SilverVue: Business Model Innovation In The Healthcare Space
“SilverVue is much more about business model innovation and finding innovative ways to get into the space.” — Co-founder/CTO Eric Smith
In the crossover between tech and healthcare, there is a very small middle where both industries co-exist — because of healthcare laws and regulations, not to mention the stark reality that a clunky system change can literally cost people’s lives, the adaptation of new tech in healthcare is a notoriously slow and laborious process. On the other hand, tech is generally known for lightning-fast implementation — one minute you’re sitting there dreaming about your next vacation, the next you’re strapping on a virtual reality headset and taking that vacation from a lazy boy. Understanding where these two industries intersect is key to understanding the story of SilverVue.
As we begin, let’s take a trip down memory lane. Eric Smith and Will West have been business partners for nearly 30 years, founding a variety of businesses that included PHAST Corporation, iBahn, and the publicly-traded Control4. In 2012, they began bouncing around ideas that concentrated on sensors in the healthcare space, an industry neither had entered before. Their original idea dealt with applying sensors to various things (beds, medicine cabinets, etc.) as a way of giving people an option to monitor elderly health patients from afar. Now, the problem wasn’t with the idea but with implementation — multiple case managers liked the idea but worried about the time it would take to put into action. During this process, still searching for an idea to base a company upon, Smith and West were notified by healthcare officials of a recent struggle: finding a way to create and exchange data regarding the IMPACT Act of 2014.
“There are regulations requiring that patients be shown all their options,” said Smith. “Lots of hospitals own skilled nursing facilities and long-term acute care facilities, and they tend to direct patients to their own facilities. The government doesn’t want them doing that anymore so they’ve made it a requirement, if the government is the payer, they must show patients choices. Those choices must include things like ratings that change every month and that’s a challenge — these are smaller businesses that come and go, they add and remove specialties, they add and remove insurances that they take. Keeping track of that is a real pain but there’s a legal obligation for them to have that data.”
Remember that middle ground I spoke about earlier, where a tech company innovates quickly and healthcare providers can use that innovation to immediately improve function? The IMPACT Act was SilverVue’s way in.
Smith moved over to SilverVue full-time in 2014, helping to create a software platform that focused on the handling of patient data entering post-acute care.
“As time went on, we started realizing there was an opportunity for software to help manage post-acute care,” said Smith. “We provide software-as-a-service and tablets that they can carry around, patients can punch in their home address and search for facilities. Those tablets have all the proper information and they have all the ratings.”
While the idea itself was innovative, getting hospitals to bite on a tech idea is never easy — again, the process is usually long and arduous. Perhaps more important than the creation of their own software was the way SilverVue chose a very particular business strategy, offering their platform for free and then charging for premium listings (think a yellow pages-type format). This allowed SilverVue to get their foot in the healthcare door in a way most tech companies simply cannot do.
“It’s really hard to get a hospital to let new technology in,” said Smith. “The laws and the downside of having a problem are so high, they tend to not want to let companies in. We come in at first and don’t need access to any patient health information, we don’t need any access to your network, we put cellular modules on our tablets and it’s free.”
After getting their foot in the door — and getting hospitals familiar with their software — SilverVue can then add additional services if needs be. One of these services is SilverSign, a simple way for hospitals to collect a patient signature stating the hospital explained all of their choices. Once the patient selects a post-acute care facility, they sign the tablet and that is posted directly to the health records system.
Another part of the post-acute care process is the time expended (through phone calls, faxes, etc.) asking a facility if they will accept the patient. SilverSelect simply automates that process through the platform — users can select multiple facilities via tablet and click request, the necessary medical information is securely sent to post-acute care providers, and they can review the data and choose yes or no.
This business model — get an immediate foot in the door, then slowly build and integrate data as time moves along — combined with the platform itself, has allowed SilverVue to sell at astronomical rates.
“Once you’re in, it’s a very different discussion with a hospital than if you’re an outside vendor,” said Smith. “We’ve sold faster than any company ever in healthcare, no software company has ever had penetration as fast as we’ve had. We’ve signed over 250 hospitals and we’ve only been selling for a year-and-a-quarter — usually it takes a year-and-a-half just to get the first hospital.”
“What we’ve done is more of a business model innovation of a way to get into health care, by doing little bits at a time,” he added. “Each time they become more comfortable and are willing to share more with us.”
With these incredible sales numbers, SilverVue has grown accordingly — they currently have about 70 employees stationed in Sandy and last year completed a $12 million funding round from Pritzker Group, GE Ventures, and Epic Ventures. I’m no expert, but I think it’s safe to claim SilverVue has found a decent middle between tech and healthcare.
“All of my other companies have been very high-tech, our value has been created in intellectual property that solves a very complicated technical problem,” said Smith. “SilverVue is much more about business model innovation and finding innovative ways to get into the space. We knew there were opportunities in healthcare but also a lot of challenges….we’ve had to feel and find out what that opportunity was.”