It’s Time to Build in Healthcare
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Here are some facts for you.

Half of medications that are described or never taken, eight, eight percent of americans are meta ally and healthy. It's twenty percent of our GDP, which is a double that of any other developed country.

Perhaps none of this is a surprise to you. In fact, we've done several episodes on this topic, which will link in the shower nuts. But what we haven't quite touch on is why it's time for technologies to step into the health care, because solving medicine .

is not enough. If you cure all cancer, you send american life span by three years.

So in today's episode, we explore why, perhaps kind of intuitively, we need technologies to be solving the equally real problem of making health care a delighted consumer focus industry and indeed be asking that trend with founders from companies like spotify and point base taking their own. But are these the right people for the job? And can they really, distant, tall, be regulated in complex industry? Listen in to find out.

As we explore with a sixteen z bio on health general partner, vigia pony and investing partner busy wolf. So tech, what do you say? Are you ready to building health care? As a reminder, the content here is for informational purposes only, should not be taken as legal, business tax or investment advice or be used to evaluate any investment or security, and is not directed at any investors or potential investors in any exigency fund.

Please note that asic and e and ziph ilios may also maintain investments in the companies is discussed in this podcast. For more details, including a links to our investments, please see a sixteen c outcome slack disclosure. Youtube predicted in twenty twenty two, but the biggest company in the world will be a consumer health tech company.

It's quite the prediction. So i'd love to just start out by setting the tone. Where are we today? Where do we sit in terms of that prediction?

I think when we wrote the peace, we have high conviction. But you know venture had of humbly business where you can have great and the market will tell you what the market tells you. I think parts have been exciting for me is that i've had a huge flux of excited about that thesis.

So, so far, so good. And I think we've seen about companies are, I think, very much trying to be that trillion dollar bigger company in the world, but obviously were not there. This is just really status.

yeah. And maybe I would be helpful to actually clarify what you mean by a consumer company because when I think consumer company, I might think snaps, I might think a sneaker company.

yes. Often times some people think consumer health, they think of these large consumer health companies like grow or hims that often prescribe drugs are provide telemedicine on the internet. And when we talk about consumer health, we actually mean something much broader.

We think a consumer health company doesn't have to be directed consumer IT can be distributed through to be IT doesn't have to be cash pay IT could be something that's free for consumers because it's totally covered by insurance and IT doesn't even have to be a services company, so like providing doctors appointments or prescribing of medication. IT could be technology. But we think what defines a consumer health company is the ability to have amazing consumer experiences, which is something traditional health care has done a very bad job of totally.

And in fact, most health care companies today are the opposite of that. And actually, some people might describe health care today as intimidating, regulated in complex. And in fact, youtube both have referred to IT somewhat in that fashion. And so what do you think the tech industry in particular is set to do in a way that others happened in the past to address this une combination?

People often say health care is intimate, which is often a ehem. M for health care is really big, which is inventive, a good thing. It's great to go after big markets.

U. S. Health care is five times the size of the global advertising industry, which is what company is like meta and google make of their run from.

And IT highly regulated, but tons of huge companies have been built in highly regulated markets. You know, if you look at arb, an beer left or even companies that have been built in unregulated markets like google and facebook eventually become regulated. So we think regulation is kind of a marker of success.

And you run into a regardless and it's a good thing in healthcare and health are is complex, but every industry is complex when you dig under the service of things and everyone thinks healthy care, do I need a PHD? I don't know how to cure cancer. And the P H, D, who are working to cure cancer are doing extremely important work.

But the reality is, if you cure all cancer, you extend american life span by three years. And we're still lagging behind other developed countries. And so you need technologies to come.

And due two things. One is a health care is a logistics, a data and Operations problem, and technologists are very good at that. And then the second is health care is really a consumer engagement problem, even for really highly motivated people, is super hard to navigate health care system.

If you're trying your best and want testing, it's really hard to know how to do IT. And then we need people to help us kind of change our behaviors. Eight, eight percent of americans are metabolite unhealthy.

Half of people don't go to the P, C. P. Half of medications that are described, they are never taken. And so people might look at that and say, we have a societal problem, but the best companies changed the behaviors of billions of people, and there is no reason to think that couldn't occur in health care.

