After thinking through the presentations at the MidAmerica Healthcare Venture Forum (MHVF) and the discussions I had while there, I wanted to talk about how I could take that information and make it actionable for startup firms and their founders.  To do that, I want to dive a little deeper on just a few topics and tie it all back to some great industry feedback that has just been provided.

The startup process: How are you planning to get launched and does your plan align to what the investors require?  Might as well plan ahead as you’ll be calling them for their money sooner than later:

1. Business plan development. Like I said in a previous post, money is telling you to start with the problem, not the solution. So, in building your business plan, you should be able to point to the problem, the costs associated with it today that you will alleviate, the revenue you will generate for solving the problem, and how your solution is different from others trying to solve the same problem.
2. Create your team. Make sure you have the personnel that investors want to put time and money into. One investor told me the product is secondary and the team is his major deciding factor. Get experience, build a solid advisory team, and align skill sets to your business – no Uncle Rico’s guys because they work cheap!
3. Focus product development on human-centered design. Usability, workflow, and task-oriented solutions are going to differentiate in the future.  Even if you have a service offering, it needs to fit into the workflow of the users of that service. If you ask users to change too much, you will create resistance and pushback that you may not be able to overcome, even with a solid ROI.
4. Build your MVP. Don’t build your solution, just build the basic solution that you can test and validate within the market. The further you go down the road with development, the more money you may have to throw away if it isn’t received well.
5. Get clients. Pilot sites, partners, centers of excellence – call them what you will, but get users banging on the product so you can introduce the feedback and experience as proof points to investors. Otherwise, you are calling for investment into an idea; every product is just an idea until you have some users.

Finally, do you have access to independent angel investors? We all do. Go online and use www.angel.co, and you can find them. DO NOT start calling venture capital firms; they are going to be the second group that you contact after raising your seed round. Calling them too early wastes your time and theirs, and you will lose credibility with them. Make sure you don’t raise too much, and be sure you don’t raise too little. It’s the Red Riding Hood issue – it’s got to be just right!  This is where good planning and strategy help a ton!

In the next post, I will share the 5 lessons I learned from MHVF (for Fitting into the Marketplace). Stay tuned!

Continuing the lessons (you can find them here and here) I learned from the MidAmerica Healthcare Venture Forum (MHVF), in this post I will be focusing on fitting into the marketplace. How do you affect the organization that you are calling on? Let’s assume hospitals – what is your talk track with the CEO, the CFO, the COO, the CNO, the CIO, etc.? Do you understand how you modify the workflow of the user or users, and in what way does your product/service affect the relationship the hospital has with the patient?

1. Everything you say and do must be audience-appropriate. Why would you present heavy financial information to a CNO? Save that for the CFO.  Confusion is your worst nightmare; make your points concise, clear, and appropriate, or you will lose the attention and interest of the person before you have the chance to win his or her business.
2. Make sure that you’re presenting documentation to your contacts that allows them to educate the rest of their team. If people are asking for more information, then you haven’t done enough yet.  They won’t move forward until you do more work. Your early pilot accounts don’t mind helping you figure it out. Just don’t make them figure it out on their own.
3. One of the biggest issues with startups is in trying to save the world from itself. The end result is that the patient’s relationship to the hospital is changed. You cannot win in a world where you modify the patient relationship to the hospital; make sure that this is heavily discussed in your strategic-planning process.
4. If you’re going to change the relationship between hospital and patient, make sure that it’s creating more value and longer-term trust. This may be easy to see with educational products but not so easy in supply-chain products. Many times the benefit is there, and it is ignored. It’s not the job of the buyer to figure out your value propositions, so always look at the patient side for time and cost saving, improved quality or safety, and higher satisfaction.
5. Tie yourself to workflow; make sure that your product/service assists the hospital in not only creating value (revenue) or savings, but also in time saving through potentially shifting workload and alleviating pain. This is a great article on that topic. The author focuses on services to CIOs that can be packaged in a manner that understands the restraints on a CIO’s time and alleviates workload.

In the end, the above five topics are a baseline to how you not only need to think through building your company and your product, but also how to fund your company. If you aren’t presenting the information clearly, then an investor, just like a buyer, will not understand the long-term value of your product/service and will thus not fund you.

Thanks again to MHVF for all of this great information. It will be interesting to see how the market shakes out while moving to a value-based model these next five years. I look forward to being a part of the process with you all. Good luck with your endeavors. I appreciate your time here today. As always, take care and have a great day.