Healthcare is like a fortress.
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The healthcare industry is a fortress in many ways.
Being the first and last line of defense for our health puts unique pressure on the industry to stick to what works. As a result, breakthrough products such as new drugs can take decades to reach end users from the laboratory. In this industry, mistakes can cost lives, and failing quickly or even failing at all is not an option.
It is also one of the most lucrative industries for entrepreneurs to enter. Global healthcare sector IT spending alone is expected to grow from $276 billion to $785 billion by 2031, making the sector a pie that many want a piece of.
Entering the market may be painful, but it is worth it for many because successful innovations can have a lasting impact on people's lives.
And what about those who have already gotten through it? Their success reveals hard-won lessons in tenacity, values, and strategy. Here's what we can learn from them:
Persistence is not an option. Why Healthcare Entrepreneurs Need Unwavering Commitment
Breaking into healthcare requires constant effort.
Barriers to entry are high and each innovation is scrutinized from every conceivable angle.
Because patient outcomes are at stake, healthcare has evolved to be conservative by design and a bulwark against the untested and untrusted, something many entrepreneurs in the industry know all too well. It's a fact.
“There is no question that healthcare is a rigid field,” said Raleen Gagnon, CEO of TalentEdgeAI. “This is an industry that takes time to adopt technology because of the stakes,” Lareen pointed out.
Industry-specific demands also impose other constraints on would-be entrants, such as the fact that hospitals are not closed for maintenance.
“When people's lives depend on consistency and reliability, there is simply no downtime to deploy changes,” Lareen said, before going on to explain how many entrepreneurs with great ideas and products , he went on to explain why he didn't have the stamina necessary to pass through that gate.
Still, for those who have the guts and persevere, unparalleled rewards can be achieved.
Take Epic Systems, for example. As a technology giant in the healthcare sector, Epic's systems impact nearly half of U.S. patients and generate three-fifths of US dollars of revenue each year.
What made Epic successful?
A tenacity, plain and simple, that founder Judith R. Faulkner often praised. Over the decades, we have made incremental progress while our competitors have lagged or crumbled under the weight of regulation.
This tenacity is what separates successful healthcare entrepreneurs from other entrepreneurs to this day.
It takes a lot of effort to get ahead, but for entrepreneurs looking to improve lives, the rewards are worth it.
And once you get involved, you can make a big impact. “The health care system is demanding change,” Lareen adds. “But that change requires a determined commitment to the mission. Anything less simply will not succeed.”
Outsized Value Matters: Why Incremental Improvements Can't Win in Healthcare Markets
For entrepreneurs to succeed in healthcare, they must deliver breakthrough solutions, not just incremental improvements.
Epic may have had humble beginnings as a bootstrapped operation in a nondescript basement in Madison, Wisconsin, but the idea proved great value and became a reality from day one.
This awareness is important for those who are knocking on the door.
There is little reason for a provider to risk change for just a 5% or 10% improvement. They need a game changer. That's a fact BioPhy CEO Dave Latshaw knows firsthand.
“In healthcare, value has to be immediate and undeniable,” he explains. “Providers are looking for solutions that address significant inefficiencies, not just minor upgrades.” BioPhy builds AI tools aimed at accelerating drug development. This is an effort to counter the risks of novelty that has the potential to save lives and improve treatment outcomes.
QuantHealth, founded by Orr Inbar, found its niche in a similar way to BioPhy.
“In medicine, especially in clinical trials, a little optimization goes a long way,” says Orr.
“We recognize that unless we deliver transformative results, we are unlikely to impact our performance, so we focus on key advances that have the potential to change results.” For the pharmaceutical industry QuantHealth's approach to designing AI-powered clinical trials may have put its customers among the world's top 10 pharmaceutical companies, but the journey was anything but straightforward.
Orr recalls the early days when proposals were rejected more often than founders would like. “You'll be told 'no' all the time, but you have to be ready to roll with the punches. The only way to succeed is to know that the value of what you bring to the table is worth the risk.” It’s about continuing to show,” Orr continues.
Atropos Health is another company that faces a very specific kind of problem by entering the healthcare industry with something completely new.
Chief Medical Officer Saurabh Gomber explains: It's about ensuring clinicians have what they need to make safe and effective decisions. That's how the value proposition must lead, no matter how innovative or impressive our underlying technology is. ”
Like other companies trying to crack the code of the healthcare industry, Atropos Health doesn't just provide incremental improvements, it aims for transformative change. One lesson from their experience is that change requires both time and trust. “AI in healthcare needs to earn trust by delivering truly transformative results,” notes Saurabh.
The conclusion is clear. Small victories are not enough. To succeed in healthcare, products must fundamentally reshape the way things are done and provide such substantial value that even the most conservative stakeholders recognize change as worthwhile. there is.
Build from within: How to partner with healthcare industry insiders to break down barriers
There is another way to break through the healthcare industry's bulky defenses. It's about manipulating the system from within.
In fact, many entrepreneurs find it easier to gain traction in this complex industry if their solutions work within an established structure and solve pressing pain points for people inside.
Take Dave Monahan, CEO of dental membership platform Kleer, for example.
“Like many medicines, dentistry is rooted in tradition and prudence,” Dave points out. “To be successful here, we have to show that we are here to help them achieve their goals more effectively while respecting that foundation.” We have achieved success not by challenging traditional medical practice, but by simplifying patient access to care and simply by addressing well-known pain points in dentistry. Reducing dependence on insurance only slows down the progression.
“When I started working with dental clinics, I quickly realized that the real challenge wasn't convincing them to change; it was helping them work better within their current system.” continued Dave.
In many ways, Kleer's path to success has been paved by understanding these nuances and simplifying things rather than complicating them. This depends on converting industry incumbents to their side of the equation.
Dr. Mitesh Rao of OMNY Health founded his company in a very similar way by addressing a key but persistent problem facing incumbents: the lack of accessible and interoperable data in healthcare. .
“Health data is siled and notoriously difficult to access,” Mitesh points out.
“OMNY was born out of my frustration with the system.” Instead of creating disruptive new models, OMNY focuses on providing a secure data layer that facilitates compliant data sharing across healthcare organizations. I placed it. “We realized that the only way forward was to build a secure and compliant data layer that could support the entire ecosystem,” he explains. OMNY's approach exemplifies how working within the system can build the trust needed to support innovation in a highly regulated industry.
These examples demonstrate that for many healthcare entrepreneurs, system support is often the most strategic path to success. Building from within establishes trust, reduces friction, and ensures new solutions meet the demanding demands of your industry.
For healthcare entrepreneurs, supporting the system rather than upsetting it is often the most consistent path to success. Building from within establishes trust, reduces risk, and ensures that new solutions meet the exacting demands of your industry.
