporate venture) presented to an audience of nearly 200, including representatives of 80 startups. They represented an interesting cross-section of assistance and funding.
Presenters: co-founders Steve Krein and Unity Stoakes
A connector-type or collaborative organization which is intended to create an ‘ecosystem’ for healthcare startups, and designed to improve access to capital, education and resources for health and wellness entrepreneurs. It originated as part of the White House’s current (June) entrepreneurial support effort called Startup America Partnership. As presented in the meeting, their goal is to create a campus for healthcare entrepreneurs in NYC to shepherd companies through the idea, startup, rampup and speedup phases of development past the traps of expertise, services, talent, customers and capital. Steve and Unity are also co-founders of OrganizedWisdom which enables doctors to set up a web presences ‘in minutes’.
Todd Pietri, co-founder
Milestone Venture Partners is a digital health investor group which currently manages 13 companies in healthcare with about a $25 million investment, but specifically avoids therapeutic devices. Their investments include MedPageToday (sold), dLife (diabetes management), Medidata and GenomeQuest.
Jean-Luc (JL) Neptune, Director
This offshoot of Health 2.0 is all about ‘problem solving for a prize’-coding, applications-for specific sponsors.
Milena Adamian, MD, PhD, Director
This offshoot of the New York Academy of Sciences started nine months ago and claims to be the first angel group in NYC investing in life sciences. In a relatively short, 9 months of existence, they have already funded 3 companies and there are at least 3 strong candidates until the end of this year. It fills the gap between Technology Transfer Offices and venture funding, and also educates entrepreneurs and investors.
The Corporate Venture
Visiting Nurse Service of NY (VNSNY)
Michael Monson, SVP Performance and Innovation
VNSNY is in the unusual position of being both a payer (Medicare Advantage) and a service provider in long-term care. His major points to developers:
- any device or service MUST fit into clinical workflow, doesn’t depend on changing consumer behavior and ideally should be disposable!
- especially do not make it dependent on a smartphone which requires a level of dexterity and visual acuity that many older people simply do not possess.
However, in seeming contradiction of above, Mike is especially interested in systems which can positively impact individual behavior, especially in compliance, disease management and in workflow productivity.
Matt Farkash, Founding Partner
Blueprint Health is a NYC-based startup accelerator that will be offering (January 2012) an intensive three-month program to NY-based entrepreneurs. It provides $20,000 of seed capital, extensive mentorship and a shared work environment to help entrepreneurs go from idea to prototype and provide access to angel and venture capital investors. Already 65 mentors-VCs, payers, providers-are affiliated.
Frank Rimalovski, Managing Director
The NYU Innovation Venture Fund is a seed-stage ($100K level) venture capital fund created to invest in startups built upon NYU technologies and intellectual property. It helps in developing product commercialization and patentable inventions.
The burning questions:
1) How do entrepreneurs get investors’ attention?
- Referrals-or a 1-2 line pitch in a highly targeted email. Know the bios of the principals and the portfolio to get the fit, and figure out a connection (Pietri)
- Develop a kicka** product where people pay you (JL Neptune)
- Solve a real world problem (Monson)
- Partnership plays with insurance companies (payers)
- Understand that this is not a friendly process (Krein)
- Confidentiality, at least prior to investment, is impossible (Pietri)
- Overall, there’s a problem in backing of NYC-based healthcare startups (although online doctor appointment scheduler ZocDoc got another $50 million in Series C funding from Russian billionaire Yuri Milner’s DST Global earlier this month.)
2) How do entrepreneurs deal with providers who are ‘stuck in the mud’? These are especially hospitals but can be doctors, payers.
- Put together a ‘dream team’-people with expertise in business, tech and a designer (Krein)
- Understand that for providers, ‘improving outcomes’ is not that desirable of a benefit (!). For payers, it is a big plus (e.g. WellDoc’s Diabetes Manager) (Monson)
- The changes in healthcare delivery are slow in coming
3) Opportunities-and not
There is an opportunity to build a model for integrated health (Monson)
- A favorable model would concentrate on data and software, have a recurring revenue model and show distinct signs of acceleration (Pietri)
- Delivering a lower cost model
- Not favored-media businesses, EHRs (all)
Video on Livestream, multiple clips (wait a bit to get the videos to play after the interminable commercials)
Many thanks to Health 2.0 NYC organizer Alex Fair (FairCareMD, which allows consumers to shop openly for healthcare pricing and matches patients and providers) and the sponsors for hosting!