Episode 29: Advice for nurse-entrepreneurs from a healthcare investor
Episode 29: Advice for nurse-entrepreneurs from a healthcare investor
Listen on your favorite appEpisode 29: Advice for nurse-entrepreneurs from a healthcare investor
Dan:
Cyril, welcome to the show.
Cyril:
Yeah, glad to be on, Dan. And thanks for having me be a part of this podcast here.
Dan:
Yeah, super excited to get your take on what's going on. We talked to a lot of people in the operations space, and it's always good to get a perspective from people involved in the health care systems from a different angle. Can you tell the listeners a little bit about your background and what got you into Providence Ventures?
Cyril:
So, I come from a traditional finance background. After school went into investment banking, then went into private equity. But around six years ago, I found my dream job here at the Providence Ventures. And so Providence Ventures is a venture fund for Providence St Joseph health. When I joined the fund, it had just been launched and joining essentially a startup venture fund was definitely an unique experience and gave me the chance to really help essentially define some of the early strategy of the fund, as well as get exposure of working inside of a health system. It's been a great experience just helping deploy our funds and invest in companies, and at the same time being a venture investor and just meeting all of these great entrepreneurs throughout the years that have some of the most brilliant ideas out there, trying to solve a space that at sometimes seems almost insurmountable with the amount of problems that are out there in healthcare.
Cyril:
But just being in this realm has been a great experience, and I've been with Providence Ventures for about five years, or for about six years now, and I've had probably 500 or so pitch meetings throughout that time period. And every one of them has been great, even if I haven't made an investment, which is probably the majority of those, but it's just been great to be there and out there in the market.
Dan:
I spent some time with the Kaiser Permanente venture team, and I always found that the time I spent with them so fascinating and the pitch meetings and how they selected through what was worth more due diligence and what you could tell right away was just not something to go for. It seemed like each one of the investors had a pocket, whether it was devices or med tech or whatever. Do you have a specialty that you focus in on or do you run the gambit from all those different types of investments?
Cyril:
I technically run the gambit, but from a personal level, what I'm interested in most is essentially those companies that are solving those perceived, or trying to solve those perceived, unsolvable problems within healthcare. Specifically those that are non-patient facing. I think when you start digging into the realm of healthcare startups, I mean, there's a ton of companies that are out there, either marketing directly to consumers, that are really successful, or helping health systems connect with consumers.
Cyril:
Those are some great companies, but at the same time, there's a whole realm of companies that are trying to solve those really hard problems. Specifically, those that are related to operations, like those related to nursing, those related to HR, supply chain, all of these different areas that I find fascinating. And when you start digging into the healthcare industry overall, you start to realize it's not as proficient as other industries. And so there's a lot of room for innovation, as well. Those are the areas that I'm really interested in, and I'm happy to delve into any of those that in particular I'm interested in, but I'd say that's a broad brush stroke there, Dan. But that's kind of how I look at it.
Dan:
Those Parts of the system that you mentioned are usually the most inefficient and legacy system in most healthcare, I think. Even at large health systems that are seen as very innovative are still running on time systems that are on DOS or supply chain management that is built in the 80s. Even email systems, like we were on, at Kaiser, were on Lotus Notes until recently. And those are the core systems of how people communicate and get things done, that are just a backend to all the nursing and physician and care team work. I'd be curious where you're seeing the most innovation or disruption from your pitch meetings. What are those areas that are really trying to be disrupted at this point?
Cyril:
I'd say one of the areas that I've been trying to dig into for a long time, and I'm seeing a bunch of companies pop up in, is trying to address one of those perceived unsolvable problems I mentioned, which is high turnover and burnout for nurse labor forces. And so as you well know, nursing is a pretty stressful job and I think at its heart, attrition is going to happen. I think the problem is that there's too much of it and there's different approaches that different organizations are looking at. And so I'm seeing a lot of innovation in that realm, where there are companies that are addressing it from two different angles. One is from addressing the underlying issues that plague burnout and high turnover rates. So, one example would be the companies that are trying to help nurses get education opportunities. A lot of times for nurses that we've seen, they just may be tire with their current role and the limitations, but they don't have an avenue to learn new skills and to get that mentorship and to get that support.
Cyril:
And that's an underlying problem as to turnover, because if you're not satisfied with your current role and you don't have any avenues to move other than just leaving and trying someplace else, you end up getting stuck. And so there's a lot of companies that have been focused on either direct mentorship type opportunities, connecting young nurses with more experienced nurses, cross connections. So, connecting nurses with other types of nurses, whether it's if you work in the ICU, connecting you with a home health nurse or vice versa, and just getting that exposure. And then I think there's other areas that, I guess, going back to the two areas to take a look at from a fighting nurse turnover. The second area is addressing the problem head on. And so there are a lot of companies that are finding innovative ways to ensure that when we hire a caregiver, which is what Providence calls our employees, then when we hire a caregiver, that we hire them to a role that they're best suited for and what will be the best fit for them from a background perspective.
