Creating a minimum viable product that attracts investors is crucial for startups trying to make it big in the healthcare industry. But with so much competition in the market, it's not an easy task. That's why you need to focus on crafting an MVP that appeals to investors' priorities and captivates their attention. After all, investors can play a pivotal role in the growth and development of healthcare ventures.

Our guide is tailored to help you launch a groundbreaking healthcare solution or revolutionize an existing service and capture investors' attention.

User ≠ Payer: Understanding Investor Priorities

It's crucial to understand a fundamental distinction: users and payers are not always the same entities. This insight plays a significant role in determining what investors prioritize in healthcare ventures.

When investors first get involved in a project, they focus on identifying potential market fit and validating the need for the proposed solution. They scrutinize the ability of founders to navigate the startup journey and assess their team's competence and commitment. This phase is all about laying the groundwork for future growth.

As a startup begins to scale, investor attention shifts to specific metrics. Focal points include:

user engagement
clinical and market validation
competitive advantage
scalability

Technical due diligence ensues to assess the viability and potential profitability of the solution. Investors want to be sure that their investment will yield returns as the venture matures.

Understanding investor perspectives leads us to the core of the matter: prioritizing features for an impactful launch.

“Launch while you're still embarrassed”: The Power of Prioritized Features

Your main goal in the early stage is to validate your business model - not to get as many customers as possible. The sooner you make it to the market the sooner you receive feedback from early adopters and make necessary adjustments.

That’s why it's crucial to prioritize core features and necessary spending when building an MVP. You should decide early on whether to build a throwaway solution or something that will grow later.

One thing to keep in mind is that you should avoid hiring inexpensive teams that lack experience. Instead, find someone with enough expertise who knows how to prioritize your product features. There are several methodologies you can use to determine which specific set of features will compose the very minimal set that will deliver the necessary function and serve as a foundation for your business.

At Kepler Team, we call this establishing a product Core, or applying the Core Design Pattern. Think of it as identifying the skeleton or essential structure of your project - the must-haves. This core structure needs to be robust enough to support the addition of extra features and functionalities without collapsing.

Even features considered essential may sometimes function as supplements, depending on the project's needs. Therefore, it's crucial to architect the technical aspects carefully, ensuring a clear alignment between business objectives and technical design.

UX is the new black, but…

How important User Experience is for your product's success? It's undoubtedly a significant consideration that requires careful attention. Should your priority be creating an app that appeals to both users and investors, or does it depend on the stage of development? Let's explore.

UX is paramount to any product's success, but the amount you invest in it can vary at each stage. Many startups face the challenge of overspending and overthinking UX, leading to a failure to launch. However, the key criterion is usability. Your app must deliver a satisfactory user experience; otherwise, it becomes unusable. Customers should be able to navigate easily and find functionality without any confusion.

Perfection is not necessary - the goal is functionality.

At Kepler Team, we work with early-stage startups and use our proprietary framework called System 4096™, which includes:

Design Patterns
Product Lifecycle Modes
Optimal Team Performance Principles
Reliability Approaches

The Core Pattern is used to allocate the "core" of the product, including the fundamental features that cannot be de-prioritized or substituted. Our approach involves breaking UX designer involvement into two stages: the first stage is at the beginning of the work to prevent obvious mistakes, and the second stage is when the development team is already working on something, and they need guidance from the UX specialists.

UX standards are continuously evolving, with a shift towards minimalistic and streamlined designs. Trends show that voice input and AI are becoming more prevalent. As long as the app is usable and follows industry standards, heavy investment in UX can be postponed to later stages. So, focus on usability, keep an eye on trends, and invest in UX accordingly.

How Important is Regulatory Compliance for MVP?

Regulatory compliance is crucial for healthcare products. But the key here is about slicing and dicing. While it may seem overwhelming, you just need to prioritize and plan for immediate, short-term, and longer-term compliance measures.

Investors and early adopters expect startups to have a solid understanding of the associated risks and a clear plan. It's natural to feel anxious about not meeting all the requirements, but having the basics in place and a plan for addressing additional compliance needs is the key.

It's also important to note that security and compliance go hand in hand. No solution can claim to be 100% secure, and new vulnerabilities emerge regularly. Even large companies with extensive security and compliance teams experience incidents and data breaches. It's therefore crucial to continuously work on improving security measures and staying vigilant.

Lights, Camera, Go-to-Market Action!

Creating a product is just one part of launching an MVP. To ensure success, you'll also need to have a solid go-to-market plan in place right from the beginning. Ignoring this crucial aspect can spell failure. So, don't forget to pay attention to the key milestones that can make or break your MVP launch:

Shape your MVP by understanding the go-to-market process, ensuring that technology serves the business rather than existing in isolation.
Tailor your go-to-market plan according to whether your company is a tech or service company.
Develop a solid revenue generation strategy that addresses the ultimate question for investors and stakeholders. Start with a plan for user acquisition and revenue generation to set the ball rolling.
Validate your startup's objectives with specific data when crafting a strong launch strategy.
Blue ocean is nearly non-existent in any industry, including Healthcare Technology. Conduct market research to prepare for pitching to funders or investors, highlighting how your business differentiates itself from others.
Overcome the challenge of finding clinical provider systems willing to run a pilot by securing partnerships for valuable insights that shape your go-to-market plan.
Refine your thinking and approach by collaborating with experienced consultants. If unsure about your audience and their purchasing motivations, consider hiring someone to build a go-to-market plan.
Continuously improve your MVP based on user feedback and requests. Partner with a reliable technical ally to navigate growth, especially during fluctuating demand phases. Be prepared for the journey's ups and downs for sustained success.

Why do healthcare startups fail?

It's important to understand the reasons behind startup failures to ensure you don't fall into the same trap. As experts who have worked closely with startups for several years, we have identified key signs of potential failure that often go unnoticed by founders:

Lack of long-term commitment and resilience. Are you prepared to endure challenges and maintain faith in your vision despite constant rejection?
Founder's indecision can also be a red flag for investors. Professional qualifications are important, but perseverance during tough times is equally crucial.
Weak and unreliable team. Success depends on the entire team's strength and adaptability, especially during moments of doubt and high demand.
Over-relying on early-stage investments, neglecting proper financial management, or prematurely seeking external funding. This can lead to unnecessary dilution of ownership or compromising on terms with investors.
Wrong strategic partner and investor selection. Selecting partners and investors who align with the startup's values and long-term vision is crucial for success. Thorough vetting ensures compatibility and minimizes risks.

To learn more about startup failures in healthcare, watch our webinar How to Fail in the First 6 Months of Your Healthcare Startup Journey.

Conclusion

Crafting a healthcare MVP that investors find attractive is an intricate task that requires more than just a brilliant idea. While healthcare innovation and market fit are essential, you also need to have strategic planning, an understanding of investor priorities, and excellent decision-making skills to succeed in the startup world. You also need to prioritize features for a successful launch, ensure user engagement, clinical validation, and scalability to grab the attention of investors.

However, creating an MVP is only half the battle. You also need a trustworthy technical partner who can transform your ideas into tangible solutions and help you navigate the complexities of scaling and growth.

Kepler Team is here to provide you with the expertise and support you need to transform your health innovation into reality and achieve long-term success in a competitive market. Let's connect now and take your healthcare startup to the next level.

Talk to us