B2B Marketing, Ecosystems, Health Care

This week’s Engagement

This week, I am in Miami, building out an alumni engagement platform for a client. They realize that alumni are often forgotten when mapping out a company’s ecosystem. There are several types of stakeholders in this group:

  • Ex-Employees: When I develop influencer, advocacy and other stakeholder programs, almost nobody wants to discuss their ex-employees. This is because senior management struggles with high turnover rates, keeping their current employees engaged and happy and with their old ‘out of sight,out of mind’ mentality. Some of a company’s biggest advocates can be their ex-employees (make sure they leave on good terms). They are the ones who will be sneaking onto Glassdoor writing reviews, writing instant messages about why they left and explaining in each future job interview ‘what happened and why they left their previous job.’ All these ‘engagements’ are opportunities to reinforce your company brand, recruit future workers, and advocate for your products. I left Intuit eight years ago, but to paraphrase Tommy Lasorda (the ex-Dodgers baseball manager) – “I still bleed (Dodger) Intuit blue.” Even more important is that since your ex-employees probably enjoyed your using your products, so they now can be net promoters for you in their new companies. Since I left Marketo last November, I have convinced three companies to use Marketo as their Marketing Automation Platform of choice. If staying in touch with your all your ex-employees, however, seems overwhelming than you could either create a community for them to engage with each other — and you engage with them or 2) you could focus first on the ones who seem the most inclined to stay in touch — your top advocates.
  • Ex-Customers: Again, there’s an out of sight (or maybe out of website), out of mind phenomenon happening here. I was always frustrated that I could not let an ex-Marketo customer (individual) use their community account after they left their company for another company that doesn’t use Marketo. If they did this, they would loose their Marketo instance. Why can’t that ex-Customer can be your number one advocate in their new company? Ex-customers can be future customers. So, don’t break up with them. Instead, maintain that relationship with them. One of my clients, Melnic, a Health Practitioner recruiting site, knows that even after they place someone in a new job, it’s important to maintain a relationship with them so that they are top-of-mind when that person applies for a new job. Why don’t technology companies do this? Why don’t others? If they were once a user or  a loyal advocate of your product, they could potentially generate more revenue for you later on.
  • Ex-Partners: This is similar to ex-customers. In the Partner Economy, word travels fast. Even if a company no longer uses your service, make sure to maintain a relationship whenever possible. This can be as simple as an email drip campaign, or as I do, set up dates on my calendar to call them and check in. (Yes, the old school phone tactic.)

Why is it that only academic institutions think about alumni? (OK, Sports teams also do a good job with their older times days). Every organization should have a formal outreach program for their alumni. They should not be ignored, especially as word-of-mouth and referrals drive more and more sales for companies. This is also true for LinkedIn and Glassdoor, who should have an ex-coworker locator. (There are some employee grassroots type of company alumni groups on LinkedIn, but most are inactive). With these services, it’s really easy to find current employees (and jobs) at a company, but it’s not always so easy to find a company’s ex-employees. If you do a search on Apple, LinkedIn highlights current employees and job openings. (See below) I get nada, niente, zippo in terms of finding an company’s ex-employees. It’s as if there’s something icky about people who leave a company.

Hey, not all ex-employees have negative things to say about your organization. And if they do, there’s a bigger problem that needs to be addressed. Remember: Every employee who steps out the door can be a future customer. Every ex-user can lead to another company buying your services.

Have you talked to an alum today?

1099, Companies, Freelancers, Health Care, Your rights: Presidential Election, Laws, etc.

On-Demand Economy’s Companies Need to Provide Job Benefits

You’ve probably heard of Uber, Airbnb and Handy before. These are just a few companies in the on-demand economy that have grown rapidly over these past few years. As a result of the increased demand, more and more freelancers are taking on multiple ‘on-demand gigs’, even stringing together multiple gigs to replace a full-time salary. While these jobs provide flexibility, one of the main drawbacks is lack of benefits. On-demand workers aren’t protected like their salaried counterparts.

In the On-Demand Economy, the need to improve job benefits and workers’ protection for self-employed workers and independent contractors is now being noticed. Recently, the labor group National Domestic Workers Association (NDWA) announced the “Good Work Code”, a pledge to help freelancers and improve their jobs with more transparency, better wages, and increased support. Twelve companies have now signed it, including DoorDash, Care.com and LeadGenius.

While more and more companies are joining this pledge and those similar to it, the largest ones have yet to make an effort, including Uber, Lyft and Handy. Time will tell if the increased pressure from other groups and on-demand companies, as well as support from political powers, will change their minds.

