Collaborating to Solve Healthcare’s Massive Problems with Nick Dougherty, Managing Director of MassChallenge HealthTech
Episode 427

Nick Dougherty, Managing Director of MassChallenge HealthTech

Collaborating to Solve Healthcare’s Massive Problems

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Collaborating to Solve Healthcare’s Massive Problems with Nick Dougherty, Managing Director of MassChallenge HealthTech

Episode 427

Recommended Book:

Seven Habits

Turn the Ship Around

Mentioned Link:

Mass Challenge

 

Collaborating to Solve Healthcare's Massive Problems with Nick Dougherty, Managing Director of MassChallenge HealthTech transcript powered by Sonix—the best audio to text transcription service

Collaborating to Solve Healthcare's Massive Problems with Nick Dougherty, Managing Director of MassChallenge HealthTech was automatically transcribed by Sonix with the latest audio-to-text algorithms. This transcript may contain errors. Sonix is the best way to convert your audio to text in 2019.

Welcome to the Outcomes Rocket podcast, where we inspire collaborative thinking, improved outcomes and business success with today's most successful and inspiring health care leaders and influencers. And now your host, Saul Marquez.

Saul Marquez:
Welcome back to the podcast. Today I have the pleasure of hosting at Nick Dougherty. He's the managing director for Mass Challenge Health Tech, a digital health accelerator that matches startups with over 30 partners like the city of Boston, Commonwealth of Massachusetts, Vertex, AARP, M.G. H. And Cerner. to address how this most massive challenges prior to the work that he does at MCHT, Nick was a co-founder and CEO of Verbal Care, helping nonverbal and verbal patients communicate effectively with caregivers and providers. He became general manager in 2015 after verbal care was acquired by a Medical Specialty Distributors McKesson Company. So his experience, both as as an entrepreneur and a business leader, are really going to be pivotal to our discussion today and with the work that he does at the Mass Challenge Health Tech. It'll be exciting to hear some of the things that he's doing and seeing with the work that he does with startups there. So, Nick, it's a true pleasure to have you on the podcast today. Thanks for joining us.

Nick Dougherty:
Hey, thank you. This is very exciting.

Saul Marquez:
So, Nick, how did you get into healthcare? So it was totally by accident in some ways. But I can thank my wife for helping me choose this direction. So I went to school for engineering at Boston University, and I knew that my senior project at the year was going to be something that I was going to try and turn into a company. So that was really my priority. Because I loved about BU is that there are senior projects in the College of Engineering or property of the students. So that that's what enticed me to go there and I wanted to start a company. And so my wife basically convinced me she's like, do something that matters with your senior project. And so when I was looking at the projects, I saw this this one that said, you know, design and I had application for stroke patients and an ICU. And I said, you know, that that looks like something that matters. And that senior project ended up being verbal care. And that's really what got me into health care was really sort of the luck of the draw that, you know, I said that I wanted to work on their projects. You know, the university said, you know, we're gonna match you to that project and the rest is history.

Saul Marquez:
And that's awesome, man. Well, that's great advice. So kudos to your wife for that. And kudos to you for picking something that then you were able to turn into a business and get a nice exit out of it. What would you say is a hot topic that needs to be on health leaders agenda and maybe in this case, Nick, company leaders agendas, right in health care and how are you and mass challenge health tech addressing it?

Nick Dougherty:
Yeah. So, you know, we look at all of these massive challenges in health. So last, how our program works is we collect the top five strategic initiatives of all of the partner and champion organizations that we work with. So it's not like everybody's focused on one thing. There's so many different things that better happening. But the thread that we're seeing that kind of ties all of this together is this culture transformation that's happening and change management that's happening as these organizations are trying to figure out how to bring digital into the work that they do, how to bring technology into the work that they do, and the kind of implementation processes that you need to make it happen or different than what you've been doing for years. And so I think, you know, for me, the biggest challenge is kind of a boring challenge, and that's change management. But I think realistically, it's what's getting in the way of all these moon shots that we want to accomplish. So I think what's exciting about our program is that we have very structured goals, milestones, process, that our startups and champions go through where they set these goals and milestones together on the projects they want to achieve. And we've been tracking that and see what's working and what's not working. So we're starting to develop Community Health Innovation Guide where we can and we're partnering with a couple of Massachusetts on that health policy commission. And the output of that is hopefully to help make it easier to adopt technology. But also, it's going to impact some of the policy that the Commonwealth writes and hopefully align incentives in the right way because, you know, basically nothing can have happens in healthcare without the right alignment of incentives. So I think I think it's exciting that we're now not looking at all of the fun stuff, but we're kind of looking squarely at the boring stuff like risk assessments and change management and trying to work on that so that all of these massive challenges that everybody wants to solve can get done effectively. So we believe there is a science to implementing innovation, and that's what we're excited about.

