Unity Stoakes contends it will take an army to change healthcare.
The Startup Health president and co-founder is targeting 10 global health moonshots, which include ensuring everyone has access to clean water and food.
The venture fund, started in 2011, boasts strategic partners and investors such as Mark Cuban, angel investor Esther Dyson, GE Ventures and Kaiser Permanente Ventures. It has invested in more than 200 companies spanning 20 countries.
Stoakes refers to the companies Startup invests in as an army rather than a portfolio, because "an army marches together towards a common vision."
The industry is bracing for disruption, including forays by Apple and Amazon into healthcare, as well as vertical deals like CVS-Aetna and Cigna-Express Scripts.
Healthcare Dive recently caught up with Stoakes at the HLTH conference in Las Vegas to discuss where the industry is heading, and what companies are well positioned for the next wave of digital health.
The following interview has been edited for clarity and brevity.
Healthcare Dive: What are you seeing in the healthcare industry that's excited you?
UNITY STOAKES: I'm excited about what we're seeing globally and how quickly new technologies and digital health solutions are taking off in places like China and India. There are platform tools where startups are building on them. These platforms are already integrated into users' day-to-day lifestyles. I'm excited to see how behavior change is occurring in other parts of the world because I think it's instructive and foreshadowing what's to come here in the U.S.
If these tools are what's to come in the U.S., what's currently preventing change?
STOAKES: It's such a fragmented market in the U.S. with thousands of health apps. There's no clear platform that everybody is using. The data is siloed. While everyone talks about the healthcare business models evolving and changing here, it's still very much caught in the past so the incentives are misaligned with the outcomes.
Consumers really don't know what to do. They don't know what solutions are right for them or how to use these tools. It's not their fault. It's that the solutions themselves are too complicated and not designed very well. I think there is a big opportunity for the next wave of innovators to solve some of these challenges.
On the consumer angle, you and I live and work in the healthcare space everyday so we may know these terms and talking points at conferences. So what is the industry getting wrong when it comes to marketing or explaining their products to consumers?
STOAKES: I think the first thing is healthcare as an industry hasn't been geared toward or targeted toward consumers pretty much ever. It been business-to-business. It's been a really complicated industry for decades in that way. One of the most exciting trends of the past year is consumer-focused brands moving into healthcare in big ways, from Apple and Amazon to even the Walmarts of the world. They touch consumers every day directly. I think it's going to be very interesting what happens when these legacy healthcare companies that have been used to selling to businesses or industry merge with companies that deeply understand how to sell to consumers.
What are some of the silver linings you've seen in the U.S. healthcare industry recently?
STOAKES: I'm starting to see glimmers of more thoughtfulness around product design and rethinking business models and the user experience. There's been more investment in companies that understand that technology, as well as packaging the user experience, matters. I'm seeing advances in basic concepts like price transparency. By no means has any of this been solved but we're starting to see to more focus in that regard.
Where do you see the industry in 10 years?
STOAKES: I'd like to see a lot of healthcare become invisible and designed into our lifestyle in ways that we don't register. This can be woven into the fabric of our everyday existence through our cars to refrigerators to clothes. That's where there's an opportunity for incremental behavior change to happen. We're a long way off from that but I think there are a lot of exciting developments in how diagnostic tools, trackers and analytics are being integrated into our lives.
You see a lot of companies' pitch decks and work with a company throughout its entire lifespan through Startup Health. What do you look for when you're assessing a company's potential longevity?
STOAKES: I look at the founders behind companies. Looking at their mindset is more important than looking at their business model or their technology. The first thing to look at is their long-term commitment. Do they have the perseverance to withstand the endless journey that it takes to be successful in this sector? Without the long-term commitment or ability to soldier on through the industry's endless battles, you're never going to be successful. We also look at their team, who they surround themselves with. It's one thing to be a great lone ranger but it's another to have an inspiring leader that's been able to create a great team that's dedicated to the same mission.
We also look at whether the founders are "batteries included" or not. There are people who when they walk into a room they bring energy in with them and there are people who drain energy out of it. When you organize "batteries included" people who are willing to support each other and go the extra mile, it creates a network effect that's transformative for the entire group.
When combined, impossible dreams start to become more possible. But it's hard. There are many companies that will not make it but there's an upside to that because a lot of the great companies in the next innovation cycle will be started or founded by companies that failed and they'll have learned from their challenges and do it better next time.
During this cycle, what are people trying to get right they got wrong last cycle?
STOAKES: People are moving away from features and trying to create more holistic solutions. There are a lot more real businesses with customers rather than people just building products. Building for the market with real customers is new. A couple of years ago, telehealth was hot but there wasn't that many customers. But the early adopters had customers in mind and now you have clinics and hospitals buying those tools. That's progress.
What are providers searching for right now when it comes to tech tools?
STOAKES: We have a company called Doctor.com doing a lot around reputation management for providers. There are new services for providers that are working to make their day-to-day lives more efficient. It's all across the spectrum whether it's how people are transcribing notes or entering data or providing at-the-point-of-care insights.
Overall, there's still too much fragmentation. If you're a hospital CEO, it's really confusing. Which solutions do you use? There are thousand of different ones. That's a big challenge.
What's one book, whether it's healthcare centric or not, you think everyone should read?
STOAKES: "The Inevitable: Understanding the 12 Technological Forces That Will Shape Our Future" by Kevin Kelly, a founding executive editor of Wired magazine. I think it's very fascinating to think about these big tech trends in the context of healthcare.