Improving Healthcare Communication: Kryptiq CEO Luis Machuca (Part 4)

SM: Have you grown primarily through direct sales, or have you had other strategic methods?

LM: There was also a viral aspect to our growth. Those people they sent an email to who happened to have a consult or a lab result, wanted the same capability. We started off with Centricity but had a rapid expansion based on the viral effect. A lot of our customers do not even realize they are sending an email because it is just an integrated part of their workflow. They just know that they are sending a report to another doctor.

SM: Can you describe the business model behind your service?

LM: Because we were a small company with limited resources, we quickly jumped from direct sales into partner sales.  In the ensuing years, GE started reselling our solution and ultimately OEM’d it. We have OEM deals with others that are similar to the OEM deals I did at Intel. I was able to leverage my past expertise.

SM: What kind of terms do you get in these OEM deals?

LM: It varies by partner. An approximation that is not terribly far from reality is that we get half of what they sell. It varies by flavor of product. We may bring a new flavor to market or a new service to ride on top of our messaging system, and we may price that differently.

SM: Do you have to get involved in the sales and marketing with your OEMs, or can they complete the sale without you?

LM: We do, but for specific reasons. We do still have a direct sales team, although GE and SAGE are more than capable of handling our solutions without our help. GE is now mounting a major campaign on connectivity as a part of the GE brand.

Our direct sales force is there for two reasons. First, we are at the cutting edge of development, so conducting direct sales for any application that we develop  for our larger customers helps us to validate that application faster. We know which customers we have relationships with that will essentially let us use them as development partners. We can then go to the OEMs and tell them that we have developed something new which has been tested with any number of large users and ask them to consider adopting that new application with their brand. We are generally successful with this approach, although we do occasionally keep something direct for other reasons.

The second reason we have a direct sales force is to sell into large providers who are not in the footprint of our OEM. We sell directly to them to respond to their inquiries. It is also a way to advance the ecosystem so that eventually it will be a network that is truly network-agnostic. It is not a very large sales force, but it is very targeted to make sure that we can maintain and advance the openness of the network. The distinguishing characteristics of Kryptiq are that we have a service which is integrated into the workflow and that we have built an open network.

These are not transactions. Networks are interactive transitions of care. It is not like building a point-to-point bridge. The possible combinations of transactions and care in the United States alone are in the hundreds of billions. You need a network that is completely transparent and open.

This segment is part 4 in the series : Improving Healthcare Communication: Kryptiq CEO Luis Machuca
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