Saul Marquez:
That is exciting. So as as you pursue these challenges, these strategic initiatives, I'd love to hear an example from your Nick of how the company you guys have created or helped pair with these larger companies have created results by doing it differently.

Nick Dougherty:
Yeah. So I look at there's there's a few great examples of companies and I think, you know, one of one of my favorites is a company called Madumo. And I really enjoy them for a couple of reasons. One of the first things that I loved about them is that they went through our program twice and their experience in year 1 vs. year 2 was very different. So in year one, they didn't have a paying customer yet. They had they were still pretty new. But by the end of the program, they had five paying health systems. And the second year it was really more about scaling and they went to I think like 20 or 25 health systems by the end of the program that were that were paying. And at the beginning, they were purely focused on G.I. departments. And at the end of the second program there rolled across multiple departments. And the reason why I believe that they were able to grow and scale so quickly was that they had a really successful approach to collaboration, where they were always coming in with an understanding that they wanted to create co-create value right alongside with the customer. They were sort of the anti transactional entrepreneurs. So they had a solution, but they weren't trying to force a solution down your throat. They were trying to identify what was the real problem that you wanted to solve. And that problem that they dug in on initially was reducing the amount of no shows for colonoscopy procedures. And they also wanted to increase the adherence to the protocol. And the way that they did it was just so simple. What they did was just text patients how it worked. And I was like, no.

Saul Marquez:
Do you know, Nick? I think about like no shows, right.. And there's people tackling the no show problem. It's a problem, right? But they are. I mean, where did they start with colonoscopy or through partnership? They said this is where the niches are, how do that work?

Nick Dougherty:
That's where they started because they knew that there is a high volume of procedures, basically like the problem made sense. And it's because they they did the diligence of figuring out like is there are going to be the most value. Where should we focus? And I was always really impressed with their approach to make sure that they're identifying a real problem and then not over building a solution on top of it. Not every not everything needs to be an app with a million features. Like literally what they do is they'll release what they did when they started. They would text someone and be like, hey, you're going to plan them in a week. This is this is what you need to do is we need to shop. Hey, here's your grocery list. Here's a link. Click on the grocery list and make sure that, you know, you're eating the right stuff. And then, you know, what they were demonstrating is millions of dollars and cost savings immediately to these departments and really savvy about they went through the procurement process like they were able to figure out what the discretionary budgets were for the departments that they were working it with. So they're able to get through the procurement process before sort of having a broader contract discussion. So they were really savvy both on the product side, making sure that they had the absolute right minimally awesome product for their customer. And then they were also really savvy on the business side, making sure that, you know, both of these things were working really well in parallel. So they've been really exciting and successful and scaled a lot. But as you mentioned, it's like this is kind of niche, you know, called Oscar de prep stuff, whereas the big sexy like, you know, digital health solutions in the future. And I think that kind of speaks to me, like some of our most successful companies are the companies that are solving, you know, what you would normally say is kind of a boring thing. And frankly, that's that's because I don't think that the culture transformation is really happened in the healthcare system side yet to be able to do a lot of the future tech that you see kind of in the news. But I think Madumo, there's a lot that we can learn what they've done. Really great company.

Saul Marquez:
A great example. And how do you spell Madumo for the people that are curious?

Nick Dougherty:
Madumo.

Saul Marquez:
Awesome. So they haven't folks. An example of how keeping it simple, listening to your customers will result in a business that works. Obviously it's not that easy, but it's definitely doesn't have to be sexy. It doesn't have to be sexy at all. And in that cultural shift that Nick alluded to hasn't happened yet. So finding point solutions like like the one that Madumo built could potentially be the way that you and your business need to go. And obviously partnering with firms like Mass Challenge Health Tech is another way to not just try to go it alone, partner with somebody that that has been there, done that and has coached others to do it. I love to hear an example of maybe the opposite, something that didn't work. Nick and and what you guys learned from it.

Nick Dougherty:
One of our companies called us about a month before the end of the program and the founder was like, look, we're gonna shut down the government. And like, what? Why are you going to shut down the company? I know that your champion loves you guys, like what's what's happening. And, you know, I don't think that, you know, the market it's going to be, I don't think the market caps high. I think the market potential is not really there in the way that we thought it was going to be graduating from my MBA program. I'm not really sure I want to continue with that. They were one of the earlier companies in the program. But a lot of the other companies in the program and then who is also like it's turning out to be more of a services business than a technology business. We really wanted to be in a pure technology space. So as I've gone on all these reasons why he doesn't want to do it. I'm like, look, health care is gonna be a services business and we're gonna be successful. You gotta have services alongside your technology and you talk to your team about it. Yeah, I let the team know that never shut down the business. Did you ask them whether or not they would want to continue? You know, maybe you don't want to do this anymore, but would you want to keep things like no. Why would they? You know, there's no opportunity here. So the company was effectively shut down. But then you I'd like to do us a favor and talk with your team and see whether or not they'd want to continue with it. And so this company ended up we ended up transitioning the sort of the reigns from the original founder over to a new CEO who was a member of the team and the company. And they ended up being one of the winners of the program, which was kind of crazy and.

