Continuing our series of talks with health tech investors, today's guest is Matt Miller, managing director of UnitedHealthcare Accelerator out of Minneapolis. Matt is also the managing director of Headwater Ventures, an early stage healthtech fund. Matt gives us insight into what he looks for in a new health tech venture, what they look for in a founder and what opportunities exist for partnering with large incumbents in the space. ************************** Product in Healthtech is community for healthtech product leaders, by product leaders. For more information, and to sign up for our free webinars, visit www.productinhealthtech.com.
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Continuing our series of talks with health tech investors, today's guest is Matt Miller, managing director of United Healthcare Accelerator out of Minneapolis. Matt is also the managing director of Headwater Ventures, an early stage healthtech fund. Matt gives us insight into what he looks for in a new health tech venture, what they look for in a founder and what opportunities exist for partnering with large incumbents in the space.
Product in Healthtech is community for healthtech product leaders, by product leaders. For more information, and to sign up for our free webinars, visit www.productinhealthtech.com.
Ian Harris (00:07):
Welcome back to Product in Healthtech, the community for health tech product leaders and byproduct leaders. I'm Ian Harris, president and CEO of Vynyl. Continuing our series of talks with health tech investors, today's guest is Matt Miller, managing director of United Healthcare Accelerator out of Minneapolis.
Ian Harris (00:22):
Matt is also the managing director of Headwater Ventures, an early stage health tech fund. Matt gives us insight into what he looks for in a new health tech venture, what they look for in a founder and what opportunities exist for partnering with large incumbents in the space. Let's jump right in.
Ian Harris (00:39):
Matt, how you doing today?
Matt Miller (00:41):
Doing really well. How are you?
Ian Harris (00:43):
Good. I'm doing all right. Yeah, I'm doing really good.
Matt Miller (00:45):
Good.
Ian Harris (00:45):
We're getting to the end of the school year here and so I'm looking forward to summer starting and having a little bit of vacation. And you've got a new one, right? You've got a new little one.
Matt Miller (00:56):
We do.
Ian Harris (00:57):
How are you hanging in?
Matt Miller (00:59):
By a thread. We've got a two year old and a two and a half month old. So, school year is not a thing, but Minnesota winters are long and sleep is short these days.
Ian Harris (01:09):
Well, I'm glad that you found the time, you got yourself some coffee and got yourself woke up enough.
Matt Miller (01:13):
Yeah, I will drink throughout. So, thank you in advance for humoring. Good to see you.
Ian Harris (01:18):
Oh, I love it. So today I thought it would be great if we started, if you could just give us the quick rundown of your background, where you came from, how got to where you are today.
Matt Miller (01:29):
Yeah, yeah. Happy to, and maybe I'll give the high level and if you want more details, you let me know. So, very non-linear career. Initially trained sociology theology, thought I was going to go to med school or be a pastor. Chose to be a wilderness guide instead for many years.
Ian Harris (01:49):
Nice.
Matt Miller (01:50):
Found my way to grad school. Spent 12 years racking up student loans. Ended up with a few masters and a doctorate and then started building companies. Then my training was all primarily in mental health at the graduate level. So, the companies were primarily focused in mental health needs technology, in some capacity.
Matt Miller (02:10):
Most of them tended to be pretty terrible ideas that were passion projects of mine that I thought the world needed. And maybe the idea was great and I'm just a terrible operator, or some combination of the two, but there's no great success story there.
Matt Miller (02:24):
I ended up finding my way to Johnson & Johnson, where I helped build digital health innovations internally for a number of years. Then fast forward four years ago, I heard from an entity called Techstars and Techstars is one of the largest seed stage investors in the world.
Matt Miller (02:40):
And they were looking for somebody to help them start a healthcare practice. And so joined forces there, sponsored and was the managing director of a digital health accelerator in collaboration with United Healthcare. We did that for three years. I actually now do that work independently, so I've continued that capacity with them.
Ian Harris (02:58):
Still with United Health, right?
Matt Miller (03:00):
Yep, correct. And actually not as an employee of, but a consultant of, and then the managing director of the program.
Ian Harris (03:06):
Can you tell us a little bit more about the United Health Accelerator and I know it started out with Techstars and now it's a separate entity, but can you tell us a little bit more about that? How many cohorts have you put through? What's the program look like maybe?