I wanted get into maybe some of the push back because I feel like for some listeners, they might be thinking all that makes sense, Daisy. But actually, technologies or not, the people we need, but interestingly, whether people believe they're the right people to provide a solution, we are seeing them start to take part.

And in fact, both of you wrote another article that said, hay tech is time to build in health care, and we're seeing founders from instar spotify coin base, probably among many others, that have started to build health care companies. So why do you think that is? What's the why now of these people participating?

Yeah, I think there a couple different elements when. One, the primary ones is that much of health care and life sciences is starting to become much more of engineering discipline. I think that's what really attracts us to tech.

I mean, think about computer scientists that almost like the ultimate inertion discipline and software is easy engineer. But I think as we can engineer these other areas attracts that mindset. But also, I think they save the huge time that this was talking about. But then finally, I think, is more than just the means and the money, I think the mission actually also is very appealing and easy.

You shared this article, which was, again, a call to technologies to participate. And there was, I think you can shared in several places, but just one of the post had over three thousand legs, over two hundred and fifty comments. So clearly people cared, right? That at the very least was clear. Just would love to get your personal take. Why do you think there was such a response.

both good and bad? I think part of IT is IT was controversial if we work in an industry venture capital where a lot of firms have written off health care and they've said, look, people have tried and failed. But the reality is, of the hundred largest public software companies, one is a health care and lifestyle company.

And as consumers, we feel the pain of that every day, every time we go to the dockery office and are asked to fill out forms, we've filled out one hundred and fifty times in the course of our lives. Every time we have a love one that dies because of something we could have cut, but our system wasn't set up correctly. And so I think, one, the take was controversial that this is the next frontier because a lot of people in our industry have written this off.

But I also think it's something that everyone can identify with. There is no amErica an out there who is like we have a great health care system. We spend know it's twenty person of our GDP, which is like double that of any other developed country and we have worse outcomes and we're all suffering.

Let's talk about some of that push back and we d love to hear your direct response to some of these people who by the way, I think have the same goals is a three of sitting here just to share a few so tom says he still sees that there are furious issues from entrench vendors, integrations, backroom deals and funding.

Yeah, I mean, the health care system is huge, right? So I think part of you're not going to fix the whole thing in one gop. And so there's a couple different projects.

You can take one approaches to work, lets say, in rebuilding something a full stack. And so companies like devoted health do that by being a mental advantage company and building payer and provider, basically doing everything. So that's really hard to do.

But actually, if you can do that, you can dress those issues directly because you're not a sort of victim. Any those issues because you are the full system, working within the system is a lot harder. And that takes a really special person, somebody that those tech knows, let's say ai, he knows all that stuff very deeply, but also knows a healthcare system deeply. There aren't too many people like that. But actually the numbers is growing very rapidly.

absolutely. Let's talk about another pizza push backs. So a few kind of touched on this issue of the unique in some of that exists in the united states.

So day, for example, is saying he's still not seeing the killer argument for why. Now Susan has said that tech has been addressing health care for quite some time and we are seeing technology evolved in something like an MRI. But when he comes to more of the system is still breaking down.

And then i'll just read out daves comment directly. He says the U. S.

Is an outlier in terms of health spend, as a percentage of GDP, in terms of a measure of that service. Life expectancy in the U. S.

Is worse. What technology has the rest of the world kept from the U. S? Why is technology necessary?

So I take two part. So terms of technology, I think there is technology health care, but it's largely in a user in your face. So like mi is really the same mr.

I from like the fifty just now on a computer display. And so that's not really tech, I would call of the absence of tech. And a lot of the tech to doctors use are things like electrical medical records, which again, it's a record keeper.

It's not sort of that high technology are talking about right now. We have this huge revolution, official intelligence that actually can do amazing things with data that actually we could never really even dream about. And so that's a huge difference in terms of wine now.

Now in terms of what's actually different about the rest of the world as well. Those non U. S. Health care systems don't have to deal with americans and american cultures different, right?

