I love working with physicians and advocating on their behalf so they can practice “on top of their license”, doing only the things that only they can do. Many are content and fulfilled from serving patients day in and out, especially if clinical, operational, and technical support is designed to enable them to focus on practicing medicine.
But this career is not the right fit for everyone in the long run. As I have experienced numerous times, especially clinicians caught up in the bureaucracy of a larger healthcare system often think and scheme and dream about launching their own venture as a way to escape their daily doldrum.
Over the past 10 years since I left the Mayo Clinic to launch my own consulting startup, I’ve come across numerous “entrepreneurially-minded physicians” that had this deep-seated desire to do more with their intellect and their passion for patient care than being a cog in the wheel of a large healthcare delivery system that posed an ever-increasing burden of constraints on their ability to honor their oath.
The most astute of them did not succumb to the fallacy that “they can do everything” and sought to compensate for their known and unknown blind spots. They teamed up with a tech-savvy person who oftentimes knew very little about healthcare. The apparent synergy provided excitement fuel often for many years (and many 100s of thousands of dollars) that after all was said and done still ended up in a painful failure.
As I’ve worked intensely with about a dozen clinicians, the blind spots are aplenty — starting from basic business, finance, and accounting principles to marketing, sales, tech development, and — most importantly — leading and managing multi-disciplinary teams.
Thus, if you know (or you are yourself) a physician who is contemplating to quit their job to fulfill their long-held dream of launching a startup (or even with the audacious goal to create the next Health IT unicorn), make sure to work through these 10 questions.
9 Critical Questions To Ask Yourself
Before Quitting Your Job as a Doctor
1. Why do you want to launch a startup?
This is the most important question. Are you running away from something or toward something? Are you seeking satisfaction that seemingly can no longer be found in your current job? Or is it because in the clinical world, you have succeeded thus far and think you can continue that success in the business world?
Or is it because you have a truly unique idea, whose financial and clinical feasibility you’ve validated? Along with a multidisciplinary team of people you trust?
2. Have you had entrepreneurial experiences (successes and failures)?
What did you learn?
Nothing teaches more than failure — and learning from it. Which is why clinical training takes at least one and a half decades. The best first experiences in the entrepreneurial world are those made on the sidelines as a contributor, a partner, not as the sole instigator. While you can’t kill a patient, you can still kill a good business idea, or worst, your entrepreneurial dream.
3. Do you have a business model? Do you have a business plan?
“Build it and they will use it or buy it” is not a solid strategy. One of the hardest things is getting other humans to use the innovative solution you’ve designed — even though it may be vastly better. A business model outlines your target market, your sales channel, your revenue streams, your cost structure and more. Going into business without a business model is to attempt surgery without a plan. “Winging it” has a very small chance of success.
4. How will you be different from your 3 biggest competitors?
No idea is as innovative or new as you think. If it can succeed, it must fill a need. If it fills a need, then there is a current way to fulfill that need – which may be as innovative as yours or it may be traditional. Think broadly: “We have no competition” is a surefire shortcut to failure, even in a “blue ocean” strategy.
Identify and study your closest competitors hard. Also study those successful in a similar field. How are they getting customers? How are they marketing themselves? What are their revenue streams (hopefully more than just a lavish flow of VC money)?
5. Which geographic area are you targeting?
It’s obviously easier to fish where the fish are and even in a wildly connected virtual world, the regulatory circumstances, the labor market, and the social-drivers of health profile of your targeted patients may be better in some areas than others. And it may not be in your own backyard.
Besides, buying Google or Facebook Ads for national coverage can get expensive very quickly.
6. Do you plan on leveraging existing technology
or custom develop your own solution?
Another crucial question. Quite a few entrepreneurially-minded physicians have a geeky technology streak that they are now trying to “live out”. Or they form a seemingly symbiotic partnership with a software guru who is enamored with the development of cool solutions.
While developing your own solution ultimately gives you more control over the customer experience and a more valuable business overall, the investment can quickly reach a million dollars.
The best strategy is always to cobble together a solution from ready-made parts to validate that customers would buy it. The best compliment (and justification for custom development) is when a customer says “I love it, I just wish it wasn’t so clunky.”
A good principle to follow is to “adopt first, then adapt and invent only where needed.”
7. How will you fund the startup phase?
While you raise money from friends, family and other angel investors, future investors will look very closely at how much of your own money you put at stake. Hours are relatively easy to come by, but parting with your own hard-earned cash shows true commitment.
Plan for a budget of at least $250,000 for the first phase until you can demonstrate value and attract additional investors to grow and scale your business.
8. Who else is already on your team?
It’s very important to build a diverse, multidisciplinary team first. Make sure you cover most dimensions of a business with people who are “pretty darn good” at it. This includes strategy, planning, business models, accounting, technology, marketing, sales, team building, product management, project management, fund-raising, etc.
But keep in mind that going from a 3 person team to a 6 person team will increase your communication channels between the team members from 3 to 15 — a five-fold increase. Thus you’re better off to find experienced, multi-talented experts to get you started and protect you from basic blunders.
9. How much time can you invest?
If you’re trying to build a startup while still doing your full time job (and have a significant other or similar family commitments), be prepared to take a long time and eventually run out of energy and enthusiasm.
While I don’t recommend you quit your job right away, be emotionally (and financially) prepared to quit your job within 3-6 months. Alternatively, be prepared to shell out good money to install at least one person you fully trust as the full time leader until you’ve validated your business model.
Most clinicians I worked with or have come across were mid-career — about 5-10 years into their full clinical practice after residency and fellowship. Some of them realized they would have to quit their lucrative clinician job to bring their dream to reality — and were not willing to do so. Some realized that they were not cut out to run a business and were glad they at least pursued it long enough to “get it out of their system”.
The few that I know that made it either hired a very talented team that the business could afford or quit their job to jump in with both feet, taking between 2 and 4 years until they’ve finally “made it”.
Entrepreneurship is highly rewarding but so is the privilege to help patients to get well and stay well. If you have this itch, at least invest a little time and money to see if there’s something to your idea — and to find out whether entrepreneurship is really what you are seeking.
Are you a clinician itching to launch your own business? Then schedule a complimentary call with me to discuss what it would take to make your dream become a reality.