Cyril:
And so I think when you can hire the right people for the right role, then you end up reducing retention overall, just through that effort alone. And similarly companies have been trying to evolve the external staffing model to be more efficient, because external staffing is critical to the success of any healthcare organization, because we will never have enough nurses on hand unless the supply for nurses increases dramatically. And so a lot of the companies out there that are trying to innovate in that realm and enabling health systems to utilize external resources more effectively and in a cost-effective manner are really exciting. And so there's a lot of innovation in that area, in particular, that I'm really interested in and I've been digging into for, I'd say, about a couple of years now.
Dan:
You mentioned one that's definitely top of mind for us, which is that contingent labor and extra labor standpoint. I'm new to that space as well, and just the inefficiencies of the system now is just mind boggling and the amount of manual work. And so there's a ton of opportunity there for innovation, for sure. We came up with a slogan about a year ago, we were telling healthcare leaders you'll never, ever, ever be fully staffed ever again. Not only is the workforce not looking for 30 years and a pension, but you're inefficient if you have full-time employees for every position you have because of the flux of the demand cycle related to patient care. So, yeah, there's definitely a need for more flexible workforce, for sure. That's a theme we've been really diving into.
Cyril:
And one thing I'll add to that is in addition to the external side of it and that, I think in general health systems and health care overall hasn't found a good way to manage our existing labor resources effectively. And that in turn results in sometimes an over-reliance on external staffing, which is ends up being a negative for all parties involved.
Cyril:
And so I think if you could find, and I've been looking around for solutions that can do this, if you can find a solution that can essentially capture all of the skills that a nurse has and have it in some sort of central repository, so that you don't necessarily need to keep staffing the same nurse who knows how to do a certain type of procedure on every shift and burn her out. You end up having a really successful way to manage your existing workforce, and then when you bring in an external resource, it becomes so much more beneficial and a better experience versus being, "Oh, we have to bring in somebody from outside because X nurse is burnt out or whatnot." It becomes, "Well, we're bringing them in to help support our nurses and help support our care for our patients."
Dan:
I agree. And I think there's definitely a technology play here, and there's also the system play. Like we've set up our hospitals with these arbitrary service lines and things that all go back to billing, but the skill sets of the practitioners kind of move across those arbitrary service lines. But we still hired nurses into medical surgical units or the operating room or whatever, and we've only used them in that one linear capacity rather than, like you said, matching skill sets and competency to the actual needs of the patient across the system even, and actually more dynamically link those practitioners and their skills to the needs of patients outside of the traditional budgeting and service line concept. So, yeah, I would love to see more innovation there.
Cyril:
And one thing I'll just add to that point that you made Dan, which is a really good point, is just the lack of interconnectivity between the different business lines within both healthcare systems and just health systems overall. Meaning, if you look at nurses like within Providence and within larger health systems, we have home health nurses, we have acute care nurses, we have post-acute care nurses, and we never really tried to bridge all those groups together and understand that they're all nurses and they all have their skills. And one of the results of COVID was that we started to take stock that all of these nurses in these different settings could have valuable skills that can be utilized during the surge period. And I think that opened up our eyes with respect to realizing that our workforce is great, our nurses are great, and there's a lot of hidden value that we've not taken advantage of. I think that's going to change in the future.
Dan:
Yeah, there's definitely leadership and mindset changes that need to happen with all of this. So, that's one area where you want to see, or we both want to see, entrepreneurship and innovation take over some of these inefficiencies in matching skillsets with nurses and patients and that kind of thing. Where is another focus area for you, where else would you like to see some more disruption?
Cyril:
Yeah. And so another one of these, my perceived unsolvable problems, is essentially the documentation problem. Ever since I joined Providence, the number one problem I hear when I talk to clinicians or nurses or anybody within Providence, is just the burden that our frontline caregivers and our clinicians face with respect to documenting information into the EHR, into whatever record that needs to be placed.
Cyril:
And what I've seen happen over the last probably three years or so is just an influx of new AI, ML type solutions that have tried to address this problem through making that a little bit more automated and being it so that our nurses don't need to spend so much time at a computer terminal, or doctors don't need to sit in front of a patient with a laptop in front of them. They could sit back and enjoy their time with the patient and address patient directly. There's a lot of innovation in that realm that we're seeing. I think in my mind, that market is still a little bit far away in terms of having that final solution, with respect to addressing that problem completely head on, but we're moving in the right direction. And just to see kind of the new technologies that are out there, that are coming out in the market. Also there's just adoption by our clinicians because they're starved for solutions like that, and so that's another area I'd highlight, in particular.
Dan:
I've been to HIMS the last few years and it's interesting to watch like the booths and the trends. I think four or five years ago, it seemed like every other vendor was a computer on wheels, workstation that you could kind of port around, with the infection control keyboards and all that kind of stuff. And then the last couple of years, it seems like more and more companies are coming out with some sort of layer on top of the electronic medical record in order to solve some sort of documentation process, whether it's voice to text or it's some intuitive AI piece, or it's layers on top that aggregate data, so you don't have to hunt and peck for everything. There's definitely a need to fix things both on the provider side of documentation, but then on the patient side to visibility into that information so that they can manage their own health. Have you seen any rock stars pop out there? I mean, you don't have to name companies specifically, but are there any solutions in general that you're seeing that might be promising?