So it's apples and oranges to say, well, we have country, a healthcare system in the country, bees people. And so the issues americans have are different. And we have issues in terms of diet, in terms of lifestyle.

And those things are independent of technology or not. We actually love doing clinically trials. The real thing to do would be apply one system to another.

For sure, you can do that. I think the reality is that what makes technology really powerful is the ability to actually affect behavior change. And that's the thing that's really where a tech maybe have some of quickest impacts in america.

I think one thing makes the american system relatively unique is that most americans get health care through their employer, which means they change healthcare insurance companies every two and half years. I think that on average, telling people stay in a job and what that meant in effect is insurance companies don't feel incentivize to cover a preventative care because they think some other insurance company will read the benefits of that when you switch jobs into a half years, which is a really unfortunate situation. But I think a few things that are happening.

One is there has been a rise of high deductable health plans, which means your health insurance doesn't kick in until you've already spent exim t of dollars of your own before. Insurance will cover a dime. Which is roughly unfortunate trend.

But the silver lining of that is you start to see some more free market dynamics and health care. When people are paying for their health care and of their own dollars, they start thinking about quality and shopping and what they really want to understand about their bodies. And the other kind of why now thing that emerged is, I think a vital probably agree with me that we were at this article two years ago and the last year, something is started to change.

And it's partially to like a lot of amazing founders who are building these often time diagnostic companies that are offering hundreds of blood test and full body amorites. And there has been this wave of consumers who really won't understand what happening in their body. And it's not just biohackers and people in the bay area, it's people who have chronic health issues, who have gone to five doctors who can't the girl, what's going on.

But there's been this real movement toward wanting to understand what's happening in your body. And I think it's kind of a delayed thing that has come out of cover where COVID reminded every one of their own mortality. We all realized that, like, health is the foundation on which you can build a really happy for fulfilling life. And if you don't have your health, it's a whole lot harder. And IT just feels like we're seeing this real consumer chef.

Yeah, I was strong G S. IT. As well. And I think it's not just understanding our body, but having real agency with IT.

What can I do? And I think clove IT put down for front of our minds, like what actions can I take for myself and my family and so on. And now the question is, what did I do? I have to make those actions. And that leads, I think, to hold accountable companies.

yeah. So what i'm hearing is basically the system is so entuned and the incentives that exists between the provider and the insure PyTorch ally has not been there to actually create this consumer incentive. And now you're saying that things of change, there's almost like this grounds well, of people who are raising their hand, who are saying, I want to improve my health and I want to have a part in this.

And that in itself is creating a market. So on that note, you basically said that the most important thing that we can do to fix health care is to improve the consumer experience. So i'd love to just hear your take on where you would even start there and maybe elaborate on what that means.

So I think first and foremost, you have to imagine, like you're using the process over that, your parents, your grandparent using the product. And so I want something that is frictionless, where you know what is so excited using in the tech product is that I don't have to click like a thousand different buttons or way two days or something happens quickly yeah. So I love to be frictionless.

I'd love to be something where it's actionable, where IT gives me that level of agency. And then finally, I think as funny as IT is, I want you to actually have just a great experience. So why do people buy apple products or a google U I IT. Has that whole experience is something that seamless and IT ships IT from this burden. So like, I guess, in the line of the D M V, get health care done to this is actually something that is extreme mind and really designed to make my life easier, rather than to make someone else is life easier, rather be the player or the provider.

One question viga posed to me couple years ago now, and we've been debating ever since, is what is health care look like thirty years from now? And what about twenty years from now? And what about twenty years from now?

Because our job as venture capitalists is to predict the future and try to invest in the future we think should exist. And we think health care probably looks like you have wearable devices that are monitoring your health at all times. Some of them are like the wearables devices we know today suber. Some little things that penetrate skin, that are monitoring all sorts of things that are happening in your blood. And these wearable devices are gonna predict that you're .

getting sick .

before you even start .

feeling.

Send them one, and all of your data is going to be in one place, every health record you ve ever had. It's crazy. We don't have this today yet, by the way, but all of the data of this wearable devices is going to be married with all of your health records from every doctor you've ever seen.

