Founder Interview with Austin Walters, Managing Partner of SpringTide Ventures: A purpose-driven serial-entrepreneurs democratizing medicine. SpringTide is a network of experienced healthcare founders, operators, and investors in the healthcare space with offices in Cambridge, Salt Lake City, and Austin. With over $350M in collective exits across 4 startup companies, the fund's Managing Partners are driven to provide access and support for fellow entrepreneurs who are expanding access to quality healthcare.
What types of big solutions in the medicine field is SpringTide looking to invest in? How are you aiming to “democratize medicine”?
We look for solutions addressing problems that are acutely felt, widely held, and poorly addressed by existing solutions. Examples include Wellsheet helping to reduce physician burnout by saving doctors 40% of their time in the Electronic Health Record, or Tula Health driving behavior change among people with Type II diabetes using monitoring technology and quality motivational coaching.
What is your fund’s investment thesis?
SpringTide leads priced Seed – Series A rounds with $500K – $2M investments in post-revenue healthcare software companies with strong technical leadership and proven track records of success.
Your team members are all serial health-tech entrepreneurs. Please share with us more about your professional background and how your past experiences and success help you to better partner with entrepreneurs you invest in.
Dan Lambert, Yiannis Monovoukas, and I been investing and operating companies in the health-tech space for two decades. Between us we have significant scientific, engineering, software, AI, sales, regulatory, and general management experience, and the entrepreneurs we invest in appreciate our understanding, our shared passion for innovation, and the solid networks we’ve built in healthcare.
What is your secret sauce for sourcing the best deal flow and the most promising Founders in healthcare?
We are in the process of closing SpringTide Ventures Fund I L.P. with 100 LPs, many of whom are serial entrepreneurs in the healthcare sector or physicians. Our LPs are our top source of deal flow.
The managers of the fund are involved as advisors at Columbia BioMedx, Harvard’s iLab, MassChallenge HealthTech, BluePrint Labs, and several other organizations that screen and select for early talent in healthcare innovation.
We host an annual “Healthcare AI Summit” where 10-20 of the world’s best healthcare AI startups pitch. We had over 500 registrants at our September 2020 event, mostly comprised of hospital CIOs, other healthcare VCs, and KOLs in healthcare innovation.
“The most important source of capital is customers”. You have invented a better way to build a strong, value-accretive sales engine – please tell us more about your proprietary Elastic Sales service.
We have invested heavily in experienced sales networks, legal agreements, and experimentation to provide a large number of fractional sales reps to our portfolio companies quickly. This works because the best reps are hungry to join the “next big thing,” and companies benefit from following the principle of “try before you buy.” We offer the service at no charge to our portfolio companies, which receive a single invoice from us per month covering the fractional rep retainers. The company extends offers of employment only to those reps who perform strongly.
Please share with us about some of your outstanding case studies.
SpringTide was a Major Investor in PathologyWatch’s $3M Series Seed round in early 2019, taking a board seat. We continued to support the company through 2019, building the in-house sales force with Elastic Sales, and subsequently leading PathologyWatch’s $5M Series A round in early 2020, doubling the valuation within one year.
SpringTide led the Series A financing of Tula Health, Inc. in the early summer of 2020 at about a $50M post-money valuation. The company then signed $80M+ worth of agreements with payers later in the summer and SpringTide is now syndicating a venture debt facility for the company to ensure scaling at speed.
What in your opinion is the future of AI in medicine?
Our view is that AI is already all around us: In Gmail’s Smart Compose functionality, in driver-assisting vehicle technologies, and surveillance. Healthcare is a conservative industry, and rightly so when it comes to innovations that touch the patient. We believe that AI will take root in applications that are less mission-critical first, e.g. automating and improving the interface with EHRs, and then begin to take on more heavy clinical lifting, e.g. clinical decision support, ground truth diagnostics, life-critical notifications. Several exciting applications we see growing quickly today are:
Cancer detection and characterization in pathology, EHR automation, Medical billing automation and Robotic process automation.
We are working to build a world where handheld or wearable devices will help provide meaningful care to billions of people who today don’t have adequate access to physicians. AI algorithms have the capability of achieving super-human performance on specific tasks, and we can embed these algorithms at the “the edge,” or at “point of care,” to accomplish tremendous good.