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Investor Guide to HDO Product Market Fit for Digital Health / SaMD / Digital Therapeutics Solutions

Shahid N. Shah
September 24, 2022

Investor Guide to HDO Product Market Fit for Digital Health / SaMD / Digital Therapeutics Solutions

Delivered at MedInvest 2022, Shahid talks about how investors and innovators should think about Healthcare Delivery Organization (HDO) product/market fit for Digital Health / SaMD / Digital Therapeutics software solutions.

Investors must determine whether innovators understand the healthcare delivery innovation lifecycle and payer, benefiter, user (PBU) intersectionality and whether a solution can survive an HDO’s innovation purchase lifecycle.

Shahid N. Shah

September 24, 2022
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  1. NoBS Investor and Innovator Guide to HDO1 Product Market Fit

    for Digital Health / SaMD / Digital Therapeutics BLUF2: Investors must determine whether innovators understand the healthcare delivery innovation lifecycle and payer, benefiter, user (PBU) intersectionality. Can the solution survive an HDO’s innovation purchase lifecycle? 1 Healthcare Delivery Organization 2 Bottom Line Up Front @ShahidNShah Publisher, www.Medigy.com
  2. Payer, benefiter, user (PBU) sweet spot determines product/market fit Payer

    • Who’s writing the check for the solution? User • Who’s actually using the solution day-to- day? Benefiter • Who’s benefiting from the use of the solution? Some rules of thumb: • If you know the payer (through actual 1st party research, not conjecture) but not the user or benefiter, NewCo is worth starting – with appropriate investment, designers and BD professionals can help figure out the rest. • If you know the user but not the benefiter or cannot figure out the payer, don’t invest in code but consider “working backwards” style PR/FAQs and find out who will benefit the most and who might be willing to write the checks for that benefit. Ready for scale, larger investment(s) should be considered
  3. “prove” sellability early Draft Press Release Should we build it?

    Prepare Roadmap Who’s going to be accountable for success? Build it ▪ In the modern software era, there’s very little that cannot be built. ▪ Assume, if you can describe it … someone can build it (who actually builds something is irrelevant). ▪ Assume, if it’s built right now and sitting on the shelf, how will you get users to use it and buyers to buy it (PBU intersection)?
  4. How can investors spot “innovator BS”? The innovator can describe

    the outcome of their novelty without talking about the technology If an innovator talks more about their tech or their product rather than the product’s outcomes or sellability tell them to rewrite their pitch
  5. For example, how can investors spot “AI BS”? Can the

    innovator describe the outcome of their novelty without saying “ML” or “AI”?
  6. Why? AI is not a product you can buy, it’s

    an experimentation technique which allows for rapidly poking and prodding at huge volumes of previously untapped data to discover facts and relationships about the complexity of our world. Rather than poking and prodding at genes, cells or molecules to see how they interact in labs, “data scientists” use ML and AI to more rapidly discover relationships that would be difficult for humans to “see”.
  7. How to Spot “AI BS” An entrepreneur that says, "we

    use AI for drug discovery” is just as silly as one who says, “we experiment with molecules for drug discovery.” It does not mean anything. If someone said “you should invest in my company because we know how to culture bacteria" you'd look at them like they were delusional. The same should be done with entrepreneurs who use “AI” and “ML” as if they are the ends, rather than the means to the ends.
  8. How can investors spot “innovator BS”? The innovator can describe

    the outcome of their novelty without talking about the technology – they talk about the ends, not the means. Why? Because HDOs have an innovation lifecycle which doesn’t match an innovators’ innovation lifecyle.
  9. HDO Innovation Lifecycle (consensus at each step) Expectations Discovery Evaluation

    Consensus Building Pilots Decision Support Adoption Diffusion Insights Failures Return on Innovation
  10. Quick and dirty stage gates for seed investors “Working Backwards”

    PR/FAQ Success Metrics & Buyer Consensus Building Strategy Workbook
  11. Success Metrics Strategy Workbook

  12. PBU intersectionality must meet HDO Innovation Lifecycle Payer • Who’s

    writing the check for the solution? User • Who’s actually using the solution day-to- day? Benefiter • Who’s benefiting from the use of the solution? • Innovators have their own innovation lifecycle (e.g., SDLC) • In a software era where anything can be built, an innovator’s lifecycle is useless if it’s not tied to the HDO’s innovation and procurement lifecycle. • Your job as an investor is to figure out whether the entrepreneurs, you’re investing in understand that. Did one or more of the PBU intersection tie properly to each HDO innovation lifecycle step?
  13. HDO Innovation Lifecycle Ontology (HDO-ILO) https://www.medigy.com/research-ontology/hdo-il-ontology/ https://www.medigy.com/communities/innovation-lifecycle/

  14. Conclusion: Investors must determine whether innovators understand the healthcare delivery

    innovation lifecycle and payer, benefiter, user (PBU) intersectionality. Any solution that cannot survive an HDO’s innovation purchase lifecycle is not worth investing in… yet.
  15. Thank You. Help us build the HDO-ILO at www.Medigy.com Find

    this and many other of my decks at http://www.SpeakerDeck.com/shah NoBS Investor and Innovator Guide to HDO1 Product Market Fit for Digital Health / SaMD / Digital Therapeutics @ShahidNShah shahid@shah.org