Understanding the Differences between Medical Culture and Tech Culture

Understanding the Differences between Medical Culture and Tech Culture

In a recent Business Insider article, John Ioannidis, Racquel Bracken, and other health tech experts lamented that the Silicon Valley tech ethos of “move fast and break things” is not being counterbalanced by the healthcare principle of “do no harm. (Why everybody gets duped by hot health and science startups, June 2019). Ironically, tech’s desire to move fast is slowing its ability to achieve widespread market adoption and profitability for health-related products. The goal of this blog is to help both industries better understand the importance of their cultural differences in order to get high-impact products to consumers more quickly.

 The healthcare perspective is underrepresented in health tech. I spent the past decade serving as the Chief Medical Officer of several health tech startups. With each one, I was initially energized by the potential for responsible disruption. The engineering, design, and product talent—and the money—was unlike anything available to physicians in a traditional healthcare setting. It truly felt like an embarrassment of riches. With each company, I was the only medical professional on the executive team, and usually the only MD in the company. With each one, I knew that we could have been more successful more quickly if the company had had an earlier understanding of the expectations of the healthcare industry and sensitivity to healthcare culture. I observed this same phenomenon in many of the health tech startups evolving into and out of existence around me.

Tech Needs to Get Curious about Medical Culture

 When I left traditional practice to embed myself in Silicon Valley, I recognized quickly that my tech teammates spoke differently than I did. They solved problems differently than I did. They worked differently than I did. If I was going to effectively partner with them to disrupt health care, I needed to learn about tech culture. I read every Silicon Valley holy book I could find—The Lean Startup, The Hard Thing About Hard Things, Measure What Matters, The Four, In the Plex, Hatching Twitter, The Upstarts, The Everything Store, From Good to Great, etc. I learned about OKRs, MVPs, 20% time, flywheels, doom loops, BHAGs, pivots, dogfooding, flat org charts, and scrums. I read about the history of the tech industry and the stories of how the FAANGs became FAANGs. (In a future blog, we will unpack all these terms. For now, just realize that in order to respect a different culture, it’s important to learn about why that culture is the way it is.) Too often, my tech teammates did not reciprocate my willingness to understand their culture. This limited the company’s ability to design appropriate products, close deals, and compile realistic financial projections. It cost real time and real money.

 Granted, the tech industry has successfully disrupted almost every industry in the last 20 years. Tech entrepreneurs are somewhat justified in feeling like their way is the right way and everyone else should get out of the way. But the reality is that the healthcare industry is different. One of the key differences is that it is not a free market. Full stop. 

In addition, there are multiple, very powerful stakeholders in health care—insurers, regulators, physicians, professional societies, pharma, and patient advocacy groups. Consumers often don’t feel like they should have to pay for legitimate health products out of pocket, so simply delighting consumers and getting them to vote with their feet is not enough to achieve widespread adoption, let alone topple the incumbent system. Unlike other industries, a direct-to-consumer product can’t circumvent the incumbent stakeholders. That’s because consumers will inevitably take the results of their health products to their healthcare providers. If the healthcare provider says, “What is this? This is junk. You’ve been swindled,” it doesn’t make for a positive consumer experience. The flywheel cannot gain momentum. You simply have to understand the values and social mores of the healthcare stakeholders to win.

Being Awesome is Not Enough

 So, how do you do that? With data, credibility, and transparency. It is not sufficient to think your product is awesome and convince consumers of this. You have to prove that your product is awesome. And not just awesome, but medically beneficial and economically worthy enough to justify the high cost of implementation. Generating this proof needs to be part of your go-to-market strategy and financial strategy from inception. What’s more, there is a well-established formula for how to do this. That means there is no excuse for confusion or delay, if investors and founders do their homework.

An obvious way to ensure success is to balance your leadership team with the right tech and medical professionals. If you go too far in the medical direction, you are essentially a traditional device company. If you go too far in the tech direction, you will waste too much time and energy learning the basics of market access and product-market fit. In general, I recommend hiring most of your engineering, product, and design teams from tech and most of your commercial and medical affairs teams from health care. Medical affairs can help make sure your product solves a real problem in health care and design the proof studies. Experienced sales, business development, and marketing professionals not only have the right contacts, but they also know how to deliver the right messages through the right channels at the right time. A future blog will elaborate on how to do this.

Culture Clash

This table highlights some of the cultural differences I’ve observed between healthcare and tech. 

  More details on the    Nuremberg Code    referenced above.  More details on the Nuremberg Code referenced above.

Finding the Right Balance

We need to find the right balance of healthcare and tech cultures to get impactful products to patients quickly and responsibly, and to successfully usher in the much needed disruption of the incumbent healthcare system. The longer we delay prioritizing this balance, the longer we all have to live with the current broken system, and the longer we have to watch billions of dollars wasted on health tech startups  that are doomed to fail because the founders do not understand healthcare culture—both are pretty unbearable!

