If Min-Sung Sean Kim’s name looks familiar, it could be because you’ve read about him in Gründerszene or Business Insider. To call him significant is to traffic in understatement: he’s worked as an investor in the health sector for almost a decade; as an investment director at the Samsung Catalyst Fund; as a venture capitalist at Allianz X and currently as managing partner at Digital Health Ventures. Min-Sung will be talking us through “Successful Exits Explained” at our next hubraum on air event on April 29th (tickets here).
We asked Min-Sung about the future of digital health but also – possibly more crucial for our startup founder-readers out there – how to score investment, what the biggest mistakes are that founders make when building a business and how to land your first paying customers.
I always wanted to put my energy into something which benefits society. Before the pandemic people seemed to think that telemedicine was a nice-to-have, not a must-have. But due to the pandemic, we know working on the necessary steps to digitize our healthcare systems so that we are safe is a must-have; so everyone has equal access to healthcare and so we don’t need to be locked up for the next five years at home because of the pandemic.
It’s a tough one to answer because everything has the potential to revolutionize the way we live, so I find it hard to choose just one field. But I think personalized medicine is a very big one. In the past, when it came to healthcare, everyone was treated almost the same. But now we have smartwatches and all this equipment to track our behaviour and vital signs. This can enhance going to the doctor.
Each industry is already tailoring or customizing its recommendations. Think about the music industry and Spotify. When you’re listening to music, you’re used to an algorithm that says “this is an artist you might like.” Or Netflix: “These are some movies that you might like.” And because of that, we ask ourselves, why is my healthcare treatment not personalized as well?
I am very specific in terms of my workout routine, in terms of my nutrition, my sleep patterns. As such, why not give that information to the doctors and ask for them to give me the best possible treatment?
This is the first step towards personalized medicine. If you go further, you might think of [DNA genetic testing company] 23andMe, where they take samples of your blood and find out what kind of diseases you might develop later on, they’re laying the foundations for you getting the right treatment, based on your genes. 23andMe is now going into drug development, too. Since they have all this data, they can produce drugs based on all the details of your genes and genomes which would be tailored to you.
I think it’s mostly about the entrepreneur’s story. Hearing how a founder developed a certain idea is pretty interesting, especially when it comes to people who have been working for a very long time in the industry.
Industry expertise is the most important thing. If you’ve worked in the industry for a while, you identify a problem and you understand how the industry works – this is the best pitch for investors because it suggests the founder knows what he’s talking about. Because sometimes we investors are students of the market, we don’t know the field better than an entrepreneur working 24/7 on his company on a specific problem.
If you’re an early stage founder, it’s very important to understand the problem. You should also understand whether that issue is a problem for your clients, and finally, whether they are willing to pay to solve it. Your problem should attract good talent (people who are willing to work for that cause) as well as investors. So, in the end, your problem should attract both talent and capital.
This is the part where it’s really useful if you already work in the industry because you already have a network. This way, you can say “When I was your colleague or when I was working for your competitor, we had that problem, don’t you have that problem? I am working at a company which actually is trying to solve this issue.” And hopefully they’d want to try it out.
The biggest issue is building a product or technology before thinking what kind of problem the tech can be used to solve. Find the problem first! This happens a lot with tech companies: they’re so excited by one specific algorithm or type of technology that they build and burn through money before considering who they might be able to sell their product to. And this usually leads to the death of the company.
l think founders need to be very honest and transparent. A very healthy relationship is when the founder can call the investor and talk about their problems and challenges. And it’s a good sign when you’re an investor and the founder is calling you and you can already anticipate what they want to talk about.
This said, I think it’s also important to be aware that investors are not your friends. They are your allies but they are also shareholders, they own part of your company. If they decide you’re not the right fit for the company at this specific stage anymore, they will look for another CEO.
Of course, investors admire founders for their courage, for their diligence and perseverance, but at the same time, we have our duties towards our investors (Limited Partners).
I would like to see at least 20-30 unicorns in the digital health ecosystem. We saw the same pattern in fintech: we had the financial crisis in 2008 and 10 years later we had around 39 fintech unicorns. Similarly, I think this decade is going to be a very good decade for digital health.
I also think doctors and patients will interact in a more technological and personalised way. I think these two things go hand in hand. At the moment, if you go to the doctor, you are like a number to them. Everyone usually gets treated the same. The doctor doesn’t usually have time to ask you detailed questions about your lifestyle and can’t check if you lie to them about your habits. I think with all the digital technology, it’s easier for you to get the right treatment for your individual body.
Min-Sung will be speaking at our hubraum on air event, “Successful Exits Explained,” at 5pm CET on April 29. Fancy being there? Reserve your (free) ticket here.