In startups, it’s easy to get distracted by shiny technology and forget business fundamentals. For Jim Pursley, who’s sold a company for multiple billions of dollars, success needs to be built on a solid foundation.
That means focusing on proven markets and delivering demonstrable cost savings to both practitioners and patients.
Jim’s approach has worked out well for him. He co-founded Livongo in 2014, took it public in 2019, and sold it to Teladoc in 2020 for $18.5 billion.
Jim’s been the President of Hinge Health since March 2021. Under his leadership, the company is fast establishing itself as the market leader in at-home musculoskeletal physical therapy.
Jim Pursely has spent the last decade tackling some of the biggest problems in healthcare. He was part of the founding executive team as the Chief Commercial Officer of Livongo Health, and took the company public, culminating in an $18.5B acquisition by Teladoc Health. Since March 2021, Jim has been Hinge Health's President. The company is ranked #2 on Crunchbase's Diversity Spotlight Report.
Key Takeaways from Jim’s Experience
- Go big when picking a market. It’s much easier to convince providers to spend money on a more cost-effective solution to a problem they’re already paying for than to convince them of of a different problem they don’t believe exists.
- Put evidence of cost savings above potential ROI numbers when positioning your offering. You have to be honest with yourself about the degree of economic savings your product creates. If you focus too much on immaterial numbers, you may end up making poorly calibrated decisions.
- Focus on both cost savings and clinical efficacy. Both are critical to building a profitable technology that improves people's lives. Focusing on either one to the exclusion of the other means building a business on a poor foundation.
Picking the Right Market
Hinge’s success comes from not shying away from the big problems. Roughly half of all Americans suffer with muscular skeletal issues. The overall cost to the US healthcare system is around $600 billion a year and is mostly overlooked compared to cancer, obesity, and heart disease.
Focusing on muscular skeletal therapies was a master stroke not only because the market is so massive but also because they are delivered so inefficiently. That meant prospective customers were well aware of the problem Hinge was trying to solve and were desperate for alternatives.
Getting physical therapy is difficult, which is why so many people opt for expensive and potentially dangerous alternatives like surgery or opioids. It’s cost prohibitive for most patients, with most having to pay out of pocket for some or all of the cost.
For a lot of injuries, like pelvic injuries for women, there's a real shortage of staffing. Pelvic health physical therapists are in short supply, and all the money in the world may still not secure you the sessions you need.
Under Jim’s leadership, Hinge Health is pioneering remote alternatives that promise to make routine physical therapy more accessible. Using its technology, caregivers and physical therapists can evaluate patients remotely.
When we spoke, Jim explained the logic of this approach.
"There's one thing to try to convince a whole bunch of people to see a problem that they didn't fully appreciate or recognize versus saying, you're already spending time and money and energy here. You're just doing it in an unpleasant, maybe an inefficient way. And there's a better way to think about product market fit," Jim says.
Address a problem where money is already being spent, allocated, and budgeted. And focus on solving an issue that hasn't been addressed yet.
Factoring in Cost
Jim says one of the big mistakes health technology companies make is focusing exclusively on clinical outcomes when designing a trial or study. For him, its important to consider both clinical outcomes and cost savings when gathering data on your product.
In Jim’s words, "I think a lot of healthcare entrepreneurs miss out maybe on the latter part. They'll maybe design a trial or a study that's highly, highly focused on clinical outcomes, which is great, but won't look for maybe some quantifiable cost improvements as a part of that study."
For example, to determine economic impact, Hinge examined 136 employers ranging from Fortune 500 companies to smaller firms. They were able to create $2,400 a year per patient in savings. This is much more reliable than self-reported ROI.
Focusing on cost savings can be an effective way to get crucial third parties on board. For Hinge, employers and corporate healthcare plans have opened up completely new markets. These kinds of providers are motivated by finding cost-effective solutions to widespread problems.
That’s why targeting employers is a core part of Hinge's strategy. Jim describes them as "the innovation engine of the nation's healthcare system."
For Hinge, focusing on healthcare plans was an effective way to reach small-scale employers who might otherwise not be a realistic target.
Jim says “health plans have been wonderful partners to us in helping to expand our reach.” Taking advantage of employer provided plans relies on finding a good fit between your product and services those plans already provide. In Jim’s words, “how do we integrate our offering with their offering so that one plus one equals three?”
Getting the Right Investors on Board
You should think carefully about who you raise money from. You should consider whether the investor you choose shares your vision and has the patience to persevere through multiple stages of your project.
Jim embraces a more competitive investment environment. He says you need to be wary of investors who are willing to pour money into projects they don’t understand. When the market turns, you want capital partners who know what you're offering and can effectivelyevaluate success in your industry.
"Are your investors going to continue to support you if I raise a Series A or B?" Jim asks. “Is this an investor who will come in my C or D round? Because they intend to be a long-term partner, they will invest in public markets. Will they be a buyer on the day of the IPO if I am fortunate enough to take the company public?"
