Why startups need a narrow focus to successfully scale
Though it might seem counterintuitive, a healthcare startup needs a narrow focus before it can scale, said Mudit Garg, CEO of analyticsMD, a company that streamlines hospital operations using data science. Healthcare entrepreneurs need to find the sweet spot between delivering a solution that is complete enough to be valuable, he said, and small enough for a startup to handle. "Understanding what the complete solution is and how to deliver it is not easy," Garg said.
The team at analyticsMD started with the intention of filling one of the biggest gaps in healthcare: that the people on the front lines at hospitals don't know how well they're doing day-to-day, Garg said. Eventually, he said, the company narrowed its focus to develop a software product that collects and presents data and helps stakeholders make better decisions in staffing, patient flow, and performance management. "That learning wasn't easy," Garg said. "It took a little bit of time."
Here are other entrepreneurial insights from Garg:
Find co-founders you can trust -- "Your co-founder relationship is kind of like your marriage relationship," Garg said. "These are individuals I trust fully in their capability and trust fully in their intent." In the challenging world of healthcare startups, it's helpful to have something solid to hold onto through the good and bad times, he said. "You need something stable and that's something stable for us: the trust and the fact that we like to work with each other," Garg said.
Consider a fundraising delay -- Until recently, analyticsMD was completely revenue funded, Garg said. "That forced us to always make sure we were working on a problem that was important for our customer," he said. "That was the only way we were surviving as a company." Once the company reached a point where its scope was narrow enough to be valuable -- but also complete enough to be repeatable -- the team went out to raise funding.
Focus on your strengths to score customers -- Play to your advantages to attract early customers, Garg said. For analyticsMD, the advantage was the company's focus on hospital operations, an unmet pain point. "We were able to work with hospitals early on," Garg said, "and what we were saying to them resonated off the bat." Another advantage: analyticsMD's earliest products could deploy fast. In fact, Garg said, the company landed its first customer because its product could deploy in a matter of weeks -- while its competitor needed a nine-month timeframe. "There is a lot of luck involved with getting that first break," he said.
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