Why haven’t you seen more health IT companies accepted into DreamIt Ventures East Coast accelerators?
DreamIt doesn’t know where to find them.
“Health IT is interesting to us, but it’s never been part of our proactive recruiting strategy because we do not know where to source them,” said managing partner Kerry Rupp. “We do the technology meetups and recruit at entrepreneur clubs. If we knew about more opportunities in the health IT space, we would love to have more applicants from that pool.”
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It’s an opportune time for health IT companies to take a run at DreamIt. The accelerator just announced a March 16 application deadline for its next New York class (DreamIt also has a Philadelphia incubator). There is an early admission deadline of Feb. 16 so that companies that are ready needn’t stagnate while they wait for the other applicants to be accepted, Rupp said.
The idea anyone would struggle to find health IT startups may be a jaw-dropping statement for the medical convergence crowd. But it isn’t so surprising. Mhealth opportunities have emerged so quickly that many savvy investors are struggling to find the best mobile health startups. Plus, old-line healthcare would never work for technology outlets like DreamIt. One of the required criteria for applicants is that they must reach their next milestone/inflection point within three months. That’s not possible for medical devices and pharma.
But the opportunities for emerging health IT startups are there. The growth of conferences offering venues for startups to exhibit, like the ones held earlier this year in New Jersey and Washington, D.C., have helped boost the profile of mobile health startups. Also, specialized accelerators like Blueprint Health and HealthBox have had little trouble finding promising candidates.
DreamIt has seen an increasingly diverse applicant pool since the Philadelphia-based accelerator got started in 2008. Since then it has helped launch 64 companies. In its first year it had 100 applicants and in the past year it had 1,000, Rupp said. It started its first New York summer class this year and a Philadelphia class in the autumn. It is repeating that format in 2012, with 15 startups in each class.
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The accelerator wants to have companies that not only have good ideas, but make the most of the resources DreamIt offers. “And that can mean does the company have people who can work well together, can adapt to change, have a good dynamic and a track record of success?”
“We look at the team … the business has to adapt, but it’s more about the potential of the people running it,” Rupp said. “A lot of what they are doing is figuring out what their team needs to be. Will they work well in an entrepreneurial environment? Can they strike the right balance between knowing when they are right with needing to listen?”
DreamIt has taken on health IT startups before. Its New York class this year included a company focused on facilitating online psychiatry appointments via a secure video link called 1 Doc Way. It has since relocated to Philadelphia.
Acceptance means getting up to $25,000 in seed capital, office space, mentoring, a weekly speaker series that includes early stage venture capital investors and entrepreneurs, and interaction with other startups. In return, DreamIt takes a 6 percent equity stake.
One of the mentors for its New York program this year was Elliot Menschik, a general manager for MEDecision’s provider markets group. Menschik is responsible for commercializing the company’s health information exchange, electronic health record, personal health record and telehealth products and services. He previously served as the founder and CEO of Hx Technologies, a health information exchange company acquired by MEDecision in 2009.