April 28, 2023 • 36 mins
As Sofia Guerra was growing up in Guatemala, her mother was a dentist serving her local community and putting smiles on faces. Now as an Investor with Bessemer Venture Partners, Sofia partners with entrepreneurs who are trying to solve big problems in the world of healthcare. Join Sofia and host Shiva Mirhosseini as they discuss how to overcome financial headwinds and find the right opportunities to build and scale health tech businesses.
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Shiva (00:09):
Hi. Welcome to Paving the Path. I'm your host, Shiva Saini.
People know me as a customer experience champion and a
digital executive at Fortune 50 companies. I plan on paving
the path in my show with women game changers, thought
leaders and executives touching the entire spectrum of digital transformation
in healthcare. Join me in exploring the digital renaissance that's
(00:33):
shaping healthcare today and forever changing the future of wellness
care and health. Welcome to another episode of Paving the Path. Today,
my guest is Sophia Guerra, a Bessemer Venture Partners investor
here in Cambridge offices in Boston, Massachusetts. She focuses on
(00:57):
healthcare and biotech and is the co-author of Benchmark's Growing
and Scaling Healthtech Businesses, a study of 100 plus best
in class companies to understand key metrics relevant to scalability
in healthcare, software and tech enabled services. Sophia began her
career as a consultant at Bain and Company, where she
(01:18):
worked on strategy, operations and due diligence projects across healthcare
and technology. Prior to joining Bessemer, she was an investor
at Box Group Ventures and co-founder and president of Nucleate,
a national life sciences entrepreneurship program helping PhD postdocs and
students commercialize scientific projects. She earned her MBA from HBS
(01:45):
and her BA with high honors in chemistry from Harvard University.
She has a very special story that I let her
speak to. Sophia. Welcome. Welcome to the podcast. Thank you
so much for making time for our audience. It's lovely
to have you. You have such an incredible story. Tell
(02:06):
us a little bit about yourself, something that gets you
out of the bed in the morning. You have a
pretty busy schedule, I'm sure, but just so that our
audience gets to know you a little bit.
Sofia (02:17):
Yeah. Thank you so much for having me. It's really
a pleasure to be sharing some of the work that
I've been doing so we can spread the word and
help entrepreneurs everywhere. What do I get out of bed
every morning? So like you said, I grew up in
Guatemala until I was about 17. Both of my parents
are dentists and my mom works in in a poor
(02:38):
area of of the city and where she grew up
and kind of is her community. And she always told
me that she got out of bed every morning because
she would put smile on people's faces. That was that
was her job. And that really stuck with me since
I was very little of I want to strive to
have a job that makes me get out of bed
(02:59):
every morning to to help others and and really make
an impact in my community And that my community has
changed over the years is, you know, I've lived in Guatemala,
then I lived in Singapore and now in the US.
But I've always been very committed to finding ways to
to make those around me better. And I think health
care is one of those areas that that really need
(03:20):
a lot of help in improving. And that's kind of
why I love working in health care and specifically as
an ambassador, because I get to partner with entrepreneurs that
are really trying to solve the hardest problems in the world.
And I think entrepreneurship and technology are their best way
to to really drive that change.
Shiva (03:39):
That's an incredible story. So can you tell us a
little bit more about Bessemer Ventures for our audience, Surely
a venture capital firm specializing in health care, amongst other verticals.
But tell us about your role in particular and why
is it different?
Sofia (03:55):
Yeah, absolutely. You know, Bessemer is the oldest venture capital firm.
You say we're more than 100 years old. It actually
got started as the family office for for the Phipps family.
Henry Phipps was the CFO of Carnegie Steel. And when
I think that was like the first kind of billion
dollar outcome type of business and he took all of
(04:18):
that wealth and he wanted to reinvest it in other
entrepreneurs like himself, instead of donating it to nonprofits and foundations.
The Bessemer Trust was created and Bessemer for a really
long time, I think up to maybe 40 years ago,
was investing out of that kind of sole limited partner capital.
And then we started taking on other money and then
(04:41):
investing it in in that same mission. Right. Entrepreneurs are
really trying to build enduring businesses that will redefine and
change industries. We're really well known on kind of our
cloud and software practice, but we've actually been investing in
healthcare for a really long time, over 40 years. My partner,
Steve Kraus, leads the health tech practice. And we've been
(05:03):
kind of investing in both healthcare, software, technical services and
life sciences for for a really long time. And then
in my role, I particularly focus in kind of both
healthcare software and tech enabled services and been focused in
understanding and studying how companies scale over time. So what
are the milestones that are required to prove product market
(05:26):
fit that series? Or as you grow for a series B,
what does the business look like and kind of the
subsequent growth stages and really thinking about how do we
quantify some of that growth and how do we share
some of those learnings to being kind of the finding
the top performers in our industry? And I think we
are at a very particularly important point in time to
(05:48):
be able to do that because our colleagues in kind
of cloud and other industries and software have been doing
this for, I think, over 20 years. But I think
the health tech industry is in a in its teenage
years for for lack of a better word. And I
think it wasn't until I guess 2019, 2020, where we
had a whole host of IPOs and really successful companies
(06:11):
go to the public market and perhaps they're not doing
as well in the public market today. But there's still
kind of a lot of success stories coming out of
the last few years. And subsequently a bunch of different
health and companies are raising a lot of capital and
passing on stages of growth. So now we have like
this whole host of assets or companies that we can
(06:33):
study longitudinally to really understand how they got there and
what particularly nuances of their business models or what I
call like the business model machine, like really make make
those companies scale successfully. Yeah.
Shiva (06:46):
You pointed out something quite special that I'm seeing a
lot of as well, which is the convergence of different industries.
Just given the advancements we are seeing in technology now,
different aspects of technology, whether it's software as a service,
whether it's AI, whether it's platforms creeping into healthcare in
(07:10):
ways we have never seen before. And so I think
Bessemer in a way, has an advantage having had that
long history of healthcare investment, but also being very much
in tuned with technology and now being witnessed to such
massive convergence, which is giving birth to, as you mentioned,
(07:30):
and a whole new generation of technology enabled or SaaS enabled,
you know, healthcare companies that are changing the face of
the industry as a whole. And we may be at
early stages. You know, you said teenage years, but it's
just moving very, very fast. I can I can't help
but notice how much reading one has to do in
(07:53):
order to just stay up to date, which is why
I'm interested in this conversation. You know, the work you
have done, the body of work, the research is extremely rich.
And so let's dive into that because the other macro
issue that we are seeing is a different economic environment, right?
Is shifting from growth and putting money into health care.
(08:18):
From a VC perspective, especially during and right after the
pandemic to now, you know, shifting the mindset to putting
more emphasis on efficient growth and profitability, which in healthcare
is quite difficult. What does it mean for you and
in your role in investment and what have you learned
(08:41):
through your research about building and scaling health tech businesses?
