- Healthcare investor and author Lisa Suennen released a list of “13 rules for healthcare entrepreneurs and investors.”
- The list was created in response to Mark Cuban’s list of “12 rules for startups.”
- The rules include business models to avoid, how tech entrepreneurs breaking into healthcare must adopt a different attitude and a call for gender parity in the field.
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Healthcare investor and author Lisa Suennen just tweeted her 13 rules for healthcare entrepreneurs and investors. Suennen says the list took only her a couple minutes to write, as the rules come from her own expertise of what she expects as an investor.
The list was born from a call to respond to billionaire Mark Cuban’s list of “12 rules for startups.” Healthcare innovation reporter Jessica DaMassa asked on Twitter for Suennen to create a healthcare list equivalent.
“The irony of this is I dashed it out in a minute,” Suennen told Business Insider.
When reading her biography, it’s clear why you should pay attention to her list. Having spent more than 30 years in the healthcare, tech, and business sectors, Suennen has plenty of experience to draw from. She also runs the Venture Valkyrie blog, hosts a podcast about healthcare innovation, and wrote a book on the topic.
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Suennen has spent 20 years in venture capital, most recently leading the healthcare fund at GE Ventures and previously as a partner at Psilos Group. Prior to that, she was part of the leadership team that built an $800 million behavioral healthcare company called Merit Behavioral Care.
Suennen is now the leader of Manatt Phelps & Phillips digital and technology businesses and venture capital fund.
Her list of “13 rules for healthcare entrepreneurs and investors” follows, along with additional insights from an interview Suennen did with Business Insider:
The 13 rules for healthcare entrepreneurs and investors
- If the problem you’re solving isn’t keeping customers up at night, keep working.
- If you aren’t sure who will pay, you are doomed. Suennen said that understanding how money flows and who pays for what within the industry is essential for making it in healthcare. “If you don’t understand how money flows through the system, you won’t be successful,” she said.
- Patients are the point, don’t forget to include them in the design and testing.
- Remember, value-based is still a long way off — the business model must account for this.
- If your product helps payers but hurts providers and you need both to play, try again.
- Consumers won’t pay for things they think insurance should cover.
- Proof of concept is nice, proof of efficacy and value is essential.
- There is no Minimum Viable Product when humans are involved – get it right. Suennen discussed the problem of using a tech startup model in the healthcare industry. “In tech you move fast and break things. That does not happen in healthcare,” Suennen said. “You cannot move fast and break people.”
While she believes tech investment in healthcare is a healthy area of growth, she said that tech can’t come in and magically solve the problems within the healthcare industry. “You need traditional healthcare and non-traditional healthcare people to make the best healthcare outcome,” she said.
- Be clear on how money flows through the system you touch, and who touches the money.
- Wellness and prevention are essential but no one wants to pay for them.
- If what it causes is worse that what it cures, you aren’t done yet.
- Women make 85% of healthcare decisions – make them a key part of the team. Suennen’s citing from a report by Oliver Wyman, that found that women make 80% of healthcare buying decisions but that only around 13% of healthcare CEOs are women. The report also notes that 65% of the healthcare workforce is female. “You need diversity on the team,” Suennen said. “It can’t all be middle aged white men.”
- Investing in healthcare is not for the faint of heart — get a coffee because it’s gonna take a while.
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