Telemedicine and the market size problem

In the startup environment, it is a habit to talk about successes to keep our hopes alive for the future, but it is a big mistake to forget the failures of the past and not benefit from the experiences of the past. For this purpose, the Ecomotive team has collected the experiences of a series of failed startups, so that perhaps the review of their failed history will be a basis for the nascent startups of the Iranian startup community. This collection will be published and made available to the audience in the form of the story of failure. We review the seventh part of this series, which deals with the failure of the Healthspot startup.

Healthspot was established in 2010 with the aim of providing remote health services. This company sought to increase access to high-quality, appropriate and accessible health services and was trying to achieve its goal by creatively using technology in the field of health. In this regard, he established a virtual medical office called Care 4 Station. By using its customized software platform, it brings together patients and healthcare providers in a convenient place. This company had tools to increase the power of specialists, to make health services smarter (telemedicine), and to make them simpler and more accessible.

Overall, Healthspot raised $43.8 million in venture capital and debt financing between July 2011 and January 2015. But finally, despite all the successes and hopes for the future of this company, Healthspot declared bankruptcy in January 2016. But this failure had reasons that cannot necessarily be extended to the telemedicine industry and to despair about the future of this company.

Healthspot only allowed scheduled appointments between patients and doctors and did not provide real-time health services as it claimed. This business model was the first cause of the company’s failure. In addition, the costs of the company were very high. Healthspot from company services the video used, which was not only expensive, but also required infrastructure that put heavy costs on the company’s shoulders. On the other hand, equipping the Healthspot kiosks was very expensive, while only about 10 patients visited these kiosks daily, and this number did not justify the expenses incurred.
This small number of patients was an important reason for the failure of the company, because the services provided by Healthspot were not as extensive as emergency care centers. In fact, the customers of the kiosks were a limited range of the community who had minor illnesses and only needed medical care.