Buffy Alegria

This 👂 podcast episode and insight’s from a16z Bio + Health's Julie Yoo spoke so clearly to the fundamental challenge facing both 🩺 clinicians and 🏥 healthcare systems.  There is a huge disconnect between supply, in the availability of clinicians, and demand, in the increasing volume and complexity of healthcare needs. -     36% of physicians plan to reduce their hours next year according to the AMA -     48% of physicians reported feeling burned out in a 2024 Medscape survey At the same time, the demographic baby boomer bubble and steady increase in the prevalence of major chronic disease, which consumes up to 90% of healthcare expenditures according to some estimates, is driving demand. With this context, Yoo points to a major opportunity for AI adoption in healthcare in 2025. Yeah, a VC hyping a wave of new AI companies that will replace the decades of training and experience of clinicians, the skeptic would say.  But Yoo is thoughtful in pointing to the role AI can play, and is already playing, through solutions such as ambient, autonomous scribe solutions (of which local star Abridge is leading the pack) in not replacing, but freeing up productivity for clinicians. There is so much unstructured context in both the complexity of disease and treatment options and the social/emotional considerations that we shouldn't be looking for AI to *replace* clinicians. But companies are getting better at finding the structured, repetitive and time-consuming places where AI tools can *help* clinicians. Nearly two-thirds of doctors cited bureaucratic tasks as the leading contributor to burnout. Rigorously trained-AI driven solutions can be a force multiplier for clinicians, and I’ve seen several interviews where nurses and doctors go as far as to say some of these solutions are ”restoring their joy in practicing medicine”. Our health is precious; and we rightly want any technology engaging with it to be developed thoughtfully and thoroughly tested. This requires top AI talent and diverse and realistic training data. Pittsburgh’s strengths in both areas is why we are an emerging hub for data-driven healthcare. #AIinhealthcare #clinicianburnout #healthinnovation #digitalhealth

15

The (Healthcare) Ground Beneath Our Feet… This year it is likely that over $10 billion will be invested in the digital health sector – a robust amount, no doubt, but inconsequential when compared to the amount of capital tied up in healthcare real estate assets, which is estimated to be $1.2 trillion by Jones Lang Lasalle. Of that amount, approximately $790 billion is in the hospital sector while the remaining $490 billion is in medical office assets. It is estimated that there are 48.6k facilities with 3.4 billion square feet of healthcare real estate, 42% of which are owned by REITs and another 33% held by other private investment vehicles. Much of the digital health investment is meant to make the physical healthcare infrastructure more productive: greater operating efficiencies, greater patient throughput, more relevant personalized care models with better outcomes. As the healthcare system is being pushed to be more distributed to lower cost sites of care, accelerated now by the rapid proliferation of automation and AI capabilities, the potential impact on healthcare infrastructure assets will be profound. Thoughts on what that might look like... https://lnkd.in/eTfAdUbS #digitalhealth Flare Capital Partners

113

6 Comments

✅Our healthcare report and market map are finally live✅ Over the past several months, I have shared with anyone who would listen that Michael Cardamone and I were in conversation with innovation executives across four of the top healthcare systems in the U.S. including Mayo Clinic Ventures, Hackensack Meridian Health, Cone Health Ventures, and University Hospitals Ventures to understand current strategies and priorities in order to hone in on our investment thesis. The goal was to arm healthtech founders with the inside perspective on the critical investment areas for US hospitals to help establish product-market fit and solve the industry's most pressing challenges. Links to download the report, check out the market map, and submit your company are all in the comments. Thank you to our contributing experts Shai Ran Sapir, Technology Development Manager at Mayo Clinic Ventures, Sandra Powell-Elliott, Chief Innovation and Commercialization Officer at Hackensack Meridian Health, David Heenan, Managing Director at Cone Health Ventures, and Matthew Zenker, Director of Deal Flow and Investments at University Hospitals Ventures. #healthcare #innovation #healthtech #earlystage #healthtechfounders #healthcarestartups

117

10 Comments

📈 Demand for fertility services is rising -> 💼 PE recognizes this and wants in -> 🏜 but opportunities are scarce (https://lnkd.in/g6zXEVZh). Highly recommend anyone who wants a deeper understanding of what's going with fertility and fertility tech read Aya Spencer's *2024 State of fertility tech report* (https://lnkd.in/gVjK_UpX) - it's a great summary