Sofia (08:45):
Yeah, you mentioned something or made a comment that is
really interesting, right? Like health care is at that point
where it really needs to be disrupted. I think a
lot of health care is still done on facts and
not using technology, and it's just really ballooning in terms
of administrative costs and what's really causing a lot of
(09:06):
complexity for for for how to deliver best care. So
at Bessemer, we we like to think about kind of
the areas we investing in kind of three Big North stars.
There's digitization, there's consumerization, there's foundation. And we look at
those North Stars to kind of look at all the
themes that we're looking at. And I think there is
(09:27):
the ability to impact the way care is delivered, right?
And there is or the services of health care and
how consumers experience that health care. And then how do
we engage those consumers either through B2B to see business
models through payer and employer or directly to consumer and
value based care businesses? That's the validation piece, and that's
(09:51):
what I generally call on my research kind of tech
enabled services. It generally is kind of a care delivery
model or navigation that includes a human in the loop
to deliver. A service or engagement. Great examples of that
are Livongo, the darling of Healthtech, as we call it.
They were tech enabled services. Businesses that were engaging consumers
(10:12):
to that had diabetes to better manage their their diabetes.
And then on the software side, where we really think
about like the back Office of Health of Health tech,
what is all the administration, how do we digitize that stock?
How do we connect payers and providers and make data
more interoperable? How does pharma engage patients in their clinical
(10:33):
trials to develop better drugs? Like all of the software side,
these are software businesses like in any other industry, right?
They tend to be B2B in nature. You either sell
to pay or a provider or pharma, and they have
kind of cloud hosting costs in their gross margins, but
they tend to be like much higher gross margin than
traditional tech enabled services businesses in degree. The best example
(10:57):
in that industry is Veeva. As you probably have come
across them. They are a CRM for pharma companies and
how they manage their relationships in sales and marketing. But
since then they've grown to to other areas, but they
are multibillion dollar business that has 70% gross margins and
it's been very successful.
Shiva (11:18):
That's amazing. I like how you have divided kind of
the categories very simply, right? Tech enabled where there is
just still that human factor in the mix. Not that
it's completely gone in the SaaS model, but it's more
of a B2B. It's it's driven by technology all the
way to automation all across. Give us a reality check, Sophia.
(11:41):
What kind of progress can we realistically expect in the
health care industry in the next 1 to 2 years
considering some of these headwinds that we are witnessing on
the macro side and just the mindset shift and some
of the banking short term issues, but nevertheless, some of
these banking issues we are seeing on the surface, before.
Sofia (12:02):
I answer the 1 to 10 year review, I also
want to say like that was a watershed moment for
the industry. I think it became relevant to every human
in the planet, right, and how we access healthcare, some
of the gaps that existed in our system and the
need to really evolve, how we were engaging consumers even
to just access patients in the home to keep them
(12:25):
safe or via telemedicine. So I think we've made incredible
progress over the past five years. And despite the market
corrections and the macroeconomic environment of 20, the second half
of 2022 and I guess now 2023, I'm still very
bullish that the market in health tech and a number
(12:45):
of investments in capital that's going into it and the
need for innovation is going to continue. So kind of
very positive and kind of what the outlook for our
industry is. I think the reality that we need to
understand and be better armed for kind of with the
best information is building in healthcare is really hard and
it takes longer than what it would take to adopt
(13:07):
and sell technology in any other industry. The report that
we're posting in a week from today, and I hope
we can share it with everyone who's listening, is we
took a look at how long does it take to
grow to $10 Billion in revenue or $100 Billion in revenue?
If you're a health care software and a tech enabled
services businesses business, comparing it to cloud or software and
(13:29):
any other industry that are your colleagues in Bessemer look
at in other spaces and it takes like roughly 3
to 4 years longer to get to those milestones. And
I think it has to do with kind of regulatory
complexity that exists in the industry. The longer sales cycles
and candidly, the more complex go to market strategies, or
(13:50):
either you get a contract in a tech enabled services
business through, say, an employer or a payer, but then
you still have to go engage the consumer and that
there is delays and learnings and a lot of that.
So we're still bullish on what the industry is going
to do in kind of the five, ten year horizon.
But I think we need to be understanding on kind
of some of the the differences that exist in this
(14:14):
industry to to scale. I'm definitely optimistic. And what's yeah.
Shiva (14:18):
No, that's that's a very good point. And I'm seeing
even within my clients or my network of startups that
patience both on the side of, you know, the operators
but sometimes even on the VC side tends to run
thin and it does take just a different approach and mindset.
(14:39):
And perhaps Bessemer, because you guys have been in the
health care investment for quite some time, just play a
little bit differently. It's very important not to starve the startups,
especially when they need that kind of partnership with the
VC is the most And I always say, you know,
you got to show up and you got to kind
of pave the path together because it is tough in.
(15:01):
Health care. And, you know, not only it's from a
regulatory perspective, but also the incentives are just not very
much aligned across the different players. And that's actually a
great segue to my next question. I got very much
into your research and the body of work you guys
have been doing from the perspective of an entrepreneur, whether
(15:25):
on the tech enabled side or the SaaS side, what
could we take away and how can we utilize your
research in a way that can shape both from a
business model, go to market perspective or just strategies from
the other side? From that entrepreneurs perspective, how can we
utilize your research?
Sofia (15:45):
Yeah, no, absolutely. I mean, that's the main purpose of this,
is to kind of help founders, CEOs and also board members, right?
Take the knowledge or the learnings that we have from
the many investments that we've made and companies that we've
seen over the years and how do we kind of
strive to be best in class? But what does it
mean to be best in class? We get a lot
(16:06):
of entrepreneurs that come to us and say like, Hey,
how fast should I be growing? How much should I
be spending in R&D? What should my gross margins be
if I'm a technical services business? And that question obviously
depends right on the business model. I think that's a
step number one. I think that's why we took this
like two business model kind of break out. But then
(16:27):
there's also nuances within that. So understanding how like what
stage of growth you're in. So if you were like
a 1 to $10 million business, what do we see
as the average growth of a venture back business and
what's top quartile growth? And should you should strive to
be in that top quartile? But then there's also what
(16:47):
investments you're making to reach that top quartile growth category.
I think you mentioned about like the shift from growing
at all costs and throwing everything into kind of what
sticks in the wall versus efficient growth. And I mean,
it's no news, right? Everyone's been talking about efficient growth.
So I don't want to sound like a broken record,
but it's about how are you making that paced improvement
(17:10):
in your gross margins to kind of bring more of
that kind of revenue into gross profit? And then what
investments you're making in your operating expenses, either new product
and research and development you're making versus what you're investing
in sales and marketing and what is that kind of
payback on your sales and marketing invested dollars to bring
(17:32):
more revenue, right? So like, yeah. So it's important for
you to understand all of the different pieces of your
business model and kind of how money flows in your
PNL or your profit and loss and what investments you're making.
