How HealthTech Startups Can Navigate Tech Giant Competition

How HealthTech Startups Can Navigate Tech Giant Competition Omri Shor, Forbes Councils Member

Omri Shor is CEO of Medisafe, a leading digital health company, helping patients manage their treatment journey.

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Over the last decade, and especially since the start of the pandemic, the digital health ecosystem has swelled, with hundreds (if not thousands) of healthtech companies working to address both old and newly emerging challenges. Naturally, the big-name tech companies saw this need for rapid modernization in the healthcare industry as a major opportunity to expand their business as well.

By nature of their size and resources, companies like Apple, Google and Amazon were all quick to enter or expand their footprint in the healthcare arena—launching new divisions or products in a matter of months or making strategic acquisitions of​​ other companies to help them catch up.

At the time, many wondered what the tech giants’ doubling down on healthcare would mean for healthtech startups. Three years later, it’s the startups have risen to the occasion—here’s how and what opportunities remain.

Nimble and steady wins the race.

Despite efforts by the tech giants to lead the healthcare space, startup companies should continue to be the primary force driving the industry forward. The reason? Their deep and historical expertise in healthcare that the tech giants just do not have.

Many companies have spent years learning about and understanding their industry’s needs, building tools and solutions to address their biggest challenges, growing relationships with valued customers and looking to the future in order to innovate and meet the needs of tomorrow—resulting in slow but steady growth over the past few years.

Many healthtech startups have not only revolutionized the way care is delivered—bringing new ideas that have made an immeasurable impact on patient outcomes—but ingrained themselves in the fabric of care delivery.

There are countless examples of this like remote patient monitoring technologies being used to help hypertension patients significantly reduce their systolic and diastolic blood pressure, AI that is helping doctors spot abnormalities on scans that cannot be seen with the human eye, apps that put therapists in the palm of people's hands or medication management platforms that proactively keep patients on track of their medications and reduce missed doses.

Born from small companies with big ideas who invested time and resources, these technologies are now saving lives around the world. Despite current economic headwinds facing the healthtech industry, the companies that do the research and continue to come up with new and revolutionary ideas to fill important gaps in care will find funding.

Technology isn't the end-all-be-all.

Although some worry about efforts to fully automate healthcare, the reality is that even the tech giants face limits in doing so. While many innovations have proven to be beneficial to patients—like Amazon Pharmacy delivering medications to patients’ doors or Apple Watches adding more and more health monitoring features in hopes of thwarting the need for common doctors-office tests and enabling fully-virtual care—the reality is that we can’t automate and superscale everything in healthcare.

Many patients still want and need human interaction in their healthcare experience. For example, although many valued telehealth throughout the pandemic, 64% of patients stated a preference for in-person visits in a recent study from the Harvard T.H. Chan School of Public Health. In spite of fears of AI replacing physicians, healthcare will continue to require a human touch, and AI will likely never rival the intelligence and experience of physicians.

While in many cases (such as those listed above) the tech giants have developed products to meet patients’ needs, focusing largely on automation will potentially limit their ability to grow. The companies who are balancing automation with human elements are more prepared to manage the comprehensive needs of the industry and will have more opportunities to expand in the future.

Tech giants are not too big to fail.

While the tech giants have certainly experienced big wins, it’s also true that they have faced challenges and roadblocks. For example, Amazon’s Haven Health, Microsoft’s HealthVault, Google Health or IBM Watson’s AI and data analytics platform have all had to shut down.

There are a variety of reasons contributing to these failures, but what most of them boil down to is a lack of understanding of the dynamic and nuanced needs of healthcare. Healthcare is a world of its own, with challenges unlike any other industry, making it an incredibly difficult industry to tackle.

While tech giants may have the infrastructure in place to develop solutions and put them on the market quickly, speed does not always equal success when it comes to healthcare—and having ample resources and great prosperity in other industries may only get you so far. When it comes to healthcare, big business does not necessarily mean successful business.

What The Future Holds

Although there is no doubt that technology is the future of healthcare, this does not mean it is only tech giants’ for the taking. What is certain is that competition between innovative new companies and global corporations will continue to propel us forward.

The reality is that the two really can’t exist without each other. Tech giants make it possible for smaller healthtech companies to extend the reach and impact of their products by allowing them to share their platforms on iPhone, Android, etc. At the same time, tech giants can also learn from the years of experience and relationships smaller tech companies have built over the years—we know this to be true from the forecasted M&A activity.

Thanks to the efforts of startups and tech giants alike, we have come a long way toward digitally transforming healthcare in a short time. However, there is so much more that needs to be done. We have the opportunity to make a real difference. As we enter this next phase of growth in healthtech, it's clear that no one company will be able to solve every challenge, but what will be critical is that companies of all types work together, learn from each other and dare each other to challenge the status quo.

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