The Good Work Code is seen as a step in the right direction for on-demand workers. It addresses many of freelancers’ concerns and challenges but at the same time, also fails to make actionable steps to fix them. Their goal is to get politicians and companies talking about to fix this larger problem and more importantly, how to change it.

Show Image In Single Post / News Page

Freelancers, Health Care, Insurance, Self-Employed

The On-Demand Society’s Need For Benefits Is Being Heard

While the on-demand society and the companies who hire freelancers have been growing rapidly over these past few years, it hasn’t been without controversy. The flexibility of being an independent contractor has it’s perks. However, one of the biggest drawbacks is the lack of benefits but most freelancers need it.

The upside of hiring an independent contractor is quite clear to an employer: the cost benefits. While the lifespan of employment is generally shorter, an employer can save significantly on costs such as health benefits, as opposed to a full-time position. But that raises the question: is that ethical? Or legal? There’s a very fine line by law when it comes to employee benefits and this concern is being brought up more than ever. In fact, it was brought up at a recent GOP debate when Carly Fiorina was asked about the growing number of workers who do not have a 401k or employer-sponsored retirement plan. Not surprisingly, she skirted around the subject. The matter of benefits for the on-demand workforce is a sleeping giant that seemingly no one wants to deal with. But the firestorm it can create is already apparent.

Many leaders of companies in the sharing economy are beginning to address this problem as they realize that this could snowball into longer term difficulties for the on-demand workforce and the employers who hire them if left unaddressed. A group of tech leaders, many from on-demand companies such as Handy, Instacart, and Care.com, have posted a letter on the website Medium calling for lawmakers to address the need of protection and benefits for this workforce. At the core of their campaign is bringing to light a freelancer’s plight – their work is nimble and unpredictable and they need a basic protections to cover them. This campaign and many others similar to it take aim at companies like AirBnb and Uber, two pioneers of the on-demand economy who have been widely criticized for their lack of employee support. While they are now launching campaigns to for legislation to provide independent contractors with support, they want to protect their own business model at the same time.

Change is still far away and slowly coming but the need to address this problem has been noticed. The on-demand workforce has become a very significant part of the American economy and the new way in which it works. In order for it to continue to not only sustain itself and grow, this workforce needs to be supported in one way or another.

Handy’s Corner of the Gig Economy Is a Mess. Doesn’t Bother Startup Investors!
Companies, Health Care, Industry Research, Ondemand Platform, Services, The American Dream, Uber

Home Services need to be Cleaned Up

Originally Published in Slate

The startup world is full of ironies and poetic justices. The bubbly race to wash your clothes. The club of billion-dollar “unicorns” that boasts more than 100 members. And the undeniably messy market for on-demand cleanings and home services.

In recent months, the home-services market has repeatedly proven one of the riskiest and most muddled in the burgeoning “gig” economy. The clearest evidence of this came in mid-July, when Uber-but-for-cleaning platform Homejoy announced it was shutting down. At the time, the company attributed its exit to problems with raising money and to a lawsuit over its employment practices;other reports since have traced the collapse to substantial losses, poor customer retention, costly expansion, and Homejoy’s inability to keep its best workers on the platform.

Similar problems have plagued Handy, another Uber-but-for of the home-services sector, and Homejoy’s main competitor before it went under. Like Homejoy, Handy poured money into scaling up its operation, spending tens of thousands of dollars a week—if not more—to onboard cleaners. Like Homejoy, Handy struggled to retain those cleaners, with 20 to 40 percent becoming inactive after two to three months. Like Homejoy, Handy is in litigation over its independent contractor-based business model. On top of that, Handy has faced tough criticism about its customer service—in particular, a signup system that automatically enrolled users in repeat bookings and made it extremely difficult to cancel them.

And yet the gig economy keeps chugging. Handy said Monday that it had raised $50 million in a Series C funding round led by Fidelity Management and several of its current investors. That brings the company’s total funding to $110 million, for an unofficial valuation of around $500 million.

In its press release, Handy points to its 1 million-plus bookings (a milestone it celebrated over the summer), and that 80 percent of them come from “loyal, repeat customers.” Presumably a good deal of the company’s valuation and new funding is tied up in this claim—repeat customers are much more likely to actually pay off than one-time users—though the fact starts to sound less compelling when you wonder how many of the 80 percent were repeatedly using Handy of their own volition, and not because they couldn’t cancel those automatic recurring bookings.

