Recently, Jared virtually sat down with Ian Chiang, Partner at Flare Capital Partners for a discussion on healthcare trends and investor insights in 2024.
Key Highlights
Digital Health Focus: Emphasis on the potential and investor interest in digital health, despite funding fluctuations.
Trend Toward Consolidation: Expectation of consolidation in healthcare, with quality companies still attracting investment.
Innovation in Specialty Care & AI: Highlighting the importance of cost management in specialty care and AI’s role in administrative efficiency.
Startup Strategy in Difficult Times: Advice for startups to focus long-term and utilize investor relationships to navigate challenges.
Q&A
Jared S. Taylor: What excites you most in the world of healthcare investing in 2024, especially compared to last year?
Ian Chiang: We’re particularly excited about the outlook of digital health. Despite a funding decrease from the peak years of 2020 and 2021, last year, 2023, was still record-breaking compared to any time before 2020. We see a maturation in companies and a sophistication in investors who seek solutions delivering real value. This year, we’re focused on backing companies that make a significant difference, anticipating some consolidation and a flight to quality. Investors, including myself, are eager to invest in companies addressing the quadruple aims of healthcare: cost savings, quality improvement, enhancing patient and provider experiences, and tackling provider burnout.
Jared S. Taylor: Are there specific healthcare categories that are particularly compelling in 2024?
Ian Chiang: Certainly, the entire healthcare sector, being a four trillion dollar industry, is ripe for innovation. However, a few areas stand out:
- Specialty Care Costs: We’re looking at innovations that can bend the cost curve in specialty care, which is a significant part of medical expenses.
- AI and Administrative Efficiency: The use of AI to reduce administrative burdens in healthcare is another exciting area.
- Healthcare Financial Tech: Creative financial solutions that enhance patient access to affordable care are also crucial.
Jared S. Taylor: Do you think this year we’ll see more down rounds, shutdowns, or acquisitions?
Ian Chiang: We’ll likely see all three. Down rounds may occur for companies that were previously overvalued but are fundamentally strong. Shutdowns are inevitable for some companies with unsustainable economics. However, it’s part of the disruptive innovation cycle. As for M&As, I expect significant activity here. This includes larger market players consolidating and startups merging for greater value.
Jared S. Taylor: When talking to the founders you’ve invested in, what are the discussions like in less than ideal situations?
Ian Chiang: Every situation is unique, but the overarching advice is to focus on the long-term. If a company’s offering aligns with the quadruple aims, it will have value and demand. Tough times require an even-keeled approach and a focus on the bigger picture. Founders should leverage their network and resources, including investors who are generally in it for the long haul and align with the founders’ visions. It’s about creating a trusted circle to navigate through challenges.
Notable Quotes
Learn More About Ian
Ian is a Partner at Flare Capital, where he led investments in Knownwell, Inbound Health, RightMove, Cayaba Care, and Oshi Health, and serves on several boards. Prior to Flare Capital, he was a Senior VP at CareAllies, Cigna’s provider services, and population health management businesses. Ian co-founded several startups, including XcelDx, and served in leadership roles at Becton, Dickinson & Company and McKinsey & Company. He advises healthcare startups and serves on various boards, including the Harvard Business School Healthcare Alumni Association. Ian holds a BS in Biological Engineering from Cornell University and an MBA from Harvard Business School.
Companies in Ian's Portfolio
