Feb 12 (edited) in 🗣 General
Top 3 Mistakes I See Healthtech Startups Make & How to Fix Them
⚠️ Warning: Unless you're a Healthtech Growth Pro or you've worked 1: 1 with me to develop your GTM plan, you're likely making at least 1 of these 3 mistakes with your healthtech business and it's costing you hundreds of thousands of dollars in funding or revenue due to sheer ignorance.
To save the day, this post reveals just how simple it can be to raise more capital and earn more revenue with your healthtech business by fixing a few common mistakes.
For context: My business broke the million-dollar ceiling because I've fixed the 3 mistakes I’m sharing with you here.
Mistake #1: The Target Audience is Too Broad & Too Diverse
Most healthtech startups’ targeting strategy is like this:
Me: “Who are you selling your healthtech innovation to?”
Healthtech Startup: “I’m selling my [fill in the blank solution] to self-insured employer groups and consumers that use [fill in the blank solution].”
Or, even worse, “I’m selling to health systems, the equine industry, the agriculture industry, and the hospitality industry. They all struggle with the same problem that we solve.”
Me: “Your pitch deck would be more powerful and compelling if it was more specific and narrow.”
Healthtech Startup: “Roxie, we cannot get more specific than this.”
Really?
C’mon. We've got to be more specific than that!
💸 It’s very expensive to pursue multiple markets at the same time and as a startup, you have to protect your cash reserves.
🚰 The competitive landscape is different among multiple markets and blending it all together dilutes your competitive position.
🔨 It’s impossible to nail your irresistible offer when you’re trying to appeal to a lot of different people.
📉 You lose the most powerful growth strategy you have: word of mouth. Different markets don’t speak to each other. They don’t hang out at the same conferences, the same watering holes. That makes it very difficult for adoption to spread.
Here’s how to fix mistake #1:
Think of markets like individual bowling pins.
Ever go bowling and try to knock down all the bowling pins at the same time?
Isn’t it much easier to knock down one single pin than to shoot a strike?
Turns out, growth often lies in focusing on a single audience, not trying to appeal to everyone.
Until you break $1M in revenue, you want to focus on one market, one offer, and one channel.
Here are three steps to narrowing your target audience.
- Find a starving crowd. Ask yourself, “What market segments have the most urgent need, desire, or pain?”
- Narrow your niche. Your best market should have the following traits:
❏ In Pain (you shouldn’t have to persuade them that they are in pain)
❏ Purchasing Power
❏ Easy to Target
❏ Growing
- Clarify your multi-sided market. Healthcare is usually a multi-sided market where the buyer of the solution is different from the user of the solution. Be sure to distinguish the buyer from the end user.
Personally, this was the hardest thing for me. I wanted to help EVERY health innovator.
🌟🚀As soon as I finally let go of trying to serve everyone, we were able to drill down our offer, attract more qualified leads, maximize our conversions, and skyrocket our growth.
💲Remember, riches are in the niches!! 💲
Mistake #2: Customers Have to Work Too Hard to Understand the Value of Your Product
I hear this often when clients come to us. “People don’t understand what we do or the value we provide.”
This is a major roadblock to securing funding or getting paying customers.
At some point in the life of your business, you might have tried using a story to sell your product or service and seen little to no results. If that’s the case, you might think that “storytelling” is just another fad that will go out of style.
Believe me, you’re making a big mistake if you underestimate the power of a story. If you're not using a story to build buy-in, your company is missing out on one of the most powerful forms of communication we have.
Humans love stories.
Compelling stories don’t just entertain us, they persuade us, they make us reflect, and when executed correctly, they make us pull out our wallets.
In his book, Building a Story Brand, Donald Miller quotes a friend of his:
“There’s a reason most marketing […] doesn’t work […] The brain doesn’t know how to process the information. The more simple and predictable the communication, the easier it is for the brain to digest. Story helps because it is a sense-making mechanism. Essentially, story formulas put everything in order so the brain doesn’t have to work to understand what’s going on.”
Don’t make customers work so hard to understand the value of your product. Tell them a story — one that drives people seamlessly toward conversion.
Here’s how to fix mistake #2:
The best way to make your product irresistible is to build the story that people would tell themselves.
When you can reconstruct your story in someone else's mind (from their perspective and in their language) the value of your idea is much more likely to make more sense to them… and they're much more likely to buy your stuff.
Try using this five-step formula that aligns with how the brain works:
- Establish the GOAL. The story begins when we discover what someone wants.
2. Introduce the PROBLEM. This creates conflict and tension, which is the engine of all action.
3. Help them discover the TRUTH. This makes inaction impossible because it puts the goal in jeopardy. (In stories, this is often referred to as the “moment of truth,” the “midpoint,” or the “climax.”) This discovery forces a person to choose something.
4. Describe the CHANGE. This is the new thinking or behavior that needs to happen as a result of the truth. It will determine whether or not the ending is happy.
5. Turn the change into ACTION. This is what’s necessary for someone to do to reach their desired outcome.
When you combine all five pieces of the formula (the GOAL, PROBLEM, TRUTH, CHANGE, and ACTION statements), BAM!, you’ll have your million-dollar story.
Mistake #3: There’s No Clear Offer
Let’s assume that your story was compelling and now your audience is ready to hear your offer.
The only way to conduct business is through an exchange of value, a trade of dollars for value. If you people don’t understand the value you provide, you are not getting any dollars. And yeah, that is a major problem.
I can’t tell you how many pitch decks I’ve gone through where at the end, I still wasn’t clear on the unique value they provided to a buyer or the end user.
A great offer will always feel like a great deal — the customer should feel like they’re getting way more value than they’re giving.
Here’s how to fix mistake #3:
It’s not enough to have a general description of your innovation.
The goal is to create an offer that is so good customers would feel stupid saying no.
This is how you get more customers, get customers to pay more, and get them to buy more.
A valuable offer is differentiated and buyers are unable to be compared to anything else in the marketplace.
When you have an irresistible offer, you will attract the best clients, who are the easiest to satisfy, and actually cost less to fulfill. And, they are the clients most likely to actually receive and perceive the most relative value.
Boom.
Instead of stating your offer like this: “We offer an AI medical scribe for clinicians.”
Or, “We offer an AI medical scribe for clinicians that significantly transforms healthcare by streamlining patient record management.”
Try stating your offer like one of our recent clients: “Optimize PT profitability & turn the tide on provider turnover in one month or less with our 30-Day Maximize EBITDA AI Toolkit.”
Boom x2.
This makes it super easy for buyers to understand the value they are getting for their money and they’re willing to pay a premium because they can’t get this anywhere else.
If you found this post helpful, give it a thumbs up 👍.
Happy innovating,
Dr. Roxie
P.S.
If you want private 1:1 help via Zoom to fix these mistakes in your healthtech business, just shoot me a DM with the word "MILLION” and we can go from there.
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Top 3 Mistakes I See Healthtech Startups Make & How to Fix Them
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