Don’t fake it till you make it

Aline Noizet knows the digital health scene inside out. In an interview, she reveals the biggest mistakes repeated by startups and how to scale the business to succeed.

Aline, imagine that it’s around 1439 and Johannes Gutenberg comes to you and asks about your advice on his startup. He wants to build a printing machine, but he has no money, and it seems like some stakeholders – including monks – won’t be happy to lose a monopoly for writing books. What would you suggest to him?

Don’t give up! If you believe in your idea, be bold, resilient and smart. Explain to the stakeholders how this new technology you want to build can benefit them and how it will make their life better. Education is key. Find some partners who believe in your idea, are well connected and are ready to support you to take your plan further. But protect your idea somehow. Craft some numbers: define the benefits for each stakeholder – qualitative and quantitative – and put a dollar sign on them, that will help you attract money.

The church being afraid of losing a monopoly for writing books is analogous to AI today. We always talk about AI replacing doctors, but we communicate less about the fact that AI empowers doctors by supporting them in the decision-making process, freeing their time and the fact that AI created new jobs that didn’t exist before like data analysts. It’s a mindset change that takes time.

Five hundred sixty-five years later comes to you Elizabeth Holmes from Theranos and also needs help in developing her great idea. Would you believe in her innovation? Why did so many people trust her?

Would I believe in her innovation? I’m not a scientist so I wouldn’t be able to assess the technology itself, but I certainly wanted to believe in it. I remember being in San Francisco in 2014 and seeing the big billboards across the city, promoting Theranos and its promises for the patients and consumers. It was very much

in line with the innovation wave of the time of doing more with less and improving the patient experience.

Why did so many people believe her? She positioned herself as the next Steve Jobs, the man who created the revolutionary iPhone. She would be the one revolutionising blood analysis.Then, it’s all about who you know. Being a daughter/son of and being part of certain circles, opens many doors. Many of the investors who put money in Theranos were people she had connections with through her family mainly, with little or limited knowledge about science, relying on what she was saying but without being able to verify the accuracy. She showed people what they wanted to see, like when she was faking demos to pharma companies. It’s the perfect example of the “fake it till you make it” attitude. But the “make it” never happened, and according to people who have some knowledge in the field, it is physically impossible to do so many sophisticated tests with so little blood. I recommend reading the book “Bad Blood” by John Carreyrou and watching the documentary about the Theranos story. It’s very insightful.

You are familiar with the digital health startups scene. There is a lot of enthusiasm, but most of the ideas fail. What are the biggest mistakes of the innovators?

Let me mention the most important ones:

Technology/market fit. A lot of people have great technologies and are trying to push them on the market or find a problem on the market that they can solve with their technologies. But there is not always a market fit for their specific solutions, and the motivation is different than someone who is starting from a concrete problem and is trying to solve it and have an impact on people’s lives.

Knowledge of the market. Some entrepreneurs identify a problem on the market but don’t have a good enough understanding of the problem itself. They don’t involve the end-users in the development, resulting in low usage of the solution because it is not what the market is looking for. Validating an idea, talking to the market and involving users in the development phase are essential.

Money management. Many entrepreneurs struggle to manage the money raised and run out of cash, burning it too fast or not spending it wisely. It’s crucial to have a clear roadmap and to work on getting traction. The more traction you have, the more you will convince investors to put money or to follow on their initial investment.

Team. Struggle within the founding team, or an unbalanced team will lead to trouble. To have cohesion within the founding team and a shared vision for the future of the company is key to succeed. Choose your work, wife/husband very wisely. It’s also essential to balance the founding team and be complementary.

With a lot of regulations and a very conservative culture, healthcare seems to be a minefield for those who want to bring a change, revolutionise medicine. Are legislations and reimbursement systems the most significant barriers?

No, I don’t think they are. Things have been moving slowly but surely those past years on this front: FDA has been pretty proactive in the US, clearing innovative solutions, like the first autonomous AI solution (IDX) or digital therapeutics solutions like Reset or Oleena. Europe will have the Medical Device Regulation coming into action in 2020 with more precise rules to follow. Yes, it’s tricky, but those rules are made to ensure patients’ security. Lives are at stake, so it matters. Insurance companies are also moving slowly into the digital health space with more and more companies including digital solutions and services into their package. A classification is missing when it comes to reimbursement of digital solutions, but insurers are finding ways to overcome it internally, like using marketing budget.

I think that the most significant barrier is adoption. End users, mainly patients and healthcare professionals, need to be educated to understand the benefits of those innovative solutions and how they work. Fear of the unknown is widespread: often healthcare professionals see digital solutions as a threat to their job or legacy while the reality is different. Funny enough, the more reluctant is not always the one we think. We see many older professionals adopting new technologies while young ones stay away from them. Innovative technologies won’t replace healthcare professionals; they will leave behind those who don’t adopt them.

As you say, we are so used to things the way they are that we can’t imagine an app replacing a drug, for instance. That’s where education and medical validation involving the right actors are needed. User experience is also essential to ensure that the user will be engaged and keep using the app.

You describe yourself as a „digital health connector.” How important is it to make the right connections, meet the right people at the right time to „sell” the idea on the market? Is technology itself the same important as networking?

