Health2047 is a Silicon Valley venture studio backed by the American Medical Association (AMA) that finds, forms, and scales early-stage companies to transform U.S. healthcare in the areas of data, chronic disease, and productivity. Pulse 2.0 interviewed Health2047 Managing Director Warren Templeton to learn more.
Evolution Of The Firm’s Thesis
How has your firm’s thesis evolved over time? Templeton said:
“Health2047 frames our investments around the core areas of data, chronic disease management, and physician productivity. These opportunity areas were relevant in 2016 when we were founded, and remain our focus today. However, both the ‘who’ and the ‘what’ have evolved considerably in our nearly ten years.”
“New technologies, business models, and care paradigms have emerged, all attempting to reimagine solutions to those problems and creative ways to scale it. Yet, despite the innovation, we still have interoperability issues, we still have significant physician burnout challenges, chronic disease management is still poor, and the cost of healthcare is up and to the right, meaning our thesis is as relevant as ever before.”
Significant Milestones
What have been some of your firm’s most significant milestones? Templeton cited:
“We had a few firsts in our early years, which shaped our view of the role of a venture studio. We learned first-hand the struggle founders face in building startups within US healthcare, from UX design to payments to sales lead times. We launched our first internally-incubated business in 2019. Our first business with external founders was Zing Health, launched in 2020. Four years later, Zing raised $140 million and expanded across the country. Each company’s formation has provided us with many learning moments, shaping our approach to doing business and how we deliver value to founders.”
Investment Success Stories
Would you like to share any specific investment success stories? Templeton highlighted:
“We are five years into our fund’s investment journey, so all of our businesses are opportunities for success. My personal excitement is in our two portfolio companies, Zing and Phenomix.”
“Zing Health, a dual-eligible managed Medicare plan, has navigated some extremely challenging operating conditions over the last few years following star rating and payment revisions to their business model. The executive team there underscores the importance of a capable, eager-to-learn leadership team at any stage of the startup journey, and what it takes from investors to support them.”
“Phenomix, an obesity phenotyping business co-founded with Mayo Clinic, reflects both the role of great science and the right timing to build a compelling business. Founded before the GLP-1 wave hit the US, the team has gained a lot of additional value from those looking to understand the drug and subsequent responders.”
Industry Focus
What are some of the industries that your firm is focused on? Templeton noted:
“We are a health tech-only investor: software-derived or -scaled businesses in healthcare.”
Differentiation
What differentiates Health2047 from other firms? Templeton emphasized:
“Backed by the American Medical Association, Health2047 invests with both a market return and healthcare impact lens. Our investment model stands out from other firms in that we take a founding stake in each investment, investing both capital and prolonged support via our network of healthcare and innovation experts. This common stock investment strategy ensures a deeply-invested relationship with each of our companies, and allows us to work with a wider range of founders by providing them with the tailored support they need.”
“We often work with founders before there is a business or a flashy PowerPoint – and sometimes only a research paper. We’ve developed a capability to partner with founders to uncover their vision, tell that story, and prepare them for an institutional raise.”
Challenges Faced
What are some of the challenges you faced while working at the firm? Templeton concluded:
“My background is in software engineering, high frequency trading technologies and capital markets (traditional FinTech). I joined healthcare first in M&A and later as a product manager. I had no contextual model for how healthcare works, let alone the business cycles. I was fortunate to have advocates, like my colleague Jack Stockert, MD and advisors like Robert Wah, MD to help me out. And, like most founders know, the best way to learn is to just do it. So, I was embedded as a fractional executive with many of our companies to help with product development and growth.”
