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Equity Financing from Customers: Modernizing Medicine CEO Daniel Cane, Boca Raton, Florida (Part 7)

Posted on Wednesday, Feb 13th 2013

Sramana: Where are you located?

Daniel Cane: We are in Boca Raton, Florida.

Sramana: That is a region that does not have as much of an angel or a VC community. That makes your company’s story even more interesting.

Daniel Cane: That is true. This area has a lot of nice ingredients for building companies. It is very rich on healthcare. My biggest limitation on scaling is hiring people who know healthcare. The technology environment in this area is weak, but not nonexistent. There are some good companies such as Citrix. We have had no problem building our ecosystem down here.

Sramana: How many people do you have on the team?

Daniel Cane: We have 125 people. About a fifth of them are tech and the rest serve in sales, client services, and other roles. I outspend 2 to 1 on my customer side. It is so important to have technology that scales as well as amazing customer service. We really want our customers to be successful. We will not even allow a customer to use the product until he or she finishes training. When our customers are successful, they go out and tell everybody.

Sramana: How difficult is it to hire technical talent in south Florida?

Daniel Cane: That is always an interesting question. In DC, I had to compete against a lot of people for that talent pool. Here I don’t have to compete as much, although there is not as large of a talent pool. I don’t think it is any harder. I have been able to attract people from Google and Pfizer. I have also been able to hire people right out of school with advanced degrees. I think it is just different.

Sramana: I believe that if you are not in a highly competitive technical market that you may be in a better position. There is technical talent everywhere. If you are a good company, then being off-centered from those talent-war locations is an advantage, not a disadvantage.

Daniel Cane: I think you are absolutely right. There are some things you lose. In the Valley there is a constant shuffle of people through companies, so there is constant cross-pollination of best practices. That is missing outside of the Valley. Most of my employees have only worked in one or two other places. In the Valley, it is a badge of honor to change companies every two years.

Sramana: Once you get to a certain scale, it is not that hard to plug into the Valley.

Daniel Cane: I agree. Our next major hurdles are around scaling, and our technology will scale easily. Our issues are all around people, processes and training rather than tech.

Sramana: You said you were working on business plans and product strategy for other markets. What is the algorithm for that?

Daniel Cane: I have done what nobody else has been able to do, and I do it by finding leverage. When it comes to dermatology, I have 14% of the market. How do I leverage that into new business? For me, the most exciting thing is all of the data that I have. This is not about taking unstructured data and mining it. Our data is all structured. I know which drugs are used when. I have all of the data behind all of the treatments and the corresponding efficacy.

For me, it is about finding a way to connect providers and patients with people who want to connect with them in a way that benefits everyone. A great example is phase 4 clinical trials. Most of those fail before they start because they can’t find enough patients to enroll. I have 100,000 patients with psoriasis. I can build a business around managing phase 4 clinical trials.

I can tell a pharma company things that they don’t know. They pay the dispensaries to know what drugs are being prescribed. They don’t know why they were prescribed it or if it was effective. I can tell them that. I can tell them all of the off-label uses of their product. I can lead them to retrospective analysis. That eclipses the EHR business tremendously.

Sramana: The question there is privacy.

Daniel Cane: We would never, ever do anything to reveal the identity of our clients patients. We can ask doctors to invite patients to clinical trials. We can also things on a de-identified aggregated basis.

Sramana: This is a fascinating story. You made my day by sharing your financing strategy. Congratulations on your success, and best of luck as you go forward.

This segment is part 7 in the series : Equity Financing from Customers: Modernizing Medicine CEO Daniel Cane, Boca Raton, Florida
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