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The Doctorpreneurs Startup Guide and startup guide for an entrepreneur
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Published Date:03-07-2017
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First Edition The Doctorpreneurs Startup Guide Nick Dragolea Vishaal Virani Avi Mehra Catherine Schuster Bruce Copyright 2017 © Doctorpreneurs Ltd. www.doctorpreneurs.comIntroduction “I always feel that if I’m still doing the same thing next year (let alone in ten years time) as I’m doing now, then I’m not evolving and that my specialty/business/ work is not evolving either.” Mr Manoj Ramachandran, Co-founder 1Chapter 1 Change is already happening. Antiquated workflows and habits of both Introduction doctors and patients are massively shifting to a modern alternative in the By Dr Nick Dragolea form of new technologies and the internet of things (IOT). The potential of big data analytics is also slowly shaping up . Welcome As a clinician, your impact is no longer limited to history taking and physical examination of patients. Technologies such as sensors, diagnostics software and other medical devices mean that your influence The Doctorpreneurs team has created this handbook as an overview of the can be far more wide-reaching. key issues that may confront you, the aspiring entrepreneur. We may not have all the answers, but we do have insight and experience. Members of Now is the time to decide whether you want to be be a doctorpreneur, the team have both started their own businesses and interviewed other involved in the paradigm shift and dictating the future of healthcare, or successful doctorpreneurs who were once at the same stage as you. whether you would rather step back and watch change happen from the sideline. Over the past five years we have built an extensive network of doctors, medical students and other individuals. Whatever their background, they share the common goal to alter the status quo and make a difference in healthcare through leading innovation and improvement. Why you, why now Now is the best time to be a healthcare entrepreneur. The wealth of talent within the system is key to driving radical change and generating a paradigm shift in healthcare over the next 5-10 years. This, coupled with current uncertainties in healthcare, means that now, more than ever, networking between doctors, patients, engineers, investors, designers and managers is crucial if you want to build your connections, your brand and your career aspirations. 2Define your craft “You need to be passionate about what you are doing. Every single successful physician who I have met was also passionate, and able to defend an idea” Dr Jessica Mann, Co-founder TrialReach 2Chapter 2 1. Why start your own business? Define Your Craft Having your own business means freedom: you set your own working By Dr Nick Dragolea hours; you choose your own team; you implement your own ideas and you have the ability to make a positive impact in an area that you are Key Contents passionate about. Other benefits include: 1. Why start your own business? Learning a whole new range of skills. • 2. Set your goals Approach business as if you’re starting a new specialism. You 3. What are your most profitable skills? have to go into it with the mind-set “I need to learn this”, not “I already know this” - Dr Felix Jackson, Founder of medDigital 4. Following your passion Scope to combine clinical work with a business, providing you with a • more varied and stimulating work life. Potential to follow your passion and turn work into a hobby. • 2. Set your goals Setting goals is the first step in turning the invisible into the visible - Tony Robbins It is impossible to know how to get somewhere if you don’t know where you are going. Every entrepreneur we have met, to date, has had their own specific goal or vision of where they are headed. There are two types of goals: 1. Long term/ Ultimate goals 2. Short term/ Day-day goals. 4Short term/day-day goals are goals that will help you achieve your 3. What are your most profitable skills? ultimate goal. In order to hone in on your current skills, it is useful to look back and identify your past achievements. These can be anything from organising The first step is to write down your goals. It is best for goals to be a successful event to speaking at a conference, designing a webpage or SMART: Specific, Measurable, Attainable, Relevant and Timely. conducting clinical research. Take the time to think now. What are your main achievements from the past 2-5 years? Note them down and What are you passionate about? (This could be in medicine or annotate alongside the skills you developed. elsewhere) What is your mission in life? 4. Following your passion In an interview with us, Dr Jessica Mann from TrialReach, emphasised What will be your legacy and lasting contribution? that there are two important considerations or ‘parts’ when starting something new: What would you do if you could do anything? “Why” do you want to achieve these goals. 