Healthcare investor shares what he wishes more startups did

The MedCity INVEST Digital Health conference is scheduled for September 28th in Dallas, in partnership with Health Wildcatters at Pegasus Park. There, eight healthcare startups focused on employee benefits will compete in the Pitch Perfect competition. Three investor judges listen to these companies and ask questions about their business model and approach to decide the winner.

Judges include Kyoko Watanabe, Managing Director at DEFTA Partners, Matthew Blum, Principal at Cigna Ventures, and Parth Desai, Principal at Flare Capital Partners.

In response to emailed questions, Desai spoke about his firm’s investment strategy, how he works with startups, and what he wishes more startups would do.

Parth Desai

What investment strategy is your company pursuing?

Investing in health technology, digital health and health service companies that improve health outcomes and expand access while reducing the cost of care. We focus on early stage opportunities in healthcare technology innovation and our investors include leading healthcare companies, large institutional investors, major family offices, endowments and sovereign wealth funds. We invest in our portfolio companies throughout their life cycle, as we work with entrepreneurs throughout their business development

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Click here to view the full agenda for INVEST Digital Health.

What was the last healthcare investment you made (that you can talk about) and why did you make it?

We recently invested in a seed-stage company called SmarterDx, which uses artificial intelligence to automatically identify missed clinical codes that bring additional revenue to hospitals and improve quality of care. With hospitals currently struggling financially and striving for operational efficiencies, the attributable impact of SmarterDx on both revenue and bottom line resonates with their customers. This initial wedge prepares the company to become a de facto clinical and financial data layer for healthcare organizations, enabling a range of future product opportunities.

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What distinguishes your company in working with startups?

We have a unique LP base of 30+ strategic positions representing the healthcare ecosystem (think healthcare systems, regional and national healthcare plans, retail pharmacies, pharmaceutical, diagnostics and medical device organizations).
We use these relationships to accelerate the growth of our portfolio companies; These groups have contributed over $600 million in revenue to our portfolio companies over the years

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What would you like from more healthcare startups?

Focus on quantifying and building a differentiated return on investment (ROI) story unique to your product. While big markets, great teams, and world-class products can be catalysts to help startups execute their early sales, it’s ultimately the ROI story (lower costs, improved quality of care, or even uncovering new revenue opportunities for businesses) that will we have found creates permanence and scale. It’s important to get this right early on.

What do you enjoy most about being a healthcare investor?

The opportunity to constantly learn about the healthcare industry from such a diverse and extraordinarily intelligent array of entrepreneurs and partners, and the challenge of transforming such a complex industry

Photo: Natalie Mis, Getty Images

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