And ninety percent of health care is maybe delivered probably from your phone in in your home. So you're going to be able to chat on your phone with a world class A I doctor, the best cardiologist in the world or human doctor of a declined to that. And we will have at home blood collection devices, will have at home delivery of medication, and then you'll probably go to hospitals for a few surgeries.

But that kind of the forward version of what we think health care will look like in thirty years, and that's the amazing consumer experience. And then what we're trying to do is predict OK. What do we have to invest in now to start making this a reality?

And also, I think this a bit of a mindset shift because that really also makes health care logistics problem as well. And that's something we think about tackle. The time we think about amazon doesn't really sell things. It's a logistics company that makes IT possible for all the stuff to get to us and see from walmart. And health care is really the right care at the right place, at the right time. And doing that, actually, we need all the information is he talked about, but then we need you to be able to be actionable with that together will feel like all the experiences that we sort of live in our lives that we have .

enough from technology. yeah. And maybe one follow question there in the future that you just painted all those devices are those trickles that we're seeing the earlier emergence of.

Now today, those options are very consumer driven, right? I'm buying my eight sleep. I'm buying my oring. Do you think that all of those devices, the holistic c health care system outside of maybe the hospital where you get your serious surgery, are those all consumer driven where i'm purchasing those? Or how do you see the overall large in combat model a link to that picture?

yes. So one thing is I think this helpful is actually health care is determined, is applied, a lot of different things. Yeah and so in the most extreme cases, I need surgery because I hit my head and my brain is emerging or something like that's like this extreme kind of thing.

That's not what we talking about. Then the second one is i've gotten ill with something and I need some sort treatment. In both those cases.

Those are examples of secure, where those are procedures that just have to be done. There is a third area that actually always associated with healthcare, which is the prevent of site. And that's me. That technology has a very natural role with preventative. You can avoid getting into that second or to that third bucket.

And when you started to think of health care that way, just even from a financial point of view, the most extreme thing is kind of like if you are a car that's inclusion and sure and serve something like that. And then the middle bucket is, well, i'm gonna just do routine madness and stuff like that. But the first bucket is i'm not be a crazy driver.

I'm not going to slam into things. I'm not gonna super fast and to do all that stuff. And I think healthcare is is gonna that combination of all those three, but people basically ignore that first bucket. And how we think about payment of these things reflect this.

And I think to answer your question had on today, most of these products are consumer project, and I think there's totally a world where insurance starts to cover a lot of wearable devices and things today that we think of this consumer products. And we definitely see that.

It's funny when we look at these consumer health companies, we've invested and see a whole bucket of them that are trying to rebuild the health care system from the ground up and our basic places like what you have over there, that crap we're starting over. And then we're seeing a ton that are trying to plug into the headcase system and a key way they plug in, as they say, traditional health care as the worst consumer experience in the world of any industry. And that really affects them.

They can't get their customers to change their behaviors. And so they're building these consumer companies that layer on top of traditional health care and wicked experience Better. And you can envisions a world where wearable devices started to play in that territory.

Yeah and maybe to dress something you said earlier VGI about the kind of experience that we can imagine, right? Why haven't we had good U. X.

Or dislike delightful experience and health care? One thing that comes to mind for me is if I go to the APP store on my phone, I have infinite possibilities. And again, its consumer choice. Among those possibilities, when I think of my health care options, is through my employer.

And I have two options, maybe even from the same company hde deductor plan or not, right? So do you see that changing as well? Because i'm just inking again from that place of incentive.

I think it's instance anything and also helps to see who I she's going to pay for IT. Yeah so someone's being out of pocket then IT feels like a consumer APP and that something were you will probably see at first. And then those types of businesses may start to compete with the ones you're talking about. And then in competition, I think you'll see the in comments feel like they have to move in that direction. We've seen this.

Another business is yes, yeah. And just a layer on there. I think a key reason consumer experience has been so horrible and health care is help providers.

