Category Archive For "Investing"
One of the subjects that we cover quite often is the idea that you should invest in what you know. For physicians, this often means that their first investments are within their specific specialty. But as time moves on, investors can find themselves eager to branch out. How do you get there, without branching out from what you know? The solution stems from expanding knowledge of the areas around you.
Advising & Consulting
The beauty of investing, and especially so within a network, is that you will be able to branch out your areas of expertise. The Warren Buffett method, often referred to as value investing, relies on understanding intrinsic values so that you can spot a good deal with the time comes. This level of understanding will come with your work expertise in some areas, but you will develop it in others over time.
One way to further develop your base of knowledge is to get directly involved with companies that are operating a step away from your current comfort zone. For instance, a radiologist could lend their expertise to a company that focuses on EHRs. Their first-hand experience in using EHRs could provide valuable insight to the company trying to build something new.
Often times, the best way to branch out is through advising or consulting for young startups. Advisory and consultancy roles are similar, but functionally different. The advisor could be seen as a mentor, likely familiar with a broad scope of the business. A consultant, on the other hand, is usually someone who fills a functional role such as a radiologist who helps to design the imaging portion of a new EHR.
The Network Effect
The AngelMD difference happens because of the network. But it’s not only a matter of pairing startups with investors. It’s important to follow startups that you find interesting. This allows you to connect with those companies, follow their progress, and be notified when they have needs to be met.
AngelMD provides the network of investors, and as you grow in your own role you will help by contributing more to the network. Angel investing is always risky, but there are ways to mitigate that risk. Build a diverse portfolio, invest with a group, do rigorous due diligence, never stop learning. Above all else, AngelMD’s strongest points of advice is to invest in what you know.
Each of the following startups joined AngelMD in the past month. Check out a new company in a specific innovation category.
We have a few mantras around AngelMD. One of those is “invest in what you know.” But recently we’ve also been focusing on the idea of “innovate where you are.” The theory is the same — you know more about the area in which you’re already working, so it makes sense to put your money or your work there.
Over the years, we’ve seen many instances where non-healthcare companies have used this same idea to break into the market. The latest of these comes from Lyft, an on-demand transportation company. Lyft is working toward building out a healthcare business unit that helps patients travel to non-emergency medical appointments. They company is focusing on its own wheelhouse, and then making key hires to help it transition into a new vertical.
Windpact is a great example of this idea. The company’s CEO is a former professional football player. He knew about the dangers of the sport, and he hired the right people to help build the solutions. Today Windpact is finding success outside of football, while still staying true to its roots, and even being recognized by the NFL.
The idea isn’t new, but it seems to come up more often these days. A few months ago, while we were at the Health:Further conference in Nashville, we heard these same suggestions. Dr. Suzanne Manzi, the Lead Investor for the AngelMD Syndicate for Neumentum, echoed the sentiment.
“I’ve seen promising companies, but sometimes they’re run by people who don’t have experience in the market that they’re trying to enter. They can have a great product, but the odds are stacked against them if they lack the background.”
That said, branching outside of your area of expertise isn’t forbidden territory. It’s a move that you have to handle in the right way. As Dr. Jack Lewin shared with us, it’s important to follow your passion, but it’s critical that what you’re following aligns with your experience. If that passion is too far removed, then find someone who can bridge the gap for your company. Otherwise you’ll be chasing problems that don’t exist.
Dr. Lewin’s example is HealthPals. Dr. Rajesh Dash started the company as little more than a lab with a single purpose. However, the market dictated that HealthPals could have a much larger impact than a single lab could provide. By partnering with the American College of Cardiology, HealthPals has been able to transform its business, while still holding true to its roots.
As the AngelMD network continues to grow, we see new companies join every day. There is nothing more motivating than watching a cardiologist, radiologist, or internist build a company that changes their field. Innovate in what you know, or connect with an expert in the AngelMD network. Are you next?
When Robinhood burst on the scene 5 years ago the ability to trade stock with no fees attached was semi miraculous. That innovation helped drive what today is a startup valued at $5B. Recently, the WSJ dug into the business model and revealed how they are able to thrive while taking no fees.
The fact of the matter is they are taking fees…just not from their trading customers. They are selling those trades on the back end to four high-frequency trading shops. Of course this begs the question as to why those shops would pay for those trades. And this is where it gets interesting. The answer: DATA
I was listening to Tim Ferris interview the CEO of Walmart this week. On the podcast the CEO described Walmart as an increasingly data and technology-driven company. Data is vital to every industry and is the underpinning of AngelMD.
While AngelMD has a long way to go, in the early stages we are aggregating intelligence from our network of physicians and healthcare insiders. We use that intelligence to guide our investment decision making. As we evolve, the data sets will continue to grow and so to will our reliance on this intelligence to give our members an edge in early stage investing.
The following blog post was written by Dr. Robert Teague. Dr. Teague is an AngelMD Regional Medical Director in the Austin, Texas area. Make sure to follow Dr. Teague on AngelMD.
Physician investors have often found themselves struggling to navigate the byzantine and risky world of startup investing. AngelMD brings a new dimension in advancing medical and healthcare innovation with physician domain and financial leadership.
In the world of healthcare startups, complexity prevails, innovation flounders, and patients often lose. One of the main reasons for these issues is the difficulty of investing in new healthcare companies. Many Angel investors do not have the necessary understanding of regulatory pathways, time to market, and other factors that are specific to healthcare. Physicians have a built in capability of assessing these issues, but needed a systematic way to participate with reasonable risk mitigation.
The 2012 JOBS act changed the rules around investing, and the SEC’s 2015 adoption of equity crowdfunding opened the door to physicians who wanted to invest in the future of healthcare.
With these rules in place, AngelMD began executing a vision to accelerate funding of early stage companies and empowering the expertise of professionals to apply smart capital to the equation. AngelMD has developed a highly curated and specialized platform that leverages the wisdom of the crowd and it focuses exclusively on health technology, device and biopharma. The platform includes assessment tools that identify success factors for early stage health tech companies in order to reduce the risk of investing.
Leveraging their physician members across the country and across specialties, AngelMD has an unprecedented capability to enlist physicians in the technical assessment and support of early stage companies with important and novel technologies. Physician excitement and engagement in this activity is palpable. Physicians are back in the innovation loop and their voice is being heard! Physicians members of AngelMD are leading future technology introduction that will improve outcomes for patients everywhere.
Not only have physicians found an Angel, so have startups, other investors, and most of all, those whose health improves from these advancements.