Matt Miller (03:19):
Yeah, certainly. Yeah, happy to. So this is year four. We do one class a year, 10 companies per class. We run it every year in the fall. When we started with Techstar, Techstar as a model tends to work really well for pre-seed or very early seed stage startups. The program structure has an economic component with participation. It tends to be a very intensive all day, every day thing.
Matt Miller (03:46):
It's very hands-on from an expert advice, mentorship and programming curriculum instruction level. So if you're pre-seed, it's perfect for you. It's game changing. We would have 10 companies come in, they'd stay with us all day every day for three months at a time.
Matt Miller (04:04):
Then at the end, we'd throw a party to celebrate the accomplishment and hopefully they had grown a year or two in terms of actual company maturation during that period. I either set themselves up for success with commercialization with United or with other entities, really just whatever business trajectory that company took as a result.
Matt Miller (04:24):
This year, we've distilled some of the learnings from it. And so the program is very much same, but different. If that's a fair thing to describe it as. What I mean by that is it's still hand in hand with United Healthcare. It's still specifically focused on serving some of their strategic innovation agenda by targeting early technology companies.
Matt Miller (04:46):
But we're going after companies that are a bit later stage. Companies that have already built a product, they've already got it in market. So, they've already gone through procurement and implementation and otherwise in contracting, they have a customer.
Matt Miller (04:59):
We don't really care about revenue necessarily, but there are so many pains associated with going live in someone else's environment, particularly in healthcare, that we're looking for companies that had already done that once.
Matt Miller (05:11):
Companies that fit that profile have often already raised a seed round too. They often have a team that they've hired. So, there was a core team and then they've added some talents on product and technology and sales and operations or customer success, or otherwise.
Matt Miller (05:25):
It's that profile that we're looking for now. As a result of that profile, we've changed the program to reflect it. So, the program is less curriculum and instruction. It's less me teaching cap table 101, financial modeling 101. Those things aren't necessarily as relevant.
Matt Miller (05:40):
It's instead a lot of cohort-oriented interaction, where you get to spend time with other world class founders, learning directly from them. And then it's a lot of closed door sessions with senior executives at United, where you can ask them anything about their strategy, things that you could never Google.
Matt Miller (05:57):
It's part-time. We give every company that participates a $50,000 investment on an uncapped safe, so terms that no one would say no to.
Ian Harris (06:05):
Right. Yeah. Great.
Matt Miller (06:07):
And then, curated access to the C-suite of one of the biggest health companies in the world. So, from a founder standpoint, it's a pretty profound opportunity to spend time with a core team, with a core group of other founders, that are building things at similar stages that are non-competitive with your own, and then again, access to United and all their resources.
Ian Harris (06:27):
Looking at some of the companies that you have coming through and maybe in years past, and then into this year, are there certain ... from a product standpoint or a solution standpoint, or an opportunity standpoint, are there certain trends that you're seeing? Are there certain areas that you think are really ripe for innovation and really, really need new companies and new products to be born to address existing issues?
Matt Miller (06:50):
Yeah. The trick at answering that question is my job is really to partner with United and the multitude of business lines that are encompassed therein. They do everything.
Ian Harris (07:01):
It's a small company, right? [inaudible 00:07:04].
Matt Miller (07:03):
I mean, it's so much easier to say what we're not interested in. We don't do anything in biotech, life science, med tech, med device, pharma, but from a healthcare landscape standpoint, there's still a lot of area. Even if you've ruled out those sectors, just about everything else is in play and then product lines that could sit within specific use cases.
Matt Miller (07:27):
We do anything that is obviously payer-facing, but also anything that's provider-facing, anything that's patient-facing. We're focused on a lot of things that are caregiver-oriented or family-oriented as well.
Matt Miller (07:40):
We're looking at white space opportunities. The big focus behind the program is find something that's net new, not small iterative progress. What that means, if I'm really crude about it's like, we're probably not going to pick a diabetes company. From an innovation standpoint, it's sort of been there, done that. If there are people that are new, they're incremental new, they're not net new.
Matt Miller (08:03):
So are there areas where we haven't had modern startups come in, modern products come in and really address an experience that's otherwise terrible? The way that we filter what we're interested in is we spend a lot of time with senior executives asking them where they need help.
