Investing in Medical Technology Innovation
The Critical Role of Medical Innovation
Economists Kevin Murphy and Robert Topel evaluated the social benefits of medical innovation by valuing aggregate improvements in human longevity (Murphy and Topel 2006). Over the period 1970–1990, the increase in the lifespan of the average American was significant. Using age-dependent values for an additional life-year and the increases in life expectancy over this period, the authors attributed a value of roughly US$57 trillion (or about US$2.8 trillion per year) to the increased life expectancy.
Empowering Medical Technology Entrepreneurship
In the innovation context, startup failures are studied through post-mortem analyses. The failure causes range from “lack of market need” to “lack of customer understanding,” passing through “exhaustion of cash flow”. Such biases affect the entrepreneur’s ability to design and sharpen efficacious value propositions and realistic pricing models. Some observers have pointed the finger at the practice of postponing marketing and pricing decisions until the end of long product development journeys. In general, practitioners and scholars openly recognize that the common denominator across the mentioned causes of failure is rooted in biased decision-making.
Visualizing Decision Problems & Business Assumptions with Mental Maps
Prioritizing the use of scarce resources.
Cognitive psychology has shown that the mind best understands facts when they are woven into a conceptual fabric, such as a narrative, mental map, or intuitive theory. For this reason, the proposed methodology uses a value-centric “map” of decision-related problems for medical innovation.
The K9 Map links market needs, product readiness, value proposition, competitiveness, stakeholder fit, segment attainability, commercialization viability, financials, and valuation. The K9 Map mitigates bias, guides scarce resources, and improves the accuracy and credibility of venture forecasts.
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Scarce resources require entrepreneurs to see all critical problems, continuously re-prioritize them, and address the most consequential first.
Enfranchising the scientific approach
from labs and clinical studies
Extensive research proves that, in early-stage startups, a scientific approach to decision-making enables entrepreneurs to make better decisions and predictions while testing and launching their business ideas.
We relied on these findings and invested significant time and effort in testing their validity in the real-life practice of medical startups. The undebatable results of the ventures adopting this approach made us commit to deploying the most practical and usable tools to help medical entrepreneurs adopt a scientific approach to decision-making.