But it's not just kind of what the return on
investment is of those investments, but what are the trade offs, right?
Are you investing a dollar in sales and marketing versus
(17:54):
you're investing a dollar on R&D? And then what are
the decisions and trade offs that you're making in what
timelines you're making those decisions? And then ultimately, what are
the outcomes that you're providing to your customers? Because I
think a really important learning that we've had across investing
over the years in health care is proving your worth
(18:15):
early on may require more capital and take longer. So
getting to that $1 million in revenue kind of milestone
may take longer because you're going to have to prove
to your customers your return on investment on a clinical
outcomes basis or financial return on investment from the customer perspective.
(18:36):
And that requires more time and research pilots. ET cetera.
But then how do you leverage those outcomes to kind
of improve your sales and marketing and kind of this
flywheel that we call it on the social marketing side?
Shiva (18:50):
Yeah, I couldn't agree more. In fact, this gives me
another thought that I'm seeing or another evidence of what
I'm seeing across the healthcare startups. It's one thing to
really just focus on how to run an efficient business.
It's another thing to look at the broader perspective of
(19:11):
all these other complementary solutions that are coming to the
marketplace and the partnerships and the ecosystem that as a
whole is shifting, right? So you can't like I'm seeing
a lot of point solutions, for lack of a better word.
But holistically, if you want to see a major shift
(19:32):
and change in healthcare, it takes a lot of point solutions.
And the earlier you can identify opportunities to partner and
kind of be associated with a with an ecosystem that shifts,
for example, the in-home health care movements that we are seeing,
the better off you are. And some companies are doing
(19:55):
fabulous work just creating marketplaces, for example, and helping organizations connect.
I'm sure you have examples like that as well, but
it's worth noticing that while it's difficult to sell into
healthcare and it does take time and it's costly, especially
getting to that first million dollar, there are opportunities for
(20:16):
partnership even within the sort of ecosystem in order to
kind of accelerate your pathway to have a bigger, more
sustainable momentum when you get to the buyers.
Sofia (20:31):
No, it's a great point. We mean, in any industry,
take fintech, take healthcare, you see different waves, right, of unbundling,
of solutions. So take like the unbundling of a hospitals
big hospital system and how are you going to deliver
best of breed solutions for each category? And we've seen
(20:52):
that over the past three years. Say we have big
winners in MSK, we have big winners in mental health,
we have big winners on maternal health. And there's still
I mean, when I say big winners, there's like companies
that have raised a lot of capital and that have
reached 50, 100 million, $200 million in recurring revenue reoccurring.
(21:13):
Guys in Healthtech in tech enabled services is not truly recurring.
But we can we can get into that later. But
you've seen kind of a lots of names going to
get ahead of the pack in those kind of what
we call point solutions. And I think we're going to
see the next wave of re bundling a lot of that.
And some of those there's a lot of benefit to
(21:34):
having a particular solution that focuses in a particular condition.
It's better to prove what your outcomes are for a
specific population. How do you better communicate and engage a patient?
And we've seen best in class companies, say, MSC, like
our portfolio company, hinge or in mental health with Headspace
to really drive that and kind of take advantage of
(21:57):
better engaging members through the payer. The employer channels to
have best in class or best of breed solutions. And
then we're going to see the wave of consolidation on
what you're saying, either through partnerships or through acquisitions and
mergers and acquisitions to get to that like re bundling stage.
(22:18):
I think that there are certain companies that are better
positioned to do that connectivity there depends on how early
you're engaged in the member, how wide your condition is
and potentially comorbidities of your patient population and the such.
But those are totally normal kind of waves of innovation
that we've seen over many years in different industries.
Shiva (22:38):
Absolutely, Sophia. And you call it normal, But, you know,
for healthcare, it's such a new phenomenon. And I love
how you put into unbundling and re bundling. And it
may take not just a few years, but decades because
it is a highly regulated, very, very complex industry. But
(23:00):
in doing so and certainly taking the time to do
it well and let the kind of the the best
of breed, even from the bundling side, that we kind
of come from the come to the other or appear
on the other side is very, very exciting. Although I'm
sure again, like we said earlier, it does require a
(23:23):
ton of patience. I mean, it just takes very thick skin,
I think, to be an entrepreneur in healthcare and probably
even more so on a on an investment side of
the house because you just have to sit with and
hold hands for a long time to see the evidence
of return and the scalability of it.
Sofia (23:44):
I'll give you a great example. I mean, we've seen
recently Oak Street Health announce a partnership with Inter and
for kidney care, and we're seeing that they're kind of
in a really interesting position because they have this kind
of primary care population of patients that they're taking care
of and taking risk on, but then they're going to
start finding who are the best of breed partners for
(24:07):
for specific conditions so they can kind of share that
risk with. That's one example of kind of an aggregator
in a way and the value based care side. And
we can also think on, say, like the commercial employer channel,
there's likely going to be a lot of consolidation because
we're hearing from a lot of benefit managers that they
don't want to be contracting with a lot of point
(24:29):
solutions or even a patient doesn't want to be accessing
a bunch of these apps on their phone. So we're
going to see kind of that wave take place in
different ways depending on the market and the business models.
Shiva (24:40):
So a lot of work, a lot of work changes. Yeah.
Sofia (24:45):
You also make a point on the scalability side. And
I think one of the things that our research has
shown is, you know, it may take longer to get
to that $10 million in kind of run rate revenue
milestone or. But those businesses are Healthtech businesses are incredibly
attractive at scale because mean scalability drives modes and economies
(25:11):
of scale like our modes and health tech. It really
hard to to get to scale. So once you're there,
it's a it's a really interesting business from kind of
a free cash flow perspective. There's also your ability and
how you kind of get there and the improvements that
you're making are definitely just as attractive in terms of
metrics as what we would expect in other business, in
(25:32):
other industries.
Shiva (25:34):
So when you look at software as a service or
these health tech enabled companies, I have to believe that
you're you're looking or getting inspiration from other trends or
other industries outside of healthcare as well. For instance, it's
(25:55):
re bundling or unbundling. We have seen it happen elsewhere.
You know, whether it's financial services, consumer goods, etcetera. What
are some of the other trends that that inspire you?
And they may not be a complete kind of representation
of what may happen in healthcare, but give you a
sense of direction as to what to expect.