Matt Miller (08:23):
We spend a lot of time with people on the policy and regulatory and reimbursement sides, trying to think about where there are tailwinds in the market. Meaning do we have justification for investing in this space in this point in time? Because there are actually things that will propel it forward, where in any year prior, it wouldn't have made sense.
Matt Miller (08:41):
Then the third layer that we put on it's this heuristic of where is the current patient experience terrible? Or maybe it's not a patient. Where's the current provider experience really terrible?
Ian Harris (08:53):
Right, caregiver experience, even.
Matt Miller (08:55):
Yeah, where is the experience where the caregiver, or the family member, or the whoever it may be? And is it bad enough or does it have a long enough tenure associated with it? Or does it happen in aggregate, in critical mass at a large enough scale that we think we can get some senior executives across United's lines of business?
Ian Harris (09:16):
Well and solving makes a whole lot ... You want to solve every problem, but is this a problem that really needs to be addressed?
Matt Miller (09:22):
Totally.
Ian Harris (09:22):
And makes financial sense, right?
Matt Miller (09:24):
Totally. Yeah. And so it doesn't need to win the day for a hundred million Americans if it's something that's a really protracted issue that also has a lot of complications or costs are otherwise associated with it?
Matt Miller (09:36):
So, I'm looking for things that I can come up with a compelling enough narrative that I can go talk to a bunch of senior leaders and get them excited enough that then they're willing to volunteer on behalf of a founder.
Matt Miller (09:50):
Then they raise their hand and say, "Yeah, I'm going to be a mentor to this company and I will give them an unfair competitive advantage. I won't give them a contract, they will earn that."
Matt Miller (09:59):
And they may or may not, that's how the market works, but I will open my brain, my strategy, our processes, I'll open my Rolodex. I'll open all of my years of experience on their behalf to ensure that they don't make mistakes and in doing so, they will be able to just exponentially level up their business and its probability of success. That's why from a founder's standpoint, I just love the work because it can be truly game-changing for founders.
Ian Harris (10:23):
So how do you find companies? How do you find these founders? [inaudible 00:10:27]
Matt Miller (10:27):
Oh, it's a hogwash. I should have more structure to it. It's a little bit of everything. We're in year four and that's nice. Year one, it was hard. We had to go anywhere and everywhere. We did a whole host of traveling. We went to every conference, conference that was industry-oriented, trade-oriented, tech-oriented, academic-oriented, otherwise.
Matt Miller (10:55):
We begged, borrowed, stealed. We asked for favors. We found companies that were good fits and then we asked them who else we should pick to try and snowball the prospective pool. Then we did our first year and we had people, founders, who went through it, who had a good experience who then started recommending to us.
Matt Miller (11:14):
We also had investors who invested in companies after they graduated from our program who then started referring companies to us, who the investor would say, "This is a company I'm really keen on, but I need you to de-risk a portion of this. But I think that they're viable, so I'd like to send them to you. If you took them in the program, you could expedite the growth, further de-risk the business. And then I could invest on the back end." So, we started building these interesting synergies with the broader capital markets.
Matt Miller (11:43):
Now we have a collection of investor referral, alumni referral, broader market referral. It propels itself in a way that truthfully, my job has never been easier. We get so much inbound that now the job is ... It's not just noise. There's an immense amount of signal in here.
Matt Miller (12:04):
And now we have to say no to companies that are actually world class that we're crazy to say no to. So we're in a privilege position and maybe we'll reassess. Maybe there's a future where we don't take 10 a class. We take 12, or maybe we run it a couple times a year. Maybe we account for that supply in some other way. But right now, that tends to be the mechanism that we use to figure out who's in the prospect pool.
Matt Miller (12:28):
And then every year, truthfully, we'll get one or two companies that are just cold inbound, where we have a website, it's uhcaccelerator.com. We hold a few AMAs that we push out publicly. We want to make sure that, and I should be able to say this more articulately, so roll with me, but the solutions to the problems in healthcare are going to come from people that look differently and think differently, and have had different lived experiences than the people who built the current system. So, what that means is we have an obligation to find those people, whoever they are.
Ian Harris (13:07):
There have to be a lot of open doors, right?