20

✨ Breaking: Redesign Health Announces New Fund.- Redesign Health Redesign Health has closed a $175 million fund to create dozens of healthcare startups over the next few years. The fund focuses on addressing key areas such as healthcare labor solutions, value-based care, and data interoperability, supporting innovation in these critical healthcare sectors. https://lnkd.in/dGavkab4 Please share to let other #Founders know For the ❤️ of Startups #Fusion42 #Startups #Venturecapital

7

1 Comment

Hot take on a lot of early-stage digital health companies out there: You're not a tech company. Most tech-enabled care companies I've seen over the past two years are only tech-enabled in the sense that they use telehealth as their delivery mechanism for care. There are exceptions to this, of course - companies who build computer vision and applied AI tools to better the doctor-patient experience, companies who build tooling around risk scoring and stratification to enable more personalized medicine, companies who build truly novel intakes to better route patients to the appropriate care, etc. These companies have real technology chops and, if they sell it right to the market, can get credit for this from investors. But if you're truly a telehealth provider, you need to realize now that the goal post has shifted dramatically from 2021 and you're going to be valued at maturity at something like 3x EBITDA. That's profit. Not revenue. Throw a revenue multiple out the window. That's not the world we live in if you're a virtual doctor's office. Think of how that impacts venture math. If you're raising a seed round at $15M post-money (or $12M pre-money), it means you'll have to generate something like $150-200M in annual EBITDA to be a fund returner for your seed investors. Maybe even more with dilution, since telehealth businesses are not traditionally capital efficient and will likely need to raise material additional capital to reach that scale. You need to be ridiculously profitable (probably on $800M-$1B in annual revenue since you're likely going to be a 40% gross margin business). Here's the good news: you can set yourself up well (and probably be a contrarian founder relative to your peers), by talking about EBITDA growth and how you can grow into a fund-returning outcome based on realistic mature market comps. This will stand out for the investors you're pitching, even at the early stage. This is how you can beat the malaise of the tech-enabled care market. Focus on the right metrics and the right type of growth. You don't have to have all the answers (no founder does), but you need to make sure the ship is headed in the right direction. A focus on profitability for "tech-enabled care" (*ahem* telehealth) businesses is a good first step.

26

3 Comments

It was wonderful to be in conversation with Madison Mills of Yahoo Finance at their annual Invest conference earlier this week. We covered everything from the venture outlook for 2025, impact of elections on women's health investing and innovation, and more. Full clip and summary below 👇 https://lnkd.in/gS67sc2Y

95

6 Comments

Another large funding round in the virtual behavioral health space. It's interesting to note Talkiatry's focus on a physician-centric care model with W-2 providers, as opposed to most of the other players who are delivering care with 1099 mid-level therapists. However, it's still not clear to me how they are measuring care quality and outcomes, which is the foundation of true value-based care.

3

1 Comment

What happened in mental health last week? ⏺ Anise Health raised $3 million to deliver culturally-responsive mental health care for the Asian American community ⏺ Goldman Sachs acquired autism therapy provider Center for Social Dynamics, a care provider to over 4,700 clients across 20 locations. ⏺ Lyra Health CEO David Ebersman announced that he will be stepping back from his role to care for his mental health. Ebersman will take on a new role as Board Chairman. ⏺ Substance use disorder (SUD) treatment provider BrightView is closing nine facilities in Massachusetts and Arizona citing challenging operating environments. ⏺ California introduced a bill that would require mental health warning labels on social media sites. It would be the first U.S. state to do so if the bill is passed. ⏺ The Australian Medical Association issued a position statement warning that chronic underfunding and increasingly complex patient presentations are pushing the mental health system to a crisis point. ⏺ Ukrainian startup Healthy Mind raised $1 million to launch an AI platform for mental health in the workplace. ⏺ Indian mental health platform GoodLives raised $129,000 in a pre-seed round, offering AI-driven self-directed exercises alongside expert-led therapy sessions. ⏺ We (The Hemingway Report) launched our 2024 founder survey. Link in comments to contribute. (All links below) __ If you liked this and want insights on the mental health industry in your inbox every week, subscribe to The Hemingway Report newsletter and follow me Steve Duke 📩 #MentalHealth #BehavioralHealth

