How can startups avoid failure? Listen better. (Laura Hilty)

[00:00:02] Dear listeners, welcome to Faces of Digital Health, a podcast about digital health and how healthcare systems around the world adopt technology with me, Tjasa Zajc.

[00:00:14] It's easy to say that people should listen better. And I think everybody that is working in the digital health space and is creating new products knows that they should talk to their end users, involve the end users into their product design.

[00:00:31] But all this can be much more difficult to enact than it may seem.

[00:00:38] So it was a delight for me to catch Laura Hilty at the Digital Health and AI Innovation Summit to talk about failure and to talk about how people can listen better.

[00:00:51] Laura Hilty has spent over 18 years working to improve the healthcare ecosystem, over 14 years of that in clinical research.

[00:01:01] She has held leadership roles spanning corporate strategy, M&A, product strategy, product management and partnerships across stages from company startup to scale through Forte, Advara and Epic.

[00:01:14] So in this short discussion, she discussed the importance of collaboration and deep understanding of the end users, validation with customers, active listening and the need to detach from the love for your product.

[00:01:30] And while doing all that, also keeping in mind the market trends.

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[00:02:44] Now let's dive in.

[00:03:04] Laura, thank you so much for taking a little bit of time here at the summit around AI innovation in healthcare and departments.

[00:03:13] Yesterday, you had a really nice presentation on failure.

[00:03:17] Why companies fail.

[00:03:19] Sometimes it's the timing.

[00:03:20] Sometimes it's the fear of taking care of the current customers that you have and not being authentic enough to the broader trends that are happening around you.

[00:03:32] So what would you advise to startups to avoid these mistakes?

[00:03:38] I think the biggest thing is collaborating and asking a lot of questions to fully understand the landscape.

[00:03:45] So I mentioned taking on the complexity and deep diving on the problem and really having a deep understanding of the problem.

[00:03:52] So my advice is to talk to a ton of people and especially before you know specifically which problem, if you haven't experienced it directly.

[00:04:01] I mean, a hundred people to interview a ton of different people to fully understand and different perspectives and themes should start to arise.

[00:04:11] I think the other thing is once you get closer to a solution, actually validating that with potential customers and a lot of them, including would they actually buy it?

[00:04:23] And are they willing to pay, you know, what they're willing to pay for it?

[00:04:26] And like I mentioned, it's understanding the full ecosystem required to fully solve for it.

[00:04:31] So that comes down to where in the workflow does it fit in and what are the requirements in order to fit seamlessly in so that it gets adopted well and is successful out in the real world as well.

[00:04:43] I'm going to challenge that number of talking to 100 people just a little bit.

[00:04:48] Yeah.

[00:04:48] So depending on the size of the startup, it might be super difficult for them to actually find 100 people to talk to.

[00:04:55] And also I can speak from personal experience working in a healthcare IT company and running user groups, you know, and I would create a feedback survey and put it out during the user group and say, I will give you five minutes now to take time for the survey.

[00:05:14] Because I know how difficult it is to take time for giving back feedback.

[00:05:18] And still, I might get the five responses out of 30 people in the room.

[00:05:22] Yeah.

[00:05:22] So what's your advice there or what are your observations in terms of why people don't really talk to their customers or just the pension users as much as theoretically if we do the mix?

[00:05:36] And you can also talk maybe about what you hear from startups.

[00:05:40] What kind of excuses or reasons do they have that they say this is not possible?

[00:05:44] Yeah, it's a great question.

[00:05:45] And I say 100 basically to get that reaction of you're talking way more than what I was thinking.

[00:05:50] And it doesn't have to be 100, especially if you have a niche.

[00:05:53] If you're selling expensive products to very few customers, you don't want to potentially steer them wrong in the beginning.

[00:06:00] But I think a big part of it is trying to...

[00:06:03] I think it's helpful to have live conversations whenever possible.

[00:06:07] I think surveys get you almost centered into specific problems, but it won't tell you the whole story.

[00:06:12] So actually having live conversations with customers or with potential customers is really helpful.

[00:06:20] There's a book I recommend, Customer Development for Entrepreneurs.

[00:06:25] It gives a little bit of the nuts and bolts of how to ask the questions and how to engage.

[00:06:30] And I feel like the important thing is having them realize that or be clear that you are not trying to sell them anything.