1) Personal part: The importance of being passionate about what you are doing i.e. only start something that you are really passionate It is vital to have clarity on what you want to achieve and why you want about. to achieve it before you start your business. Without this initial step, you 2) Practical part: You are passionate about your idea, but do you also are more likely to quit at the first hint of a setback. have the vision of where this passion could take you? Is there a market in the medical community, or better yet, can you create a Goal WHY Time Frame market? You need to be passionate about what you are doing. Every single successful physician who I have met was also passionate, and able to defend an idea - Dr Jessica Mann, Co-founder TrialReach People don’t buy what you do; they buy why you do it. And what you do simply proves what you believe - Simon Senek, Start with What I would say to people is find ways to find out what else Why you’re interested in or what else you could be good at, and don’t undervalue the skills that you have, because they are valuable. - Dr David Cox, Chief Medical Officer Headspace 5Idea Generation, Validation & MVP “I think the biggest skill set missing from healthcare industry innovation in the UK is around commercialisation – building a go-to-market strategy, navigating investment, pricing and regulation.” Peter Hames, Co-Founder Sleepio 3Chapter 3 1. Idea Generation Brainstorming & People have written whole books on idea brainstorming alone but we’ll aim to keep it brief. Idea Validation Creative/ soft thinking: By Dr Nick Dragolea brainstorming product Key Contents innovations 1. Ideas Generation Logical/ hard thinking: formal business planning 2. Areas to target Brainstorming requires creative thinking. A good place to start is by 3. Five Types of innovation taking a piece of paper / clipboard / open a new note in Onenote, and labelling it “My Ideas”. From now on, every time you think of something 4. Matching fit and validating your idea worthwhile, make an entry. 5. Building your MVP Try to get into the habit of being a problem solver It is always better to identify a solution rather than just the problem Components of Business Ideas 1. Subject: Who are you targeting? Who is benefiting from 10% your product/ service? What groups of people? Try to hone down to a specific group e.g. patients / relatives / doctors. Never target ‘everyone’. 90% 2. The ‘Pain Point’: What is the problem / pain you are trying to solve? 90% of business ideas are problem-based. 73. Business model: How you address the pain / problem you have 2. Areas to target identified (the solution) is the business model. Business model Business ideas are directed at trying to improve something or allowing examples include: product purchase outright and subscription models someone to do something that they couldn’t previously do. - more on this later on There are four different sections of the ‘value chain’ that business ideas most commonly target. Subject + Pain point + Business Model = Complete Business Idea Complete idea Product/ Service Procurement I’m renting this flat in San Francisco and my rent is too expensive. What if I could rent out some air mattresses on the floor at very competitive prices and serve people breakfast? I would make some money which would help me pay for the rent. I’m going to make a website and advertise online. Promotion Delivery Subject: Me (a lot of business ideas were born from trying to solve personal problems) 1 Product / Service: Selling to a customer e.g. tastier pizza. Pain point: Expensive rent 2 Procurement: Where does the product / service come from? Think about everything from the point where nothing exists to the point of Business model: Hire out my floor space, make money and use it to pay creating a product e.g. Where do they get the ingredients for the pizza? rent. I can do this myself by building a website and advertising online - Who delivers the ingredients / components? minimum startup costs. 3 Delivery: How / who delivers the final product / service? e.g. pizza Does this ring a bell? That’s how AirB started when the co-founders delivery / store pick-up. couldn’t afford their rent in san Francisco 4 Promotion: What advertising channels are used? e.g. TV adverts, digital marketing, print media. These four areas are the areas with the most potential for innovation and the space to create a successful business. 83. Five types of innovation Early stage validation 1 Price: Can you make your product cheaper than anyone else? This Google Search: Stick your idea into Google to see if it already exists. • may be achieved by simplifying the process of product and/or service Even if it does, do not give up too hastily. There are always ways to creation, or fusing two or more products into one. Conversely, you may improve the existing choose to increase the price of a product if you add more perceived product. value. Google Keyword • Planner is a tool that has 2 Convenience: Lowering friction for every single action that is been around for years. required for a customer to do something removes steps for the customer, Once you put your thus making it more convenient for them to purchase your goods e.g. keyword in, it will show Uber requesting a car via an app vs having to call the cab company to you the number of people book it in advance. searching for the same keyword on Google in a given month. 