Not familiar with Schumpeter’s gale? You may be more familiar with the term “creative destruction.” Schumpeter’s “gale of creative destruction” is the inevitable “process of industrial mutation that continuously revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.”
This is the last THCB Gang of what has been a long, grueling, but enthralling year. And every week (well almost every week) we have had a group from across the health care luminescence to discuss it.
Joining Matthew Holt (@boltyboy) on #THCBGang at 1pm PT 4pm ET Thursday for an hour of topical and sometime combative conversation on what’s happening in health care and beyond will be THCB regular writer Kim Bellard (@kimbbellard); delivery & tech expert Vince Kuraitis (@VinceKuraitis); privacy expert and entrepreneur Deven McGraw (@HealthPrivacy); WTF Health host & Health IT girl Jessica DaMassa (@jessdamassa); and three occasional gang members making very welcome appearances–venture investor & soccer mogul Marcus Whitney (@marcuswhitney); surgeon & startup guy Raj Aggarwal (@docaggarwal); and health economist Jane Sarasohn-Kahn (@healthythinker).
And towards the end of the show we should have our now traditional (or 2nd time) visit from as many other gang members who can make it!
The video will be below but if you’d rather listen to the episode, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels.
I recently watched some of the recent Congressional hearings on cryptocurrency, and, boy, if there’s anything funnier than watching experts try to educate most members of Congress on anything crypto-related, it’s probably me trying to explain it. I don’t own any digital assets, still don’t see the point of NFTs, and am not going to buy any real estate in the metaverse.
All that being said, there’s something about Web3 that fascinates me. Knowledgeable people are talking about Web3 “reinventing the internet,” “democratizing” it, giving people more ownership of/control over what they do on it. It’s a counterbalance to how the internet – both the traffic and the infrastructure — has grown increasingly dominated by a few very large firms, such as Google, Facebook, or Amazon.
Online exchanges of information and value are decentralized
All that sounds very intriguing to me, especially as someone who has dim views of how healthcare likes to silo information, has placed too little value on patient ownership of their own data, and is rushing to centralize.
Each week I’ve been adding a brief tidbits section to the THCB Reader, our weekly newsletter that summarizes the best of THCB that week (Sign up here!). Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt
For my health care tidbits this week, it’s time to bring up the disconnect between the continual collapse of #DigitalHealth stock prices and the continued increase in private sector investment and valuation in the same sector.
All of nine months ago, way way back in March 2021 market leader Teladoc hit a stock price of $308. Last week it hit a low of just under $90. Meanwhile several companies have IPOed or SPACed this year and almost all of them have seen their stock fall dramatically. For example, pioneer online mental health company Talkspace is now at a market cap of under $300m. This week a different mental health company Cerebral which was only founded in January 2020 raised $300m at a private valuation of over $4 billion. Yes they could have bought out Talkspace for that amount! In October Medicare Advantage plan Devoted Health raised money at a $12 billion valuation which exceeded the market cap of rivals Clover, Bright Health and Oscar–each of which has more members.
So what’s going on? Part of this is the wash of money still going into venture funds. Interest rates are historically low, while inflation is picking up, so that money has to go somewhere. Additionally some of the companies that SPACed out were probably unable to get such a good valuation in a private round. But it can’t be that all the 50 or so public companies are lower quality than the private ones. That indicates that either the private valuations aren’t real (because there are so many protections built into the deal for investors), or that the private and public valuations are going to get closer together. There is of course one more possibility–some of the private companies may pursue M&A and buy out some of the public ones. But in any event, this current arbitrage cannot last forever.
It’s not unlikely the public stocks may pick up. But we’ve seen private and public market bubbles before and the aftermath isn’t usually pretty.
Today in Health in 2 Point 00, Jess and I talk about the plethora of notable deals in the Healthcare Space. Bright Health gets $750 million with notable investment from Cigna; Innovaccer gets $150 million, bringing their total up to $375 million; Cadence gets $100 million, bringing their total up to $141 million; Ophelia raises $50 million, bringing their total up to $64 million; and Apti Health raises $50 million, bringing their total up to $65 million.