So hospital systems, doctors offices don't really see patients as they're n customers because patients generally aren't paying for their care. The insurance company is. And so they're optimizing for the insurance company instead of the patient, which is a really sad existence. But what we think everyone has gotten wrong is that if you have amazing patient and consumer experiences, you can actually start to encourage behavior change, getting people to show up to the doctor if it's less of horrible experience selling their medication, if it's easier taking their medication, if it's easier affording the docker, if there's a financing option. And so we think everyone's done that wrong historically, and there is a ton of opportunity.

The private might be too like who needs to comment to actual or the right mentality. So would like moderator of create the iphone or something like that. Probably not right to take someone that as a very different mindset.

You know, when you look at companies that really change industries, often these are companies that come from the outside that work with insight. So like in streaming music and something like spotify. And they can create new artists and create new labels, but they work with artist labels, but they also came from outside music system.

I think that brings up the point around these technologies, and it's like water technologies is unique ly good at. I am thinking about some of these consumer engagement strategy like retention or game fiction. So i'd love to hear from both of you, where do you see some of these engagement strategies that maybe take 开始 previously flourished， being applied to health care? That seems like an obvious potential fit.

I think all I think you mention two in terms of attention, game fiction. I think IT starts with just even there's the product and that's the humification, another type of things. And then there's the mindset for how to run the business often to these is earlier point when we're not paying, people don't worry about retention, but because you want your health care or you don't want your healthcare, right?

I think those are not really choices. And so when you actually have choices, then people I have to worry about retention and that will actually feed into product. So it's that whole ecosystem shifting where we are much more in the driver's seat. Terms of choice will lead to Better products as we have seen many cases.

Yeah in the best consumer talent in the world, work and technology. It's crazy that today we all use apps for hours a day that didn't exist ten or fifteen years ago. And they've been so good at getting our attention and changing our behavior and changing the way we go about the world. If you go to a concert now, everyone filming, so everyone composted .

on instagram and .

your take exactly. And so the talent in tech for building amazing consumer experiences is that change the way we go about our lives is insane. And that how that just doesn't exist at all in health care. And it's partially because what we are dog manlier, no one seeds consumers as the end customer and therefore as an optimized, and no one has bread that telling in the industry. But I think when you marry people who understand hel care and people who understand consumer tech, really magical things can happen.

And in your article that we reference at the very outset, this idea of becoming the biggest company in the world, especially when you're addressing in industry that feels so lofty and there are so many incumbent, i'd love to just hear your take on how that might actually happen. Like how does a technologies potentially come into this huge industry? Is there really a path there?

Yeah, we made in the begin. This is kind of a controversial take because the consumer health companies in the public markets today are relatively small. But I said, if you think about IT from our first principles perspective, health care is twenty percent of the american economy.

There's no reason that can exist. And we basically laid out two ways we think a company could get to be the biggest company in the world of a consumer health. The first is becoming a pay wider.

And pay wider basically is an industry short hand term for being both the insurance company and the providers care. And united health group is that its united health care, which is insurance company, and opto, which is their services company. They employ doctors who then provide care.

And there are one of the biggest companies in the world. I think at the time we wrote the article, they were eight. And I think they've come down a bit since as A I companies have surpassed them.

But there are one of the biggest companies in the world with a really crappy consumer experience, their N P. sis. for.

And so we ventured to say, what if you had that business model married with the consumer experience of apple? That would obviously be the biggest company in the world. Every employee would demand that their employer offer that plan.

And you know, when you get to medicine and you will get to choose your plan after your sixty five, every senior citizen would choose that plan and the competition would fall by the wayside. And so that was the first path we laid out. That's a vertical integration strategy.

And the second was a horizontal strategy. And we had said either you can become a consumer marketplace. So the amazon of health care, the place everyone goes to find their health care provider, to pick their health care insurance, to finds the cheapest cost drug.

And if you get a Normal twenty percent take rate, which is what most markets aces get, that gets you the revenue to be the biggest company in the world. And then the second path we let out was a financial infrastructure layer. So what if you became the VISA of health care, health care payments? I won't go into this collection.

Probably the general audience is is a little dry, but health care payments are stuck in the one thousand and eight. We do a whole lot of fixing of forms, mAiling of gift card, mAiling of checks. And if you could build the financial infrastructure to service health care, we think that would easily they be the bigger company in the yeah.

