Lance Hill’s health tech startup is one of those few companies that appears to have had the incredibly fortunate of enjoying a huge surge in demand thanks to the recent disruptions brought on by the coronavirus and how it has accelerated the use of technology, new needs and hiring changes.
On the Dealmakers Podcast, Hill shared his inspiration for this healthcare tech company, how he dropped out of school to work with some of the biggest companies in the world, and then pivoted to build a cash flowing and profitable business before betting on scale with a big growth funding round.
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No One Else Is Going To Do It For You
Lance Hill was born in a little rural town in Massachusetts. His family didn’t have much money growing up. He says this experience taught him a lot about striving for better, taking accountability, and learning that no one else is going to give you everything. If you want to better your life, you have to roll up your sleeves and do it yourself.
His mother ended up going to night school so that she could earn her degree and become a database administrator. So, in the evenings he would go with her and sit in the back of the lab, and began soaking it in. When they eventually got one of the first home computers at the house Lance quickly fell in love with programming.
He was inspired by being able to create, and the fact that tech provided this great equalizing environment where you could succeed based on the merit of what you do, not your family name, the school you went to or letters after your name.
Dropping Out To Learn About Tech & Business
Lance’s love for computers turned into a college scholarship in Ohio. There he studied computer engineering right as tech was really taking off.
Like many other notable tech startup founders, it wasn’t long before he was recruited by IBM and dropped out of school.
He joined their global services division during a time of great growth, when they were transitioning from just focusing on hardware. When he came on board with IBM, he says there were only about 40 in his regional team. Just a few years later, that team had grown to 800.
Hill describes this as an incredible learning experience. One which tasked him with technology consulting for Fortune 500 companies all over the map. He would help them design their infrastructure and security. It also meant an intense schedule, traveling six days a week for almost four years. He consulted finance and healthcare companies as well as government agencies.
He also began discovering some substantial inefficiencies in efforts to modernize and install new technology. Whether it was school districts or for profit companies, he found many were spending tens of millions of dollars just for the sake of bringing in new technology and spending that budget, versus actually caring about and focusing on the impact it would have. Or if it was even moving the needle for the organization in the right direction.
Lance really loved what technology could accomplish when it was brought in with alignment with goals and how fast it could have a positive impact if thought through well.
So, after a stint handling IT for a top 10 bank, he found himself at an even smaller company. WebMethods was just around 2,000 people when he arrived. Compared to IBM’s 100,000. It was still a public company with $200M in revenue. Yet, he found the smaller he went, the faster the impact loop was seen from providing technology driven solutions.
He also got to see the full cycle of a company as webMethods was eventually acquired.
Starting From Scratch To Scale
Lance started his first company, Within3, with the goal of improving communication in healthcare, using technology.
This is at a time when MySpace was the number one social network, and LinkedIn really hadn’t found its place.
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They led in with the idea that a social media network just for healthcare could help doctors and patients. They began bootstrapping and building, and eventually pulled in some angel investor capital.
Then it soon became clear that their business model just wasn’t working. They needed a pivot, or they weren’t going to be able to keep going.
The laws and regulations in the healthcare space were and are restrictive. Yet, they saw a path. Instead of trying to build a new social network from the ground up, that required content, users and capital, what if they provided a SaaS solution to businesses to solve their communications inefficiencies?
More than 80% of theri shareholders got on board, and they helped recapitalize the business to go at it again with this new angle. They repositioned as a life sciences company, bringing solutions to doctors and drug development companies. They created these virtual solutions to speed up research and product development. An approach that happened to position them incredibly well ahead of the COVID crisis.
Going For Growth
After pivoting and recapitalizing they focused on building a strong cash flow producing business that was profitable. A company with strong financial fundamentals, that would organically fuel its own growth.
They began growing fast and tripling their size. Then COVID hit. It ws clear that this was a moment to go fast to meet the huge demand out there.
In just 90 days they raised a $100M growth round. Through 2020 they tripled the size of their team. They now have a presence in the US, Latin America, Asia and Europe.
Storytelling is everything which is something that Lance was able to master. Being able to capture the essence of what you are doing in 15 to 20 slides is the key. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) where the most critical slides are highlighted.
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Listen in to the full podcast episode to find out more, including:
- Choosing the best growth financing partner
- How Within3 has been hiring and expanding during COVID
- Lance’s top advice for new entrepreneurs