Sofia (26:18):
We have the privilege of working with incredible investors and
others that have deep experience in other industries at Bessemer,
and I try to work with as many partners as
possible and kind of have learned from kind of the
investments they've made and what they've seen in shift in
their industries. One example and near that, I've been spending
a lot of timing is in kind of this health
(26:39):
healthcare payment space or what we call like this, like
health care and fintech intersection. And that's because in financial
services over the past, say, ten years, we've seen kind
of a huge shift to shift to digitization of payments
and the tools and software that we're using to enable
a bunch of digital payments. And in healthcare, we really
(27:01):
haven't really seen that. I think 25% of payments from
a payer child provider are still done in a cheque
and obviously payers are not incentivized to pay in a
timely manner because services have been rendered in a fee
for service world and we're making the revenue cycle management
processes incredibly complex to prevent providers from getting paid and
(27:23):
payers are paying and there's just this very complex system.
So how do we think about digitization of the health
tech payment stack and how do we take out a
bunch of services vendors that exist that touch different parts
of the system with with best in class software? How
do we take parts of that system and automate processes
(27:44):
that required today hundreds and thousands of coders and and
billing and administrative personnel? Because I mean, our system is
ballooning and costs and the big driver of that is
the administrative burden that that the system is taking. I mean,
there are other other drivers, but I think that's one
way in which we can deploy software and that we've
(28:07):
seen it done well in other industries like traditional financial services.
And then another area, I guess tangential to that is
just how do we leverage all of this incredible innovation
and kind of technological shift that's happening in kind of
large language models in generative AI and how it's applied
to to healthcare? I think, I mean, like we said,
(28:29):
innovating in healthcare is incredibly hard. And I think having
a differentiated distribution and go to market is is critical.
So I think what are the use cases within health
tech that we think can be addressable with innovations in AI,
in how do we deploy that in a very responsible way?
I think is is one area where we've been spending
(28:49):
a lot of time in Bessemer.
Shiva (28:51):
I'm super excited about that as well. To your point,
kind of digitization was perhaps an intermediate phase of disruption
in a good way to kind of collapse and automate.
And then with AI and these large language models, you
can go from point A to point Z in a
(29:12):
fraction of a not just time, but cost. And and
then there's this whole code list or minimum code solutions
that if you are a healthcare administrator, I mean, it's
just it opens up a whole host of opportunities for innovation,
efficiency and and very exciting time for sure, as long
(29:35):
as it's done with the right guardrails in AI and
ethics perspective from DEI and bias and just making sure
that the models are very much representative of the reality.
Sofia (29:51):
Yeah. And I mean building the trust with the consumer
and the buyer or the user, right? I mean, it
could be the physician, a clinician. It could. Be the consumer,
or you can just be a provider like administrator and
it's about what is the use case you're solving how
big of a pain point that is and why using
(30:11):
gives you like a leverage in in a differentiated way
to solve that problem. And then obviously, what do you have? Right.
If we believe that large language models are going to
be used for solving a lot of this issues, is
it the data that you're accumulating to train and the
processes that go to market differentiation and obviously scalability of
(30:31):
that that will kind of build modes over time? We're
we're still learning a lot. Another thing that also guides
a lot, the areas that we invest in and outside
from kind of big technological shifts is legislation and regulation.
I think we said in health care you should use
regulation to your advantage and have it be a friend
(30:53):
instead of a foe. Right? You don't want to be
disrupted by regulation. Have your business begun in kind of
the span of a blink of a day, I guess.
But in instead we we study and think about what
are the big regulatory changes that are happening and then
how is our regulation enabling for incentivizing for innovation and
(31:15):
new business models to to kind of arise? I mean,
the high tech act that gave kind of birth, as
you want to say, to the health tech industry as
we is, we look back like 15 years to changes
in payment models, to enabling new value based care businesses
or even small on the patient and ultimately play this
(31:36):
game between the pair and the provider on utilization management
and prior authorization, not let the patient kind of have
access to the drugs they need. How do we make
sure that biosimilar is now that we're finally kind of
seeing some of those get approvals, really the benefit accumulates
to the patient and actually really seeing increased market share
(31:57):
in that space?
Shiva (31:58):
Absolutely. And I think it's a it's a partnership with
the government, right? It's, you know, informing and influencing for
some of these policy changes and also kind of doing
the dance with the government and ensuring that, you know,
investments are done in the right places to really elevate,
you know, in all the areas that you mentioned, the
(32:18):
innovation and the opportunities for market shifting products and services,
I feel like we can talk forever. And so I'm
very excited not just for the work you have done,
but for the next generation of the work you're doing,
because it's not just I want to clarify this and
we'll post this with the podcast. It's not just the
(32:39):
benchmarking of these companies. And for you as an entrepreneur
to kind of see where you fall in that bell
curve shape, if you would. But it actually gives you
a sense of where you can go or where you
can take your company. And that's why for those of
you who are entrepreneurs listening or in the investment community
(33:01):
want you to follow this work that Sophia is doing,
because the next generation of it is going to be
just as much, if not more informative and powerful. And
so we'll make sure that we continue the conversation. Sophia,
anything you want to add to what you are publishing
next and how people can engage with you, follow you,
(33:22):
Where where do they find you as they get even
more interested in the body of the work you're covering
right now?
Sofia (33:30):
Yes. I mean, that's the the main goal of that
is to make this accessible to all entrepreneurs out there. So, yeah,
so we're going to be publishing the report for scaling
health tech businesses to 100 million and beyond in the
next week, or by the time you publish this, I'll
be I'll be public. But then the the whole goal
(33:50):
of this is to have this database be an ongoing
project where we can continue to add more companies to
the database and continue to follow longitudinally how the businesses
in the database have scaled and cut it in different ways,
either by understanding your your end customer, if you're selling
to a provider or pharma or a payer, how those
(34:12):
aspects benchmarks change. Or if you're a value based care business,
which are particularly different business models, how do those benchmarks change?
And yeah, we want to productize this and make it
available to as many as many folks as we can
in as many different cuts as we can. If you
think about it, it's like a three dimensional cube, but
(34:33):
you can reach me at my email. I'm at esguerra.com.
You can follow me on LinkedIn or Twitter and you
can share if you if you have where you are
in your growth stage, what are some of the milestones
that you're thinking about and how you compare to the
benchmarks that we've published so far across kind of top,
bottom quartile or average? And we can take it from there.
Shiva (34:56):
Thank you so much, Sophia. I cannot. Thank you enough
not just for your time, but the wealth of knowledge
and the work that you're doing and creating. Encourage our
audience to find you and LinkedIn, Twitter and elsewhere. We'll
make sure that we post all the research that you
are working on and you have already published. I also
(35:20):
would recommend people to look you up in Byutv and
some of these other major conferences, health care conferences, in
order to find you if they have questions in person
and otherwise. But it was lovely to have this conversation.
We are looking forward for the next version and the
next edition of your research. And thank you so much, everyone,
(35:44):
for joining the podcast today.
Jared (35:47):
Thanks for tuning in. If you like what you heard,
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Shift Forward Health The channel for Change Makers. Subscribe to
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(36:09):
podcasts you need and it's all for free. And remember,
we might have a lot of work to do in
health care, but we'll get there faster together. Thanks again. You.
