Thanks to the constantly rising use of mobile technology along with advances being made in medical science, the business of health care has never looked as attractive to entrepreneurs looking to break into the healthcare industry. The World Health Organization says that by 2035 there will be a global shortage of 12.9 million healthcare workers which makes it a perfect time for entrepreneurs to enter the global healthcare market. However, getting a healthcare startup running successfully is fraught with challenges, a few of which are discussed below.
1. Sluggish Growth – The healthcare sector is notorious for being slow in terms of growth. As an entrepreneur, you could have a great solution but healthcare is at its core a data driven industry and nothing will find approval without testing and proving efficiency through reliable data. All of this takes time and if you are looking to sell to a large hospital, it could take over a year to get approval from executives of varying degrees of seniority.
Even though the market may not be saturated with countless competitors, very few startups actually survive the slow pace of growth the sector sees. In India, for example, while the healthcare sector is said to be worth $280 billion USD by the year 2020, the country's slow moving policy framework will only hinder rapid growth.
2. Lack of organization – Many countries have a large discrepancy between the way the urban and rural population can access healthcare and technology. This can be especially challenging for a startup as they often rely heavily, sometimes even solely, on technology. If the consumer doesn’t have access to technology, the services being offered by the startup are of no use to that consumer.
Another challenge that healthcare startups often face is ensuring consumers have sufficient levels of data when using the internet because most mobile applications on smartphones require a minimum level of data. Without an internet connection with sufficient speeds, for example, a user cannot access the technology required on their smartphone.
3. Multitasking - Often companies feel the need to address every single issue at the same time. What is important to remember, however, is that it's better to focus on a single, main point and focus on solving that completely. Instead, startups often get distracted by various different issues and are unable to stay focused on the bigger picture.
4. Lack of doctors – Many countries face a lack of doctors and this causes problems for a startup as they are unable to connect potential consumers with a medical professional. In the real world, the lack of doctors often makes medical professionals seem elusive to the huge pool of consumers. This can often mean that the consumer doesn’t have much say in their treatment, which is something healthcare startups are trying to change.
Another negative thing that healthcare startups face is the fact that many doctors are not familiar with the level of technology that could be required from them in order to get onboard a technology drive healthcare app. They find adapting to technology a challenge and research has found that only 20 percent of doctors today are on any digital platforms. Doctors are often reluctant to break the status quo that is already in place.
5. Regulation - In most countries around the world, especially the US, which has a healthcare industry worth 3 Trillion USD, regulation is seen as a huge deterrent for even the gutsiest of startups. Regulations include security and compliance while patents are another large issue altogether. It's crucial for a startup to have people on their team who know the ins and outs of the healthcare industry and this is even more important in countries where the regulations are not well-defined or not very transparent.
6. Business Model - In a traditional business model, the person benefitting from the product or service is the one who usually pays for it and makes the decision to buy it. In health care, however, the person who will benefit from the service is not always the one who is paying for it, not are they necessarily involved in the decision making process. Healthcare startups need to take into account this complicated business model and how it will affect the decision making process when it comes to their business from the customers, and doctors' point of view.
7. Diversity – When a startup is creating a product they usually follow the principle of 'know your user.' Unfortunately, in health case this mantra is hardly applicable as the diversity of users is unprecedented and could range from doctors, patients, caregivers, nurses or even administrators. Each of these groups has a different set of needs. This means that the product must be scalable and applicable to several user groups, increasing the complexity altogether.
Usually entrepreneurs know exactly what they are getting into when venturing into this industry. Despite the pitfalls involved in creating a successful healthcare startup, some would say the challenges are what drives these entrepreneurs to work harder to reach their goals.