3 Speed: Increasing delivery of your products or services e.g. Amazon offering Prime delivery on the majority of its top goods. Google Trends is another powerful tool provided by Google that will • show you the trend for a specific keyword or phrase over the past 4 Quality: Tricky term but in this case referring to the various individual months and years. characteristics that people use to subjectively judge whether a product and/ or service is better or worse e.g. more comfortable or better Seek feedback from others. Don’t be paranoid about it getting stolen. • designed T-shirts, RFID blocking wallets. Now is the time for some brutal honest feedback. 5 Self Expression: Characteristics that make a person feel better after Ideas are cheap, execution is everything - Chris Sacca, Investor in purchasing a product compared to the competition, even if inferior e.g. Twitter & Uber GoPro cameras are no better than the competition but it is branded as a cool lifestyle product. If you have the opportunity, sell a lifestyle, not just Get feedback on your idea and see if it actually works in the real a product. world - Dr Felix Jackson, Founder of medDigital Build an MVP (Minimum Viable Product) • Build your brand (logo, website, products, etc.) • 94. Matching fit and validating your idea 5. Building your Minimal Viable Product (MVP) A surefire route to business failure is making something that no-one If you have successfully validated your idea by following the steps needs or wants. If you have more than one business idea, pursue the above, it is now time to build a prototype with the minimum amount of one you think might have most potential. Put the others on hold. features, just enough to define what your product does. This will vary according to the nature of your business idea. Ask yourself: “Could I do this every single day without losing interest?” This is where the importance of being passionate about your Landing Pages / Websites: Business ideas may be services instead of idea really comes in. Founding a business is a long journey and you fully fledged products, but the same concept applies. You may test your shouldn’t embark on it if you don’t think you can persevere through the service idea by having a core offering e.g. a website offering a mattress inevitable tough times. and breakfast in a flat in San Francisco. The easiest solution is to relate your business idea to your hobbies or a Videos: Before Dropbox launched, their MVP was a 3-minute video passion. If it is only related to some industry you are experienced and explaining how the service works. This got them 5K subscribers before are skilled in, but not passionate about it at all, this may not be enough they wrote a single line of code Whiteboard videos such as the ones to keep you going. Monetary benefit is not a strong enough reason to you can make in Videoscribe have become very popular nowadays. Try keep you powering through the hard times. a visit to where experts will make your video for as little as 5. There’s plenty of opportunity to innovate but be prepared to work Basic Prototype: If you have a technological idea, such as a extremely hard. You need to be passionate about what you want smartphone app, you can either learn how to code a basic version to create as this gets you through the tricky times. - Dr Kartik yourself or hire a freelancer to do the work for you. and Modha, Co-Founder of are both great places to start. You may also contact an offline app development agency but these are often more costly. Focus on what you really like in life and you can really achieve Crowdfund: Sell it before you build it. Websites great things. - Dr Rupert Dunbar-Rees, Co-founder of Outcomes such as are full of business ideas Based Healthcare and projects that are explained in a video. You can often raise more than what’s required to develop a service or product before you start putting any effort into it. It is also a brilliant way of gauging your customer’s interest. 10Raising Funds “Try to prove you have a solution to the problem discovered before going to access funding or entrepreneurial advice.” Dr Michael Urdang, Co- Founder Figure 8 4Chapter 4 1. Introduction Raising Funds Raising funds is a common challenge that is faced by most start-ups. By Dr Catherine Schuster Bruce The first test is finding the funding. Another is working out how much you are willing to sacrifice to secure financial support - how much of your company, and decision-making capabilities are you willing to share? The balance between total control of the company and giving up equity to raise the funds required to take your business to the next level can be one that is hard to strike. Key Contents When reading this chapter remember that every business is an adventure in its own right. No adventure, including the funding aspect, 1. Introduction will be the same. The chapter will focus on the most common routes to 2. Useful Definitions raise those all-important funds. 3. Common Funding Sources 2. Useful Definitions 4. Top Fundraising Tips A method of funding a business whereby investors from all backgrounds, including investment professionals, venture capital firms and everyday Crowdfunding investors like you and I can come together and invest as much or as little as they like. This is typically run through an online platform. 