Cyril:
I won't name companies in particular, but in my mind that the companies that can make it so that the workflow for the physician or for the nurse is minimally impacted, meaning just having a device in the corner of an office or having it automatically fill in fields based on data, just without having to initiate it, are the ones that in my mind are the most successful. I think there are different approaches where sometimes it's a little bit more intrusive to the provider and it ends up not solving the problem, it just becomes another burden. And so those companies that are able to have it be just in the background or have it just handle everything on its own are the ones that will be successful in the long run.
Dan:
Yeah. We had a philosophy, nurses and physicians can make or break any innovation. So, if you don't design with them in mind, they'll just not adopt it. It doesn't matter how great it is, and then it dies on the vine. But that brings into a good segue into how you think about and vet out ideas that come across your desk. How do you engage the Providence system and the nurses and physicians and other care team members as a way to do due diligence on these companies? Do you connect with them? Do you demo things with them? Do you bring them into the loop or how does that process?
Cyril:
Well, one of my most favorite things about working for Providence Ventures is the fact that whenever we find a company that we like, we always run it past our clinical or operational partners. That's a key part of our diligence, and so that enables me to really get out there and talk with a lot of really talented clinicians and leaders out in our system. And so, for every company that we see that we like, we always bring it to the appropriate clinical or operational partner that it falls under and get their view and their take on it. Because if they're not in favor of it, or they're not interested in that solution, then from an investment standpoint, it's very difficult for us to get excited about it because we want to add value to our portfolio company's post investment. And if we can't get that inside, pre-investment, that there's a partnership and a growth opportunity, then it becomes a difficult choice to make that investment. And so for us, like we integrate in that clinical and operational expertise into every investment decision that we make through that diligence aspect.
Dan:
One thing I found as we did this at my past organization, was you'd bring ideas up and if you're in the space, you're used to challenging these assumptions and thinking outside of the day-to-day work that you're ingrained in. But as you bring it to the frontline clinicians, it was hard for them to zoom out sometimes from what they know on the day-to-day to see the possibilities of something different. How do you work with your operational and clinical partners to prep them or get them ready to think differently about these portfolio companies and break away from their day-to-day to see what could be possible?
Cyril:
I think a lot of that has to do with just building a strong network within the health system. So, for Providence, we have so many talented nurses and clinicians that we know are innovative and willing to step outside the box, as you described, and willing to take a look at it. And so I think the first step that we do is we find those partners and we work with them, and we're always out trying to recruit those partners and to find those folks, because those are the folks that will tell it to us straight. Because if we find a solution that... I mean, on the venture world, we also have our blinders to some degree in terms of I'll find a shiny object company that I think is the greatest thing in the world, and I'll go talk to one of our neurosurgeons, and they'll just tell me in less than a sentence like, "Yeah, there's no way we could do this because of X, Y, Z."
Cyril:
And it makes my life easier, as well. I may even get a little bit more humble, but it's definitely something that we really focus on. One last thing on this, the number of those folks that are more innovative and more open have only increased in the six years that I've been in Providence. It started out at the leadership level at Providence and it filtered its way down. There's a lot of really innovative people at Providence and across healthcare, not only Providence. But it's just something that's growing. And it's good news for a lot of innovative companies out there.
Dan:
I've noticed that as well. I think the next generation of care providers, entrepreneurship seems to be ingrained in their blood. I think even schools are starting to teach it and make it a part of their curriculum, and so people are coming out with the idea of they can solve these problems that have plagued their predecessors. And they want to jump into it, they want to take the risks, they want to start a company, or they want to do some intrepreneurship within a system. I've definitely noticed a change in both just the understanding of the landscape of venture and entrepreneurship, but also the skillset and understanding how these things work and figuring out how to put them into their daily practice. So, it is very promising.
Cyril:
Yeah. I mean, there's so many nurse entrepreneurs out there and then physician entrepreneurs across the spectrum from digital health to companies like I mentioned before, that are solving those problems. And then also even on the medical device side and now everything in between, and it's always great to see those and meet those companies and talk to those CEOs with that type of passion.
Dan:
It's something that gets me up every morning, is to talk to passionate people about how they're going to solve healthcare. So, you mentioned, I mean, you must see a million pitches every year and some are probably amazing and some are probably not that great. How do you coach the ones that aren't that great? You mentioned, and we know this, there's a lot of nurses and healthcare workers out there that have this idea of starting a company. They may want to go for venture capital. What tips would you give them if they are a budding entrepreneur? They have an idea, even a company, that they're starting to look for funding for.
Cyril:
A couple of advice points there. There are a lot of organizations within health systems, within Providence we have a few of them, that help our clinicians jumpstart some of their ideas and some of their projects. And so I'd say that the first piece of advice is I'd say look internally, there should be at least a few of these type of internal incubator type solutions within the health system that you can use as an initial sounding board, with respect to your company or your idea even. And then the second thing is, from my perspective, whenever I talk with clinician entrepreneurs, the first question I ask is, is this a product or is this a business?
