This September, Atlanta Ventures hosted a powerhouse panel discussion with A.T. Gimbel of Atlanta Ventures, Sarath Degala of BIP Capital, Spence McClelland of Noro-Moseley Partners, and Philip Lewis of Fulcrum Equity Partners. We covered everything from how they got to where they are, common hurdles that startups face in healthcare, how entrepreneurs can prove ROI to investors, and tips when raising money for your HealthIT startup in Atlanta.
The morning kicked off with small group networking chats to talk about fundraising challenges before each panelist shared their background and respective firm focus. Collectively, the panelists agreed that it is critical to invest in healthcare (and healthcare software) because there is a massive opportunity for growth right now.
Trends for Investing in Healthcare
There’s been a tremendous amount of innovation in different areas within healthcare. When it comes to HealthIT and the software space, each investor shared a few opportunity areas they believe entrepreneurs should go after: Data Analytics, Predictive Analytics, Hospitals reducing readmissions, New payment mechanisms, Patient revenue lifecycle, and Social determinants of health.
“The data analytics space is really interesting. …What you can do with predictive analytics, taking genomic data, taking pathology data, taking different genetic markers, … and what you can start predicting around a certain type of treatment. That is a space that doctors and providers are clamoring towards.”— Sarath Degala
Tips on Where to Start in Healthcare
There’s no surprise here when we say entrepreneurs face great challenges when going into the healthcare space. Sarath shared the importance of customer discovery — talking to clinicians to see what challenges they face and working with them to solve those problems. Philip added the importance of focusing on the buyer and a big enough problem.
“Make sure you really understand who the ultimate buyer is. If you’re selling into a hospital system, make sure the problem you’re solving for is big enough to actually get sign-off on.”— Philip Lewis
Proving ROI in Healthcare
When selling any product, proving the ROI is mission critical to close that deal, and oftentimes, it’s difficult to sell with a soft ROI.
“The ones that are most successful are the ones that figure out pretty early on, the ROI and can very clearly articulate that. … When you find partners who invest or you give free trials to, it’s about good ol’ fashion upfront requests, ‘We want your help measuring this. Here’s what we’re going to measure.'”— Spence McClelland
Tips Before Speaking to a Potential Investor
Each panelist shared what they recommend when entrepreneurs go out to raise money.
“Prepare! Don’t think you know everything, though. … Try to keep an open mind. Really go into it with a humble mentality.”— Philip Lewis
“I love early on seeing that people are using [your product] and they like it. It’s that initial check that you haven’t just built something that addresses a big problem and has a big market, but the dogs are eating the dog food.”— Spence McClelland