I think in the fullness of time, this won't be even viewed as all that controversial. I think there's this a lot of building has to be done. The one thing that I think people really tend to forget is just how huge health care is, how much a place in all of our lives.

And you think about what you pay for a phone versus what you d pay out of pocket to have health care. Be a little Better. Oh my god. So IT just needs to be built.

absolutely. And maybe taking both of those pass on their own. What would you say the biggest obstacle is for each and actually making that a reality?

Yeah, I can take the first one. So internal, the full stack, there's a lot to build. If you're going to build the full stack company from scratch, you have to build up a provider and a pair and have technology throughout all of that.

And that something that takes a huge man d capital in a huge man time and then to scale and multiple geography. So there are companies working to do that. And that something that just we can have examples of that in flight, but that will take time to build.

I think on the second one is you have to build your way into the traditional health care system. If you're gonna be the amazon of health care, you've got to onboard every provider in america. You have to onboard every insurance company.

You've got to work with the pharmacy benefit managers. And so IT is going to take time to infiltrate the industry. And probably plugged into the system is the most chAllenging part.

I think one of the founder that we think a lot about todays, like Johnson one is done amazing things. But in video is an overnight success. What three years the big say.

So he's been making very thoughtful stage decisions of multiple decades, yes, to build this company. And did that point IT started a few decades ago. I think I hope that maybe in ten years will have similar conversations with the change monks healthcare.

And obviously, we hope or almost expect that this may come from startups, right, and not the income IT. But also, is there the possibility I mean, he talked about maybe the apple of health care or you talked about payments and kind of replicating in some way what visas been able to achieve. So why would would not come from them, right? We actually have her that quite a few of these large fan like companies are trying to under health care because IT is such a big market, to your point.

So could IT come from them, the traditional innovate to lama? And that is really hard for your comments. I think occasion in comments can disrupt themselves, which pretty rare.

And I think this is the case. I'll be particularly hard to because it's just so technical and difficult. And I think if you're in a combat, your temptation is to stay away from healthcare.

If you can be this massive horizontal, would you probably do everything except the hard clinical AI stuff? Leave that to something else because that's whole different beasts. And so I suspect that for those reasons is something that the big tech companies will try. And we have seen apple and amazon, google all double, but I think those experiments probably won't fit the way they want to build their company. And so I think the stay is experiments.

Yeah, they've double a lot over the years. They've all seen the size of the industry. And so I think they look at health care and they see dollars, but they're not healthcare native. And so they've tried to make these little place to grab health care dollars without really investing and health care and changing our clinical outcomes and the kinds of really hard things you need to do. And so I think both the acquisitions on the origins, like we saw with amazon buying one medical and apples products are always kind of verging .

on health of those .

are going to count your steps for you. But we've been talking about this for a long time and we haven't really seen anyone pulled off.

It's like, will the electric car come from the right? I be not the first yeah maybe it's in the first of time, right? I think you outside and the .

flip side of that question is my united health care to get really good at consumer experience.

right? But I don't think in your breath, maybe just around that out. Perhaps there's a case study or learning, right? We have seen, to your point, huge industry, lots of opportunity. In some cases, you might argue, oh, well, apple is the wearable able already on news. They have all. But then you also see interesting cases like dollar general getting into health care because they just have so many locations or you see walmer try, but then they're closing their clinic. So is there maybe an example that comes to mind of some of these companies with maybe some of the right assets just approaching IT incorrectly?

Another version that question is which in command you think are closest.

which is there one that you think might be actually taking the right approach?

Good question. Amazon's interesting because we've bought one medical, but that feels like a tope dipping rather than going all the way and they'd have to buy a lot more. And then then you start to look like A P, E.

Roll up the questions. Can they integrate in what they do really well? And so that becomes an interesting choice. But as these we are saying, they are all have done small experiments. And this is something that you can build this huge hordes, tal, or the full stack vertical .

with a small. There are great people who work at all these companies, so we don't want to disparage them in any way. But IT feels like with the walmart health of the world, IT was almost a play to get you to stand while a little longer and spend a little bit more money. But without really investing in building world class health care, you're never gonna win in the industry. And I think that's what we've seen happen over and over with kind of big tag.