Matt Miller (13:09):
Yeah, yeah. But that means that-
Ian Harris (13:11):
Even then, you have to go out and find folks that can refer other people to you, expand your network beyond just who you already know. I think that's totally true.
Matt Miller (13:20):
We get a lot of inbound referral from the insider club and we also read every single application that comes from the broader market, knowing that there are gems out there and also just wanting to level access. So, this is as level as a playing field as we can make it.
Ian Harris (13:37):
So, can you tell me about some of the companies that have gone through? Can you give me some examples of interesting companies that-
Matt Miller (13:42):
Oh, I'm going to make enemies if I don't talk about some more than others. Yeah, so let me talk about the most recent cohort and I can just riff on a few of the ideas that are in there and then if there are any that strike you, we can double click.
Matt Miller (13:59):
So we had a company that the software that measures stress and strong emotions in adults that have cognitive disabilities or intellectual disabilities to try and get ahead of potential incidents where if you're a fully grown man that has a brain injury that's nonverbal and is getting agitated and stressed, you're potentially a danger to yourself, to your family, to your caregivers, et cetera, unless we could give you a voice and then enable your care team to intervene earlier.
Matt Miller (14:30):
We went pretty hard on the thesis that benefits. Health benefits will be portable at some point in the future. Historically it's made so much sense and, I'm sure other people that are smarter than me would argue with this, but from my perspective, historically, it's made sense to tie those to employment because at least historically, you picked a job and you worked there for 40 years and then you got the pension and retired.
Matt Miller (14:53):
But with current employment trends and the idea that, "Oh, I'm here for 12 months and then there for 24 months and then here for eight months," and then whatever and lags in between, I say this with very rife bitterness because I'm trying to enroll my family on Cobra today, the idea that we could decouple your benefits from your employment structure and go after ICHRAs, it is the way that the future. Benefits will be portable and they will be much more personalized than their current constructs that employers are able to offer.
Matt Miller (15:28):
We had a pretty straightforward one that just for me, makes common sense. It's last mile medication delivery to ensure that people have access to meds and an easier opportunity to be adherent to them. I mean, the list goes on, but opportunities across the board, the common theme is a world-class founder.
Matt Miller (15:49):
And what I mean by that is somebody that's smarter than I am, that I have utmost of respect for because of the integrity that they bring to their work. Somebody that has so much leadership and vision and dynamism about them and not to say that they can't be introverted or otherwise, we have all sorts of different types of CEOs, but they have the profile that commands the opportunity that they're pursuing.
Matt Miller (16:14):
And as a result, it's somebody that I'd be willing to work for. It's actually one of my check boxes of would I work for you? And if so, you're an incredible candidate for this.
Matt Miller (16:22):
And then I need to make sure that they have a nicely well-rounded team, whatever that means within their construct. We're looking oftentimes for teams that have product savvy internal, technical savvy internally. We can teach the healthcare side. So, if you're a little bit light there, that's okay.
Matt Miller (16:39):
But the rest of the nuts and bolts of your business need to be in place. And then truthfully, because we know that healthcare is so complicated, which is a pretty cliche thing to say. But what I mean by it is if you're a founder, it's probably the dumbest place to have picked to innovate.
Matt Miller (16:58):
There's so many stupid inane, bureaucratic sales cycles that don't align with funding cycles. You are screwed from day one and as a result, you need to have an immeasurable pain tolerance, which means you shouldn't be in this for a buck. You shouldn't be in it for the glory or anything.
Matt Miller (17:17):
You should actually pick your business, tackling a real problem in the world that matters to you. It's not that you need to have experienced it yourself necessarily, but there needs to be some core identity to the company that then also aligns with the vision, that gives us confidence that you're not going to quit. And if you don't have that, if there's not a compelling why us story, meaning like founder product, founder market fit, we don't take a second glance.
Matt Miller (17:44):
It's just because we've seen so many companies with the best of intentions realize that building in healthcare is a terrible idea. Yeah. It's just running into a brick wall constantly. So, we want to make sure that the folks that we end up pouring a lot of time, energy, resources, expertise, et cetera into, we want to make sure that they're in it for the long haul.
