Alumni shared their experience with medical innovations from both the founder and investor perspective.
In a preview of what’s to come at the Dartmouth Entrepreneurs Forum this September, two Dartmouth alumni came together Thursday evening to discuss the future of MedTech, from the perspective of both entrepreneurs and investors.
John White, ’00, is principal at KCK MedTech group. Prior to becoming a medical technology investor, White was an innovator in the medical device space. He started off by saying that the difference between being an operator and being an investor isn’t as large as people might assume.
“Most of the time I look at new companies and my first question is, ‘Do I want to work at this company?” he said. “It’s an incredibly important part of what I do.”
Ultimately, whether you’re inventing a new technology or investing in one, the end goal is the same.
“I’m just trying to solve problems for patients most of the time. In this case it’s through the deployment of capital,” White said.
He was joined by Christina LaMontagne, ’03, chief operating officer at Pill Club. In addition to her role as COO, LaMontagne invests in startups, exclusively in the digital health realm.
“You really have to kind of embrace being both an investor and an operator if you want to work on any of these roles,” LaMontagne said. Founders and employees at early-stage startups might not be investing their money in the business, she pointed out, but they’re still investing years of their lives and careers, so the calculation about whether to move ahead is similar.
Although White works with more traditional medical devices while LaMontagne is focused more on digital health services, both agree that the pandemic has changed the industry. More people are now willing to embrace digital health solutions, which has disrupted the operations of more traditional medical device companies.
As infusion of capital into the digital health space has ballooned, industry players have had to figure out how to monetize their businesses and access the market. Many digital health companies have massive customer acquisition costs, so they’re exploring employee-pay or insurance-pay models. In oder to do that, they need to prove that they offer evidence-based practices that have benefits from a healthcare economics perspective.
Since various companies are pursuing different channels to access the market, there’s some uncertainly in the digital health industry.
“What happens in the next economic downturn?” LaMontagne said. “Will employers always want to provide all of these wellness type solutions?”
Still, that uncertainly hasn’t slowed down investment: LaMontagne pointed out that billions of dollars are invested in digital health each week. Despite that, success in digital health isn’t guaranteed, even if you have identified a problem that needs to be addressed.
“Healthcare is complicated,” LaMontagne said. “Despite the fact that there’s a lot of capital, the landscape is strewn with healthcare companies that didn’t make it.”
She urged attendees considering healthcare entrepreneurship to spend time thinking about the details of their business: not just the problem they’ll solve, but also how they’ll get paid. With the industry growing so rapidly, there is tons of talent available in the medtech space, and founders should think about making their team well-rounded, she said.
“It’s a mistake to just have tech people on your team if you’re building in healthcare.”
White reiterated that while those details are important, there’s no substitute for becoming an expert in an unmet need. One of his inventions, iRhythm, is a single-use cardiac monitoring patch. The idea for the technology came after White spent the day in an EKG lab, watching patients frustrated by the wires of their cardiac monitors. Innovators should consider the patient, but also providers, payers and caregivers.
“If you have developed a solution that is going to be good for all of those stakeholders, you should feel confident about bringing those ideas forward,” he said.
LaMontagne pointed out that one of the current trends in med tech is increasing health equity. The proliferation of direct-to-consumer health companies has meant that entrepreneurs can design solutions for underserved populations like the elderly, people with limited English, or those with cultural barriers to accessing healthcare.
“There are larger and smaller companies trying to make health care more inviting for everyone in our society,” she said. “In a lot of the aspects of health care that have been seen as hard, there have been some unlocks and more attention paid. I’m excited for what’s to come.”
Potential entrepreneurs in this space should also be sure that they have the passion and tenacity required to get through the long regulatory process in the healthcare space.
“Healthcare is a marathon, it’s not a sprint,” White said. If you suddenly decide that you can’t spend 10 years thinking about the issue you’re addressing, “that’s a real problem,” White said.
Whether or not someone has an interest in healthcare, he urged all the students in the session to take an opportunity to work for a start-up or growth-stage company.
“You’re going to have so many opportunities,” he said. “Pick ones where you are going to be part of an organization that is doing something for the first time, doing something revolutionary. When you experience growth, opportunity always follows. You’re going to get more opportunities to be a leader than if you play it safe.”
Watch the entire presentation, “The Future of MedTech,” here. For more discussions about the latest in medtech innovation, be sure to register for the Dartmouth Entrepreneurs Forum, taking place live in San Fransisco on September 10.