Startups as Disruptors (ft. Tom Cassels)

Thanks for tuning to Digital Voices podcast, where we chat digital transformation challenges and opportunities across healthcare and life sciences.

And now your host, Ed Marx.

Excited to have you on another drop of Digital Voices. As you know, the Digital Voices is aimed to bring together chief digital officers and those who report to them across all of health and life sciences, breaking down barriers and silos. And today we will be speaking with a former colleague, but current friend of mine, Tom Castles. And we'll allow him to introduce himself a little bit here in a second, and we'll go a little bit deeper, but we're gonna talk all things digital from the perspectives of startups and advisory services and some of the innovation and disruption that's taking place And Tom brings an excellent point of view given his background and as CEO of RoC Health. So really excited about that. And Sydney, before we dive in with Tom, you know, I know startups have this like a magical allure, especially perhaps to the younger generation. You know, what do you and your peers think about when you think about startups? And is that something attractive to you? And did you think about perhaps joining one at one point?

Yeah. There's something very attractive about startups, I think, because especially when they start out so small and if you can join at that beginning stage, you— there's such an emphasis on like employee wellbeing. And I think everyone just gets really close and it makes a really tight-knit group of employees that work together. And then also I think there's a lot of room to grow too in startups. and work your way up. So that's definitely attractive.

Not that I want you to go anyplace, Sydney. So you're, you're the best engineer DJ out there for podcasts. And so I really appreciate serving with you. But yeah, Tom and I go back a little ways. So we first met at the advisory board where Tom has spent many years and he'll get into that a little bit. And then from there, we both went our separate ways. And with that, I just want to welcome Tom. So Tom, welcome to our podcast.

Thank you so much for having me.

So Tom, as you know, we have 2 standard questions we ask every guest, and the first one is favorite music. So like when you're just chilling, what kind of music do you like to listen to?

Um, pretty eclectic. Um, my sons make fun of me for it, so, um, I range from Johnny Cash to Chucho Valdez to Imogen Heap and The Cure. So it's a little bit all over the place.

Yeah, no, that's very cool. And what about sort of what's your driver in life? Do you have like a life mantra message or, you know, something that provides you that sort of energy, go Joe, you know, each day?

You know, since the start of the pandemic, I will, I won't claim to take this from anything other than Ted Lasso, but be curious, not judgmental. Genuinely, kind of what I learned, you know, 15 years at the advisory board and the rest of my career is Curiosity is a very, very valuable tool. And that's what I kind of hang my hat on.

Love it. And I love the Ted Lasso name drop. So I'm a big Ted fan. Can't wait for the newest season. Should be dropping soon. I can't wait.

Absolutely.

So let's talk first about yourself. So I gave you a very high-level introduction, but you have this interesting background. Can you sort of share with us your background and then how you came to, you know, be CEO of Roc Health?

Sure. And I should make one quick disclaimer. I'm the president of Roc Health. Bill Evans is our CEO and a good, good friend, so he won't feel bad about the little mistake. He is one of the most humble leaders I've ever worked with. So I'm lucky for that. But, you know, my, my story is kind of interesting. So out of undergrad, I was a grade school teacher in Camden, New Jersey. Easily the hardest job I've ever had. I taught remedial math and English in a parochial school. And I was afraid every day for the first 5 months, you know, how do you actually connect with young children when I was pretty much a child myself at 21?

Right.

And how do you communicate and teach After I left teaching, I found myself at the advisory board company. And, you know, this, this was an opportunity that was presented to me. I knew nothing about healthcare, but I, I got lucky and some, some core people like Chas Rhodes, Richard Schwartz, who runs Health Evolution now, Really took a bet on me, and kind of what you know what shrinks it all down is something that happened my first day. My first day at the advisory board, my then manager was out sick, and we had a phone call scheduled with Joel Allison, who was the CEO. at what was then Baylor, now Baylor Scott& White Health. And the rest of my team, the analysts were like, oh, we'll reschedule. And I said, no, no, no, you know, it's just a, just a say hi, it says on my calendar. And so got into a conversation with with Joel about what kept him up at night. And after he, you know, stopped, I said, I don't understand any of the things that you just said. And I think he was blown away that I was so honestly stupid.

