The CEO of 2070 Health, Dr. Pankaj Jethwani, offers observations on the state of Indian healthcare startups at the moment. He draws attention to the notable increase in healthcare investments, which shows that many investors are actively involved in the market.
2070 Health is India’s first healthcare-focused venture studio, established in 2022. Functioning as a cutting-edge platform, it concentrates on developing disruptive healthcare startups from the ground up that have the potential to revolutionize the industry and improve the lives of billions of people. The project takes a methodical, three-phase approach, starting with the identification of white spaces that have substantial unmet needs. This initial phase, which lasts three to six months, entails extensive due diligence, which includes clinical research, patient and physician interviews, evaluation of regional innovation landscapes, and idea validation with Key Opinion Leaders (KOLs) and industry leaders.
2070 Health refines and launches these healthcare startups in phase two of their approach, working with exceptional founders and Entrepreneurs in Residence (EIRs). Achieving product-market fit becomes the main focus in the third stage. This entails making use of their internal operating team and a range of execution playbooks in key areas like product development, technology, talent acquisition, marketing, and go-to-market strategy. The ultimate goal is to accelerate these businesses’ scaling process faster and more affordably than with traditional startups, especially in the difficult early stages of business development given the current macroeconomic climate.
2070 Health has successfully launched four companies in the last year by using their approach. Launching eight to ten more healthcare ventures is part of the ambitious plan for the next two to three years. In addition, the venture studio plans to grow beyond its present sites in the US and India, indicating a dedication to deepening its influence on the worldwide healthcare scene.
The Venture Studio at 2070 Health prioritizes talent and idea validation/research to reduce the risk of potential failure points during the startup launch phase. During the ideation stage, the studio methodically pinpoints unresolved issues and suggests creative fixes. To improve and validate these solutions, a thorough investigation, validation, and feasibility studies are used in the process. Targeting sizable, expanding markets with urgent solutions, addressing precisely defined patient/demand-side issues unaddressed by current solutions, and concentrating on areas where disruptive and significantly better solutions can be developed are important requirements.
At 2070 Health, team-building entails choosing seasoned Entrepreneurs-In-Residence (EIR) or founders to spearhead startups and collaborate on solutions after a workable concept is found. Putting together a senior founding team with the necessary experience and enthusiasm for the goal is essential. In order to ensure founder-market fit, the studio seeks out founders with a background in 0-1 and scale journeys, a deep passion for healthcare, and the necessary skills for the particular solution. This method assists new businesses in systematically identifying clinical white spaces without copying existing solutions from other startups.
With more than 9,800 startups, the Indian healthcare startup scene is steadily expanding. Two prominent themes surfaced in 2023: the growth of healthcare SaaS and services targeted at the US/India corridor, and the increase in vertically integrated, omnichannel healthcare service providers, particularly in specialized therapy areas like dermatology and oncology. The latter is anticipated to prosper as a result of India’s proficiency in creating AI for healthcare and its capacity to provide locally developed technology to clients throughout the world.
The increasing use of digital health by both patients and providers is driving the expansion of the Indian healthcare startup scene and drawing significant investment from important institutional investors. The pressing need to address the rising disease burden and clinician shortage is what is motivating this expansion. Increasing clinician productivity and making healthcare more accessible are important objectives. Furthermore, the development of strong healthcare solutions that can benefit a larger population is made possible by the availability of AI solutions.
India’s healthcare investments have grown significantly, and the number of active investors has increased as well, reaching a peak of 628 in 2021 and 487 in 2022. The fact that 68% of investors in 2021 were first-time healthcare investors is noteworthy since it shows growing interest in the industry. Numerous agnostic funds are creating specialized healthcare teams to handle the ever-changing healthcare landscape and carry out the comprehensive research required for wise investments in this area.
Thematic funds have arisen in response to the unique needs of the healthcare industry and a growing emphasis on patient-centered strategies, focusing their whole portfolio in the healthcare space. These funds, which number in the range of 10 to 15 in India, have a wealth of experience in the healthcare sector, which allows them to offer their portfolio companies specialized support in areas like technology, research, and industry insights.
Due to the complexity of the healthcare industry and the involvement of numerous stakeholders with disparate goals and points of view, innovation in healthcare startups is by its very nature difficult. It’s a difficult task to coordinate efforts between patients, physicians, hospitals, pharmaceutical companies, insurance, and regulators. Another obstacle is the sluggish adoption by medical professionals and patients. Establishment providers often enjoy the trust of their patients, which makes it difficult for newcomers to do the same. Given the possible risks to patient outcomes, financial costs, and reputations, healthcare professionals are cautious about adopting new treatments or digital solutions because they frequently follow strict protocols.
Given the importance of patient welfare, navigating the ever-changing and complex regulatory landscape presents a significant challenge for healthcare startups. In contrast to the startup credo of “move fast and break things,” healthcare innovation necessitates compliance with complex legal requirements in order to guarantee patient safety. The Clinical Trials Bill, the e-Pharmacy Guidelines, and the ART (Assisted Reproductive Technology) Bill are just a few examples of the laws and guidelines that entrepreneurs need to stay up to date on. In spite of these obstacles, the healthcare industry presents an abundance of chances for creative approaches to address the wide range of healthcare requirements of India’s sizable populace.
Creating innovative healthcare is only half the battle; the other half is expanding access to a sizable population. With over a billion potential users, India’s $400 billion healthcare market presents numerous opportunities for solutions that could enhance millions of lives. Because there are many different clinical conditions and changing methods, it is difficult to achieve standardization in operations and care. Replicable solutions need to adjust to new information while maintaining a balance between uniform, “protocolized” care and professional judgment. The same is true of technological solutions, which necessitate flexibility in order to be deployed effectively across various hospital technology stacks.
Healthcare innovation faces several challenges, such as attracting and retaining diverse talent and overcoming the obstacles to broad distribution in India because of low insurance penetration and a disjointed provider ecosystem. A dynamic and flexible multi-channel distribution strategy that is adapted to different patient segments and geographic areas is necessary to achieve scalability.
It’s a good time to start a healthcare business in India because of the country’s expanding digital adoption and accessible infrastructure. There are still a lot of white spaces and problem statements in spite of the increased entrepreneurial activity, which offers founders a chance never seen before. Important tips include concentrating on large white spaces, giving clinical outcomes and patient experience top priority, and creating a distinct competitive advantage, or moat.