Saul Marquez:
Ironic.

Nick Dougherty:
They went from like like 3 or 5k monthly recurring revenue to something like 10 or 20K and a few months. And it was pretty amazing to see the transition there. But like founder, dynamics are always really interesting and weird and can be really challenging. So I think that's always something where it's really difficult when you're you're kind of out on your own in the wild without sort of a support network or committee. I felt that when I was a founder myself. So having an organization or a person or a group to go to that you can kind of mediate through those difficult founder issues is, I think, pretty critical, especially in the early stages as you're trying to figure out your identity as a company.

Saul Marquez:
Nick, I think that's such a great, great call out and there's so many people going through that. I mean, how you know, I'll tell you just with the Outcomes Rocket. I started it two years ago and it's never smooth at the beginning. I had a couple of points where I paused and I had to think, what's my why? You know, why am I doing this? And thankfully, I've got a nice network of of what I call my board of directors. You know, people that have been there, done that. And they helped me through those those turns and challenges. And here we are still producing these podcasts with awesome folks like you. So it matters, folks. It matters to have that community or that group of people or that board of directors that you can reach out to a company like Mass Challenge Health Tech, ight.. So a great, great example, Nick, and I'd love to hear that that the that the business turned around and started making revenue with the new leader. So what would you say one of your proudest experiences has been to date there?

Nick Dougherty:
I think that was a really proud one, to be honest. Being able to intervene in that way. I think what what I'm really proud of is with our team and just sort of how dedicated everybody is to helping the entrepreneurs win. And I know it's really cheesy to say, like, I'm proud of I'm proud of the team and what they've accomplished. But I know in our first year we had like four or five people on the team and we've had about sort of that much. And, you know, we've generated over 270 partnerships in the last three years between the startups and were champions through our matchmaking. And it's just a colossal effort to source companies that don't want to be in the program, especially when we're, you know, we're starting off. We know our first year was only a couple of years ago and nobody knew what our program was. And it was a mass challenge. I've been around and people respected the brand, but we were creating a later stage accelerator program. So everybody that we wanted to be in the program had already gone through accelerators and was at the point where, like, we don't want to go through it's our system or it's not worth it. So we would you know, we had to call hundreds and hundreds of people. And I think what I get what I'm really proud about is that the team lives and breathes it and cares about the outcomes that we're delivering. And it always goes the extra mile for the entrepreneurs. And that's been super consistent. And because of that, we see our companies impacting millions of patients lives, increasing their revenue and funding by over 70 to 90 percent during the course of the program. We see them hiring hundreds of employees and growing like crazy. And I think we take that acceleration really seriously. And in the next couple of years through some of our research collaborations, our goal is to become one of the first evidence based accelerator programs, too. So we've had some researchers embedded since the beginning. So I just I really believe in the team and I'm proud of what they've accomplished.

Saul Marquez:
That's awesome. Now, Nick. That's that's a great message and an lofty thinking with the evidence based accelerator program. And it's truly important and obviously the space that that we're in. So that's an exciting project. Anything else that you want to highlight as an exciting project that you have going on?

Nick Dougherty:
Yeah. So I think. That's a big one. And underneath that umbrella, we have a few research initiatives that will support that and some collaborations with external university partners that are studying our program. So it's not just us that's doing the research. The goal is to have external parties doing the research on us. And and also on the industry so that we can build that. The other thing I'm really excited about is our work that we're doing in Massachusetts to the digital health initiative where we're working on a standard security assessment. So hopefully it takes less time to go through that risk assessment process before signing a BAA.. We know that's really burdensome on both sides. And we're also working on that through Together Health, which is this consortium of health innovation ecosystems where we're working alongside HHS and see to bring the nation's innovation ecosystems together so that we're collaborating and working together. And this was kind of prompted by this understanding that our startup companies aren't just going to be selling and working with partner organizations in their backyard. They're going to be going all across the country, all across the world. And, you know, it'd be really great if there were some cultural consistency. There are some standard frameworks and best practices at the business level, not just at the technical level. And, you know, that's really the goal together Health is to bring these groups together. So I'm really proud of our team for helping to launch that initiative over the last couple of years… successful, too.