Understanding the Differences between Medical Culture and Tech Culture 1

Jill Hagenkord, MD

MDisrupt Guest Author

Jill is a board-certified pathologist with subspecialty boards in molecular genetic pathology and a fellowship in pathology/oncology informatics. She brings expertise in health product strategy, coding, coverage, reimbursement, medical and regulatory affairs, health policy, clinical laboratory medicine, population health, provider education and patient engagement.

Every health tech company wants widespread adoption for its health product. There is a community of healthcare experts who would love to help you. Talk to us—we can help.

Why Investors Need to Do More Rigorous Medical Diligence as a Core Part of any Healthtech Investment

Why Investors Need to Do More Rigorous Medical Diligence as a Core Part of any Healthtech Investment

Yesterday’s big news, reported by Chrissy Farr of CNBC, was ‘“Gut health start-up uBiome files for bankruptcy five months after FBI raid.”  In other words, yet another health tech company is making headlines for avoidable, costly—or dangerous—missteps. The troubles of uBiome, Theranos, Nurx and 23andMe have been high profile enough to make the press, but they are by no means unusual. In fact, similar missteps are happening all the time with smaller health tech companies, usually unbeknown to their investors. 

It’s time that we in the industry, who are creating the health products of the future, ask ourselves why these problems keep  happening and what we need to do to fix them. A heated debate erupted on Twitter in response to the latest uBiome headlines, questioning what role investors play in enabling missteps and whether they are doing an appropriate level of medical diligence when they fund health tech companies.

Investing in early-stage companies is always risky particularly in the unproven health tech sector. In every investment transaction, investors conduct a process of due diligence to confirm the accuracy of claims about the company’s finances, business model and teams. The due diligence process is intended to help identify the potential winners, elucidate key risks, and develop a risk mitigation plan with the management team. Common areas of review during the diligence process include finances, operations, legal, and, when appropriate, technical. Although the investors and entrepreneurs need to be aware of diligence issues, the actual assessment is typically done by professionals—accountants for financial diligence, lawyers for legal diligence, and so forth.This is because these individuals do a far better job of identifying potential pitfalls or risks.

Yet in health tech, the process happens in a different way. When it comes to the medical diligence required to evaluate a company, tech investors usually rely on their associates instead of on professionals with medical industry expertise. 

Medical Diligence Is Missing

We would hope that by simply presenting the above sentence to the investor world, the logical disconnect would speak for itself. In case that’s not convincing enough, the proof of the problem is in the numbers: Over $50 billion has been invested in health tech in the last ten years, but with very few successful exits. Clearly, most medical diligence that has been done to date has not been rigorous enough. For the most part, it has failed to separate those companies who are creating a clinically and commercially viable health product from those who are not. And it has failed to detect the ones making the egregious missteps we are seeing in the headlines.

Tech entrepreneurs are famous for solving problems with rapid iteration and learning. However, they can often take far too long—five years or more—to discover certain requirements for success in health tech: Specifically, that: 

  • There is a formula for achieving widespread market access in health care 

  • They need team members who are part of the healthcare industry 

  • Credible evidence presented in the right places is necessary before widespread adoption of a new health product can happen. 

Proper medical diligence that takes these principles into account can save entrepreneurs years in opportunity cost and save investors tens of millions of dollars per company.  

Investors Need to Lead

The investment community has the power to propel the health tech industry forward and accelerate the disruption of health care by identifying the most viable health products faster. In order to do this effectively, investors need to know that a company’s business practices and financing are sound. But they also need to know if a product or service is actually clinically useful, solves a real healthcare challenge, and whether the company has data or is conducting studies that support its claims and stated value propositions. The timeframe to investors’ return on investment is overtly tied to the answers to these questions. Rigorous medical diligence is ESSENTIAL to investor success and to the creative disruption of healthcare.

While the elements of medical diligence are well known to traditional healthcare investors, we believe it’s important for all investors to obtain an assessment of these criteria when considering an investment in a health tech company.  We have outlined these essential parameters in our blog The Formula for Widespread Adoption of Health Products that Every Investor and Health Tech Entrepreneur Needs to Know.

At MDisrupt, we believe that an obvious solution to the problems in health tech is to engage healthcare professionals and market access experts to assess the viability of health tech investments. As with legal, financial, and technical diligence, medical diligence, when conducted by experienced professionals, can save time and money, avoid embarrassing missteps, and set appropriate revenue timeline expectations. 

MDisrupt works with investors and health tech entrepreneurs to do an independent, transparent, and objective assessment of the clinical and commercial viability of health-related products and services. We can identify red flags early on as well as work with companies to bridge any gaps they may have. Our assessment includes: 

  • Clinical Viability

    • Intended use and product-market fit

    • Analytical and clinical validity

    • Clinical utility and health economic models

    • Prospective outcomes studies

  • Commercial Viability 

    • Coding, coverage, and reimbursement, if appropriate

    • Clinical dossier development

    • Key opinion leader strategy and eventual inclusion in professional society guidelines

    • Channel optimization and market access strategy

  • Regulatory Strategy

  • Privacy and Security

As an industry, we need to do better. We need to combine the best business philosophies of the tech industry with the best practices of the healthcare industry to help get the most impactful products to patients faster. This is MDisrupt’s mission.  