So almost coming back to that idea, you have to give a Better experience and maybe some of the experiments have not focused on that. So we've talked a lot about technologists participating in health care, but that's a really broad brush. And we may be touched on like consumer, but that's also a broad brush.

So we all know there's a few technologies that seem to really matter. A I some people are looking at augmented reality is another potential interesting entering to health care. What is catching your eye in terms of the kind of technologies that .

can really move the needle I have to talk about? I think I think there's two sides of coin is really interesting. One is that you could argue healthcare really needs A I and that the cost of healthcare is rising exponentially.

There's a huge man of data. There's all these services that could maybe become compute and song to start with, like brain surgery. It's going to start with a simple sort of babies of clinical things first.

And we've seen A I for nurses and A I for maybe therapies know the things like that. And that's got me a huge change from the cost curve. The amazing thing about technology is that we will all get the best, all get the best nurse, the best therapy.

Can I like the spotify? My pockets the same. spotify. You on moscow the same. Five billions have technologies, a great democratizing. I think the things that people don't realize that there's a flip I will stand about why healthcare needs A I. I would make an argument that A I is healthcare.

And the argument there is that actually, where is a place that A I could be applied to where the cost is so high that justify the cost of A I right now because I really expensive. These models costs the lions of dollars as lots of computer hardware. And to replace that with cat pictures is nice.

And I love cat pictures. I don't get me wrong, but that's not we're we're spending huge fraction GDP. So I would say, A I needs health care because that's the place is very good to rich and the place where actually the cost is so high now and increasing exponentially, IT actually could .

have a huge impact. A I has far worse margins than traditional software, but IT has way Better margins than human services. It's way to burn to use a large language model.

But IT is to employ a human. And health care is a four trillion dollar industry amErica that's like crowing ninety percent human services. And so we've talked about how there might be this elite frog moment where, you know, I mentioned traditional technology software has really not penetrated health care.

We have one of the hundred largest public software companies as a health care company. We all feel that. But just like in the developing world, where you went straight from cash to mobile payments and lee thug over credit cards, we think we're about to have a similar moment. And health care or we're going to leapfrog over traditional software.

Are we going to go straight from human services to AI? And so you don't have to go to these I T departments in hospitals and who have no budget and everyone is overtired and try to convince them to buy software that they're onna have to train their whole workforce on. You can say everyone spared out, we're gonna hand you A I code humans.

And by the way, large language models and multi model models are really good at doing with low level service humans due today in health care. And health care is the only industry that has call centers of thousands of people who are scheduling appointments, faxing form handling, prior authorization. We're just really behind.

And we've seen that we've seen in venture health care has been traditionally after invested category, and that's definitely changed with A I. I saw that, that twenty percent of AI dollars have gone to our health care. And there is a reason for that.

We have very clear problems that can be solved with A I that other industries don't have. I mean, the world needs more career of tools and all, but we have life for death issues. And A I is going to be able to make a huge difference. And care is increasingly data science. And doctors are not data scientists, and so they need these kind of copilot tools to help them catch things they are missing.

I would just wanted call out something you said earlier, which is that even if we cure all cancer, irk an's lifespans are only going to increase by three years. Do you go have any other just whether stats or thoughts around if we really are able to deploy A I in the ways that you're describing, what does that really change and real outcomes, whether it's for patients or americans at large?

Yeah, I think in that spirit, I think these so social determinants of health care that are outside of the attritional health care system is actually a large fraction that leads to mortality, mobility. And so A I be able to do behavior changes such an easy one.

No one's been able to pull off behavior changing of over a day. But I really does feel like we have this right now moment. There's regulatory change that are enabling consumers to get access to all of their health records or grant that access to an APP. There are these diagnostic companies that are running every customer a son and tracking changes over time. There is more penetration of wearable devices than ever before. And if you marry all of those things, we're going to have these companions very soon that are providing actually helpful health tips and motoring us and telling us when something might go wrong far before we know somethings is going wrong, so far before a doctor can diagnose us. And that's gonna a except change for human hell.

