With the passing of the Affordable Care Act and the increasing demand for transparent, accountable, and patient-centered services, the American healthcare system is ripe for innovation. In 2014, digital health investments in the United States reached $4.1 billion, and lately, bigger companies like Google, Amazon, Microsoft, and Apple are diving into the healthcare sector.
Health Innovators, a Seattle-based health innovation community, recently completed a fascinating study titled, "Health Innovation Location Attractiveness." Spearheaded by Angela Hong and Ed Butler (both co-founders of early stage digital start-ups), this study sought to answer the question, "What is the best city to grow a new health technology company?"
To address this question, the study assessed five cities (Boston, NYC, San Francisco, Seattle, and Chicago), and compared them against the following criteria:
Cost & Regulatory Complexity
This criteria sought to compare each city by the ease of forming a business. How hard and expensive is it to form a company? Are there any state or local laws that make it easier or harder to build a digital health product?
Availability of Talent
This criteria investigated the local population and density of skilled designers, engineers, health professionals (nurse practitioners!), behavioral and life science researchers, marketing, and sales professionals.
For most startups, access to financial capital (venture or angel) is of the utmost importance, and unfortunately, the number of investors who understand the complexity of the healthcare system is small. This criteria sought to compare the financial capital and the number of healthcare industry investors.
Centrality of Healthcare Institutions
Health institutions include hospitals, payer organizations, pharmaceuticals, and life science research institutions. This criteria investigated the number of these "big-name" institutions in each of the comparison cities.
Finally, this criteria looked at whether each city fostered a "startup-friendly culture." How open and friendly is the startup culture in the metro area? Is it cut-throat competitive? How likely is it that other companies will poach your team?