Yeah.

And he was like, well, if you really want to know, why don't you come down and shadow for a few days.

Wow.

And that's what healthcare is to me, that incredible generosity to not be so put off by this, you know, happy idiot, but to invite me into an organization to start to understand. And what that allowed me to do is kind of what I did in the classroom. Understand, okay, well, you know, health system executives and health plan executives and life science executives are coming from where they're coming from. How I connect with them and how I can help them has everything to do with my willingness to understand and ask questions that, you know, others might just assume the answer to. And then do my very best to help them make good choices. So not to say that health system executives are a lot like 6th graders, but they respond similarly to me, I guess.

Yeah, no, that is a unique background and I love it. And I love the story about Joel. Yeah, he's great. He was a great leader there. helped bring together the Baylor Scott& White. And yeah, good stuff. I love it. So, you're first and foremost a leader, you know, and you talked already a little bit about your evolution. What do you do today? So, you know, a lot of people listening, CDOs are leaders. And what do you do to sharpen the saw today? People are interested, you know, what others are doing.

Yeah. So, It's interesting. In the last year and a half, Rock Health, since I joined, went from about 8 people to almost 30 now. And the thing that I did when I started and what I do with every person I interview, I ask one question. Which is, what do I have to know about you to know you? And I think knowing people at the level of who they are is the first step to being able to build trust in what, what role they, they're going to play at Rock Health and for our members and clients. and founders. So I do that religiously when I first meet people. And the other thing is just, you know, if I have 31 days in a month, I want to talk to 31 people outside of my organization. And that can be, like I said, members of our the market intelligence group, investors, other investors in digital health, and definitely founders, both inside our portfolio and beyond, to grasp what's really going on for them.

Yes.

To give me a sense of, clarity that I'm not the only crazy person in the world, but also a sense of perspective for the, you know, what we are really feel a responsibility for, which is to be able to convene the whole ecosystem of digital health. And it's hard to do that if you don't have a finger on the pulse of people outside the organization.

Yeah, no, that's, that's great counsel. So I want to dive now deeper into sort of digital health and, and trends that we're seeing and things of that nature. But before we get there, just to set the context, it might be helpful for people to understand a little bit about Roc Health and the type of companies that you look to invest in, uh, because then when we dive into digital health, it'll, it'll form that Sure.

So Rock Health was originally founded by Hallie Teko and Nate Gross, largely as, I would say, the biggest advocacy organization for bringing technology together with medicine. And what we've done, I think, you know, know, in all humility over 10 years, and I'm only in 2, is, you know, keep our eyes focused on what is the largest possible constituency we can bring research and information to about digital health. Part of the way that we do that is investing. And the companies that we look to invest in, you know, it's kind of our DNA, digital health infrastructure companies. So think of, you know, recent investments we've made in Ribbon Health focused on transparency into physician networks, Zeus Health, really trying to build a platform on which you can actually speed up the development of new digital health solutions. That's one category. Another category is care models that are integrated offline and online. So we've invested in companies like Brightline in the pediatric behavioral health space, Equip in the eating disorder space and Oola in the kind of integrated birthing and postpartum space. Those are the types of companies that touch— both touch medicine and touch other digital health companies. and help them grow and scale. So that's who we look for when we invest.

All right, so that everyone understands sort of that perspective, let's jump into uber trends. So I know Rock Health, you also do advisory services, and obviously because of the work that you do in these sort of investments, you have to know what's going on in digital health. So that's the beauty of this conversation and why I love having you So let's talk those uber trends. What's happening out there in the marketplace with, you know, quote unquote digital transformation?

Yeah, I mean, I think if I had to boil it down to 3 things, I mean, one is business model evolution. I think where we are today is such a different place than where we were when, you know, Hallie and Nate started off. We actually have proven business models, you know, evidation in real-world data. Like, their business model is there, and folks are able to kind of build on the back of that. But now we're starting to see evolutions, and I think Julie Yu from Andreessen has said it best. There's increasingly space for things like B2C2B. And I do think that in order to scale, a lot of digital health is about engaging individuals in their own health and then showing the value of that to employers, health plans, whoever's paying the bills.

Right.

