1996-2006 Start-ups, what have we learned?

I was attending the other day a presentation held by several start-ups to present their offering.
While I am always enthusiastic about creative people who pursue a dream to bring change and new products on the market, the general feeling was a bit ..."back to the future".

I couldn't help wondering what we had learned, if anything at all, from the 90s:

One of the company set to establish itself in the electronic content publishing "everywhere-anythime-whatever the device". We were then showed a reading device, the size of a smaller lap top screen that would enable us, the customers, to read "everywhere, anytime, anyhow"... We were assured that technologically there were many complex issues and all this "thing was not trivial to establish". Nonetheless, I would be able to read in Norway a Japanese newspaper if I'd wish to...

With all due respect to the creative drive and enthusiasm (that I believe should be rewarded in one way or another), words of wisdom from a business angel were still echoing in my head long after the speech was done: "If the technology replicates a concept already existing, stay clear from this venture..."

Addition Feb 2011: well, you can't always be right, can you... Kindle anyone? (smile)

Healthcare and new cures

It is not a mystery that the healthcare industry is still a market with a lot of potential for growth. The population of the rich countries are aging and need more care, medecine is still making progress in many untapped territories.

On one hand we have demand for more and better service, on the other hand research is pushing the limits and making more cure available.

A client of mine who came up with very interesting technology made the following reasoning:

"We know that 5% of the population in the rich countries suffer from the disease Z, there are roughly 500 Million people in the targeted countries, therefore our market is 5% x 500 million = 25 million customers" No need to say that the reasoning justified huge investments and ambitious business planning.

However, after studying the market conditions, and different healthcare systems, it appeared that the client had made a major mistake. They failed indeed to understand that while there might be several million potential users of the technology to cure dizease Z, the budget envelope dedicated to reimburse medical expenses is quite limited. The new cure will be actually competing against many other cures for other diseases. Thus, while the cure for disease Z might be promising, it will be probably overlooked in favor of treatments for cancer or other more serious diseases.

In the healthcare industry, don't forget to look at

• the reimbursement schemes: the newest cure might not be reimbursed yet, therefore its adoption and expansion might be greatly limited
• the "competing" diseases : the healthcare budgets are not extensible and your cure (in spite of its theoretical ability to cure an important number of patients) might not be the first priority

As nothing goes in this industry with small numbers, you can only imagine the costs of approximate marketing and strategic planning. Terrible losses.

Consultant or Collateral casualty? part II

Some of you have expressed interest in the solution adopted with this particular client (look at post bellow "Consultant or Collateral casualty" for the background story).


Consultants, and Management consultants in particular, should be extremely aware of the task that is being asked. This is one point. The fact that you are aware of a political situation is all to your credit, however you need to represent your company to its best and still help your client.

No "updating your CV" is not the answer (although your CV should be always updated).

The answer is
a) you protect your company by documenting absolutely all your efforts, all the reactions and effects.
b) you protect your client by documenting every possible solution and action that reasonably could be tried.

What you think of the client next is left as an exercise to the reader... but my advice is to laugh it off (grin).

Be wise and do happy consulting, it's just part of the challenges you may face one day or another as a consultant.