- January 18, 2015
- Posted by: growth@locutushealth.com
- Category: Healthcare Startups, Industry Articles
So healthcare’s the new booming industry and the ACA has made it even more tantalizing for entrepreneurs in the U.S. It’s not just us though, India’s also seeing growth in the sector.
But what happens when a healthcare startup…stops starting?
I believe it’s commonly referred to as “failing” and is a concept steeped in myth and statistics that leave you asking more questions—especially if you’re wondering how success rates play out in healthcare specifically.
There is a bit of insight to be found though–some basic numbers on startup failure were available from Statistic Brain…
After 4 years, 56 percent of startups in Health/Education were still chugging along (way better than pure tech’s 90% failure rate)
The major cause of failure? Incompetence. (Though a lack of managerial experience ran a close second).
The leading mistake? Going into business for the wrong reasons
Did healthcare make the top 5 categories who showed success after 5 years? Nope.
Was it in the bottom? Also no.
Good news right? Well, it seems to say that healthcare startups don’t deviate too far from the norm. The bad news though, is that that norm might be worse than people are letting on.
Back in 2012, the WallStreet Journal reported on the difficulty of shedding light on the true chances of startup success in any industry (and, how it can be difficult to define “success” itself. I wouldn’t be surprised if things hadn’t changed much.
More good news though, you may be able to increase your chances of healthcare startup success by taking good advice from other industries. Check out this piece from MedCity News to get started.
So what risks do healthcare startups really face? It’ll likely be a good while before we know for sure–and even that assumes we get the full story.