And so I think that evolution to being valued for what we do first by people living their lives as people, and then by enterprise companies. That's, that's taking place at, at a greater speed than I would have expected. Um, there's a tension right now, um, between interoperability and M&A. Which one's going to be easier? Um, so We have, and we talked about this earlier this week, we've gotten to the point where there's 1,000 points of light. Unfortunately, it's very difficult to work with 1,000 different solutions. So I think the ability to either have a platform, and I know this is something that you're working on at Tech Mahindra, a platform that can integrate multiple digital health properties, that is, that's hard, you know, in-the-weeds work. The alternative is, if we don't want to be a point solution, let's acquire some other digital health companies. And I think 2022 is full employment for iBankers inside the digital health ecosystem because it really is a speed to being able to fit in easily to customers' operations is so important. And, you know, it's either you're going to be easy or you're going to be bigger. And then the third thing that we've been really focused on is just the war for talent is, I mean, a number one or number two issue with every digital health CEO I talk to. And every health system, life science, pharma company that I talk to around their digital teams. And, you know, I think clinical competency is an area where there's a real struggle. And frankly, a lot of M&A is, you know, not just buying a complementary asset. It's buying talent that you just can't find out there in the world. Product folks with a medical background do not grow on trees. And so that, I think, those Those 3 megatrends are ones that we're keeping our eye on, not just from a research perspective, but from a practical perspective when we're advising. I like to say we invest in the little guys and advise the big guys and try and help them meet in the middle. Those are things that we're really finding are not just talk. It's really resonant and happening now.

Yeah, that's super insightful. So I'm wondering, Tom, as you mentioned, part of your organization, part of Roche Health, also does a lot of advisory services. And obviously, the answer to this will be somewhat similar, especially on the war on talent. What are you finding the biggest pain points out there for some of the, maybe the health and life sciences sort of companies or health systems that you speak with? What are some of the, you know, maybe 1 or 2 pain points that they're dealing with aside from the war on talent?

Yeah, I think there are 2 things that, you know, all of the All of the individual engagements and projects that we work on fit into. One is, how do we, how do we make the choice and actually implement doing traditional things differently? So, you know, an example I would use is At a, at a macro level, how do companies turn innovation functions from push to pull? So we're doing a lot of work educating, for example, market access leaders on how do you, how do you get closer to the person Who's actually taking, you know, your drug. And there are digital capabilities that can get you closer to that end of the journey. How do you pull from the innovation team? How can I do— how can I get there? Rather than have it pushed on you and be a distraction from, this is how I know how to do what I do. That, that is a big strategic change.

Yeah.

The other set of changes that we work on is choosing to do different things. So, and those, Those are very different, um, uh, different choices to do, to do the same things differently versus doing something different. And that's, um, you know, an example of that is serving people as their own caregivers. So, you know, I think health systems in particular, um, you know, the, The focus of care has always been the hospital or the clinic, and and for for many organizations now the home. But the locus of care has always been a licensed medical professional. I don't see a way forward where health systems don't engage people in their own. self-care and see success. And so looking for not just the technology solutions, but the engagement capabilities of getting people to actually engage in their health on a day-to-day basis, that is, you know, a big challenge that that we are elbows deep in from day to day.

Yeah, that's super interesting to understand what the perspectives are and comparing them with— we talked first sort of on some of what we're seeing out there in the trends and with some of these disruptive-type companies, and then the on-the-ground sort of the health and life sciences organizations and what they're grappling with in and dealing with and all the interplay between all those. Let's shift over to the, you know, obviously the companies that you work with are obviously poised for disruption. There are some of these potentially disruptive companies that are going to be able to help with the things that we just spoke about. And so, one of the things I was really curious about is what are some of the common traits that these disruptive companies have? Because, you know, where I'm headed here is like, you know, trying to learn and audience trying to learn and thinking, oh, those are, those are some key traits and I should look at myself or my own organization and maybe we should adopt some of those traits. So that's sort of the heart of the question is, you know, what are some of the, again, commonalities that these successful disruptive companies have?

So I think I, I might, um, might just take a a company that I think is truly disruptive and talk about the traits that other companies like this one have.

Perfect.