[00:06:40] I think that's where a lot of times people don't engage in those conversations because they think at the end of it, they're going to try to sell me something.

[00:06:46] And I think that's key throughout this whole problem discovery and solution discovery is to turn off the sales part of your brain.

[00:06:53] That definitely needs to come back later, but assuring the other side that you're not going to try to sell them anything, I think, is partly why people tend to run away from those conversations.

[00:07:05] In the presentation that you had, listening was a really big emphasis.

[00:07:11] So listen more, listen better.

[00:07:13] It sounds easy.

[00:07:14] It's not as easy when you think about it more broadly or more in depth.

[00:07:21] What does that actually mean?

[00:07:23] Because most of the time, people listen to respond.

[00:07:27] So to just say something back instead of really understanding what the underlying message was.

[00:07:33] For example, I can make an analogy between a husband and a wife.

[00:07:37] A wife might say, oh, you're working too much.

[00:07:40] You don't do anything at home.

[00:07:41] You're never home.

[00:07:43] You only care about yourself.

[00:07:44] When what she's actually saying is, I actually, I miss you and I want to spend more time with you.

[00:07:49] But that's not what the husband would like to hear.

[00:07:52] So what would you advise against the company?

[00:07:55] How can they learn to listen better?

[00:07:57] It's like a huge communication skill.

[00:07:59] It is.

[00:08:00] Yeah, it's a great question.

[00:08:01] And I think I was serious when I joked about it, but said you have to be willing to hear that your solution may be as ugly.

[00:08:08] And if you aren't able to handle it, because people get very passionate about, you know, what they've created.

[00:08:14] That if it's reality, like if you can't handle it, find somebody who can, because that's key to identifying where the solution might break down.

[00:08:23] And otherwise it might, it might not work once it gets out there in reality.

[00:08:27] And it's better to know now where those things break down.

[00:08:30] I think part of that is having a little bit of, a lot of curiosity, but a little bit of detachment from what you have in your mind as the solution is helpful there.

[00:08:39] And then I just think of having the detective hat on.

[00:08:42] If you're trying to detect where this might break down in the future and always asking questions around that of what about this and that, how might this actually play out?

[00:08:52] And would you actually buy something like this?

[00:08:54] I'm not trying to sell it, but would it, is that something that you would actually allocate budget towards?

[00:08:58] And those sorts of things to try to get at the real information.

[00:09:02] If you come in too excited, people will sense that you're going to be really disappointed to hear the truth.

[00:09:09] And a lot of people, whether on myopic reason, Blankley talked about, won't share that, especially if you have something, some sort of relational capital in there, they won't tell you the real truth unless it comes across as very detached, basically.

[00:09:22] I think in healthcare, one thing to keep in mind is also that every hospital, every doctor is going to have a little bit of a different opinion on the clinical guidelines.

[00:09:31] When you're gathering that feedback, you don't necessarily have to take into account everything that people say.

[00:09:38] But you have to have that open mind that people are giving you feedback.

[00:09:42] They're not necessarily trying to criticize you.

[00:09:45] So it's all about the perception that you have in terms of receiving that feedback.

[00:09:49] It's a really good point.

[00:09:50] And a good one to emphasize is just because you hear all of the feedback and you are truly listening doesn't mean that you have to address every single thing and answer everybody's problem.

[00:10:00] Because you're right, there's going to be conflicts.

[00:10:02] But the more that you see and the more that you truly understand, you start to put the pieces together and see beams of what's common and what's not common.

[00:10:11] And just even having that information of everybody saying that this is all the same and here's some outliers where they differ.

[00:10:17] Just even having that information is really valuable.

[00:10:20] Which brings me to my next question.

[00:10:23] When you're actually listening attentively and when you're trying to put a lot of focus on customer success, what can happen is this tunnel vision on your focus on keeping customers satisfied.

[00:10:33] And then, for example, especially in software, you can just keep bloating your solution and not pay attention to what's happening outside.

[00:10:42] What do you advise companies in those situations when you see them?

[00:10:46] It's a great question and definitely is a challenge.

[00:10:50] Having been in product, understanding the balance of all of that.

[00:10:53] I think there's always needs to be an ear to the broader market beyond the current customer base as well.

[00:10:59] And I think some of that is understanding what potential disruptions are coming and not necessarily reacting to every single little other startup that's starting out there.

