In the fast-paced realm of healthcare, where digital technology revolutionizes patient care and treatment, a striking paradox emerges. While innovations like remote operations and robotic assistance promise to enhance emergency care and access to medical advice, a staggering 90 percent of digital healthcare platform startups face an early demise.
In contrast, a mere 0.07 percent of these startups ascend to the revered realm of unicorns—those coveted companies valued at over US$ 1 billion. These unicorns represent success and transformative influence over GDP and employment. What if we could unveil the secrets behind these elusive unicorns and pave the path for more startups to thrive?
Five distinguished universities across Europe – Kaunas University of Technology in Lithuania, University of Montpellier in France, Universitat Autonoma de Barcelona in Spain, Tampere University in Finland, and Lund University in Sweden – set out to decode the enigma, revealing pivotal ‘secrets’ that have propelled digital healthcare platforms towards unprecedented success. A few identified ‘secrets’ about unicorns of digital healthcare platforms are presented below.
Secret 1: Early investors’ involvement is necessary. Early investors’ involvement in startups of digital healthcare platforms is one key characteristic of current unicorns. A digital healthcare platform startup’s chances of becoming a unicorn are increased by early-stage funding from at least one of the following investors: crowdfunding, angels, or incubators. Without the early investors’ involvement, the digital healthcare platform startup is not likely to be a unicorn.
Secret 2: Government funding doesn’t help to become a unicorn. At first glance, it may seem that receiving government funding is a success and a good sign for a startup, but the research shows the opposite. The government does not compensate for the absence of early private investors and, worst, the chance of becoming a digital healthcare platform unicorn becomes less than 2 percent when the startup is using artificial intelligence (AI).
In other words, a startup that receives public funding and has technologies related to AI, machine learning, natural language processing or big data, reduces its chances of becoming a unicorn. This can be explained by the fact that while public funding can provide resources for a startup, on the other hand, the bureaucratic burden that often falls on public funding can limit a startup’s ability to adapt quickly in a particularly highly regulated healthcare sector.
Secret 3: Artificial Intelligence (AI) is not needed to become a unicorn. Another surprising result of the study revealed that AI is not necessary for a startup to become a unicorn. Of course, the use of AI increases the chance of becoming a unicorn, but it is not a necessary condition. The digital healthcare platform startup can become a unicorn even without AI, especially if they have a subscription model for B2C (business-to-client). However, if a digital healthcare platform startup’s business model is B2B (business-to-business), then AI is necessary.
Secret 4: The business model may change with investment rounds. To be successful, startups need to be able to adapt to changing trends. After each round of investment, the startup aims to expand and grow rapidly. Thus, this growth may require adjustments to the existing business model (B2B, B2C, mixed) to expand operations or enter into new markets.
Secret 5: Collaboration with potential competitors can be useful. Cooperation with competitors can be risky if the cooperation strategy is not thought out and if the agreement is not made. However, otherwise, identifying competitors and start collaborating with them can add significant value to a startup – or unicorn. It may result in improved customer satisfaction and an enhanced value proposition. This happens because cooperation with competitors expands competitive, technological or financial opportunities, shares knowledge and technologies, which helps to find common solutions to problems, and expands markets or customer groups.
By unveiling these several hidden secrets of thriving digital healthcare platform unicorns, we’re lighting a path toward a future where their appearance will be faster and unicorns will no longer be the privilege of a few. These “secrets” might help to accelerate the emergence of healthcare platform leaders, making unicorns a more achievable dream for ambitious startups.
We want to acknowledge all the other researchers involved in the DiHECO project, coordinated by Kaunas University of Technology, Kaunas, Lithuania.
The article is based on the several scientific studies currently underway on digital platform unicorns. Research team: Asta Pundzienė, Neringa Gerulaitienė, Rima Sermontyte-Baniulė, Sea Matilda Bez, Isabel Narbón-Perpiñá, Irene Georgescu, Saleh Farazi.
This project has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No. 952012.
Author
Assoc. prof. Neringa Gerulaitienė
