Investment Memo: Engaging Care
In late spring Futuristic invested in Engaging Care. Led by an experienced team, they’ve set out to solve one of the hardest problems in health: scaling a great healthcare experience. This investment is exciting for many reasons, but first and foremost it’s our first foray into the Swedish startup scene. We’ve now invested in Finland, Denmark and Sweden. Norway, are you next?
EC provides clinics and hospitals with a digital platform (communication & content), supplementing traditional methods of healthcare delivery with a highly scalable and patient-friendly digital component. The company’s mission is to improve the quality and patient experience of healthcare services delivery and build the foundation for the world’s first truly global healthcare platform. As always, I’m happy to co-invest with familiar faces such as Neil Murray, Hampus Jakobsson, and many more great investors.
My Conviction About the Team
Annica, Charlotta and Peter make for a great and holistic team. Annica’s meticulous focus on the patient experience coupled with Peter’s product design acumen ensures that the product will actually help solve problems for patients and clinics alike. Add to this a world-class CEO in the form of Charlotta, who previously scaled Min Doktor to become the largest digital healthcare provider in Sweden, and you have a team who can tackle the most difficult problems in the space.
The EC team has accomplished more in nine months than others have in several years. It’s extremely rare to find teams that can move at this pace in healthcare. Networks and unique insights into the industry have been driving their pace and we’re excited to help them speed things up with the latest round of funding.
The Market: Why Now?
Like education (outlined in my Peergrade memo), healthcare is one of those industries that has been slower than anticipated by most VCs to adopt technology at a large scale. This year’s technology expenditure is forecasted to rise by about 10% (source: Forrester Research), meaning that things are picking up. However, to a large extent, subdued growth arises from insufficient readiness of large institutions to integrate technology into their day-to-day operations. One industry expert told me that hospitals get proposals for new tech daily, yet have capabilities to implement 2–3 new initiatives per year. That’s tough odds.
Why do I believe that EC will succeed where others have failed? For starters, the value proposition for hospitals is easy to identify, as the EC platform evidently reduces the need for resources rather than increases the workload for healthcare providers. From my observations, this is where a lot of the reluctance comes from within the institutions. In a world where hospitals are increasingly getting crowded, we need technology that can help scale the experience of great health care — without relying on more real estate and staff to deliver that experience.
The counter-argument I’ve seen most frequently to this is that hospitals are getting incentivised to generate as much revenue (and bill for as many services) per patient as possible. While that is true for some markets (mainly US), you could argue that freed up capacity would allow hospitals to spend more time on patients in need of more urgent care. The questions is, does it become a net negative on the profitability of hospitals, thus disincentivizing them from using the platform, or are you helping them shift their value creation efforts towards patients that need better care? The outcome of this remains to be seen.
Why This Makes Sense for Futuristic.vc
The thesis for Futuristic is fairly simple. Nordic founders have outperformed every other geography in Europe by a mile when it comes to delivering venture returns. We want to find and work with the next generation of these exceptional founders before they’re discovered by bigger investors. This thesis explains our conviction in Engaging Care.
When you find a founder like Charlotta, you invest. Aside from her incredible track record within the industry as an executive, her vision and intensity are something that I immediately knew I wanted to invest in. Healthcare is a difficult space, with a variety of stakeholders, regulations and embedded legacy systems. Initially this vertical wasn’t part of our strategy. However, I’m increasingly learning to appreciate the premium to be gained from allowing space for serendipity. After all, as good old Mike Tyson said: “You have a plan until you get punched in the face”.
This piece was written by Christian Jantzen, founding partner of Futuristic.vc. You can follow my writings here or on twitter @chrjantzen.
Futuristic is an early-stage VC firm based in Copenhagen, investing all over the Nordics. We invest in beautiful minds building epic companies. You are welcome to reach out with comments or feedback at christian@futuristic.vc.