“Handy has demonstrated to consumers that it is the company to trust when it comes to finding professionals to take care of their homes,” Handy co-founder Umang Dua says in the release. “Professionals love the flexibility, high-paying jobs and high demand for their services, while consumers enjoy the convenience and high quality.” It’s nice PR boilerplate that becomes less convincing once you consider the cleaners who have filed lawsuits against Handy, the customers stuck with followup bookings they didn’t want, and the customer-experience employees at Handy’s headquarters who had their jobs outsourced and were fired en masse between late 2014 and early 2015. For more on most of that, see my Slate story from this summer.

On the other hand, it’s possible that Handy, in the spirit of its sector, has started cleaning up its act. In late August, a former Handy employee notified me that the company had finally reviewed its compensation and payroll practices and issued back-pay to some customer-experience employees for their rest periods. As part of that, back-wage recipients were asked to “stipulate and agree that my accepting this payment does not constitute, for any purpose whatsoever, either directly or indirectly, an admission of any violation of law or contract or any other legal obligation whatsoever by Handy,” according to a copy of one agreement provided to Slate. They also released Handy from “any and all individual and/or class claims under the New York Labor Law and, to the extent allowable, any other federal, state or local law, related to the payment of wages, benefits or other compensation related to my employment with Handy,” so you have to assume that’s something the company was nervous about.

Could such changes, plus the Homejoy exit, be enough to pave Handy’s way toward establishing a profitable, sustainable business?Or is the market for home-cleaning and other household services fundamentally too tough? Those are questions that as of yet don’t seem to have clear answers. For now, though, Handy doesn’t need to convince the world one way or another. It just needs metrics that are aspirational enough to attract a few investors—to keep the cash flowing in from one end to be burnt up on the other. Fifty million dollars might not feel like much compared to the $1 billion rounds that Uber raises with casual regularity. But for a company in a space as murky and fraught as Handy’s, it’s an equally big vote of confidence.

 

Companies, Health Care, Industry Research, Services

Health Care Industry: Change is happening

Printed without permission (but I like the topic). Original from CBInsights.com

I recently had the chance to attend Rock Health’s Digital Health Summit and below are my notes throughout the two-day event and my overarching takeaways.

Digital health is very different from tech (especially time horizons)

Health is a gigantic, lucrative, and an essentially recession-proof business. But companies in healthcare are often slowed down by regulatory issues and the need for health outcomes data, i.e. data showing a given therapy’s effectiveness and safety. That may be why in health, “it’s better to be long-term greedy, than short term greedy,” as Chamath Palihapitiya of SocialCapital put it several times.

Almost every speaker from the VC side emphasized that venture capital as an asset class was designed to make risky bets on companies that have longer return timelines, so healthcare is an important place for them to be. As Noah Lang of Stride Health said, “The important thing is to be patient.” (I’m guessing he didn’t intend the pun, but it got some laughs.) Chamath was a bit more blunt, saying ”VCs should be investing in health but instead, they’ll keep investing in these on-demand brownie delivery services instead.”

Unlike tech startups, healthcare companies don’t enjoy the luxury of a soft landing. Tech is known for pushing out products and iterating as they get feedback, especially when things aren’t working. Health is different because products cannot fail. People’s lives are at stake. And because of that, potential customers — not to mention regulators in many cases — want to see evidence that these companies have an actual impact. This presents many healthcare startups with the Catch 22-type problem, “how do we get evidence if we can’t get customers?”

Healthcare needs to be more personalized

As we move towards value-based care where price is dependent on results (as opposed to fee-for-service), attention to patients is being given new priority. The old system that fits patients into a one-size-fits-all mold is primed to be disrupted. Whether it’s using software to connect customers/patients with caregivers that match their preferences (like Honor), or making sure wellness or healthcare coaches continuously work with the same users to understand their needs (like Lantern), or helping users find the right insurance company for them (like Collective Health). This is a great time for small and nimble companies to find niches where they can appeal to patient needs or fill gaps, which could allow them to compete with some of the larger entrenched players.

Preventive medicine is what’s cool right now (and still growing)

The Affordable Care Act in the United States expanded the market size and importance for preventive medicine by creating incentives for healthcare organizations to keep patients out of hospitals. Plenty of startups are ready to operate in this space. With more individualized care, companies can make sure that at-risk patients are identified and helped before they have to enter the hospital. Lyra Health does a good job of this by identifying patients that might need behavioral health services at critical moments by using data (like after pregnancy or coping with chronic disease). The goal of Human Longevity is being able to use genomic data to identify problems before they occur, rooting the company in preventive medicine. As we get more data from patients outside of hospital settings, it will be easier to identify those who are at risk.