And so a company that I think of as really disruptive is Truepill. And I think what makes them disruptive is in the pharmacy customer journey, they've identified where they're playing. And they're going to be really good at that. There's no confusion that Truepill is going to open bricks and mortar. It's not what they do.

Right.

So they, you know, everyone in the world knows what Truepill is good at. And so they're actually a disruptor that is embraced by incumbents. You know, I think, you know, when, when you're kind of intel inside for Optum. You've done a good job of disrupting the marketplace. Another thing about Truepill is that they're clinically competent, which is not to say that they are a provider, but they understand what job they have to do to help providers do their job and to do it legally, with respect to privacy, with respect to, with respect to how clinicians want to work with, with their patients and with pharmacies. And the last thing is that they create better choices For both people as consumers and companies who touch the prescription process. You could try and rebuild, you could try and back out how Truepill works, or you can just work with them. And people are choosing to work with them.

Yeah.

So they're an example that, you know, those 3 things, you know, being really focused on the consumer journey, being clinically competent, and making yourself a better choice than competing with you, that The folks who are going to be really successful disruptors will have those 3 characteristics.

Yeah, Tom, that's a great case study. Those are very 3 clear points that could be attributed or that you could take and try to attribute to your own organization if you want to be a disruptor. Love it. Look, we talked about so much in a very short period of time. We talked about leadership, then we talked just to set the foundation a little bit about Roche Health and what you do so we can understand. your perspective on digital trends. And then, you know, this final piece where we talked about, wow, what are the common traits of a disruptor and how we might apply them to ourselves or our own organization. Super, super rich. Tom, anything else that I may have missed in asking a question or anything that we wanted to double down on as we close?

You know, I think 2 things. One, when health system leaders and other kind of enterprise leaders in healthcare are thinking about, you know, these disruptors versus their own vendors, I don't think it's, I'm going to work with a disruptor or I'm going to work with, you know, a vendor I know. I think it's more, core, you know, what makes people choose me and context. How do I run my business?

Right.

Finance, operations, et cetera. Are you playing in— are you gonna be a partner for me that actually expands the way that I do my core business? I get more customers, or are you going to help me run my business more efficiently, effectively, reliably?

Yeah.

That's how to think about those relationships. And it's not immediately clear that a lot of the disruptors are thinking about how their customers differentiate between those 2 things. The only other thing I would say is a huge piece of what Rock Health is about is recognizing the fact that health equity, even in digital health, is a choice. And right now, we're not making very good choices. We look at lived experience And, and see it as a bias in some of the investment decisions that are being made. We actually need to see lived experience bias in the BIPOC community, in the LGBTQ+ community, and harness that in the ways that we're making product and the ways we're investing.

Yeah.

We're never going to make progress otherwise. And when we think about health equity, we need to think of trust in traditionally marginalized communities as a hard asset. There are, there are people in the community that have it. Traditional healthcare and tech companies don't. How do you partner with those trusted hard assets that are out there? Those are 2 pieces of making health equity, making the choice to do something about health equity or to just wave at it as important. And I don't, I wouldn't want to, miss out on that piece of what's really kind of at the heart of what we're trying to accomplish at Rockwell.

Yeah, Tom, that's an excellent way to end our time together. You know, that missional aspect is key for all of us to incorporate into the way we operate, the way we live. And so those are wise words. Now you can see, now my audience can understand why I gave Tom a promotion. Although, should have talked to Bill first. But Tom, thank you so much for, for being our guest. This has been fantastic.

Thank you for having me.

All right, that concludes another drop of Digital Voices. Look forward to chatting next time.

Hi, this is John Lynn from the Healthcare IT Today podcast. If you like the latest rumors, insights, and happenings in healthcare IT, You'll enjoy hearing my colleague, Colin Hung, and myself debate and share the latest happenings from the world of healthcare IT. Find the latest episodes or dig into our archive at healthcareittoday.com, or search for Healthcare IT Today on your favorite podcast application or YouTube. When it comes to healthcare technology, we love this stuff, and we can't wait to have you join in on the discussion of everything health IT. Thanks, Edward.

Thank you for listening to Digital Voices Podcast with Ed Marx. If you enjoyed this episode, subscribe on your preferred streaming service and leave a rating and review. And most importantly, thanks again for listening.