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Blueprint for digital health startup success

Madison-based Datica has created a roadmap for other digital health startups to improve on a 50% failure rate in the industry.

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Datica developed the DHSF from thousands of digital health startup conversations the company has had since its 2013. Those conversations include early-stage startups to medium and high growth startups, as well as innovation group leadership from various hospital systems. “Additionally, we sourced the framework from 30 interviews with hospital CIOs and CMIOs who we’ve interviewed on the Healthcare Innovators Podcast, a show hosted by Datica CEO Travis Good, MD,” Olschesky notes.

As an open resource for digital health vendors and health care innovation groups, anyone can access the DHSF at

The Digital Health Success Framework from Datica is an easy-to-navigate roadmap for digital health startups looking to see where they are on the timeline to success.


Digital health vendors can use the guide to determine where they are on the timeline of digital health success and what measures are on the horizon that they will need to address next, like HIPAA compliance, HITRUST CSF Certification, when their app needs to meet security requirements for health care data, addressing hospital EHR integrations, and more, explains Olschesky. Developers and company founders can hover over the various months shown on the framework and learn more about that particular step that will need to be addressed. If desired, digital health vendors can set up a consultation with a Datica compliance expert to help them determine where they are on the timeline and their best next steps.

“Not all startup founders — especially those coming to health care from outside the industry — will know the various steps that successful digital health product will need to traverse,” Olschesky says. “Others know the steps, but not necessarily the months in which a company needs to take these steps in the company evolution. Datica lays these out in an easy-to-navigate framework with clickable monthly tabs that provide more information about each step.

“Also not found elsewhere is what it takes to actually achieve compliance in the cloud. It is hard to close a deal with a health system or get through [an institutional review board] if you are not a master of compliance; we do our best to provide the fastest path to mastery.”

Checklist for success

Compliance and security need to be the backbone of any application, Olschesky continues. Determining which users can see what amount of protected health information and how you will distribute your application to clinicians and patients is not as easy as putting an app in the app store.

“Those, along with many other steps, are crucial to delivering an application that not only delivers outcomes but also can scale growth across multiple organizations,” says Olschesky. “Miss one of those steps along the way and backtracking will create delays and possibly negative outcomes with proposed hospital pilots. The DHSF supplies this checklist that centers on compliance and security. While many other resources are available on how to ensure startup success, digital health is unique in its regulatory requirements and that can trip up those who aren’t ready for the rigors of this industry.

“From our many Healthcare Innovators Podcast interviews, CIOs tell Datica that while a Mayo Clinic, Cleveland Clinic, or UCSF pilot is the brass ring every digital health startup hopes to achieve in the first year, it’s extremely rare without addressing the steps laid out in the DHSF.”

Olschesky admits Datica has lost a few customers who were early-stage startups that went out of business over the last few years. “While some businesses fell apart for the usual business failure reasons, I’d say that the biggest health care specific reason is that companies did not hit scale fast enough. For most significant digital health business models, your sales model is likely B2B or B2B2C. This means that you need to go through procurement with health care organizations, which in many cases are not noted for their agility in contracting.

“We’re in the same boat at Datica, where sometimes it can take us over a year to close a deal with an organization. It’s important to be able to parallelize your sales and delivery efforts and to ensure that you can prove what you need to prove to organizations fast so that the only barrier left is just grinding through contracting. What needs to be proved is usually three-fold: competency, compliance, and outcomes. The DHSF helps companies come up with the framework to demonstrate those three things.”

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