Cyril:
Because I think that's always something that... I know it's a little bit of a cliche, I think I heard it my first year on the job. But to me, that's something that you just have to think through because there's a lot of great products out there because they're solving those problems that a clinician or a nurse may face, but you have to build a business model around it, otherwise that the growth potential isn't there and you won't get the funding to really drive that business and increase the adoption to level to make an impact on the health system. And so it's kind of like a trade-off, where if you have a really good product, you got to find a way to make it work financially. Otherwise, it will be really difficult to make that change that you want to make.
Dan:
I think that's a great point. You may have an awesome idea, but it doesn't always a great business. And so it's where does it fit? Is it pitching it to the system, so that the system can use its resources to build it out and it becomes a solution internally, or does this actually have legs that people are actually going to buy it and it becomes a sustainable revenue source and can be a solution longer-term across multiple systems? Yeah, I think that's definitely one piece of the puzzle that I find early stage innovators haven't always thought through yet. They get sometimes stuck on the shiny object and not the business that is needed to support it.
Cyril:
Yeah, no, I think it's a similar thing around like sometimes you just focus so much on that problem because that's what's driving you to make your company or to make it. But you need to kind of step back and take a look at just the overarching, both need for the product and how to make it so that you can make the changes you want to make. Maybe not directly, or the same timeline that you have before, but if you find that business model, then you can make that change more broadly applicable to other health systems.
Dan:
One of the things we like to do on this podcast is hand off some cool information to the next group so that they can build out their future and think about what they can incorporate from the podcast into their daily lives and leadership. As you think about venture and its role within innovation in healthcare, what are a couple of things you'd like to hand off to the healthcare leaders listening, so that they can either be better participants when they are approached with ideas, or how can they be better at building their innovations and maybe landing on your desk and becoming the next portfolio company for Providence Ventures?
Cyril:
I'll break that up into two parts, one part for nurse leaders and for executive leadership of health systems, and the second part towards entrepreneurs. And so for nurse leaders and for just clinician leaders overall, I think when you look at venture companies, a lot of times it's biased to some degree where they may not necessarily have all the resources of a larger organization or may not have all the shiny toys per se, that a large company will have. But sometimes it's good to not have those. What you'll find with startups is that they'll bend over backwards to help you and to help your business grow, and they'll make those changes that you want. Versus with some of the larger entities, which have been moving into healthcare very quickly and very efficiently, they may not have that same level of flexibility that you're looking for and to helping the organization become agile and to grow effectively. And so that's my pitch for all my startups, in our fund in terms of-
Dan:
They'll all bend over backwards to help your organization grow.
Cyril:
And then the second hand off to the entrepreneurs, I'd say it's a tough path being an entrepreneur. I mean, I'm an investor and so I'm happy where I am. I kind of sometimes wonder just to the moxy that an entrepreneur needs to have in order to be successful because the advice I'd say is you're going to get rejected for your idea from good investors and bad investors and everything in between. But I think if you focus on what you perceive as your mission to make change into healthcare or into whatever type of business that you are, and you believe in that, that's what you need to use this fuel because it's never going to be an easy path to make change in any industry and healthcare is one that's very immovable at times. And so, I'd say for those entrepreneurs that I've talked to that may have passed an opportunity or a nod. Sometimes I'm kicking myself in the leg because I know that it was a good company. And so I'd say just that tenacity and that drive is just so critical and don't lose that. That's my advice.
Dan:
Yeah. That's great. Yeah, and don't let other people assign value to your thing. If you believe in it, keep going because someone out there will join your co-conspirator network at some point. Well, Cyril, this has been great. I really appreciate all the insights. I'm always fascinated to hear from investors and especially funds embedded in health systems about their perspectives on what's going on. Where can the listeners find you and learn more about Providence Ventures?
Cyril:
Providence Ventures, we have a website and we'll provide the link in the notes. Also, feel free to reach out to me on LinkedIn. That's kind of my main social media. I do have a Twitter, but don't really use it as much. But LinkedIn is the way to connect with me directly.
Dan:
And in the future we'll be on TikTok.
Cyril:
Oh, yeah. I recently learned about TikTok. Definitely an interesting experience.
Dan:
We keep asking our marketing guy if we're going to get on TikTok and he's like, "Yeah, we're still vetting that out." But anyway, Cyril, I really appreciate you being on the show. Thank you so much for the insights and we'll get this out and get you linked on the show notes.
Cyril:
Great. Really appreciate it, Dan. And thanks again for the opportunity to be here and speak to your audience.
Description
In recent years, more and more hospitals and health systems have launched investment arms in order to discover and fund companies that can help solve some of their internal challenges.
Our guest for this episode is Cyril Philip, a Principal at Providence Ventures, where he focuses on investments in healthcare technology, tech-enabled services, and digital health. We talk about the kinds of companies that get him excited and what technology he’s looking to invest in.
