Rabin Yaghoubi has extensive experience working for both global players and disruptive early-stage businesses. He is also a prolific investor and advisor for Trussle, Citymapper, Trouva, Adbrain, Hiro Media, Green Man Gaming, Sony Pictures, Vodafone, Apax Partners and Bridgestone Capital.
Rabin acted as Chief Commercial Officer of Babylon Health, the leading AI-driven personal healthcare platform, driving its commercial efforts globally. Prior, Rabin was President & COO of FindTheBest (acquired by Amazon) a data-driven comparison engine backed by Kleiner Perkins. Previously, Rabin was Director of Strategic Partnerships at Google, where he was responsible for launching and leading Google’s content, commerce and local partnerships across Europe, the Middle East and Africa. Prior to Google, he was global Vice President of Media at DoubleClick, responsible for managing, globally expanding and ultimately selling the Company’s Media business.
In the first of two collaborations with Technology, Digital and Change Recruiter La Fosse Associates, Rabin spoke to Emma Roderick about innovation and investment opportunities in the health-tech space.
The opportunity for digital transformation to make healthcare accessible and affordable globally is massive, yet innovation moves slowly.
The potential for scalability in healthtech is huge. Health affects everyone, and every healthcare system is broken in some way, from the astronomical insurance premiums in the US to the long appointment wait times in the UK. Almost 50% of the developing world’s population has little access to quality healthcare, yet we all have mobile devices – the key driver to democratising access to healthcare services globally.
Why has real disruption in healthcare taken this long? Healthcare is a highly scrutinised, political and regulated space. Furthermore, it is not a single sector but an interconnected ecosystem of some of the biggest industries in the world – including insurance, pharma, pharmacy, government and the medical profession. These sectors don’t always have aligned objectives and don’t always put the customer – the patient – at the centre. It is therefore no surprise that we are only starting to see the customer-centric, technology-led innovation that has already permeated other industries.
Partnerships are a necessity, not a ‘nice to have.’
One of the key reasons it has taken longer for healthcare to be transformed by technology is the fact that it is difficult for innovators to provide disruptive solutions for end users independent of large incumbent players.
Amazon, Google and Facebook didn’t require large partners to achieve scale and own their respective markets. In fact, arguably bringing a completely new data-led approach to media or retail against slow-moving incumbents with large traditional businesses at stake is what allowed them to win.
However, if you are a patient-focused health-tech start-up, it is challenging to access patients independent of the incumbents, as healthcare is usually paid for not by consumers but by governments, insurers or employers. In the case of babylon, for example, partnerships with the NHS and insurers such as Bupa were critical in accessing patients at scale, whether directly or via corporate employee benefits programmes.
Executing these partnerships brings all the classic challenges small companies face when working with large corporates, such as multiple hierarchies and decision-makers leading to lengthy and arduous deal cycles. The highly risk averse, regulated and compliance-driven nature of healthcare only exacerbates these hurdles further.
While corporates have started to recognise the need to innovate more quickly via partnerships with digital pure-plays, establishing innovation labs and elevating internal digital teams, we are just starting to see some of the internal structural changes necessary for the right culture to permeate these organisations.
Healthcare is local by nature, so requires more time, and deeper local knowledge.
When carrying out global expansion for well-capitalised players like Google, market similarities often outweigh the differences, especially when expanding from the US to Western Europe. This allows for an internationalisation playbook that can be replicated at speed and scale.
Healthcare is more challenging to scale globally because it is, by nature, local and the ecosystem and regulations interact differently in each country. For example, in some continental European countries, a doctor cannot issue prescriptions until they have physically seen a patient, making the whole premise of telemedicine (i.e. seeing a doctor via video chat) untenable. In the long term, regulations will ultimately adapt to market demands, but as with all regulatory environments, innovators will always outpace regulators.
The requirement to execute more locally also puts countries like the UK at a level playing field with the US. In many sectors, the US capitalises on a 325 million homogenous market to scale globally. However, healthcare in the US is regulated at state level. US companies therefore do not have the typical scale advantage and face similar market expansion challenges to those faced by European players. This gives countries like the UK the opportunity to become global leaders in healthtech – with world-class standard in quality of care, infrastructure and clinical and technology talent, particularly in AI.
While healthtech is still too nascent to fulfil the universal investment criteria required by PE firms, it is now one of the most attractive investment sectors for VCs.
The investment criteria which PE houses have traditionally been attracted to is focused around high growth and profitability. Though PE houses invest in established capital-intensive healthcare organisations, these criteria are currently broadly inconsistent with health-tech, particularly consumer/patient-facing propositions, which are still in their infancy.
Meanwhile, in light of the massive opportunity to disrupt an $8 trillion dollar industry that affects everyone, healthtech is now one of the most attractive areas for VC firms, with almost $7 billion being invested globally in early stage companies in 2017 across the entire healthcare value chain (according to CBInsights). VCs are making big bets anticipating that the time has now come for technology to fundamentally change and democratise the nature of healthcare – making better accessibility and affordability inevitable. Much like the trajectory of other sectors like media and retail 10-15 years ago, this may be an indicative precursor to substantial PE investment in the future.
Artificial intelligence will play a key in prevention, diagnostics and treatment.
AI is a buzzword that is tossed around quite generously these days, but its impact on healthcare is undeniable. We are already seeing broad application of AI in triage and diagnosis, complementing the role of doctors and nurses through sophisticated mobile chatbots. This is just the beginning.
80% of the cost of healthcare is actually “sickcare” – clinicians, hospitals, medication, prescription etc – but the real holy grail of healthcare is preventative.
Think cars – when is the last time you’ve seen one break down without warning? Sensors in cars collect data constantly, identifying small problems before they escalate. Similarly, improved data collection and monitoring via mobile devices and wearables – the so-called “quantified self” – will allow us to apply sophisticated predictive analytics to identify conditions before they become serious.
Effective, non-invasive data collection is one of the roadblocks, with much clinical data currently reliant on blood or urine testing. But we are increasingly seeing innovation in constant and cost-effective data collection – from 23andMe’s genetic testing to Thriva’s home blood testing kits. And all the key players in mobile devices – Apple, Google/Deepmind, Samsung – are investing heavily in health-related teams and product strategies.
In a world where your device can collect clinical data constantly and passively, then analyse and interpret that data across broad populations to recognise predictive patterns, we will be able to identify problems before they can occur. This It will bring us one step closer to practicing earlier intervention and thereby fundamentally alleviating the substantial cost burden to healthcare systems that are focused on treatment rather than prevention.
Rabin Yaghoubi | LinkedIn