Today, MedCrunch surprises its readers with an exclusive interview on digital health. Vishal Gulati, managing director of Radiant Capital and founder of Digitome, has over ten years of experience as a health care investor, special diagnostic devices, healthcare, and biotechnology. The focus of the conversation is going to be on the Digital Health Forum 2013, an event that will be taking place for the first time next week.
MedCrunch: Vishal, will you tell us about yourself and your journey as a health care investor?
Vishal Gulati: I am very pleased to talk to you about my journey in digital health. I started my life as a physician and ended up becoming an investor in healthcare companies. I invested across the value chain – as you just mentioned specifically in biotech, devices and diagnostics – in several countries. I wanted to see what might be the next big thing in healthcare. I looked at several different developments that were happening around the world, but the one that struck me – the only one I thought was important – was being neglected by investors. I’m talking about the power of digital health. Digitalization has touched many other industries, but it is still quite new in the field of healthcare. For the last 2 to 3 years, I have therefore been evangelizing, promoting, and investing in digital health.
MedCrunch: Could you tell us more about your transition from being a medical practitioner to becoming an investor? How does this shape your opinion and your approach to digital health?
Vishal Gulati: I think the most important difference in being an investor with a medical background versus an investor who doesn’t is that you’re not afraid of medical things. You don’t hold the medical profession in very high deference because, as in any industry that undergoes change, people who are in the industry find ways to resist that change. A normal response for people is to resist change. When confronted by change, many health care professionals are fairly negative and try to find reasons as of why embracing change will not work. Of course, there are some visionaries who are able to see change before it actually happens, and attempt to found companies. Having been a physician, I think I’m able to look through this thick glass and ask difficult questions that need be known by investors.
MedCrunch: Do you feel that the resistance from physicians to embrace this change is decreasing?
Vishal Gulati: I do not have an objective answer to this question. My subjective opinion is that it is definitely changing and, as you see, the old guard is moving out of the way. A lot of people who are in decision-making positions within the healthcare space are quite technology savvy. That never used to be the case. What we know for a fact is that the majority of physicians now has smartphones and touchscreen technology. We have reached to a point where physicians and decision-makers are asking the question, “Why not?” That’s a very good position to be in. Nevertheless, we should not underestimate individuals that are unhappy or slightly apprehensive about new technologies. Those people have been carrying out their every day tasks in a certain way for a long time; change is never going to be easy. Also, there are reasons why the healthcare industry changes slowly: it is structurally designed to do things that are well tested, and are backed up by sufficient evidence. Without this design, doctors around the world would be doing things, which they think are good but may not be in the best interest of the patient. I therefore want to say that there are good reasons for the healthcare industry to be somewhat slower than retail or advertising.
MedCrunch: Of course. So, as an advocate of the digital disruption in healthcare, can you tell me how Digital Health Forum was conceived and what effort it took to make it happen?
Vishal Gulati: I have been talking to people about digital health and embarking on conversations with people who are in the industry for a long time. Gradually, I started speaking at people’s conferences all over the world, and focused on specific events that were looking for what might be the next big thing. I did, however, not find a conference or event that was specifically designed to make things happen. When I – as an investor – say, “make things happen” I refer to the capital that is needed to make a significant change in the healthcare industry. There are great ideas out there, but there aren’t sufficient investors that buy into the idea of digital health. This is something that Digital Health Forum (DHF) is trying to change. We are trying to change the investors’ minds. We are trying to highlight the best health opportunities to invest in. This is why DHF was set up. We weren’t expecting to get a lot of traction during the first year, but we are delighted to see that world-leading visionaries like Esther Dyson see and understand the importance of what we are doing and graciously accept the invitation to come to the event. As you know, she is the original Internet guru; she predicted the power of the Internet in 1997 when most people didn’t know what the Internet was. We are really, really delighted to see this much interest.
MedCrunch: That sounds amazing. We think this outcome-related approach is very interesting. Can you tell us more about how you tailored the program and how you want the event to have an effect on digital health?