Ian Harris (18:04):
So, what about the product and the idea? How do you think about that? When a company comes to you, especially at an earlier stage, how hard are you looking at something like your idea of product market fit or the idea as it's presented to you?
Ian Harris (18:16):
Or are you looking at the broader space, and your context and thinking, "Well, okay, this isn't exactly right, but I think that there might be a bigger opportunity for this person, in the space as you see it." I mean, how do you look at that?
Matt Miller (18:31):
Yeah, yeah. That's a great question. My answer's sloppy because it's a little bit of all of those things. And without sounding arrogant, I will tell you that most of the companies that we meet are wrong.
Matt Miller (18:45):
They've made a bunch of assumptions around something, and it's not to say that they didn't have the best of intentions and actually do the homework on their side. But a lot of healthcare, particularly the internal economic intricacies of a payer landscape are so wildly complicated and as you get into-
Ian Harris (19:05):
[inaudible 00:19:05] come from that, right? If you're coming at it from a different angle.
Matt Miller (19:08):
Oh yeah. Unless you have a key advisor who is moving mountains to teach you, or if you have personal expertise, either in yourself or a core founding member on the team, there's a lot of this stuff that you just can't know. So, most of the teams that we pick and actually, I didn't intentionally omit this earlier, but most of the teams that we pick also have a pretty high degree of coachability, meaning that they're actually ... They're not defensive when you sit them down and say, "Hey, I think there's a different opportunity here." Or, "I think you're a bit off course."
Matt Miller (19:41):
They revel in that because they recognize that now is the time to get that feedback versus three, four years from now, when you've over-capitalized the business and you've overbuilt the product solution, whatever it may be on those core assumptions that may not actually align with market realities. So, that wasn't an answer to your question, but just ...
Ian Harris (20:01):
No, I think it is to some extent. I think what you're saying, and maybe it's not, you correct me if I'm wrong, but I think what you're saying is that it's important that they have a product idea and a vision that broadly you think is interesting and that there's a there there, but that it's more important that in addition to that, that they're very coachable and that they're willing to try different things, to hear different types of feedback, to learn things than to incorporate what they're learning into their company as they continue to build it, right? [inaudible 00:20:35].
Matt Miller (20:35):
Yeah. So, in this upcoming cohort, which is the new model, it's same but different. This is the part-time, slightly longer one where we target slightly later stage companies, those companies, we tend to take the product component of diligence much more seriously.
Ian Harris (20:56):
Further along, there's more to know, right?
Matt Miller (20:58):
They have to be. Yeah, they have to have something that we can push against.
Ian Harris (21:02):
In market, right?
Matt Miller (21:02):
Yeah, they have a product in market. And so we'll do customer discovery. We'll do customer interviews. We will download the app and review it and we'll put it in front of subject matter experts.
Matt Miller (21:14):
We'll also put it in front of people that are technically proficient in the space. What we're looking for is, is it special? Is what they are onto actually ... Back to that net new idea. Is there a there here, a there there, or however we would say it, in a way that gives this team some sort of interesting insight, interesting place in the market, in the midst of all of this noise? Is it something that's not easy to replicate? There's something proprietary, there's something defensible about it.
Matt Miller (21:49):
From United's standpoint and I don't have permission to speak on their behalf, so we'll have to dance around some of these framings, but I can tell you pretty consistently, I hear senior executives talk about the importance of the member experience.
Matt Miller (22:03):
End user experience, the patient experience, and recognizing that many of the ways that current healthcare journeys are constructed, the experience of the patient is an afterthought. So if you, as a product team, you as an entrepreneur, are building something with that patient experience top of mind, and as a result ... and I want to layer in here, I'm not a designer and I've been adjacent to product development for the past couple decades, but I'm not great at it.
Matt Miller (22:32):
So, what I would look at is not a review of the product myself as if I'm some sort of expert in that space. I would look for data to tell the story that you actually implemented that level of thoughtfulness about whoever your end user is and it would be in NPS and engagement metrics and churn metrics and whatever metrics that matter, relevant to the patient churn. It's not necessarily like everyone needs to have a daily active or monthly active, because that's not necessarily relevant for-
Ian Harris (22:59):
It might not be the right metric for them anyway.