In startups, it’s easy to get distracted by shiny technology and forget business fundamentals. For Jim Pursley, who’s sold a company for multiple billions of dollars, success needs to be built on a solid foundation.
That means focusing on proven markets and delivering demonstrable cost savings to both practitioners and patients.
Jim’s approach has worked out well for him. He co-founded Livongo in 2014, took it public in 2019, and sold it to Teladoc in 2020 for $18.5 billion.
Jim’s been the President of Hinge Health since March 2021. Under his leadership, the company is fast establishing itself as the market leader in at-home musculoskeletal physical therapy.
Jim Pursely has spent the last decade tackling some of the biggest problems in healthcare. He was part of the founding executive team as the Chief Commercial Officer of Livongo Health, and took the company public, culminating in an $18.5B acquisition by Teladoc Health. Since March 2021, Jim has been Hinge Health's President. The company is ranked #2 on Crunchbase's Diversity Spotlight Report.
Key Takeaways from Jim’s Experience
- Go big when picking a market. It’s much easier to convince providers to spend money on a more cost-effective solution to a problem they’re already paying for than to convince them of of a different problem they don’t believe exists.
- Put evidence of cost savings above potential ROI numbers when positioning your offering. You have to be honest with yourself about the degree of economic savings your product creates. If you focus too much on immaterial numbers, you may end up making poorly calibrated decisions.
- Focus on both cost savings and clinical efficacy. Both are critical to building a profitable technology that improves people's lives. Focusing on either one to the exclusion of the other means building a business on a poor foundation.
Picking the Right Market
Hinge’s success comes from not shying away from the big problems. Roughly half of all Americans suffer with muscular skeletal issues. The overall cost to the US healthcare system is around $600 billion a year and is mostly overlooked compared to cancer, obesity, and heart disease.
Focusing on muscular skeletal therapies was a master stroke not only because the market is so massive but also because they are delivered so inefficiently. That meant prospective customers were well aware of the problem Hinge was trying to solve and were desperate for alternatives.
Getting physical therapy is difficult, which is why so many people opt for expensive and potentially dangerous alternatives like surgery or opioids. It’s cost prohibitive for most patients, with most having to pay out of pocket for some or all of the cost.
For a lot of injuries, like pelvic injuries for women, there's a real shortage of staffing. Pelvic health physical therapists are in short supply, and all the money in the world may still not secure you the sessions you need.
Under Jim’s leadership, Hinge Health is pioneering remote alternatives that promise to make routine physical therapy more accessible. Using its technology, caregivers and physical therapists can evaluate patients remotely.
When we spoke, Jim explained the logic of this approach.
"There's one thing to try to convince a whole bunch of people to see a problem that they didn't fully appreciate or recognize versus saying, you're already spending time and money and energy here. You're just doing it in an unpleasant, maybe an inefficient way. And there's a better way to think about product market fit," Jim says.
Address a problem where money is already being spent, allocated, and budgeted. And focus on solving an issue that hasn't been addressed yet.
Factoring in Cost
Jim says one of the big mistakes health technology companies make is focusing exclusively on clinical outcomes when designing a trial or study. For him, its important to consider both clinical outcomes and cost savings when gathering data on your product.
In Jim’s words, "I think a lot of healthcare entrepreneurs miss out maybe on the latter part. They'll maybe design a trial or a study that's highly, highly focused on clinical outcomes, which is great, but won't look for maybe some quantifiable cost improvements as a part of that study."
For example, to determine economic impact, Hinge examined 136 employers ranging from Fortune 500 companies to smaller firms. They were able to create $2,400 a year per patient in savings. This is much more reliable than self-reported ROI.
Focusing on cost savings can be an effective way to get crucial third parties on board. For Hinge, employers and corporate healthcare plans have opened up completely new markets. These kinds of providers are motivated by finding cost-effective solutions to widespread problems.
That’s why targeting employers is a core part of Hinge's strategy. Jim describes them as "the innovation engine of the nation's healthcare system."
For Hinge, focusing on healthcare plans was an effective way to reach small-scale employers who might otherwise not be a realistic target.
Jim says “health plans have been wonderful partners to us in helping to expand our reach.” Taking advantage of employer provided plans relies on finding a good fit between your product and services those plans already provide. In Jim’s words, “how do we integrate our offering with their offering so that one plus one equals three?”
Getting the Right Investors on Board
You should think carefully about who you raise money from. You should consider whether the investor you choose shares your vision and has the patience to persevere through multiple stages of your project.
Jim embraces a more competitive investment environment. He says you need to be wary of investors who are willing to pour money into projects they don’t understand. When the market turns, you want capital partners who know what you're offering and can effectivelyevaluate success in your industry.
"Are your investors going to continue to support you if I raise a Series A or B?" Jim asks. “Is this an investor who will come in my C or D round? Because they intend to be a long-term partner, they will invest in public markets. Will they be a buyer on the day of the IPO if I am fortunate enough to take the company public?"