Hi. Welcome to Paving the Path. I'm your host, Shiva Saini.
People know me as a customer experience champion and a
digital executive at Fortune 50 companies. I plan on paving
the path in my show with women game changers, thought
leaders and executives touching the entire spectrum of digital transformation
in healthcare. Join me in exploring the digital renaissance that's
(00:33):
shaping healthcare today and forever changing the future of wellness
care and health. Welcome to another episode of Paving the Path. Today,
my guest is Sophia Guerra, a Bessemer Venture Partners investor
here in Cambridge offices in Boston, Massachusetts. She focuses on
(00:57):
healthcare and biotech and is the co-author of Benchmark's Growing
and Scaling Healthtech Businesses, a study of 100 plus best
in class companies to understand key metrics relevant to scalability
in healthcare, software and tech enabled services. Sophia began her
career as a consultant at Bain and Company, where she
(01:18):
worked on strategy, operations and due diligence projects across healthcare
and technology. Prior to joining Bessemer, she was an investor
at Box Group Ventures and co-founder and president of Nucleate,
a national life sciences entrepreneurship program helping PhD postdocs and
students commercialize scientific projects. She earned her MBA from HBS
(01:45):
and her BA with high honors in chemistry from Harvard University.
She has a very special story that I let her
speak to. Sophia. Welcome. Welcome to the podcast. Thank you
so much for making time for our audience. It's lovely
to have you. You have such an incredible story. Tell
(02:06):
us a little bit about yourself, something that gets you
out of the bed in the morning. You have a
pretty busy schedule, I'm sure, but just so that our
audience gets to know you a little bit.
Sofia (02:17):
Yeah. Thank you so much for having me. It's really
a pleasure to be sharing some of the work that
I've been doing so we can spread the word and
help entrepreneurs everywhere. What do I get out of bed
every morning? So like you said, I grew up in
Guatemala until I was about 17. Both of my parents
are dentists and my mom works in in a poor
(02:38):
area of of the city and where she grew up
and kind of is her community. And she always told
me that she got out of bed every morning because
she would put smile on people's faces. That was that
was her job. And that really stuck with me since
I was very little of I want to strive to
have a job that makes me get out of bed
(02:59):
every morning to to help others and and really make
an impact in my community And that my community has
changed over the years is, you know, I've lived in Guatemala,
then I lived in Singapore and now in the US.
But I've always been very committed to finding ways to
to make those around me better. And I think health
care is one of those areas that that really need
(03:20):
a lot of help in improving. And that's kind of
why I love working in health care and specifically as
an ambassador, because I get to partner with entrepreneurs that
are really trying to solve the hardest problems in the world.
And I think entrepreneurship and technology are their best way
to to really drive that change.
Shiva (03:39):
That's an incredible story. So can you tell us a
little bit more about Bessemer Ventures for our audience, Surely
a venture capital firm specializing in health care, amongst other verticals.
But tell us about your role in particular and why
is it different?
Sofia (03:55):
Yeah, absolutely. You know, Bessemer is the oldest venture capital firm.
You say we're more than 100 years old. It actually
got started as the family office for for the Phipps family.
Henry Phipps was the CFO of Carnegie Steel. And when
I think that was like the first kind of billion
dollar outcome type of business and he took all of
(04:18):
that wealth and he wanted to reinvest it in other
entrepreneurs like himself, instead of donating it to nonprofits and foundations.
The Bessemer Trust was created and Bessemer for a really
long time, I think up to maybe 40 years ago,
was investing out of that kind of sole limited partner capital.
And then we started taking on other money and then
(04:41):
investing it in in that same mission. Right. Entrepreneurs are
really trying to build enduring businesses that will redefine and
change industries. We're really well known on kind of our
cloud and software practice, but we've actually been investing in
healthcare for a really long time, over 40 years. My partner,
Steve Kraus, leads the health tech practice. And we've been
(05:03):
kind of investing in both healthcare, software, technical services and
life sciences for for a really long time. And then
in my role, I particularly focus in kind of both
healthcare software and tech enabled services and been focused in
understanding and studying how companies scale over time. So what
are the milestones that are required to prove product market
(05:26):
fit that series? Or as you grow for a series B,
what does the business look like and kind of the
subsequent growth stages and really thinking about how do we
quantify some of that growth and how do we share
some of those learnings to being kind of the finding
the top performers in our industry? And I think we
are at a very particularly important point in time to
(05:48):
be able to do that because our colleagues in kind
of cloud and other industries and software have been doing
this for, I think, over 20 years. But I think
the health tech industry is in a in its teenage
years for for lack of a better word. And I
think it wasn't until I guess 2019, 2020, where we
had a whole host of IPOs and really successful companies
(06:11):
go to the public market and perhaps they're not doing
as well in the public market today. But there's still
kind of a lot of success stories coming out of
the last few years. And subsequently a bunch of different
health and companies are raising a lot of capital and
passing on stages of growth. So now we have like
this whole host of assets or companies that we can
(06:33):
study longitudinally to really understand how they got there and
what particularly nuances of their business models or what I
call like the business model machine, like really make make
those companies scale successfully. Yeah.
Shiva (06:46):
You pointed out something quite special that I'm seeing a
lot of as well, which is the convergence of different industries.
Just given the advancements we are seeing in technology now,
different aspects of technology, whether it's software as a service,
whether it's AI, whether it's platforms creeping into healthcare in
(07:10):
ways we have never seen before. And so I think
Bessemer in a way, has an advantage having had that
long history of healthcare investment, but also being very much
in tuned with technology and now being witnessed to such
massive convergence, which is giving birth to, as you mentioned,
(07:30):
and a whole new generation of technology enabled or SaaS enabled,
you know, healthcare companies that are changing the face of
the industry as a whole. And we may be at
early stages. You know, you said teenage years, but it's
just moving very, very fast. I can I can't help
but notice how much reading one has to do in
(07:53):
order to just stay up to date, which is why
I'm interested in this conversation. You know, the work you
have done, the body of work, the research is extremely rich.
And so let's dive into that because the other macro
issue that we are seeing is a different economic environment, right?
Is shifting from growth and putting money into health care.
(08:18):
From a VC perspective, especially during and right after the
pandemic to now, you know, shifting the mindset to putting
more emphasis on efficient growth and profitability, which in healthcare
is quite difficult. What does it mean for you and
in your role in investment and what have you learned
(08:41):
through your research about building and scaling health tech businesses?
Sofia (08:45):
Yeah, you mentioned something or made a comment that is
really interesting, right? Like health care is at that point
where it really needs to be disrupted. I think a
lot of health care is still done on facts and
not using technology, and it's just really ballooning in terms
of administrative costs and what's really causing a lot of
(09:06):
complexity for for for how to deliver best care. So
at Bessemer, we we like to think about kind of
the areas we investing in kind of three Big North stars.
