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.

Transcript

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
   

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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
   

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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)?
   

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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
   

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5. For
   example,
   how can
   investors
   spot “AI
   BS”?
   Can the innovator
   describe the
   outcome of their
   novelty without
   saying “ML” or
   “AI”?
   

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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”.
   

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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.
   

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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.
   

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9. HDO Innovation Lifecycle (consensus at each step)
   Expectations Discovery Evaluation
   Consensus
   Building
   Pilots
   Decision
   Support
   Adoption
   Diffusion
   Insights Failures
   Return on
   Innovation
   

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10. Quick and dirty stage gates for seed investors
    “Working Backwards” PR/FAQ
    Success Metrics & Buyer Consensus Building
    Strategy Workbook
    

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11. Success Metrics Strategy Workbook
    

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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?
    

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13. HDO Innovation Lifecycle Ontology (HDO-ILO)
    https://www.medigy.com/research-ontology/hdo-il-ontology/ https://www.medigy.com/communities/innovation-lifecycle/
    

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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.
    

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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
    

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