Investing in Healthcare| From the Inside Out – a Peak at Partner’s Pivot Labs, by Jacqueline Ganim-DeFalco

As an industry observer and marketer, I am always fascinated by the number of places that new ideas are seeded and grown into businesses.  At this Partners/Pivot Labs #Healthcare #Innovation event on “Creating a Path to Investibility”, I learned a bit about how this powerful health care institution is leveraging its human talent – literally its own DNA.   The panel included these experts from the Partners ecosystem and beyond:

Amanda Centi, PhD, Research Program Manager, Partners HealthCare Pivot Labs (Moderator); Carl M. Berke, PhDPartner, Partners HealthCare Innovation Fund; Laurance Stuntz, Director, Massachusetts eHealth Institute at MassTech (MeHI); Arlene Fortunato, Senior VP for Advancement, The Greater Boston Food Bank; Dr. Kamal Jethwani, Senior Director, Partners HealthCare Pivot Labs –  “experts in philanthropy, venture/seed funding, corporate collaborations and state government resources”  who discussed “what they look for in ideas and how they decide which projects to support.”

The internal venture team at Partners (Pivot Labs) is charged to empower employees of the vast ecosystem to take their ideas out of the labs and see if they might be commercially viable.  The formation of this entity was announced in October last year at the Partners Connected Health Conference.  The mission of Pivotal states, “Partners Pivot Labs develops, tests, builds and deploys digital health solutions that transform healthcare from the current model of fitting the patient into the system to one where the system fits the patient, by combining insights from patient data and an in-house clinical testing facility.”  With that in mind, the panel shared sound investment advice to an audience of scientists, researchers, medical experts, and a few curious outsiders.  Keep in mind, Pivotal can ONLY invest in ideas seeded inside the Partner ecosystem.

To a seasoned entrepreneur or startup advisor, the advice was sound, but not at all surprising.  The panelists reinforced these tenets of starting a new business with an eye toward the unique characteristics of digital health care innovations.

The Basics:

• A strong value proposition with valid proof points
• Seek out assets that are protectable – e.g. Patents
• Test the ideas “close to home” with potential users (business or otherwise) and get real data
• Timing is critical – don’t reveal your innovation too early, but also, don’t miss the market window – what is the tipping point?
• Venture Capitalists invest in people, not ideas/technologies – so surround yourself with a good team – and don’t expect that you, as the founder will have all the talents you need to start a business.
• Understand that you CAN start businesses without venture capital and that this route is not for everyone. You have to decide if you have to be “king” and retain control or give up control in favor of a faster path to growth.  In short, after 4 or 5 rounds of raising money it’s likely the founders only own 5-7% of the company on exit. [Big message to entrepreneurs to focus on getting revenues in the door for for growth rather than just VCs and Angels.]

Beyond Basics:

• Approach networking opportunities as learning experiences and research the individuals you meet. Ask for their advice and input in areas where you know they are anxious to share their expertise rather than try to pitch them on your idea.  Make it a conversation.
• Look for advisors/stakeholders that can get you access to a potential customer or funder – seek out private foundations that are focused on specific diseases, venture philanthropists, or large players like Gates Foundation, Robert Wood Johnson, etc.. However, be prepared to have a strong case study and deal with stringent guidelines.  If you are lucky, you may find a smaller philanthropy that wants to “learn with you” and this is an ideal partnership for a young idea.
• Think in terms of “who would acquire this?”

Unique Insights:          

My favorite point of view was captured here – the “road to market” to get large clients to buy into a new technology.   It’s a unique perspective that one can only have when you are a substantial player like Partners.  CIO’s of large health care organizations don’t want a marketplace of diverse digital applications – they want one accountable source so that when something goes wrong – they can quickly resolve the problem with one party. Share on X

Finally, the panel encouraged the Partners-centric audience to take full advantage of the unique situation at Partners – the built in community of patients, physicians, and other stakeholders who are experiencing challenges every day – problems you can help solve.  This rich ecosystem is the breeding ground for new ideas AND critically the basis from which one can test ideas and applications.