If you are an investor considering an investment in a health tech company, talk to us. We are happy to outline and explain the essential elements of medical diligence and why they are important to successful investments. Medical diligence can help keep you and your portfolio companies from making headlines for the wrong reasons.

jill hagenkord

Jill Hagenkord, MD

MDisrupt Guest Author

Jill is a board-certified pathologist with subspecialty boards in molecular genetic pathology and a fellowship in pathology/oncology informatics. She brings expertise in health product strategy, coding, coverage, reimbursement, medical and regulatory affairs, health policy, clinical laboratory medicine, population health, provider education and patient engagement.

Every health tech company wants widespread adoption for its health product. There is a community of healthcare experts who would love to help you. Talk to us—we can help.

Why medical diligence is essential for healthtech

Why medical diligence is essential for healthtech

We spent the early part of our careers working in the traditional health and life sciences industries. That’s where we met, traveled the world together on medical roadshows, and became great friends. We bonded around our shared frustrations at the slow pace of innovation within our respective fields. We had recognized that technology was going to transform the healthcare industry and were inspired by the early trends in consumer-empowering health products. We wanted to contribute to that transformation. 

Ten years ago, we each decided to move to Silicon Valley. Since then, within our industry, we have seen and witnessed the incredible, the inspirational, the irresponsible, and the wasteful. And now we are on a mission.

Despite healthtech being one of the fastest growing industries (over $50 billion spent since 2011) it can claim relatively few success stories. Most venture investors expect an exit within 7-10 years. Yet for a health product, it can take 10-17 years to gain widespread adoption and reimbursement. Many companies have (and will) run out of money before they become profitable.

Furthermore, many companies with promising ideas have suffered completely preventable missteps because they simply didn’t understand the process of successfully getting a product into the healthcare market. Some well-known examples include Theranos, uBiome, and 23andMe. There are many other stories that weren’t high-profile enough to make it into the mainstream press.

Our early years at healthtech companies in Silicon Valley were challenging. After working at a number of startups we realized that medical expertise was often significantly underrepresented. We learned that tech had a completely different culture from what we had been accustomed to in health care. For example, a common ethos in the tech industry is move fast and break things . It’s standard practice in consumer tech to launch a minimally viable product (MVP) and iterate on the fly.

In contrast, the primary rule in health care is first, do no harm. And the data proof points for health products are much higher than in other industries.

And yet there is a clear and well-established formula for healthcare market adoption and reimbursement. Unfortunately, entrepreneurs are often several years in before they are fully aware of all the steps that this formula requires.

For example, when commercializing a health product you have to communicate in a different way in order to convince a skeptical audience. There is a strategic approach to marketing and business development activities. It requires a combination of the right message, at the right time, with the right data, from the right person, through the right channels. Persuading a scientist or physician isn’t done with a testimonial or a five-star rating. It happens through studies, peer-reviewed publications, podium talks, health economics data, and medical society guidelines.  

We believe that what’s missing in the healthtech industry is a medical diligence process. In most investment transactions, there is usually a rigorous due diligence process which includes legal, financial, and technical diligence. But there is currently no established protocol for assessing the clinical and commercial viability of a healthtech product.   


Our hypotheses are

  •  Healthtech entrepreneurs need to find the balance between “go fast and break things” and “first do no harm.” If they understood the formula for healthcare market adoption earlier, they could accelerate their path to market.
  • Investors in healthtech need better ways to assess whether or not a healthtech company can successfully capture sufficient market adoption in the expected timeframe.
  • Organizations such as employers, health systems, and commercial retailers who are being approached by healthtech companies need an objective way to assess the clinical viability of health products before they adopt them.

It’s taken us 10 years to learn how to speak both languages and balance the best of both worlds. Our aspirations when we came to Silicon Valley were to be a part of the responsible transformation of healthcare. We believe that a core part of this is bridging the cultural divide. 

That’s why we founded MDisrupt.

MDisrupt is the world’s first medical diligence company for the healthtech industry. Our mission is to unite healthtech and healthcare stakeholders to accelerate the responsible disruption of medicine. By doing so, we can get potentially impactful health products to patients faster.

MDisrupt also provides an easy path for practicing medical professionals to participate in our mission. We will matchmake them with the healthtech companies who need their expertise. Our network consists of some of the most experienced people from the scientific, medical, regulatory and commercial sectors of health care. We call them MDisruptors. 

We all share a common desire to see the products that can have the biggest impact on patient care make it to market quickly and responsibly. We believe that by uniting the innovators, entrepreneurs, and investors from the healthtech industry with our team of experienced MDisruptors, and applying a medical diligence process, we can get there faster together.

Written by Jill Hagenkord, MD and Ruby Gadelrab