There's digitization, there's consumerization, there's foundation. And we look at
those North Stars to kind of look at all the
themes that we're looking at. And I think there is
(09:27):
the ability to impact the way care is delivered, right?
And there is or the services of health care and
how consumers experience that health care. And then how do
we engage those consumers either through B2B to see business
models through payer and employer or directly to consumer and
value based care businesses? That's the validation piece, and that's
(09:51):
what I generally call on my research kind of tech
enabled services. It generally is kind of a care delivery
model or navigation that includes a human in the loop
to deliver. A service or engagement. Great examples of that
are Livongo, the darling of Healthtech, as we call it.
They were tech enabled services. Businesses that were engaging consumers
(10:12):
to that had diabetes to better manage their their diabetes.
And then on the software side, where we really think
about like the back Office of Health of Health tech,
what is all the administration, how do we digitize that stock?
How do we connect payers and providers and make data
more interoperable? How does pharma engage patients in their clinical
(10:33):
trials to develop better drugs? Like all of the software side,
these are software businesses like in any other industry, right?
They tend to be B2B in nature. You either sell
to pay or a provider or pharma, and they have
kind of cloud hosting costs in their gross margins, but
they tend to be like much higher gross margin than
traditional tech enabled services businesses in degree. The best example
(10:57):
in that industry is Veeva. As you probably have come
across them. They are a CRM for pharma companies and
how they manage their relationships in sales and marketing. But
since then they've grown to to other areas, but they
are multibillion dollar business that has 70% gross margins and
it's been very successful.
Shiva (11:18):
That's amazing. I like how you have divided kind of
the categories very simply, right? Tech enabled where there is
just still that human factor in the mix. Not that
it's completely gone in the SaaS model, but it's more
of a B2B. It's it's driven by technology all the
way to automation all across. Give us a reality check, Sophia.
(11:41):
What kind of progress can we realistically expect in the
health care industry in the next 1 to 2 years
considering some of these headwinds that we are witnessing on
the macro side and just the mindset shift and some
of the banking short term issues, but nevertheless, some of
these banking issues we are seeing on the surface, before.
Sofia (12:02):
I answer the 1 to 10 year review, I also
want to say like that was a watershed moment for
the industry. I think it became relevant to every human
in the planet, right, and how we access healthcare, some
of the gaps that existed in our system and the
need to really evolve, how we were engaging consumers even
to just access patients in the home to keep them
(12:25):
safe or via telemedicine. So I think we've made incredible
progress over the past five years. And despite the market
corrections and the macroeconomic environment of 20, the second half
of 2022 and I guess now 2023, I'm still very
bullish that the market in health tech and a number
(12:45):
of investments in capital that's going into it and the
need for innovation is going to continue. So kind of
very positive and kind of what the outlook for our
industry is. I think the reality that we need to
understand and be better armed for kind of with the
best information is building in healthcare is really hard and
it takes longer than what it would take to adopt
(13:07):
and sell technology in any other industry. The report that
we're posting in a week from today, and I hope
we can share it with everyone who's listening, is we
took a look at how long does it take to
grow to $10 Billion in revenue or $100 Billion in revenue?
If you're a health care software and a tech enabled
services businesses business, comparing it to cloud or software and
(13:29):
any other industry that are your colleagues in Bessemer look
at in other spaces and it takes like roughly 3
to 4 years longer to get to those milestones. And
I think it has to do with kind of regulatory
complexity that exists in the industry. The longer sales cycles
and candidly, the more complex go to market strategies, or
(13:50):
either you get a contract in a tech enabled services
business through, say, an employer or a payer, but then
you still have to go engage the consumer and that
there is delays and learnings and a lot of that.
So we're still bullish on what the industry is going
to do in kind of the five, ten year horizon.
But I think we need to be understanding on kind
of some of the the differences that exist in this
(14:14):
industry to to scale. I'm definitely optimistic. And what's yeah.
Shiva (14:18):
No, that's that's a very good point. And I'm seeing
even within my clients or my network of startups that
patience both on the side of, you know, the operators
but sometimes even on the VC side tends to run
thin and it does take just a different approach and mindset.
(14:39):
And perhaps Bessemer, because you guys have been in the
health care investment for quite some time, just play a
little bit differently. It's very important not to starve the startups,
especially when they need that kind of partnership with the
VC is the most And I always say, you know,
you got to show up and you got to kind
of pave the path together because it is tough in.
(15:01):
Health care. And, you know, not only it's from a
regulatory perspective, but also the incentives are just not very
much aligned across the different players. And that's actually a
great segue to my next question. I got very much
into your research and the body of work you guys
have been doing from the perspective of an entrepreneur, whether
(15:25):
on the tech enabled side or the SaaS side, what
could we take away and how can we utilize your
research in a way that can shape both from a
business model, go to market perspective or just strategies from
the other side? From that entrepreneurs perspective, how can we
utilize your research?
Sofia (15:45):
Yeah, no, absolutely. I mean, that's the main purpose of this,
is to kind of help founders, CEOs and also board members, right?
Take the knowledge or the learnings that we have from
the many investments that we've made and companies that we've
seen over the years and how do we kind of
strive to be best in class? But what does it
mean to be best in class? We get a lot
(16:06):
of entrepreneurs that come to us and say like, Hey,
how fast should I be growing? How much should I
be spending in R&D? What should my gross margins be
if I'm a technical services business? And that question obviously
depends right on the business model. I think that's a
step number one. I think that's why we took this
like two business model kind of break out. But then
(16:27):
there's also nuances within that. So understanding how like what
stage of growth you're in. So if you were like
a 1 to $10 million business, what do we see
as the average growth of a venture back business and
what's top quartile growth? And should you should strive to
be in that top quartile? But then there's also what
(16:47):
investments you're making to reach that top quartile growth category.
I think you mentioned about like the shift from growing
at all costs and throwing everything into kind of what
sticks in the wall versus efficient growth. And I mean,
it's no news, right? Everyone's been talking about efficient growth.
So I don't want to sound like a broken record,
but it's about how are you making that paced improvement
(17:10):
in your gross margins to kind of bring more of
that kind of revenue into gross profit? And then what
investments you're making in your operating expenses, either new product
and research and development you're making versus what you're investing
in sales and marketing and what is that kind of
payback on your sales and marketing invested dollars to bring
(17:32):
more revenue, right? So like, yeah. So it's important for
you to understand all of the different pieces of your
business model and kind of how money flows in your
PNL or your profit and loss and what investments you're making.
But it's not just kind of what the return on
investment is of those investments, but what are the trade offs, right?