12An individual who invests in start up company or entrepreneur. This may be a one-off payment Usually government schemes that provide Startup Loans Angel Investor to help a company to get going or an on-going funding and support to small businesses. (a.k.a angel funder; instillation of funds to get a start up through the private investor; seed early stages. Angel investors use their own investor; business money, and often are the first source of external angel) funding for a startup. Support early stage companies through initial development stages until the company has sufficient financial, human and physical Incubators resources to function alone. There are some A company with a portfolio of investments in independent incubator firms, but they can also Venture Capitalist start-up companies. The funding stages be run or sponsored by VC firms, large (VC) include: seed funding, series A, B and C. corporations and government bodies. The initial capital when starting a business. IId de ea a L La ab b,, R Ro ock ck H He ea alltth h,, St Sta art rtU Up p H He ea alltth h a an nd d Bl Blu ue ep pri rin ntt H He ea alltth h.. Typically provided for early stage operations Seed Funding such as market research, product development and / or prototype production. Accelerate growth and scale an existing company. Usually an accelerator firm provides The first significant round of VC funding, usually Series A Accelerators mentorship to a company for a specified length to optimise the company / product. of time. For some, this includes funding. Funding to take the business past the initial Usually comes after the incubator stage. development stage. This includes improving Series B Y Y C Co omb mbiin na atto or r,, T Te ech chst sta ars, rs, Bra Bran nd de ery ry a an nd d D Do ottffo org rge e.. business development and marketing strategies. Series C Funds to scale the business. 133. Common Funding Sources There is not a way to win everyone over but the best you can do is The most common funding sources are: crowdfunding, Venture Capital to make sure the main bases are covered well, and the business (VC) and self-funding. The choice is yours and the path you choose will is presented in a way that’s true to you - James Gupta, Founder of be for a reason unique to your business Synap A. CROWDFUNDING B. VENTURE CAPITAL Kickstarter, Indiegogo, RocketHub, Crowdcube, Fundrazr are all popular Benchmark Capital, First Round Capital, Sequoia Capital, Balderton online crowdfunding platforms. Capital, Sapphire Ventures, Index Ventures, Mercia Technologies Pros: Pros: • Broad range of investors. Deep pockets - average investment is usually between £500K - £5M. • • Good way to build a brand and form a community around the company. Can bring skills and networks to strengthen your business since they • are equally as interested in your success as you are I thought crowdfunding was about the money but it turned out to be about building a community. The real yield was a committed Cons: tribe of nearly 600 people passionate about caring for people completing life comfortably. - Michael Fratkin, Founder of • Often have a very short run time, and if you don’t take off... you crash. ResolutionCare. (It is okay to fail though) • Need to be able to prove potential for much higher financial return on investment than other investors. Cons: • Typically want to be a director and hold equity, and will push for fast • To attract crowdfunding investors, you must have an attractive growth. Giving a VC firm too much of your equity may result in losing marketing campaign including a business pitch. It can be a lot of work to overall control of your company. get it right. It is, however, useful to remember that there is no such thing the ‘perfect pitch’. 14C. SELF FUNDING 4. Top Fundraising Tips 1. Be prepared. Both angel and VC investors commonly take into Pros account three things. • Usually common in the initial, prototype stages of business a) You and your team development. b) Your idea • Most suitable for older entrepreneurs that have saved up some money or have had prior successful ventures. c) Market Potential • Allows you to retain full equity and control over how you develop your business. a) You and your team. Do you have star quality? Are you driven to Cons make your idea a success against all odds? Are you likable, someone that will make a ‘good’ business partner? Do you have the skills in your • Risk on yourself and your friends / family. team to take the product to market? Investing your own money is one way to show you are committed to the cause. • Can be a struggle if other bills to pay or relationships to maintain. The further you have got under your own steam (product and market validation, initial paying customers), the more attractive There were a few awkward moments where I was asked by high you will be to investors, so don’t wait for external funding to get profile investors why I had “only” invested a few thousand pounds, started - Peter Hames, co-founder of Sleepio and had to answer “It’s all I have” - Stephanie Eltz, Founder of Doctify b) Your idea. Is the idea scalable? Will it make money? Is the idea innovative? Make sure you know your customer and the scale of the opportunity. 