134

7 Comments

To my amazing network - I am thrilled to announce the launch of Pave Health Ventures, an early-stage venture fund dedicated to broadening access to healthcare and improving the overall well-being of our communities. I’ve been very fortunate in my healthcare career. As the Founder & CEO of MedPilot, we capped off a seven-year journey with a successful exit when we were acquired by Vytalize Health. For the last three years, serving as Chief Innovation Officer, I’ve had the honor to contribute to the remarkable growth at Vytalize, impacting the lives of hundreds of thousands of patients by enhancing the quality of care they receive. I am immensely grateful to Matt Buder Shapiro, not only for being the perfect partner and co-founder but also for being an incredible friend. Additionally, I extend my heartfelt appreciation to Faris Ghawi, Amer Alnajar, and Jordan Brown for their outstanding leadership and for broadening my perspective on the significance of value-based care. This journey has not only provided me with industry expertise but has allowed me to cultivate invaluable relationships and an incredible network. As I embark on this new chapter, I am profoundly grateful to be supported by top executives and thought leaders in the investment, wellness, and healthcare industries. Within the healthcare ecosystem, we are represented by key stakeholders from health systems, insurers, governmental organizations, retail health businesses, provider groups, and value-based care organizations. At Pave Health Ventures, we believe the timing couldn't be more opportune to help support health-focused startups. With the growing prevalence of illness and chronic health conditions impacting our communities, consumers and key Healthcare Stakeholders are increasingly prioritizing proactive and preventative care. This shift in focus is fueling demand for technology, products, and services aimed at improving health outcomes, unlocking trillions of dollars in growth potential within the healthcare landscape. Pave Health Ventures is all-in. We are actively seeking solutions that tackle the root causes of illness, manage chronic conditions, and optimize care and care teams. Please support us in our mission by opening your networks and introducing us to amazing founders and entrepreneurs. Together, let's help pave the way to a healthier tomorrow. Jacob Myers

140

34 Comments

As I wrote earlier, Venture Builder is an attractive new tool for early-stage investment in deeptech startups. Investments in the Venture Company Initiate, which specializes in healthcare, attracted $45 million, a vivid example. If you are considering investing in healthcare startups and would like to learn more about investing in Venture Builder, please email me.

1

Two of healthcare’s most-funded startups raised well over half a billion dollars—then shut down this year. So, does raising big bucks really lead to success? 🤑 SignalFire‎ teamed up with FierceHealthcare‎ to take a closer look at the 20 most-funded #HealthTech startups and the 20 largest recent HealthTech funding rounds. The top 20 #HealthTech startups raised $16.8B+ collectively. Where’s the money going? We unpacked: 📈 How #AI is driving a surge in funding for improving efficiency and outcomes. 💣 Lessons learned from flameouts like Olive and Forward Health. 🚀 From telehealth to value-based care, see how these startups are transforming healthcare—and what it takes to thrive. Check out the article from Heather Landi at Fierce Healthcare‎, who covers insights from YY at SignalFire's Health & PharmaTech practice below, and Danielle Z. on our data science team👇 Congrats to my former team at Devoted Health, who is at the top of this list, and our portfolio companies Ro, Grow Therapy, Color, PayZen on raising successful rounds!💸🎉 #Healthech #VentureCapital #Startups #AI #PharmaTech #Healthcare

109

9 Comments

I always read Rock Health's digital health reports as they give a nice pulse feel for what is happening in the digital health funding space. Good to see funds raised in H1 2024 suggest funding in the sector seems to have stabilized at 2023 levels. Its no surprise the report emphasis the buzz around AI and healthcare. There have been clear winners in the AI healthcare space in the area of process and cost optimization and the R&D space. The impact of AI in care and treatment delivery is so far much more muted. One area I never though to look at AI was in its ability to bring together multiple healthcare pathways and digital point solutions into a more holistic seamless experience for the patient. There is a clear trend away from using stand alone digital health point solutions, and could AI address this challenge by facilitating the efficient integration of disparate processes and technology into unified care programs. I can see this happening with digital health products but this will be more tricky to do with physical care programs involving clinicians and HCPs. “AI is helping us combine multiple parts of the care journey, across all care experiences. In the future, benefits navigation, clinical guidance, and care delivery won’t be delivered by separate companies or point solutions within the healthcare ecosystem. They’ll be features that work in concert within products, and they’ll happen in under 90 seconds for a seamless patient experience.” – Glen Tullman, CEO, Transcarent and Managing Partner, 7wireVentures