Matt Miller (23:00):
Right, right, but we want to really dig into what's the onboarding experience and where are you losing people? And do they turn yes, no, and what are your acquisition channels? And are those scalable? And at the end of the day, can you scale them and still delight the end user? And if so, you have something that's profoundly valuable in healthcare, that many of the current incumbents haven't yet figured out. So, that's how we think about product when we're looking at prospects.
Ian Harris (23:27):
Yeah. I think there's a lot right there. We talk to companies all the time, obviously within our business, and I talk to startups that are pitching us. One thing that I think is interesting in healthcare is that as you said, daily active users, or time in the app or whatever, some of that might not make any sense at all.
Ian Harris (23:45):
In fact, you might have a service that's very valuable that the experience has to be great, that people use only when they're sick, when they're getting certain types of medication, right?
Matt Miller (23:54):
Yeah.
Ian Harris (23:55):
They might use it once a month or twice a year, but that experience has to be great. They have to get everything out of it that they need to get out of it. And if you're looking at even a big payer or something, maybe they need to be able to self-serve themselves without having to get on the phone and spend an hour of somebody's time navigating through something that's difficult.
Ian Harris (24:15):
It's like, there's a lot of other metrics that they need to look at to see how it's delighting the customer. Not just are they spending lots of time in the app.
Matt Miller (24:24):
Totally.
Ian Harris (24:24):
Because in fact, spending lots of time in an app could be bad in some ways.
Matt Miller (24:27):
It could be the antithesis of the business, right?
Ian Harris (24:30):
Yeah.
Matt Miller (24:31):
If your app is predisposed to set people up for a health trajectory, they should be spending less time in it over time, which is now a really complicated proposition to integrate into a business model to sort that, but yeah, it is very much a review of the data associated with the product, directly in the vein of what is the thing supposed to do? And then does the data reflect whether or not people do that.
Ian Harris (24:57):
From a health outcome standpoint and an economic standpoint, those two things.
Matt Miller (24:59):
Absolutely. Yeah, absolutely.
Ian Harris (25:02):
So in addition to running the accelerator with United Health, you're also an early stage investor. You're making investments in companies.
Ian Harris (25:12):
Full disclosure, we invested alongside you with your first fund, with Headwater Ventures, which looks really promising. I know that you're continuing to do that. Tell us a little bit more about it.
Matt Miller (25:25):
So, I get an opportunity to invest alongside the work that I do with the accelerator program. Just a little bit of backstory on it. So I started angel investing and people use that word pretty loosely. I don't have a trust fund. I don't come from wealth. I didn't inherit anything. I've never been paid overly well.
Matt Miller (25:46):
So, many of those checks have been pretty small. Pretty humble checks. Thousand bucks, 5,000 bucks, 10,000 bucks. I found a lot of satisfaction putting money into companies that fit the same sort of thesis and heuristic that I used for the program, which is solving a real problem with incredibly competent founders, world-class team, net new opportunity on the market and at the earliest of stages, meaning price per share will never be cheaper.
Matt Miller (26:16):
So some people would look at that and say, "Well, that's risky." And it is, and it's risky. It's highly illiquid. It's a tricky asset class that you wouldn't want to be overly exposed to it. I would also consider it a form of value investing because of the way that I'm able to de-risk those opportunities relative to my understanding of the market and the introductions that I can make and the advice and counsel I can give to the founders to give them an unfair advantage, shares will never be cheaper.
Matt Miller (26:41):
I'm not going to come in and save the day for any of these companies. They're doing fine on their own, but I'm looking for companies that are clearly solving problems that are also spaces that I'm passionate about that I can add value. And I do so alongside adding some dollar so that they have more cash to put to work. I started doing it a number of years ago, 10 years ago or so. And I found it more satisfying than owning Apple stock.
Matt Miller (27:07):
I found it more satisfying than owning the S&P. Life is short, there are only so many things you can do with your money and even though full disclosure, I own Apple stock and the S&P, there was something that was really extremely satisfying about this process and putting money to work and being a part of the early story of some of the most important companies in healthcare, or at least companies that have the potential to be the future's most important companies in healthcare.
Matt Miller (27:35):
I found it compelling enough that I set a goal for myself. And the goal was initially one a quarter. And it was don't change your risk threshold. Don't change what you're willing to have tolerance for or not. Be pretty firm in who you're looking for and the type around you would come in at, and the type of differentiated technology or product or otherwise that are actually investible, but spend enough time in those environments, around people that are doing those things so that you have enough volume so that you could do one a quarter.
