📈 Growing Sustainable and Profitable in Health Tech - by Erica Jain, CEO at Healthie

By Light-it, in collaboration with Erica Jain, Co-Founder and CEO at Healthie.

Sep 30, 2024

Welcome to DHI’s new section: Leading Voices in HealthTech. 🎙️

In this exciting addition, we’re spotlighting thought leaders and experts from across the healthcare industry.

Every two months, we’ll feature exclusive columns from specialists sharing their insights, experiences, and cutting-edge perspectives.

From advancements in HealthTech to discussions on the future of healthcare, this section will provide you with more in-depth expertise to stay ahead of the curve in digital health innovation.

Our goal is to connect you with the most influential voices shaping the industry today.

So, check out our first expert column, where Erica Jain, Co-founder and CEO of Healthie ($17.9M raised), explains how to grow a sustainable and profitable tech company below! 👇

Happy Reading!

Healthie offers infrastructure (EHR, patient engagement, scheduling software & API) for next-generation digital health companies that provide virtual-first, collaborative care. The company’s customers include Hinge, Oscar, and hundreds of digital health startups from seed upwards.

Growing a Sustainable and Profitable Health Tech Company

At Healthie, we believe our impact hinges on staying in business. Founded in 2016, we've operated profitably for over half our existence, with 85%+ of our growth driven by referrals. This sustainable approach affects every decision, avoiding the 'grow-at-all-costs' trend and spending less on areas like branding. While this may have led to missed opportunities, it's been crucial for our profitability and long-term impact in healthcare.

Note that, it’s incredibly hard in healthcare to get that first set of sustainable customers and find product market fit. The advice below assumes that your company has some level of that.

Here are five principles that have allowed Healthie to optimize for the long-haul consistently:

Authenticity: We’ve built our business, and our daily operations in a way that works for us, not necessarily what’s prescribed by common startup folklore.
Pricing: We didn’t offer things for free until many years into the business.
Patience: We waited to expand our product to new markets until we had built a solid base of customers and a product that could meet their needs.
Funding: We raised strategically when the timing and opportunity in front of us made sense.
Product: We didn’t try to build everything for everyone.

1. Be Authentic in how you build your business

The world is over-saturated with Founder advice — honestly, there’s just too much of it. Rather than molding your business approach to the latest startup trends, focus on what works best for you. Be mindful of popular opinions on how businesses “should” be built, but don’t feel bound by them.

At Healthie, for example, we stayed heavily involved in product development, customer management, and more — even after hiring for those roles. As founders, we’ve consistently done 1:1s with our employees (and still do, to some extent!) and regularly engaged with our customers. While thishands-on involvement might not align with typical startup advice, it worked for us. It was essential to ensure our customers received the best-in-class experience they deserve.

2. Pricing to the value you provide.

In SaaS, especially in healthcare, offering free products upfront to build long-term customer loyalty is common. At Healthie, we’ve taken a different path. From the beginning, we’ve avoided offering free versions of our product because we believe charging for our services reinforces their value. When customers are willing to invest, it’s a sign that we’ve effectively communicated that value — and it allows us to continue innovating and operating without relying on external funding.

After six years of growth and financial stability, we introduced a freemium model for solo practice providers. But this was a deliberate choice, made only after we had a strong foundation.

If you’re just starting out, do what it takes to get those early customers. But once you start seeing product-market fit, hold firm on pricing your product or service appropriately.

3. Be patient. Build a repeatable business motion before expanding.

At the beginning of your company’s life cycle, it’s a race to get revenue at all; we get that. But once you have a repeatable revenue stream, stick with it before you go and build into a new segment. In healthcare, there’s always an adjacent market to tackle with an even larger $ TAM - try not to get lured in; instead, have the focus and patience to deepen your core offerings.

We started building a solution for the nutrition private practice space. We saw Digital Health gaining momentum, but didn’t dive into it immediately. Instead, we spent several years refining our product, building our team, and solidifying our processes. It was hard to watch potential opportunities pass us by, but that time allowed us to develop an industry-leading platform, bulletproof our operations, and gain the confidence we needed to take on bigger challenges. When we finally made our push into Digital Health, we were ready.

4. Fundraise when the opportunity calls for it.

Healthie has a non-traditional fundraising story in a few ways. When Healthie made the decision to raise its Series A, we had more money in the bank than we’d raised in the previous round. We decided to raise because the Digital Health market was poised to grow, and we were confident we could deliver a world-class product to service that market.

We know we were very fortunate to be in that position, but it demonstrates how we think about external capital. Raising capital should be strategic and well-timed, not a default action at every stage, or every 18 months. It’s easy as you start to scale to get lost in hiring and spending, but a disciplined "every dollar counts" mindset is vital, no matter what stage you’re at or how much capital is in your account. At Healthie, we prioritize our spending on engineering, product development, and customer success, the three places we know will have an outsized impact on the value we provide our customers. We only leaned into additional fundraising when the tailwinds were in our favor, and we were ready to scale faster.

5. Product: “Don’t Build Everything, Even When Your Customers Want You To”

It’s easy to slide into ‘feature overload’ and continue rolling out new features left and right. It’s hard to stay disciplined when customers ask for feature requests that you know will help retain them but won’t necessarily be a value add for other customers.

The key is to focus on being the best in class for what you offer versus “just okay” at many more. For Healthie, that has meant prioritizing three products: scheduling, EMR, and patient engagement. For example, building towards a best-in-class approach is why companies like Hinge Health and Oscar use our scheduling system. Additionally, we keep a public-facing product roadmap so that our customers can submit requests and have real transparency into the features we are both building and considering. Ultimately, we align and weigh these requests against our internal product vision.

Moreover, we launched a marketplace of pre-integrated applications that enables our customers to extend the reach of our product even further, and customize their tech stack for their unique business and care needs. This is how we strike the right balance between customer’s immediate needs and our long-term vision. Part of our marketplace includes partnerships with 3rd party development agencies, including Light-it. Collaborating with Light-it allows us to tailor our offerings to meet customers’ requirements while maintaining best-in-class solutions. Light-it’s expertise in complex customizations ensures that each solution seamlessly integrates with diverse needs.

Want to join the conversation? We’re always looking for new guest columnists to share their expertise with our audience. Reach out if you’d like to be featured!