by Emily Melton, DFJ Partner
DFJ is thrilled to announce that we are participating in Livongo’s Series B. After a number of years researching the chronic care market, diabetes in particular, it wasn’t until I met Livongo’s CEO Glen Tullman when I understood that a platform predicated upon improving the EXPERIENCE of the CONSUMER who has a chronic disease is essential. There are a number of compelling companies in this space, some with impressive revenue growth, but the offerings are entirely focused on PATIENTS with chronic diseases. And the two are very different.
Glen’s approach taps into the benefits we expect from the consumer experience revolution made possible by the ubiquity of mobile devices and data-driven personalization. Amazon has changed the way we shop; Uber changed the way we think about transportation; Facebook has changed the way we keep in touch with family and friends. Technology has had a profound impact on the quality of our lives and I believe that the principles that created success in other categories can provide templates for creating better experiences in healthcare.
A PATIENT is defined as someone who “receives medical care” or a person who “is acted upon.” It is a passive role. A CONSUMER on the other hand is “a person who buys products or services.” It is an active role — being a consumer is about choice. Livongo focuses on the consumer’s point of view and optimizes their experience:
- Price: Unlike other monitors that make a margin on expensive test strips, increasing the overall cost to consumers, Livongo keeps track of strips used and sends new strips when they are about to run out, for free.
- Convenience: In addition to providing strips, Livongo’s service platform keeps track of a consumer’s data, and if ever needed, a virtual care team is available 24/7 with up-to-date information to offer an optimized personal experience.
- Feedback: A “number” is only one piece of the puzzle. Livongo is the only solution in the diabetes market with a two-way communication device that asks the consumer to provide context around the numbers, improving the data collected, but also providing feedback that further increases engagement.
- Community: We are social creatures and in most instances there are people in our lives who want to participate in our treatment. Livongo’s platform allows you to share readings with others. Now the parents of a teenage diabetic can stop nagging their child about their readings or the adult child with a diabetic parent can have peace of mind if they don’t live nearby.
While we were compelled by the consumer centric vision and experience of Livongo, we also appreciate that in healthcare, consumers alone are not sufficient for success. The statistics around chronic disease are daunting. Heart disease, obesity, arthritis and diabetes are among the most common and costly health problems. It is estimated that almost half of all adults in the US have one or more chronic disease, and it is taking a toll on the overall medical spend in our country; individuals with chronic diseases account for 81% of all hospital admissions; 91% of all prescriptions filled and 76% of all physician visits. Economic stakeholders include self-insured employers, PBMs, ACOs and health plans, all of whom are increasingly incentivized to promote solutions in chronic care that reduce costs. Livongo’s solution not only improves the lives of those living with chronic disease, but also increases compliance of medication, data and knowledge while limiting the expense. It is the definition of a win–win.
At DFJ we look to invest in products serving huge markets ripe for disruption, yet fundamentally we invest in people. We look for entrepreneurs whose passion is irrefutable and project an insatiable desire to change the status quo. Glen Tullman and the executive team at Livongo embody this transcendent drive toward change. And it’s personal for Glen, and many members of Livongo’s team. They have family members living with diabetes, and Livongo was built with their experiences in mind. The Livongo team is not thinking of a “patient with a disease,” but addressing the question of how can we deliver the best solution to help my son, mother or friend to improve their quality of life? Livongo is uniquely positioned to answer those questions.
