Two speakers discuss how startups can break into heavily regulated markets like healthcare. The strategy: find where stakeholders' incentives align, prove ROI on a small slice of the market using a real example like Livongo, then use that proof to scale broader adoption.
Chapters
In healthcare ventures like Livongo and other sectors that have significant gatekeeping, licensing requirements, regulation, stuff like that, how do you approach introducing novel business models? Yeah, such as a customer-first model that may not easily be accepted in that existing system.
It is such a great, uh, question. And, um, the the business models that are in these industries have a lot to do with, you know, where they end up. So advertising is a misaligned business model, right? Who pays and who benefits are two different stakeholders. Healthcare is even worse. Who pays, who benefits, who decides are different stakeholders often. So one of the things we have always thought about a lot is where are those leverage points in the system? Where, uh, there's alignment of those stakeholders. So when we started Livongo, for example, we went to these self-insured employers because they were taking their own risk, and we could go to them and say, here is the clinical ROI, here's the improvement in lifestyle of your employees, and here's the financial savings. So if you make that decision, you benefit across the board, uh, in, uh, in, uh, in using the service. And so, I think the key is to find these leverage points where there is alignment for even if it's a small sliver of the overall market, demonstrate success. And if you have shown economic as well as in this case clinical benefits, others will follow. And it's exactly what happened there and that has become a little bit of a playbook in this industry because I meet lots of companies now that are Livongo for X where X is a persona. If Livongo was serving for diabetics. And, and I think just that leverage point identification is really, really important.