Vishal Gulati: What we basically did was looking at the (inaudible) group and saying, “What are the questions that are at the top of their minds?” We came to the conclusion that just providing them with potential investment opportunities and having a full day of companies pitching is not going to be sufficient. We have to address the questions and hurdles that are in investors’ minds. We decided that those hurdles are around regulations and data protection. We also found hurdles around finding the right investment thesis and business model, which works for founders, healthcare providers, and investors. Thirdly, we wanted to address the gap between people that have great ideas and big companies. We have addressed all of these issues and sandwiched the information in presentations. All questions and hurdles that investors have in their minds will most likely be addressed and opportunities will be offered for them to invest in.
MedCrunch: Following up on that, can you tell us more about the Hot Five competition?
Vishal Gulati: We thought the Hot Five Competition would be a great idea to add value. We did not want to create an event where people just came and presented; we wanted to have some kind of quality control. We want to make sure that investors who give their valuable time to come to this event don’t just end up seeing two companies and leaving. We thought a lot about it and several times slightly tweaked the model. We now think we have gotten to a model that really works. The key thing about our conferences is that we do not want young companies – who are embarking on their journey to change the world – to have to fork out a lot of money in order to see investors. We think that investors should be as excited about meeting great investment opportunities as great investment opportunities are excited about meeting investors. We try to level the playing field. We have told ground breaking digital health companies around the world to apply to the Hot Five Competition. If they manage to get through our judging panel and are seen as exciting and hot companies, they get to come and present for free. Many companies applied and we have now identified top-notch companies. At the conference, those companies will get the chance to pitch in front of investors; a group of those investors will act as judges and will mark and identify the best pitch. The company with the best pitch will get a cash prize of a thousand pounds, which is only a small encouragement. Companies need a lot of money and a thousand pounds won’t take them very far, but at least it will cover some of their costs and provide them with a lot of good publicity. We are collaborating with College Hill, a great PR company, and believe that through our media presence, we will be able to get these companies not just in front of great investors who are at our conference, but also to the attention of many other investors around the world.
MedCrunch: Great! That sounds amazing. Just one more question: looking at the bigger picture, when and how do you think digital health will actually be ready to disrupt healthcare and what can physicians do to contribute to this disruption vector?
Vishal Gulati: I object to your question asking when digital health will happen, digital health is already happening. Millions of people around the world are assessing their health in some form through Internet, smartphones and all sorts of other devices. As far as I’m concerned, digital health is already here and it’s all around us. If we look carefully we will see three million people going to Health Tap every month and asking questions to physicians; millions of people are booking their appointments using Softdoc. There are great examples of great digital health that are already here. That doesn’t mean that we have seen it all. I think we are at the beginning of a ten-year revolution.
MedCrunch: That’s what I actually meant, when do you think this real sort of revolutionary shift is going to happen? It seems to be warming to it more.
Vishal Gulati: I think that any revolution that happens over a period of ten years happens at a pace where we become so used to it that we don’t actually see it being a revolution. People who buy almost everything on Amazon, don’t think their life has been revolutionized unless you actually ask them that question. I don’t think that there will be a day when you will wake up and say, “Oh, isn’t this wonderful?” I think what we will start noticing is that our healthcare experience will gradually get better. We will have more choices in terms of when we see physicians, how we see them, and whom we see. This revolution is already happening. On the other hand, there is the question of when the healthcare system will become smarter; I give it about 5 years. At that point, the system will be able to analyze big data, tailor services, approach populations and tell us what we need to gain better health rather than wait for symptoms to develop in relation to sickness. As you know, the healthcare system was invented to deal with things that have already happened. I think that some of the digital health changes will happen at a small pace. I heard somebody say that every ten years the world turns upside down but we don’t know it because we are in it. I think this is applicable to digital health as well.
MedCrunch: Great. Thank you very much for your insight! We look forward to the event!
Vishal Gulati: Excellent! I look forward to seeing you as well.