He also shares how he engages clinicians in his vetting and due diligence process, and why it’s so important for him to get them excited and involved before he decides to make an investment.
And for all of our listeners out there who are budding entrepreneurs, Cyril shares some great advice about getting your company off the ground and looking for investment, including the one question he always encourages entrepreneurs to ask themselves.
Links to recommended reading:
- Providence Ventures blog
- Leave Your Job (But Stay in Nursing) - Trusted Health Blog
Transcript
Dan:
Cyril, welcome to the show.
Cyril:
Yeah, glad to be on, Dan. And thanks for having me be a part of this podcast here.
Dan:
Yeah, super excited to get your take on what's going on. We talked to a lot of people in the operations space, and it's always good to get a perspective from people involved in the health care systems from a different angle. Can you tell the listeners a little bit about your background and what got you into Providence Ventures?
Cyril:
So, I come from a traditional finance background. After school went into investment banking, then went into private equity. But around six years ago, I found my dream job here at the Providence Ventures. And so Providence Ventures is a venture fund for Providence St Joseph health. When I joined the fund, it had just been launched and joining essentially a startup venture fund was definitely an unique experience and gave me the chance to really help essentially define some of the early strategy of the fund, as well as get exposure of working inside of a health system. It's been a great experience just helping deploy our funds and invest in companies, and at the same time being a venture investor and just meeting all of these great entrepreneurs throughout the years that have some of the most brilliant ideas out there, trying to solve a space that at sometimes seems almost insurmountable with the amount of problems that are out there in healthcare.
Cyril:
But just being in this realm has been a great experience, and I've been with Providence Ventures for about five years, or for about six years now, and I've had probably 500 or so pitch meetings throughout that time period. And every one of them has been great, even if I haven't made an investment, which is probably the majority of those, but it's just been great to be there and out there in the market.
Dan:
I spent some time with the Kaiser Permanente venture team, and I always found that the time I spent with them so fascinating and the pitch meetings and how they selected through what was worth more due diligence and what you could tell right away was just not something to go for. It seemed like each one of the investors had a pocket, whether it was devices or med tech or whatever. Do you have a specialty that you focus in on or do you run the gambit from all those different types of investments?
Cyril:
I technically run the gambit, but from a personal level, what I'm interested in most is essentially those companies that are solving those perceived, or trying to solve those perceived, unsolvable problems within healthcare. Specifically those that are non-patient facing. I think when you start digging into the realm of healthcare startups, I mean, there's a ton of companies that are out there, either marketing directly to consumers, that are really successful, or helping health systems connect with consumers.
Cyril:
Those are some great companies, but at the same time, there's a whole realm of companies that are trying to solve those really hard problems. Specifically, those that are related to operations, like those related to nursing, those related to HR, supply chain, all of these different areas that I find fascinating. And when you start digging into the healthcare industry overall, you start to realize it's not as proficient as other industries. And so there's a lot of room for innovation, as well. Those are the areas that I'm really interested in, and I'm happy to delve into any of those that in particular I'm interested in, but I'd say that's a broad brush stroke there, Dan. But that's kind of how I look at it.
Dan:
Those Parts of the system that you mentioned are usually the most inefficient and legacy system in most healthcare, I think. Even at large health systems that are seen as very innovative are still running on time systems that are on DOS or supply chain management that is built in the 80s. Even email systems, like we were on, at Kaiser, were on Lotus Notes until recently. And those are the core systems of how people communicate and get things done, that are just a backend to all the nursing and physician and care team work. I'd be curious where you're seeing the most innovation or disruption from your pitch meetings. What are those areas that are really trying to be disrupted at this point?
Cyril:
I'd say one of the areas that I've been trying to dig into for a long time, and I'm seeing a bunch of companies pop up in, is trying to address one of those perceived unsolvable problems I mentioned, which is high turnover and burnout for nurse labor forces. And so as you well know, nursing is a pretty stressful job and I think at its heart, attrition is going to happen. I think the problem is that there's too much of it and there's different approaches that different organizations are looking at. And so I'm seeing a lot of innovation in that realm, where there are companies that are addressing it from two different angles. One is from addressing the underlying issues that plague burnout and high turnover rates. So, one example would be the companies that are trying to help nurses get education opportunities. A lot of times for nurses that we've seen, they just may be tire with their current role and the limitations, but they don't have an avenue to learn new skills and to get that mentorship and to get that support.
Cyril:
And that's an underlying problem as to turnover, because if you're not satisfied with your current role and you don't have any avenues to move other than just leaving and trying someplace else, you end up getting stuck. And so there's a lot of companies that have been focused on either direct mentorship type opportunities, connecting young nurses with more experienced nurses, cross connections. So, connecting nurses with other types of nurses, whether it's if you work in the ICU, connecting you with a home health nurse or vice versa, and just getting that exposure. And then I think there's other areas that, I guess, going back to the two areas to take a look at from a fighting nurse turnover. The second area is addressing the problem head on. And so there are a lot of companies that are finding innovative ways to ensure that when we hire a caregiver, which is what Providence calls our employees, then when we hire a caregiver, that we hire them to a role that they're best suited for and what will be the best fit for them from a background perspective.