Saul Marquez:
Congratulations on that. That's definitely another pathway to getting some great things done. So, Nick, we're getting close to the end of the podcast here. I always feel like we don't ever have enough time, but we have just enough time to get some good nuggets and this is the lightning round. So I got a couple lightning round questions for you, followed by a book that you recommend to the listeners. You ready?

Nick Dougherty:
Yes.

Saul Marquez:
All right. What's the best way to improve health care outcomes?

Nick Dougherty:
The best way to improve health care outcomes and I'm trying to give a cheesy answer, but it's the only one that I can think of that's to really embed the patient in the decision making process. They've got to feel ownership, and that's important.

Saul Marquez:
What's the biggest mistake or pitfall to avoid?

Nick Dougherty:
I think that don't focus on selling your solution. Focus on solving the problem.

Saul Marquez:
How do you stay relevant as an organization despite constant change?

Nick Dougherty:
I think that that constantly diagnose where the problems are and where the value is and make sure that you understand your unit economics, even if you're getting a great outcome for the patient, it has to align to some kind of business incentive or else you can't be sustainable.

Saul Marquez:
A great point. And what's an area of focus that drives everything at Mass Challenge Health Tech?

Nick Dougherty:
It's the desire to solve massive challenges. There can never be a short of shortage of amazing people working their butts off to make the world better. And that's what we're focused on is helping those people.

Saul Marquez:
Love that. These next two are more on a personal note for the listeners to get to know you. What's your number one health habit?

Nick Dougherty:
Oh, I think for me, it's thinking ahead for the week and saying, when am I going to fit in that time I need for myself to either read a book or work out or spend time with friends and family. Otherwise, I will let myself get consumed by my work. So I'm being intentional about carving out that personal time. That's critical.

Saul Marquez:
It's a great habit. And how about your number one success habit?

Nick Dougherty:
So I guess it's not one thing. Stephen Covey is Seven Habits have really been embedded with me since I was in high school and I find that I use those all the time. And I think that the one that is probably the most effective and useful is seek first to understand than to be understood. You try to understand, people try to appreciate where they are, what they're going through. You find yourself open to new ideas, new ways of thinking, and generally someone else has a better idea than you do.

Saul Marquez:
Well, you know what, Nick? Through our talk, I feel like this is definitely part of your philosophy. As we dive into, you know, your thoughts around solving the problem, not focusing on the solution. Listen. Definitely one that I feel in here you live by.

Nick Dougherty:
I try my best.

Saul Marquez:
That's awesome, man. And what book would you recommend to the listeners?

Nick Dougherty:
So, I mean, I just recommended one, which is the Stephen Covey one. I think a great follow up to that book is something that was recommended to me by Ashley Reed, who is the CEO of Wireless. And she's just a fantastic mind. And she recommended Turn the Ship Around by David Marquette. It's a really interesting read. Normally, I don't like to read business books, but the reason why I like it, it's talking about how a naval submarine captain turned the worst performing ship in the fleet into the top performing ship in the fleet and basically six months. It's a really interesting read and there's a lot of great mechanisms that you can use in your role to help foster an environment where everyone is a leader and that there are no bitter followers.

Saul Marquez:
Love that. And folks, what I love about Nick is that in the space of accelerators and even education, right., you have you have folks that have been there and done that and now are teaching and then folks that are theory and teaching that nothing's wrong with that. But when you're in business, you want someone that's been there and done that. Nick has been. And so this recommendation. Take it seriously. Turn the ship around. You could find a link to that book as well as an entire transcript of our discussion today. Just go to outcomesrocket.health in the search bar type and mass challenge and you'll find today's discussion there. Nick, this has been a blast, man. I really appreciate your time. If you could just leave us with the closing thought and then the best place for the listeners could learn more and continue the conversation with you.

Nick Dougherty:
Well, thank you, Sul. This is a lot of fun. And if anybody's interested in getting involved in our community, you just got a masschallenge.org we're always looking for amazing people that want to help. Our entrepreneurs were always looking for the world's best entrepreneurs. And we just want to solve these massive challenges. So if you want to you want to join our community and help us do that. We'd love to have you.

Saul Marquez:
Outstanding. And what would be the best place for them to do that, Nick?

Nick Dougherty:
masschallenge.org.

Saul Marquez:
Masschallenge.org. Yep. You mentioned that mass challenge.org, folks. Check that out. And again, just want to say thank you to Nick for sharing his story as well as what he's learned in the health startup space with all of us. And Nick, thanks again.

Nick Dougherty:
Thank you. This is awesome.

Thanks for listening to the Outcomes Rocket podcast. Be sure to visit us on the web at www.outcomesrocket.com for the show notes, resources, inspiration and so much more.

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