[00:11:11] But to critically think through that, because I think a lot of times smaller potential disruptors get dismissed because they don't have a lot of funding or they haven't made a big splash yet.

[00:11:23] But then it's too late once they actually get there.

[00:11:26] So I think part of it is being close to the customers, understanding more of the problems that they're still understanding.

[00:11:32] Because only going with questions about what features or what solutions, they're going to have their own mindset.

[00:11:39] But if they are, here's an example within clinical research.

[00:11:43] There's some patient trial matching companies that they help mine deep EHR data to find potential patients in clinical trials.

[00:11:50] And that is a thing that so many people are really interested in, which is really great.

[00:11:56] If they basically only keep focusing on that, then you might miss the bigger question of why they're interested in that as they're actually trying to solve for the enrollment problem in clinical trials.

[00:12:07] And that's one example of partnerships where it might make sense to pull in others to come alongside to pick up ones you identify the patient to take that all the way through to get them enrolled.

[00:12:17] And if you're asking customers more about, is this solving the alternate problem?

[00:12:21] And they're saying no, then that might be something that some other company might come alongside and solve the problem in a different way than just adding features to the existing specific products that you're solving for.

[00:12:34] So I think, I guess it's a couple of different answers.

[00:12:37] Is having an external view on the market and then going deep with the customers, not just on your product, but on their broader problems that they're looking to solve that are top of mind, whether it has anything to do with your current product or not.

[00:12:50] Well, you launched several products in your fast.

[00:12:54] You mentioned six and you also said that one of them failed, like the seventh one.

[00:12:58] Can you talk a little bit more about that?

[00:13:01] What did that mean to you?

[00:13:03] What did you learn from that failure?

[00:13:05] How did you go through it?

[00:13:06] Sometimes failure is essential for growth, for pivoting.

[00:13:11] It definitely taught me a lot.

[00:13:12] It was the second product.

[00:13:13] So I learned a lot and avoided failure, knock on wood.

[00:13:17] From that point on, I think a lot of what I'm talking about actually comes from that experience as well.

[00:13:22] We understood the customers that we were talking with.

[00:13:27] We understood their problems and we're going basically helping develop products for that.

[00:13:33] But we underestimated the slight differences across customers.

[00:13:37] So we had probably three customers to start and we're doing great things with them.

[00:13:41] The more customers that we talked to, so these are site networks and they were slightly different in how they operated.

[00:13:48] Some were all under one entity, some were multiple entities, and the way we had developed it didn't allow for the flexibility it needed to.

[00:13:57] So it was basically everybody had 80% of the same needs, but the 20% that were different were very different across different site networks.

[00:14:05] And it required a different infrastructure than we had.

[00:14:09] And so it wasn't just features that we could add on easily.

[00:14:12] Otherwise, it was basically ended up to be custom software.

[00:14:15] All that to say, I think talking with more quantity would have pulled that out if we had done that before we actually started development or gone too far with development.

[00:14:26] It's definitely a big part of this whole theme is collaborating with a lot of different people even before you really connect.

[00:14:33] Are there any trends or unmet needs that you are observing on the market in the current investment landscape

[00:14:40] that are not addressed yet that you would wish to see being addressed?

[00:14:44] What do you see in that sense?

[00:14:48] It's really interesting.

[00:14:49] There are a ton of innovations in a lot of different pockets.

[00:14:52] For early stage, it's helpful to have a clear focus and go deep on that and have success in one specific area.

[00:14:58] But larger organizations like pharma specifically don't want a ton of quite solutions to deal with.

[00:15:06] And on a clinical trial, for example, they need to work closely together.

[00:15:09] I think there's something in a little bit of more of an integration perspective or a system integrator that can pull together a lot of those point solutions.

[00:15:19] I see that both within pharma and across sponsors and saiyah cooking.

[00:15:23] There's still NIST opportunity there.

[00:15:26] Within clinical trials specifically, since I spent so much time there,

[00:15:29] I also think there's a lot of opportunity in research-naive physicians across the globe

[00:15:37] that we haven't quite figured out how to leverage that for more access to clinical trials.

[00:15:42] And there's different things that have been tried, but nothing has really stuck and made it across the line

[00:15:48] with pharma feeling comfortable and suites those.

[00:15:50] That's one specific example that I'm hoping is an impact because I think that could make a big impact.

[00:15:55] Thank you.