Joining Matthew Holt (@boltyboy) for an hour of topical and sometime combative conversation on what’s happening in health care and beyond were — medical historian Mike Magee (@drmikemagee); futurist Jeff Goldsmith; fierce patient activist Casey Quinlan (@MightyCasey); and policy consultant/author Rosemarie Day (@Rosemarie_Day1).
Plenty of talk about voting rights, the future of American “democracy” and much more, and we did get back to health care eventually. A great & fun, while important, conversation!
You can see the video below where it’s kept for posterity. If you’d rather listen than watch, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels
Health tech infrastructure startup, Innovaccer, announced its $150M Series E and newly assigned $3.2B valuation today, and I’ve got CEO Abhinav Shashank with the essential intelligence on how this company is pursuing health IT’s holy grail: the single patient health record.
This is a story of cloud technology’s uptake in healthcare, which has lagged behind other sectors like banking and retail in terms of industry-wide adoption. Abhinav tells us that the “economic incentives” are finally aligned for cloud to really take-off in healthcare, as the technology will be critical to any models where care is longitudinal instead of transactional and a singular view of a patient’s clinical data, labs, scans, and claims will be essential to healthcare organizations taking on more risk.
So what, exactly, does Innovaccer do? What’s the work, and how do they get paid? Who has access to the data they’re landing in the “Innovaccer Health Cloud”? Will patients one-day be able to access this single record themselves? And, what stops Epic or Cerner from just doing this and owning the space outright? No detail left unexplored in this one and – for the benefit of those of us who are not very plugged into the IT underpinnings of the EHR – Abhinav breaks it all down for us in a way that even us non-techie health tech market watchers can understand!
Digital mental health startups are leaning into the fact that mental health care is not “one-size-fits all” and, as a result, we’re seeing new offerings hit the market that seek to combine typical therapies and their human-plus-machine delivery in novel ways in order to better meet different patient needs. In this interview, we hear about Resony, a digital therapeutic that’s tackling anxiety and stress through a completely autonomous, AI-driven program that brings together resonance breathing and physical relaxation exercises with cognitive behavioral therapy. In other words… working on the physical side of that mind-body connection for the overall benefit of mental well-being.
Resony is just the first DTx coming out of Rcube Health, one of four early-stage startups that have gained the backing of Bayer G4A as part of their Digital Health Partnerships Program Growth Track. CEO and co-founder Ravi Janapureddy introduces us to the business that he’s building on the thesis that true scalability for digital therapeutics in mental health care relies on full automation – no clinical intervention. In a crowded space, how will Resony stand-out as a stand-alone business, instead of a ‘feature’ for a larger, full-service virtual-first mental health care provider? Is this where Bayer might see the opportunity for an “around the pill” or “alongside the pill” approach? Another digital mental health use case to explore!
Joining Matthew Holt (@boltyboy) on #THCBGang at 1pm PT 4pm ET Thursday for an hour of topical and sometime combative conversation on what’s happening in health care and beyond were Queen of all employer benefits Jennifer Benz (@Jenbenz); THCB regular writer Kim Bellard (@kimbbellard); futurist Ian Morrison (@seccurve) and two investor guests — Super smart AI doc from GSR Ventures (@GSRVentures) Sunny Kumar; and the “I make unicorns” King Bill Taranto from Merck GHIF (@BillTaranto).
We got some forecasts and some reviews of the money and the movers in health care this past year, and looked at the world of employment inside and outside of healthcare, RPM and the public vs private financial markets.
The video is archived below. If you’d rather listen to the episode, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels
How much longer do we have to wait for Glen Tullman to be on the NASDAQ with Transcarent? In this episode of Health in 2 Point 00, Jess and I discuss several new deals in the healthcare space. Suki raises $55 million, bringing their total up to 95 million; Robin raises $50 million , bringing their total up to $65 million; Cerebral raises $300 million, bringing their total up to $420 million; Nomi raises $110 million ; and Apti Health raises $50 million, bringing their total up to $65 million.
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