Having a strong network is critical. I believe more in building long-lasting, genuine relationships rather than meeting the right person at the right time. If you have an established network, selling your idea to the market will be easier as you can tap into your direct network or ask to be introduced through a connection. Trust is key in any relationship, but trust comes with time. It’s easier to ask for help or discuss the commercial relationship with someone you know and trust already and who knows you and your project/idea. When it comes to fundraising, for instance, it’s better to start talking to investors when you are not looking for money yet – you get to know each other, build a relationship, and when the time comes, you know each other already. If there is a fit, the investment will happen naturally and pretty fast.

Is technology as important as networking? This is going back to your question about Theranos. Connections are everything; it’s who you know! Theranos technology was not working, but Elisabeth had connections, that’s how she made it, and Theranos became a unicorn.

Networking can also help your technology and solution. The more people you meet, the more feedback you get on the market’s need and on your solution itself. The ideal scenario is a mix of the two: to have a reliable technology/product and a vast network to push it to the market.

Could you please give five most essential hints on how to become an effective connector in digital health?

Here we go: • Listen! It’s not about you; it’s about them. You need to understand well what people do or are looking for to make the right connections happen.

Listening requires empathy. • Be curious! Read, go to conferences and meetups, investigate trends and players. The more you learn and the

more people you get to know, the better you will be as a connector. Be genuine! Connect people because you care, not because you want something in return. Life will pay you back at some point when you less expect it! Be selective! Don’t connect just anyone. Recommending or linking the wrong person can shed a bad light on you and affect your credibility. Do your homework! When connecting people, explain each party why you think they should be talking and where you see potential synergies, as it may not be noticeable for them and you may see things that they don’t. Not doing so can be a waste of time for both parties.

Is there a startup that inspired you most recently?

Kaia! They are a multimodal digital therapeutics (DTx) for back pain and other chronic conditions combining physical, psychological and educational elements. They are one of the pioneers in the field in Europe, ticking all the boxes that make an app a DTx. Not only are they an excellent example for others to follow their path in Europe and learn from them, but they are also available and open to help others and share their lesson learnt.

Kaia listens and adapts the conclusions very well into the philosophy of the company. They have involved the users a lot along the way to make sure the solution fits the market’s needs, continually improving their product. They recently integrated motion sensors to correct users while they do the physical exercises for back pain.

»We see many older professionals adopting new technologies while young ones stay away from them.«

I believe the team itself has a lot to do in the success of the company. I was talking about that with Konstantin the CEO, and he was saying that they are investing a lot in the people, empowering them as much as possible. This is something that they learnt from their previous startup, Foodora, that they successfully sold, before starting the Kaia adventure with the same cofounders. I believe this is the key to success. Your people are your best assets, treat them with respect. Without your team, you are nobody.

Patients can choose among thousands of fitness apps, some trends like digital therapeutics or mental health draw the startup’s scene attention. Are there fields in digital health where the competition is already too big and the niches with great potential?

The healthcare landscape is enormous; there is always space for new solutions to come in. If we look at Europe, each healthcare system is different, which means multiple markets to target. You need to shuffle things around sometimes and look further. Your solution may have a lot of competition in your market but have potential in other markets.

There are fields like online medical appointment booking system which are becoming a bit crowded, with leading players like Doctolib in France – which recently became a unicorn – or DocPlanner, present in 15 countries in Europe and Latin America. It makes it more challenging to enter the markets where those big players have a monopoly. Other busy fields are telemedicine, skin cancer app detection or period trackers for instance.

We are moving towards a more regulated scene, differentiating between fitness apps and medical grades apps, clinically validated. The competition decreases a lot when regulation is involved. Although the regulation process is tedious and time-consuming, market access is easier, and it also increases the price point of the solution.

As you mentioned, Digital Therapeutics (DTx) is an exciting and promising field and very hot at the moment. It has the potential to disrupt healthcare by offering effective digital treatments available anywhere, anytime. DTx is targeting niche markets like diseases with no or little cure like IBS, multiple sclerosis, etc. They also have the potential to address different comorbidities at the same time in a unique solution. Mental health is one of the critical fields targeted by DTx, using Cognitive Behaviour Therapies: Patients can access the treatment from the comfort of their home, without having to travel, they can remain anonymous if they want to, and the cost decreases. Mental health is a big issue worldwide, and thanks to solutions like telemedicine or DTx, more people are getting access to treatments, and the outcomes have been very positive.

One of the other targets of the DTx solutions has been to reduce the amount of drug consumed. Used with pain management, for instance, it speeds up the recovery period and reduces the hospital stay. DTx, the little sister of digital health, is a field to look at with promising opportunities.

What big tech companies could learn from startups, and what startups should learn from big tech companies?

Big tech companies can learn to be more agile, speeding up the decision-making process and reducing validation layers. Working with startups can also help them to think out of the box and explore new opportunities for their business, either different business model or new/complementary lines of products. Startups have an education role to help big companies keep up to date with the latest trends on the market and how it can be applied to their businesses. Startups, on the other hand, should learn some processes and structure framework from big tech companies but keeping it light. They can also learn how to scale successfully, learning from the mistakes or experience of the big companies. 