Matt Miller (28:04):
And it worked. So, I set a higher bar and it was one a month. For the past five years, I've done one a month every month and year and a half ago, my wife told me to knock it off because I work for a public benefit corporation and we've had some exits and it's gone quite well actually, but it's a fair amount of our investible income is tied up in assets that maybe illiquid for a decade.
Matt Miller (28:35):
So she said, "We need to, for our family's sake and the potential stress of family economics and finances, we need to rethink this model, consider doing a pooled investment vehicle instead." Still put some of our family money in, but consider raising money from outside parties like yourself, put together a small pool, find a way to do it creatively, where it's still the same types of founders, and again, capital from us, but less of a burden on family finances.
Matt Miller (29:02):
So Headwater Ventures was born, and this is we're now a year or so into that. The thesis behind Headwater Ventures is technology that increases access to care. So, back to some of those similar themes that we've covered.
Matt Miller (29:19):
People whose current experience of care is complicated, or crappy, or it's nonexistent. We're looking for founders who have scalable solutions that can address those unmet needs and looking for them at the earliest of stages where shares are reasonably priced, particularly relative to some of the froth that exists in the market at series A, B, C, beyond. That's not for us, we'll never be able to play there.
Matt Miller (29:44):
We raised and deployed a fund this past year. We put it into 17 companies, all pre-seed or seed, all doing something novel in healthcare for people, all solving real problems. The fund is going to evolve and I'll actually have to leave it TBD right now, but fund two will have a startup studio.
Matt Miller (30:05):
It'll be a little bit larger in scale. There's going to be some additional partners that are brought in. It may have a different name as well. So, a few details that are in flux, but the same themes will persist of the brightest founders at the earliest of stages.
Matt Miller (30:21):
From my side, and I don't know if this is terribly relevant for this podcast, but there's a lot of money out there. There are a lot of people that wear the venture hat out there. There are a lot of people even in healthcare.
Matt Miller (30:30):
And so, if you are an investible founder, it's fairly easy for you to find capital. The cornerstone that we're trying to anchor this thing on, is that a portion of our competitive advantage is compassion.
Matt Miller (30:47):
Meaning that we've built companies and I've built them abysmally, and to get a sense of how hard it is, versus an investor that maybe comes in with some braggadocio or some hubris or otherwise.
Matt Miller (30:59):
This is very much a friend of founder mentality. It's still also very much a venture returns mentality, but one in which we're partners on a journey versus bosses of the founders, which is a perspective that many investors I think get misaligned to.
Ian Harris (31:18):
Matt, it's been so wonderful to have you here. Thanks for sharing your stories and your perspective with us. If some of our folks watching or listening want to get in touch with you, either about investment or for the United Health Accelerator, how can they do that?
Matt Miller (31:33):
Yeah, yeah. Well, first, huge privilege to see you and to be a guest here, so thanks for having me. Anybody who feels like this resonates, I would love to know them, truthfully. So, find me on LinkedIn.
Matt Miller (31:46):
If you're interested in the accelerator specifically, there's a lot more detail at uhcaccelerator.com. There's a contact us form there. That doesn't go to a robot, it goes to me. So, if you got questions about the program after you've read through the details there, fill out that form and I'll see it same day, or at least same business day.
Matt Miller (32:05):
And then in terms of investing, if you feel like you're a good fit for the fund, just shoot me an email directly. My email is matt@headwater.vc. Matt@headwater.vc. So, any of those avenues are appropriate.
Ian Harris (32:18):
Awesome. Thank you so much for spending your time with us. I appreciate it.
Matt Miller (32:21):
Happy to. Cheers.
Ian Harris (32:24):
Thank you so much for joining us. If you like the show, drop us a rating on Apple, Spotify, or wherever it is that you're listening. We'd really appreciate it.
Ian Harris (32:31):
You can also connect with us on LinkedIn, on YouTube, or on our website, productinhealthtech.com. If you have ideas or suggestions for what you'd like to hear on future episode, or if you'd like to be a guest, just shoot us an email. That's info@productinhealthtech.com. Thanks so much.