There’s been a lot of talk about digital transformation since the pandemic forced the world to alter life and business. While most recognize the “new normal” of working from home and ordering more products online, there are deeper shifts affecting all areas of life.
Healthcare was at the forefront of the pandemic as scientists and researchers accelerated a vaccine. Health technology is continuing to forge ahead in new and unprecedented ways, years after the outbreak of COVID-19.
Improving Care through Innovative Ideas
You’ve heard that necessity is the mother of invention, and this was proven true during the pandemic. As every industry has pivoted to meet the evolving needs of our connected society, we’ve seen a surge in health tech that addresses gaps, solves problems, and strives to offer a higher quality of care for patients. At Cortado, we’ve seen two major healthcare innovation trends: 1) the rapid development of health tech, and 2) innovative healthcare business models that are serving patients and providers in new ways.
Since its inception 20 years ago, Teladoc is a technology company that has been at the forefront of connected healthcare. Providing 24/7 access to healthcare and non-emergency treatments changed the way people viewed doctor’s visits. In the new unknown arena of remote care, Teladoc faced many early challenges to their novel ways of caring for patients. Compliance and licensure were questioned, yet telehealth remains popular in spite of those early setbacks. This novel idea was one of the first to pave the way for the growth of digital and technological innovation in the healthcare sector.
Technology has vastly impacted the way patients receive care and has changed the way medicine is practiced. Here in the Midcontinent, we’re seeing breakthroughs in the quality and type of care patients now have access to, thanks to the innovative ideas of entrepreneurs with a desire to address gaps in the healthcare space.
Co-founded by Michael Gorton of Teladoc, Recuro Health strives to create a Digital Medical Home™️ for patients. Offering a suite of services from primary care, urgent care, mental health, and chronic care management, Recuro is leveraging health data to improve health outcomes with products, tools, analytics, and services that touch patients along their health journeys, and ultimately reduce the need for acute, episodic care. This type of care is especially helpful for patients managing chronic conditions like diabetes, where half the cost of annual treatments are a result of an emergency room visit. This technology reduces costs and improves overall health with proactive tracking and care, which positively impacts the daily life of patients.
nSight is another company in the Cortado portfolio serving surgical teams, hospitals, and patients alike. This software platform tracks instruments in the operating room and creates efficiency, increases safety, and reduces lost inventory. Like many of our other investments, nSight is a company with improved outcomes for all.
Business Model Shifts
Beyond implementation of technology across the healthcare system, we’re seeing a new batch of healthcare entrepreneurs who are finding innovative ways to better serve patients through unique business models.
Disparities in fertility care continue to be an issue for the 30% of the population that experience fertility issues, with only about 2% of the population receiving care. Fertility treatments have traditionally been prohibitively expensive, and more fertility clinics are closing while the need continues to grow. Mate Fertility (ma+e) is changing the landscape of fertility care, making treatments more accessible and affordable than ever by pioneering the first ever tele-fertility™️ business model. This new approach is capable of addressing the shortage of treatments and offering services that cost up to 40% less than other providers, making fertility treatments more accessible to those who need them.
Lumata Health is another great example of business model innovation in the healthcare space. Lumata removes barriers in ophthalmology treatment by providing virtual care management for people with degenerative eye diseases (like macular degeneration). With Lumata, patients receive consistent, quality care and attention between in-person appointments with their ophthalmologist. This continuity of care can improve health outcomes, improve attendance at doctor appointments, and better track changes in a patient’s eye health. Lumata enhances the quality of care and life for patients while also providing valuable data to providers of changes in patient condition over time.
The Role of VC & Entrepreneurship in Healthcare
Healthcare makes up approximately 20% of GDP spending in the United States. It’s a foundation needed for everyone, and the complexities of care make healthcare a ripe institution for innovation.
Venture capital plays a crucial role in the growth of health technologies in its willingness to take financial risks to improve lives and continue the advancement of innovation in the healthcare sector. As a result of technological developments and changes in consumer behavior, health care technologies continue to innovate and evolve.
Coastal VC funds tend to overlook novel healthcare institutions here in the Midcontinent, creating an open market for Cortado to invest in early stages of new ideas. Legacy industries in the Midcontinent have deep roots and expertise in healthcare, science, and biotech. With skilled entrepreneurs who have a desire to improve the human condition, it’s an exciting time to invest, knowing that our work can positively impact the lives of people worldwide.
We have a strong network of healthcare leaders and partners, including the Presbyterian Hospital Foundation, which invests in the development of new healthcare advancements. The Oklahoma Medical Research Foundation remains on the cutting edge of research across numerous health sectors. The U.S. EDA’s recent Build Back Better Regional Challenge has brought $35M to Oklahoma City’s Oklahoma Biotech Innovation Cluster, which will support Oklahoma Biotech Startup Programs, directed by the University of Oklahoma’s Tom Love Innovation Hub and co-located with us at The Verge OKC entrepreneurship hub.
When we see an opportunity to vastly improve current systems of care or innovate business models, we take notice. Our founder-centric stance is focused around the goal of helping entrepreneurs become as impactful as possible. With aligned interests from Cortado, founders, innovators, and care providers and patients, we see a bright future for the healthcare industry.
The Future of Health Tech
The growth of health technology has been accelerated by the COVID-19 pandemic, and Cortado has continued to invest in healthcare startups. We recognize the significant growth potential of the industry and the positive impact of improved care and outcomes. And we expect the healthcare industry to continue to grow and evolve in the coming years, with venture capital playing an important role.
The future of health tech and healthcare lies in collaborative efforts of providers, insurance companies, venture capital firms, university health systems, foundations, incubators and bold entrepreneurs. Cortado Ventures is proud to play a small role in advancing healthcare innovation.
Special thanks to Cortado team members Deborah Moorad, Mike Moradi, Nathaniel Harding, and J.D. Baker for their ideas and contributions to this blog post.
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At Cortado Ventures, we invest in pre-seed and seed stage startups with a focus on energy, logistics, life sciences, and the future of work. If you are a Midcontinent startup or looking to invest in these startups, Contact Us to learn more.