Cyril:
And so I think when you can hire the right people for the right role, then you end up reducing retention overall, just through that effort alone. And similarly companies have been trying to evolve the external staffing model to be more efficient, because external staffing is critical to the success of any healthcare organization, because we will never have enough nurses on hand unless the supply for nurses increases dramatically. And so a lot of the companies out there that are trying to innovate in that realm and enabling health systems to utilize external resources more effectively and in a cost-effective manner are really exciting. And so there's a lot of innovation in that area, in particular, that I'm really interested in and I've been digging into for, I'd say, about a couple of years now.
Dan:
You mentioned one that's definitely top of mind for us, which is that contingent labor and extra labor standpoint. I'm new to that space as well, and just the inefficiencies of the system now is just mind boggling and the amount of manual work. And so there's a ton of opportunity there for innovation, for sure. We came up with a slogan about a year ago, we were telling healthcare leaders you'll never, ever, ever be fully staffed ever again. Not only is the workforce not looking for 30 years and a pension, but you're inefficient if you have full-time employees for every position you have because of the flux of the demand cycle related to patient care. So, yeah, there's definitely a need for more flexible workforce, for sure. That's a theme we've been really diving into.
Cyril:
And one thing I'll add to that is in addition to the external side of it and that, I think in general health systems and health care overall hasn't found a good way to manage our existing labor resources effectively. And that in turn results in sometimes an over-reliance on external staffing, which is ends up being a negative for all parties involved.
Cyril:
And so I think if you could find, and I've been looking around for solutions that can do this, if you can find a solution that can essentially capture all of the skills that a nurse has and have it in some sort of central repository, so that you don't necessarily need to keep staffing the same nurse who knows how to do a certain type of procedure on every shift and burn her out. You end up having a really successful way to manage your existing workforce, and then when you bring in an external resource, it becomes so much more beneficial and a better experience versus being, "Oh, we have to bring in somebody from outside because X nurse is burnt out or whatnot." It becomes, "Well, we're bringing them in to help support our nurses and help support our care for our patients."
Dan:
I agree. And I think there's definitely a technology play here, and there's also the system play. Like we've set up our hospitals with these arbitrary service lines and things that all go back to billing, but the skill sets of the practitioners kind of move across those arbitrary service lines. But we still hired nurses into medical surgical units or the operating room or whatever, and we've only used them in that one linear capacity rather than, like you said, matching skill sets and competency to the actual needs of the patient across the system even, and actually more dynamically link those practitioners and their skills to the needs of patients outside of the traditional budgeting and service line concept. So, yeah, I would love to see more innovation there.
Cyril:
And one thing I'll just add to that point that you made Dan, which is a really good point, is just the lack of interconnectivity between the different business lines within both healthcare systems and just health systems overall. Meaning, if you look at nurses like within Providence and within larger health systems, we have home health nurses, we have acute care nurses, we have post-acute care nurses, and we never really tried to bridge all those groups together and understand that they're all nurses and they all have their skills. And one of the results of COVID was that we started to take stock that all of these nurses in these different settings could have valuable skills that can be utilized during the surge period. And I think that opened up our eyes with respect to realizing that our workforce is great, our nurses are great, and there's a lot of hidden value that we've not taken advantage of. I think that's going to change in the future.
Dan:
Yeah, there's definitely leadership and mindset changes that need to happen with all of this. So, that's one area where you want to see, or we both want to see, entrepreneurship and innovation take over some of these inefficiencies in matching skillsets with nurses and patients and that kind of thing. Where is another focus area for you, where else would you like to see some more disruption?
Cyril:
Yeah. And so another one of these, my perceived unsolvable problems, is essentially the documentation problem. Ever since I joined Providence, the number one problem I hear when I talk to clinicians or nurses or anybody within Providence, is just the burden that our frontline caregivers and our clinicians face with respect to documenting information into the EHR, into whatever record that needs to be placed.
Cyril:
And what I've seen happen over the last probably three years or so is just an influx of new AI, ML type solutions that have tried to address this problem through making that a little bit more automated and being it so that our nurses don't need to spend so much time at a computer terminal, or doctors don't need to sit in front of a patient with a laptop in front of them. They could sit back and enjoy their time with the patient and address patient directly. There's a lot of innovation in that realm that we're seeing. I think in my mind, that market is still a little bit far away in terms of having that final solution, with respect to addressing that problem completely head on, but we're moving in the right direction. And just to see kind of the new technologies that are out there, that are coming out in the market. Also there's just adoption by our clinicians because they're starved for solutions like that, and so that's another area I'd highlight, in particular.