11

Redesign Health has launched its largest fund to date, securing $175M to support over 20 new healthcare startups. Founded in 2018, the venture builder has previously incubated more than 60 companies, including Scriptology and Vivid Health. The new fund aims to address challenges such as healthy aging, interoperability, and expanding sites of care. This funding underscores investor confidence in tackling the $4T healthcare market's persistent challenges.

4

What I Learned from the HLTH Conference: Key Takeaways for the Future of Healthcare Attending the HLTH Conference was an eye-opener in many ways. Here are a few of my key takeaways that can reshape how we approach healthcare: Funding the Future: Sustainable funding models remain crucial. Whether through traditional routes like Medicaid (despite its fragmentation) or exploring alternative payment sources, it's clear that innovative payment models are essential to ensuring broad access to care. Outpatient SUD Treatment: 90% of substance use disorders (SUD) can be treated in outpatient settings. This shift could reduce healthcare costs and ease the burden on emergency rooms, where many addicts currently turn due to lack of primary care support. Technology and Wearables: The role of wearables and AI in healthcare is growing. Brainwave monitoring, biosensors in wearables for addiction management, and camera-based non-verbal emotion recognition are all promising advancements. Continued collaboration with tech leaders like Microsoft, Google, Samsung, and others is key to scaling these solutions. Workforce Challenges: By 2025, we could face a shortage of 3 million doctors, forcing healthcare to rethink delivery models. One solution? Empower patients to help each other—technology can facilitate this transformation. The Power of Partnerships: Engaging with partners, whether through foundations, tech companies, or local community-based programs, will be essential to overcoming healthcare’s biggest challenges. Collaboration is at the heart of progress. Looking forward to following up with the incredible individuals and organizations I met at HLTH and continuing to push forward in addressing some of healthcare's toughest issues! #HealthcareInnovation #HLTH2024 #WearableTech #AddictionRecovery #OutpatientCare #Partnerships #FutureOfHealthcare #DigitalHealth

5

Anne Wojcicki, CEO of 23andMe, has announced plans to take the genetic testing company private. This strategic move aims to provide more flexibility in navigating regulatory challenges and to accelerate growth opportunities. The decision follows a trend of health tech companies seeking private ownership to focus on long-term objectives. Wojcicki highlighted the importance of this shift to maintain the company's commitment to innovation and customer-centric services. Taking 23andMe private reflects a bold step towards enhancing its position in the rapidly evolving genomics industry. Read more about this exciting development here: https://lnkd.in/gdrC3a64 #genomics #IPO #privatisation #23andMe

13

Alot of bad actors and a few good actors. $2.5T HC capital raised & $1T invested by PE in last decade. $31B in 2013 vs. $217B in 2021. We know the story. Misaligned incentives - unrealistic multiples, short-term profit focus, aggressive cost-cutting, unrealistic scaling, misunderstood market dynamics, just to name a few. However, our industry needs money. But our industry is more infrastructure asset class than tech start-up (James Nicholls gave me that epiphany). Mic drop on the lyrical genius of Alex Fair of MedStartr Ventures as he literally gives the whole story poetic justice as he reads HIS POEM on this "On The Road at VIVE" episode of The Reverse Mullet Healthcare Podcast w/BP2 Health. This is the perfect episode for a Friday afternoon! He and Paulo J Machado donned the actual reverse mullets and joined us back in February at #VIVE2024 to talk about the need for REAL change in healthcare, startup focus and investor expectations. It was one to remember and one that is in desperate need of a full-length follow-up episode. Give us a like and a watch or a listen https://lnkd.in/e4w4mjkv https://lnkd.in/egmK3kMB

13

3 Comments