15c) Market Potential. Is there a need / problem to be fixed? Does your idea have a sustainable advantage over competitors? Does it fit in with the investor’s own vision for the future in that field? Is there a large potential market size? Securing funding can be made easier if you take these three aspects into account when brainstorming at the initial stages of idea development (Section 1). Have the evidence ready and be prepared for questions 2. Pick the right investor for you. Check that your business profile and theirs match Understanding your investor is critical, you need the right investor for your business model - Jamie Wilson, Founder of Home Touch 3. Rise to the challenge. Determination and grit gets it done, like with anything in life - Sean Duffy, Co-Founder Omada Health 16Balancing Clinical Work With A Startup “... continuing to practice medicine is very important to me, both personally and professionally. I practice two weeks per month, so I essentially split my time between Figure 1 and the hospital.” Dr Joshua Landy, Co-founder Figure 1 5Chapter 5 1. If and when Balancing Clinical Medical students and doctors typically plan their career timelines as meticulously as Big Ben chimes on the hour. However, given the increasingly attractive health startup market perhaps it is time for Work With A Startup entrepreneurial medical professionals to take some time out to re-think By Dr Vishaal Virani their broader career goals. Key Contents Deciding if and when to quit clinical medicine to pursue your healthcare startup ambitions is one of the biggest dilemmas that entrepreneurial doctors and medical students face. Some doctors get the entrepreneurial 1. If and when bug and immediately swap the scrubs for sweatshirts and their stethoscope for software programming. Some doctors get the bug and 2. Key insights from experienced doctorpreneurs react by gradually building their startup whilst clutching reassuringly to the financial safety net of clinical work. Others still stoically ignore the bug, and focus wholeheartedly on their first love of medicine, trying to fend off the philandering advances of this so-called entrepreneurial bug. The reality is that there is no universal, one-size-fits-all answer to the big question of if and when to quit your clinical career to focus on a healthcare startup. The comforting truth, however, is that there are a number of successfully proven approaches to tackling this dilemma that is facing an increasing number of doctors and medical students. The common thread in all the stories below is that if you get the entrepreneurial bug, you will succumb to it. The real question is whether you succumb full-time or part-time. In order to exemplify the variety of career paths taken by doctorpreneurs, here are several case studies to satisfy the medical profession's desire for evidence-based decision making: 18Jessica Mann, Co-Founder of TrialReach and ex-cardiologist, values her 2. Key insights from experienced doctorpreneurs years in specialty medicine but now focuses exclusively on her startup Stephanie Eltz, Founder of Doctify, has managed to continue her work as an orthopaedic surgeon whilst running a startup It depends on how much sleep you need...but I think if you have a passion for either of them medicine or your startup, at one point As a doctor, you have a duty towards your patients and your you will need to make a choice. I do think that you should be clinical work has to be prioritised above everything else. I would putting in a few years of seeing patients in the specialty you like never compromise on that. I am 150% focused at the hospital. You because that is going to make you able to empathise with patients’ have to be very organised and compromise on your life outside of needs. work to balance clinical and startup work. Say goodbye to your friends and the pub. Sean Duffy, Co-Founder of Omada Health, left medical school and went 'all-in' to his startup venture Jim Gray is an orthopaedic surgeon, Clinical Director of an NHS hospital, So at first I paused my medical training, took a year off, and took and Founder of Tuberosity. another year off, and I had to make a choice. Everything worth doing in life is harder than you imagine it to be, once you get Investors will be concerned when you talk about balancing a clinical going. As an entrepreneur you’re just fighting gravity each and career and driving your business. It’s not unusual for med tech every day, so it requires an all-in, full-in, dedicated approach I companies at all but you have to make sure your absence is covered think. and that you add as much value as your full-time startup colleagues. Rupert Dunbar Rees, Founder of Outcomes Based Healthcare, has The balance I have between my clinical, personal and my technically left medicine but thinks founding a healthcare startup is 'still business life is complementary. I see the business as a hobby not doing medicine, just of a different kind' a chore so I’ve got a healthy balance. I look forward to weekdays as Mondays bring emails about our startup alongside a long list of A lot of us have been in that big dilemma around whether you patients and hospital management duties no doubt... leave medicine or not. I eventually did after working in general practice for several years. On the team I’m the only one who has got that far down the line to leave medicine. Would I say I’ve left medicine? Probably not. I’d argue that we are all still doing 19