Are you investing a dollar in sales and marketing versus
(17:54):
you're investing a dollar on R&D? And then what are
the decisions and trade offs that you're making in what
timelines you're making those decisions? And then ultimately, what are
the outcomes that you're providing to your customers? Because I
think a really important learning that we've had across investing
over the years in health care is proving your worth
(18:15):
early on may require more capital and take longer. So
getting to that $1 million in revenue kind of milestone
may take longer because you're going to have to prove
to your customers your return on investment on a clinical
outcomes basis or financial return on investment from the customer perspective.
(18:36):
And that requires more time and research pilots. ET cetera.
But then how do you leverage those outcomes to kind
of improve your sales and marketing and kind of this
flywheel that we call it on the social marketing side?
Shiva (18:50):
Yeah, I couldn't agree more. In fact, this gives me
another thought that I'm seeing or another evidence of what
I'm seeing across the healthcare startups. It's one thing to
really just focus on how to run an efficient business.
It's another thing to look at the broader perspective of
(19:11):
all these other complementary solutions that are coming to the
marketplace and the partnerships and the ecosystem that as a
whole is shifting, right? So you can't like I'm seeing
a lot of point solutions, for lack of a better word.
But holistically, if you want to see a major shift
(19:32):
and change in healthcare, it takes a lot of point solutions.
And the earlier you can identify opportunities to partner and
kind of be associated with a with an ecosystem that shifts,
for example, the in-home health care movements that we are seeing,
the better off you are. And some companies are doing
(19:55):
fabulous work just creating marketplaces, for example, and helping organizations connect.
I'm sure you have examples like that as well, but
it's worth noticing that while it's difficult to sell into
healthcare and it does take time and it's costly, especially
getting to that first million dollar, there are opportunities for
(20:16):
partnership even within the sort of ecosystem in order to
kind of accelerate your pathway to have a bigger, more
sustainable momentum when you get to the buyers.
Sofia (20:31):
No, it's a great point. We mean, in any industry,
take fintech, take healthcare, you see different waves, right, of unbundling,
of solutions. So take like the unbundling of a hospitals
big hospital system and how are you going to deliver
best of breed solutions for each category? And we've seen
(20:52):
that over the past three years. Say we have big
winners in MSK, we have big winners in mental health,
we have big winners on maternal health. And there's still
I mean, when I say big winners, there's like companies
that have raised a lot of capital and that have
reached 50, 100 million, $200 million in recurring revenue reoccurring.
(21:13):
Guys in Healthtech in tech enabled services is not truly recurring.
But we can we can get into that later. But
you've seen kind of a lots of names going to
get ahead of the pack in those kind of what
we call point solutions. And I think we're going to
see the next wave of re bundling a lot of that.
And some of those there's a lot of benefit to
(21:34):
having a particular solution that focuses in a particular condition.
It's better to prove what your outcomes are for a
specific population. How do you better communicate and engage a patient?
And we've seen best in class companies, say, MSC, like
our portfolio company, hinge or in mental health with Headspace
to really drive that and kind of take advantage of
(21:57):
better engaging members through the payer. The employer channels to
have best in class or best of breed solutions. And
then we're going to see the wave of consolidation on
what you're saying, either through partnerships or through acquisitions and
mergers and acquisitions to get to that like re bundling stage.
(22:18):
I think that there are certain companies that are better
positioned to do that connectivity there depends on how early
you're engaged in the member, how wide your condition is
and potentially comorbidities of your patient population and the such.
But those are totally normal kind of waves of innovation
that we've seen over many years in different industries.
Shiva (22:38):
Absolutely, Sophia. And you call it normal, But, you know,
for healthcare, it's such a new phenomenon. And I love
how you put into unbundling and re bundling. And it
may take not just a few years, but decades because
it is a highly regulated, very, very complex industry. But
(23:00):
in doing so and certainly taking the time to do
it well and let the kind of the the best
of breed, even from the bundling side, that we kind
of come from the come to the other or appear
on the other side is very, very exciting. Although I'm
sure again, like we said earlier, it does require a
(23:23):
ton of patience. I mean, it just takes very thick skin,
I think, to be an entrepreneur in healthcare and probably
even more so on a on an investment side of
the house because you just have to sit with and
hold hands for a long time to see the evidence
of return and the scalability of it.
Sofia (23:44):
I'll give you a great example. I mean, we've seen
recently Oak Street Health announce a partnership with Inter and
for kidney care, and we're seeing that they're kind of
in a really interesting position because they have this kind
of primary care population of patients that they're taking care
of and taking risk on, but then they're going to
start finding who are the best of breed partners for
(24:07):
for specific conditions so they can kind of share that
risk with. That's one example of kind of an aggregator
in a way and the value based care side. And
we can also think on, say, like the commercial employer channel,
there's likely going to be a lot of consolidation because
we're hearing from a lot of benefit managers that they
don't want to be contracting with a lot of point
(24:29):
solutions or even a patient doesn't want to be accessing
a bunch of these apps on their phone. So we're
going to see kind of that wave take place in
different ways depending on the market and the business models.
Shiva (24:40):
So a lot of work, a lot of work changes. Yeah.
Sofia (24:45):
You also make a point on the scalability side. And
I think one of the things that our research has
shown is, you know, it may take longer to get
to that $10 million in kind of run rate revenue
milestone or. But those businesses are Healthtech businesses are incredibly
attractive at scale because mean scalability drives modes and economies
(25:11):
of scale like our modes and health tech. It really
hard to to get to scale. So once you're there,
it's a it's a really interesting business from kind of
a free cash flow perspective. There's also your ability and
how you kind of get there and the improvements that
you're making are definitely just as attractive in terms of
metrics as what we would expect in other business, in
(25:32):
other industries.
Shiva (25:34):
So when you look at software as a service or
these health tech enabled companies, I have to believe that
you're you're looking or getting inspiration from other trends or
other industries outside of healthcare as well. For instance, it's
(25:55):
re bundling or unbundling. We have seen it happen elsewhere.
You know, whether it's financial services, consumer goods, etcetera. What
are some of the other trends that that inspire you?
And they may not be a complete kind of representation
of what may happen in healthcare, but give you a
sense of direction as to what to expect.
Sofia (26:18):
We have the privilege of working with incredible investors and
others that have deep experience in other industries at Bessemer,
and I try to work with as many partners as
possible and kind of have learned from kind of the
investments they've made and what they've seen in shift in
their industries. One example and near that, I've been spending
a lot of timing is in kind of this health
(26:39):
healthcare payment space or what we call like this, like
health care and fintech intersection. And that's because in financial
services over the past, say, ten years, we've seen kind
of a huge shift to shift to digitization of payments
and the tools and software that we're using to enable
a bunch of digital payments. And in healthcare, we really
(27:01):
haven't really seen that. I think 25% of payments from
a payer child provider are still done in a cheque
and obviously payers are not incentivized to pay in a
timely manner because services have been rendered in a fee
for service world and we're making the revenue cycle management
processes incredibly complex to prevent providers from getting paid and
(27:23):
payers are paying and there's just this very complex system.
