Big ideas are often hampered by small budgets. In the world of healthcare, the drawing board is often littered with cast-away notes for projects that never saw the light of day due to lack of funding. I’ve recently noticed a number of accelerator programs, grant challenges and contests in the news that, presumably, are trying to help healthcare entrepreneurs and small businesses overcome this fiscal funk in an effort to bring new and unique products to market that will ultimately advance patient care.
A recent HealthcareITNews.com report notes that “venture capital [VC] funding for healthcare IT in Q32011 more than tripled, with $207 million in 17 deals compared to $66 million in six deals in the previous quarter. VC funding for the same quarter last year came to $62 million in seven deals. Fifty different investors participated in these funding rounds.”
There’s money to be had, if you know where to look – and have the right product idea and business plan to back it up. The folks at Sandbox Industries are big believers in enabling innovations to make it to market, so much so that they have created Healthbox, “one of the first business accelerator programs in the healthcare industry to provide a platform that supports innovation among seed-stage companies,” according to the Sandbox website.
“Healthbox is a three-month program for seed-stage companies that culminates in an Investor Day, in which participants are able to pitch to a broad group of healthcare investors, including Healthbox’s strategic partners - Blue Cross Blue Shield Venture Partners, California HealthCare Foundation, HLM Venture Partners, Merrick Ventures, Ridgeview Medical Center, Sandbox Industries and Walgreens - as well as angel and venture investors from across the country,” says Dan Phillips, Director of Healthbox.
The program, which is currently reviewing applications, will start in January 2012 with around 10 teams, which will work out of Chicago for three months on their chosen technology projects. Each team is allocated $50,000 in exchange for 7-percent equity and the aforementioned Investor Day, which will afford the teams the opportunity to raise additional money.
I recently spoke with Phillips to learn more about the program, and how it is helping to bring healthcare IT innovation to market.
Why did Sandbox decide to invest its resources in getting Healthbox up and running?
DP: As manager of the Blue Cross Blue Shield Venture Funds, Sandbox connects with hundreds of healthcare entrepreneurs and startups each year, yet only makes investments in a select few that meet the fund’s criteria. We often encounter high-potential entrepreneurs with great ideas who are simply not far enough along with their businesses to receive VC funding. So we’ve been looking for a way to engage with these entrepreneurs in a deeper way and support healthcare innovation at its earliest stages. We feel that Healthbox is an optimal vehicle to connect with entrepreneurs and healthcare communities across the nation and fill the existing gap in funding and support for these types of companies. Early on, we were fortunate to identify some great strategic partners who share this vision, making the idea a reality.