Last week’s 35th annual J.P. Morgan Healthcare conference in San Francisco was packed with thousands of healthcare investors, analysts, large multinational healthcare companies, startups, and everything in between.
It was fascinating and enlightening to have private one-on-one time with so many startups, large global healthcare companies, hospital systems, and pharmaceutical companies. As well, it was great to catch up with so many angel, seed, and Series A investors. From these meetings, several trends emerged. Some were new learnings while several were amplifications of what we see in our work at Dreamit Health when building and accelerating dozens of post-seed digital health and medical device startups every year.
Here are eight early stage related trends I spotted at the conference:
- The big data trend is very strong and growing;
- Diagnostic companies are conducting earlier validation studies;
- Disruptive innovation is relying on model inversion;
- Second order companies are emerging;
- Corporate interest in startups is expanding;
- Strategic investors are trying several approaches to be more innovative;
- Seed funds want to invest in at least the same country; and
- Corporate venture capital investors are investing strategically and globally.
Driving better patient outcomes based on a true big data approach With a very large, longitudinal volume of patient and outcome data, big data startups can leverage that information for proactive and predictive insights that will increase the quality of patient care, decrease mortality and morbidity, and lower overall costs. We are seeing this recurring big data theme across a wide range of specialties and we expect it to grow.
Some examples include radiation oncology, preventing prescription errors in hospitals, and telemedicine platforms looking to glean insights from millions of users.
Robust early validation studies for early stage diagnostic companies It’s now harder for a diagnostic startup to get funded as so many Theranos investors were burned and other investors are now more cautious when evaluating these businesses. But the best entrepreneurs realize that necessity is the mother of invention and the invention here is conducting earlier validation studies and publishing results as quickly as possible. The advantage of focusing on evidence-based validation prior to significant funding is that the diagnostic space is going to deliver companies with a stronger, more de-risked story sooner rather than later.
Inverting business models Examples include making telemedicine healthcare consults free for patients and generating revenue through other non-obvious mechanisms or new go-to-market strategies that zero capital costs and all revenue is made via a disposable or in some cases only off of the data generated or new software-based capabilities delivered via a SaaS model. I saw fewer of these, as they are extremely innovative but also harder than other startups — harder to imagine ideas like this,…