So how do we think about digitization of the health
tech payment stack and how do we take out a
bunch of services vendors that exist that touch different parts
of the system with with best in class software? How
do we take parts of that system and automate processes
(27:44):
that required today hundreds and thousands of coders and and
billing and administrative personnel? Because I mean, our system is
ballooning and costs and the big driver of that is
the administrative burden that that the system is taking. I mean,
there are other other drivers, but I think that's one
way in which we can deploy software and that we've
(28:07):
seen it done well in other industries like traditional financial services.
And then another area, I guess tangential to that is
just how do we leverage all of this incredible innovation
and kind of technological shift that's happening in kind of
large language models in generative AI and how it's applied
to to healthcare? I think, I mean, like we said,
(28:29):
innovating in healthcare is incredibly hard. And I think having
a differentiated distribution and go to market is is critical.
So I think what are the use cases within health
tech that we think can be addressable with innovations in AI,
in how do we deploy that in a very responsible way?
I think is is one area where we've been spending
(28:49):
a lot of time in Bessemer.
Shiva (28:51):
I'm super excited about that as well. To your point,
kind of digitization was perhaps an intermediate phase of disruption
in a good way to kind of collapse and automate.
And then with AI and these large language models, you
can go from point A to point Z in a
(29:12):
fraction of a not just time, but cost. And and
then there's this whole code list or minimum code solutions
that if you are a healthcare administrator, I mean, it's
just it opens up a whole host of opportunities for innovation,
efficiency and and very exciting time for sure, as long
(29:35):
as it's done with the right guardrails in AI and
ethics perspective from DEI and bias and just making sure
that the models are very much representative of the reality.
Sofia (29:51):
Yeah. And I mean building the trust with the consumer
and the buyer or the user, right? I mean, it
could be the physician, a clinician. It could. Be the consumer,
or you can just be a provider like administrator and
it's about what is the use case you're solving how
big of a pain point that is and why using
(30:11):
gives you like a leverage in in a differentiated way
to solve that problem. And then obviously, what do you have? Right.
If we believe that large language models are going to
be used for solving a lot of this issues, is
it the data that you're accumulating to train and the
processes that go to market differentiation and obviously scalability of
(30:31):
that that will kind of build modes over time? We're
we're still learning a lot. Another thing that also guides
a lot, the areas that we invest in and outside
from kind of big technological shifts is legislation and regulation.
I think we said in health care you should use
regulation to your advantage and have it be a friend
(30:53):
instead of a foe. Right? You don't want to be
disrupted by regulation. Have your business begun in kind of
the span of a blink of a day, I guess.
But in instead we we study and think about what
are the big regulatory changes that are happening and then
how is our regulation enabling for incentivizing for innovation and
(31:15):
new business models to to kind of arise? I mean,
the high tech act that gave kind of birth, as
you want to say, to the health tech industry as
we is, we look back like 15 years to changes
in payment models, to enabling new value based care businesses
or even small on the patient and ultimately play this
(31:36):
game between the pair and the provider on utilization management
and prior authorization, not let the patient kind of have
access to the drugs they need. How do we make
sure that biosimilar is now that we're finally kind of
seeing some of those get approvals, really the benefit accumulates
to the patient and actually really seeing increased market share
(31:57):
in that space?
Shiva (31:58):
Absolutely. And I think it's a it's a partnership with
the government, right? It's, you know, informing and influencing for
some of these policy changes and also kind of doing
the dance with the government and ensuring that, you know,
investments are done in the right places to really elevate,
you know, in all the areas that you mentioned, the
(32:18):
innovation and the opportunities for market shifting products and services,
I feel like we can talk forever. And so I'm
very excited not just for the work you have done,
but for the next generation of the work you're doing,
because it's not just I want to clarify this and
we'll post this with the podcast. It's not just the
(32:39):
benchmarking of these companies. And for you as an entrepreneur
to kind of see where you fall in that bell
curve shape, if you would. But it actually gives you
a sense of where you can go or where you
can take your company. And that's why for those of
you who are entrepreneurs listening or in the investment community
(33:01):
want you to follow this work that Sophia is doing,
because the next generation of it is going to be
just as much, if not more informative and powerful. And
so we'll make sure that we continue the conversation. Sophia,
anything you want to add to what you are publishing
next and how people can engage with you, follow you,
(33:22):
Where where do they find you as they get even
more interested in the body of the work you're covering
right now?
Sofia (33:30):
Yes. I mean, that's the the main goal of that
is to make this accessible to all entrepreneurs out there. So, yeah,
so we're going to be publishing the report for scaling
health tech businesses to 100 million and beyond in the
next week, or by the time you publish this, I'll
be I'll be public. But then the the whole goal
(33:50):
of this is to have this database be an ongoing
project where we can continue to add more companies to
the database and continue to follow longitudinally how the businesses
in the database have scaled and cut it in different ways,
either by understanding your your end customer, if you're selling
to a provider or pharma or a payer, how those
(34:12):
aspects benchmarks change. Or if you're a value based care business,
which are particularly different business models, how do those benchmarks change?
And yeah, we want to productize this and make it
available to as many as many folks as we can
in as many different cuts as we can. If you
think about it, it's like a three dimensional cube, but
(34:33):
you can reach me at my email. I'm at esguerra.com.
You can follow me on LinkedIn or Twitter and you
can share if you if you have where you are
in your growth stage, what are some of the milestones
that you're thinking about and how you compare to the
benchmarks that we've published so far across kind of top,
bottom quartile or average? And we can take it from there.
Shiva (34:56):
Thank you so much, Sophia. I cannot. Thank you enough
not just for your time, but the wealth of knowledge
and the work that you're doing and creating. Encourage our
audience to find you and LinkedIn, Twitter and elsewhere. We'll
make sure that we post all the research that you
are working on and you have already published. I also
(35:20):
would recommend people to look you up in Byutv and
some of these other major conferences, health care conferences, in
order to find you if they have questions in person
and otherwise. But it was lovely to have this conversation.
We are looking forward for the next version and the
next edition of your research. And thank you so much, everyone,
(35:44):
for joining the podcast today.
Jared (35:47):
Thanks for tuning in. If you like what you heard,
please spread the word. Tell your colleagues to tune in
for all the awesomeness, then leave a review on Apple,
Spotify or wherever you listen. This show is produced by
Shift Forward Health The channel for Change Makers. Subscribe to
Shift Forward Health on your favorite podcast app and you'll
be subscribed to our entire library of shows. See our
full lineup at Shift Forward Health one subscription all the
(36:09):
podcasts you need and it's all for free. And remember,
we might have a lot of work to do in
health care, but we'll get there faster together. Thanks again. You.
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