I change you. So actually came up on our podcast, tom, from mora, and you mentioned how actually all your friends after gain the morning and are drinking less alcohol. Yeah, just you.

So I get the earring for Christmas and not these these friends really pretty good. But I up drinking less alcohol. And then like dinner the other night, people at the table were talking about their sleeves score itself like that. That's real behavior change and that actually medically significant behavioral change.

You're totally right. I know check is example.

I think we can come up with a handful more, but I think maybe the original poins, there's a lot more to do totally.

There's a lot more to do. And if anyone solves the problem of alcohol disrupting your sleep, please combine us.

And I love to .

continuing .

about consumer changed. I was at a wedding recently, and people are gna grow me for this. But everyone hadn't eight sleep.

Every single person at the wedding table, the couples there, maybe six years of them, they all had a sleeves and they're all like, what's your temperature? That is a social phenomenon. And you're going around like home, the hot one. And now you mention kind of social phenomenon. I feel like we're seeing IT with other devices as well.

I think social phenomenon is a real thing and social obviously real thing and tech. And I think there is a movement, again, maybe post cove IT towards health, where I think people are drink a lot less alcohol, they are working out a lot more. And IT helps that the social contingent of source that is a sort of cool to do that.

And I think we all want to improve our health, and IT helps them were all doing IT. So tech is an ample fire of that where there are time of social network, but also not just a social network. You need the number, you need the result or you need the score. It's the beginning. I think there's a lot more to go from there.

A similar thing. We invest in a company called function health that runs every blood test in the sun on you and explains what happening in your body system by system. And they provide you with something called biological age and the number of checks. I've never gotten that I think what's your biological age? And people are comparing their biological ages and having the age birthday parties.

I ve things.

things are changing and you can change IT, you can lower IT.

So and you know you talk about how sometimes just the right number of things have to come together. And so I think about A I talk about how if we didn't use all tags back in the day and we weren't labelling all these pictures, like where would we be in terms of the data set that we have today, at least for imagery, right? And so feels like some of the things you're both bringing up is okay.

So we're certain to get the data. We're certain to get the consumer buying some the incentive are changing in all of that coming together does feel like A I now. So maybe closing things out if there are people who maybe are still a little doubtful they are hearing this and they're like that.

I agree that I want this to change, but maybe I don't necessarily agree that technologists are the people right now who are going to be able to make this shift. What would you say to those people? And also maybe what would you say to the technologies?

So maybe are on the fence. I think part of IT is that if you're medical professional, I think the key thing of all these technologies are not necessarily complete out. There are people that also know the healthcare system in internet because IT does feel a little.

Are that like some person just graduates with the underground to and solve of a health care? That's why not the case. These people are deeply rooted in the medical system but are also technologies. And that's something that just didn't exist before, and that's kind of another one.

Now yeah, i'd say startups are really hard. But you know, with the limited number of days and hours we all have on this planet, wouldn't be amazing to be working on something that really matters. And you don't have to cure cancer.

You don't need a PHD to save lives. Slike, a company that detects medical errors or helps people afford health care, conceive countless lives. And we would love to welcome you into our industry. So the water come on in. absolutely.

I think about these websites where we can look at the very earliest versions of a google or and you're like, wow, they started there. And so hopefull, there's some sort of health care equivalent there, right, where there's going to be an. Early version or so you were just like providing one blood test for consumer or even a subset of consumers. And then I wonder how that spirals.

I hope you have some examples. There's that internet book store that became more than that time, yes, song actually.

who which bought one medical, right? So I mean, you see how IT inspirits. Well, this was great.

Thank you so much. B, J. And J, Y, I really hope that ten years were. Now, to your point, we can sit down and look back and think, oh, that was quite obvious looking forward.

Thanks for having us.

Thank you all. All right, that is over today. If you did make IT this far first work, thank you. We put a lot of thought into each of these episodes, whether it's guess the calendar touches cycles with our amazing Edgar coming until the music is just right. So if you'd like what we put together, consider dropping us a line. I read this past now calm spash is extreme and let us know what your favorite episodes it'll make my day. And i'm sure tommies to we'll catch you on the flip side.