Dan:
I've been to HIMS the last few years and it's interesting to watch like the booths and the trends. I think four or five years ago, it seemed like every other vendor was a computer on wheels, workstation that you could kind of port around, with the infection control keyboards and all that kind of stuff. And then the last couple of years, it seems like more and more companies are coming out with some sort of layer on top of the electronic medical record in order to solve some sort of documentation process, whether it's voice to text or it's some intuitive AI piece, or it's layers on top that aggregate data, so you don't have to hunt and peck for everything. There's definitely a need to fix things both on the provider side of documentation, but then on the patient side to visibility into that information so that they can manage their own health. Have you seen any rock stars pop out there? I mean, you don't have to name companies specifically, but are there any solutions in general that you're seeing that might be promising?
Cyril:
I won't name companies in particular, but in my mind that the companies that can make it so that the workflow for the physician or for the nurse is minimally impacted, meaning just having a device in the corner of an office or having it automatically fill in fields based on data, just without having to initiate it, are the ones that in my mind are the most successful. I think there are different approaches where sometimes it's a little bit more intrusive to the provider and it ends up not solving the problem, it just becomes another burden. And so those companies that are able to have it be just in the background or have it just handle everything on its own are the ones that will be successful in the long run.
Dan:
Yeah. We had a philosophy, nurses and physicians can make or break any innovation. So, if you don't design with them in mind, they'll just not adopt it. It doesn't matter how great it is, and then it dies on the vine. But that brings into a good segue into how you think about and vet out ideas that come across your desk. How do you engage the Providence system and the nurses and physicians and other care team members as a way to do due diligence on these companies? Do you connect with them? Do you demo things with them? Do you bring them into the loop or how does that process?
Cyril:
Well, one of my most favorite things about working for Providence Ventures is the fact that whenever we find a company that we like, we always run it past our clinical or operational partners. That's a key part of our diligence, and so that enables me to really get out there and talk with a lot of really talented clinicians and leaders out in our system. And so, for every company that we see that we like, we always bring it to the appropriate clinical or operational partner that it falls under and get their view and their take on it. Because if they're not in favor of it, or they're not interested in that solution, then from an investment standpoint, it's very difficult for us to get excited about it because we want to add value to our portfolio company's post investment. And if we can't get that inside, pre-investment, that there's a partnership and a growth opportunity, then it becomes a difficult choice to make that investment. And so for us, like we integrate in that clinical and operational expertise into every investment decision that we make through that diligence aspect.
Dan:
One thing I found as we did this at my past organization, was you'd bring ideas up and if you're in the space, you're used to challenging these assumptions and thinking outside of the day-to-day work that you're ingrained in. But as you bring it to the frontline clinicians, it was hard for them to zoom out sometimes from what they know on the day-to-day to see the possibilities of something different. How do you work with your operational and clinical partners to prep them or get them ready to think differently about these portfolio companies and break away from their day-to-day to see what could be possible?
Cyril:
I think a lot of that has to do with just building a strong network within the health system. So, for Providence, we have so many talented nurses and clinicians that we know are innovative and willing to step outside the box, as you described, and willing to take a look at it. And so I think the first step that we do is we find those partners and we work with them, and we're always out trying to recruit those partners and to find those folks, because those are the folks that will tell it to us straight. Because if we find a solution that... I mean, on the venture world, we also have our blinders to some degree in terms of I'll find a shiny object company that I think is the greatest thing in the world, and I'll go talk to one of our neurosurgeons, and they'll just tell me in less than a sentence like, "Yeah, there's no way we could do this because of X, Y, Z."
Cyril:
And it makes my life easier, as well. I may even get a little bit more humble, but it's definitely something that we really focus on. One last thing on this, the number of those folks that are more innovative and more open have only increased in the six years that I've been in Providence. It started out at the leadership level at Providence and it filtered its way down. There's a lot of really innovative people at Providence and across healthcare, not only Providence. But it's just something that's growing. And it's good news for a lot of innovative companies out there.
Dan:
I've noticed that as well. I think the next generation of care providers, entrepreneurship seems to be ingrained in their blood. I think even schools are starting to teach it and make it a part of their curriculum, and so people are coming out with the idea of they can solve these problems that have plagued their predecessors. And they want to jump into it, they want to take the risks, they want to start a company, or they want to do some intrepreneurship within a system. I've definitely noticed a change in both just the understanding of the landscape of venture and entrepreneurship, but also the skillset and understanding how these things work and figuring out how to put them into their daily practice. So, it is very promising.
Cyril:
Yeah. I mean, there's so many nurse entrepreneurs out there and then physician entrepreneurs across the spectrum from digital health to companies like I mentioned before, that are solving those problems. And then also even on the medical device side and now everything in between, and it's always great to see those and meet those companies and talk to those CEOs with that type of passion.
Dan:
It's something that gets me up every morning, is to talk to passionate people about how they're going to solve healthcare. So, you mentioned, I mean, you must see a million pitches every year and some are probably amazing and some are probably not that great. How do you coach the ones that aren't that great? You mentioned, and we know this, there's a lot of nurses and healthcare workers out there that have this idea of starting a company. They may want to go for venture capital. What tips would you give them if they are a budding entrepreneur? They have an idea, even a company, that they're starting to look for funding for.