 

Lots of entrepreneurs are coming from tech into digital health

It was interesting to see the number of entrepreneurs that were jumping into healthcare from tech (even if they didn’t have a background in the field). On the panels were David Ebersman from Lyra Health (previously Facebook), Ali Diab from Collective Health (previously at Qwilt Software) and Alejandro Foung from Lantern (previously at Trulia), as well as many entrepreneurs I met at the reception with similar backgrounds. Coming from tech brings positive qualities, like the willingness to break systems when they aren’t efficient, the desire to move quickly, and a strong customer-oriented focus.

However, it’s important when going into healthcare to understand more patience is necessary (see above) and behaviors are very different. In tech, investors/customers care much more about your growth and potential. In healthcare people care much more about how much money you’re saving the system, and want data to back up your claims.

It’s all about the data, and that data needs to be open. We need better interoperability.

New health data is being created by the boatload, and healthcare is not doing a good job keeping up. Fitbit CEO James Park made a relevant observation in this regard when he said Fitbit’s fitness trackers allow people to visualize something that was previously invisible (like steps taken in a day, sleep duration, etc). As wearables, diagnostic tests, online portals, and other instruments create and accumulate data, we need better ways of packaging it and making it usable so that doctors and systems are not bombarded with noise.

Unfortunately, due to tight regulations surrounding health data, outdated electronic medical record (EMR) systems, and hesitance about data quality, there is very little communication and interoperability between systems. These barriers will need to come down in the future for any progress to happen. As J. Craig Venter of Human Longevity said, the innovations in genomic data/linkages that his company is doing with the genome are “only useful if the data is available”.

Siloing health problems is no longer the way to go

Healthcare has historically taken an approach of focusing on one issue at a time, but “integrated care” is coming into the spotlight as more people realize the cost of “co-morbidities,” or interrelated health threats. J. Craig Venter spoke at length about how different alleles and phenotypes are interconnected, and we need to look at disease holistically.

More anecdotally, several presenters spoke about how patients with chronic diseases who subsequently develop mental health problems as a result (such as depression) are much costlier to the system than either problem alone. However, reimbursement from insurance companies currently isolates each condition separately, even as more evidence mounts that they are interrelated. In the future, we’ll be able to use better data to understand how health problems correlate and better treat and price our patients.

Digital health aims to improve efficiency and remove humans from non-core functions

One of the biggest improvements digital health can bring is to improve efficiency. Many startups are trying to remove any process that isn’t a core function of a healthcare professional (Sandy Jen from Honor spoke extensively about how their software removes a lot of the tedious aspects of caregiving that are not directly related to taking care of customers). By using software, not only can more time be dedicated to better care, but there is also an opportunity for better scale so that practitioners, coaches, and caregivers can see far more people in a far shorter time.

Branding is extremely important

The concept of “branding” came up several times in different contexts. The first time was when DJ Patil said that the branding around software workers in government needs to change. Workers are often called “IT” when in reality they’re designers, programmers, product people, etc. and it’s important to recognize them as such. Sandy Jen from Honor spoke about branding in the context of marketing different services. She spoke about how people are adamantly against people putting their parents into home-care services, but if the same product is positioned as “someone coming to check on your parents every couple of weeks,” people are much more receptive.

And finally, David Ebersman from Lyra Health talked about the importance of phrasing and methodology of outreach when talking to people that might be at risk for behavioral disorders (which prompted a wider conversation about the stigma barrier in behavioral health as a whole, since many potential patients can’t get past the stigma of admitting they are depressed or struggling with a treatable disorder).

 

The current regulatory framework is broken

There was unanimity among everyone at the conference about the need to address the broken regulatory framework. Chamath talked quite passionately about this issue, and explained that the capital intensity required to get through the FDA process was what allowed companies like Axovant etc. to go public at crazy high valuations without any products out. On the other hand, many investors are scared that regulatory burden will cripple their investments before their companies can even get to the starting line.

Meanwhile, Leslie Botorff of GE Ventures outlined the different levels of regulation the FDA imposes, and how startups are trying to find ways to stay in the less heavily-regulated classes of FDA approval. On top of FDA issues, the need to be HIPAA compliant is one of the driving reasons why interoperability and data sharing are such complicated issues in the US market.

 

Developing countries are great places to start digital health companies

Developing countries have become ideal places for investors to look to for investments in digital health companies. Not only do these companies face less stringent and complex regulations (which result in lower costs to start companies and a more open uses of data), but the governments in these areas are much more concerned with increasing the overall health of their citizens so that they can compete with the standard of living in the US.

In addition, the massive populations and their growth — in India and China specifically — yield extremely high patient-to-doctor ratios, which creates a strong demand for more efficient systems. Combined with a growing working class that will have more income to spend on healthcare, the arenas outside the US are starting to look promising.