Cyril:
A couple of advice points there. There are a lot of organizations within health systems, within Providence we have a few of them, that help our clinicians jumpstart some of their ideas and some of their projects. And so I'd say that the first piece of advice is I'd say look internally, there should be at least a few of these type of internal incubator type solutions within the health system that you can use as an initial sounding board, with respect to your company or your idea even. And then the second thing is, from my perspective, whenever I talk with clinician entrepreneurs, the first question I ask is, is this a product or is this a business?
Cyril:
Because I think that's always something that... I know it's a little bit of a cliche, I think I heard it my first year on the job. But to me, that's something that you just have to think through because there's a lot of great products out there because they're solving those problems that a clinician or a nurse may face, but you have to build a business model around it, otherwise that the growth potential isn't there and you won't get the funding to really drive that business and increase the adoption to level to make an impact on the health system. And so it's kind of like a trade-off, where if you have a really good product, you got to find a way to make it work financially. Otherwise, it will be really difficult to make that change that you want to make.
Dan:
I think that's a great point. You may have an awesome idea, but it doesn't always a great business. And so it's where does it fit? Is it pitching it to the system, so that the system can use its resources to build it out and it becomes a solution internally, or does this actually have legs that people are actually going to buy it and it becomes a sustainable revenue source and can be a solution longer-term across multiple systems? Yeah, I think that's definitely one piece of the puzzle that I find early stage innovators haven't always thought through yet. They get sometimes stuck on the shiny object and not the business that is needed to support it.
Cyril:
Yeah, no, I think it's a similar thing around like sometimes you just focus so much on that problem because that's what's driving you to make your company or to make it. But you need to kind of step back and take a look at just the overarching, both need for the product and how to make it so that you can make the changes you want to make. Maybe not directly, or the same timeline that you have before, but if you find that business model, then you can make that change more broadly applicable to other health systems.
Dan:
One of the things we like to do on this podcast is hand off some cool information to the next group so that they can build out their future and think about what they can incorporate from the podcast into their daily lives and leadership. As you think about venture and its role within innovation in healthcare, what are a couple of things you'd like to hand off to the healthcare leaders listening, so that they can either be better participants when they are approached with ideas, or how can they be better at building their innovations and maybe landing on your desk and becoming the next portfolio company for Providence Ventures?
Cyril:
I'll break that up into two parts, one part for nurse leaders and for executive leadership of health systems, and the second part towards entrepreneurs. And so for nurse leaders and for just clinician leaders overall, I think when you look at venture companies, a lot of times it's biased to some degree where they may not necessarily have all the resources of a larger organization or may not have all the shiny toys per se, that a large company will have. But sometimes it's good to not have those. What you'll find with startups is that they'll bend over backwards to help you and to help your business grow, and they'll make those changes that you want. Versus with some of the larger entities, which have been moving into healthcare very quickly and very efficiently, they may not have that same level of flexibility that you're looking for and to helping the organization become agile and to grow effectively. And so that's my pitch for all my startups, in our fund in terms of-
Dan:
They'll all bend over backwards to help your organization grow.
Cyril:
And then the second hand off to the entrepreneurs, I'd say it's a tough path being an entrepreneur. I mean, I'm an investor and so I'm happy where I am. I kind of sometimes wonder just to the moxy that an entrepreneur needs to have in order to be successful because the advice I'd say is you're going to get rejected for your idea from good investors and bad investors and everything in between. But I think if you focus on what you perceive as your mission to make change into healthcare or into whatever type of business that you are, and you believe in that, that's what you need to use this fuel because it's never going to be an easy path to make change in any industry and healthcare is one that's very immovable at times. And so, I'd say for those entrepreneurs that I've talked to that may have passed an opportunity or a nod. Sometimes I'm kicking myself in the leg because I know that it was a good company. And so I'd say just that tenacity and that drive is just so critical and don't lose that. That's my advice.
Dan:
Yeah. That's great. Yeah, and don't let other people assign value to your thing. If you believe in it, keep going because someone out there will join your co-conspirator network at some point. Well, Cyril, this has been great. I really appreciate all the insights. I'm always fascinated to hear from investors and especially funds embedded in health systems about their perspectives on what's going on. Where can the listeners find you and learn more about Providence Ventures?
Cyril:
Providence Ventures, we have a website and we'll provide the link in the notes. Also, feel free to reach out to me on LinkedIn. That's kind of my main social media. I do have a Twitter, but don't really use it as much. But LinkedIn is the way to connect with me directly.
Dan:
And in the future we'll be on TikTok.
Cyril:
Oh, yeah. I recently learned about TikTok. Definitely an interesting experience.
Dan:
We keep asking our marketing guy if we're going to get on TikTok and he's like, "Yeah, we're still vetting that out." But anyway, Cyril, I really appreciate you being on the show. Thank you so much for the insights and we'll get this out and get you linked on the show notes.
Cyril:
Great. Really appreciate it, Dan. And thanks again for the opportunity to be here and speak to your audience.