Teladoc Health’s CEO weighs in on what a look at the past can tell us about the future.
The last three years in digital health have been the most dynamic since the dot.com craze of the 1990s. While the players were different, the human and economic factors were very much the same: A rapid rise of key players, followed by money pouring into the space, followed by investments in every niche imaginable, finally brought back to earth by a recession that many companies did not weather.
I saw this cycle play out in my first tech job as the head of customer engagement at Mail.com. If you go to Mail.com today, it’s not what it was back then. But in the mid-’90s, we were convinced that we had the answer to the future of communications: free email and vanity URLs for some of the biggest names on the internet, including AltaVista, Lycos and Geocities.
Of course, this was a business that quickly got commoditized and when our clients lost the search engine wars, our contracts went along with it. Today you have to be over a “certain age” to even remember these brands.
I share this walk down memory lane because we find ourselves in similarly turbulent times at the intersection of health and technology.
A lot of money has poured into the sector over the past few years, funding strong and weak business plans alike. This investment has certainly validated our view that virtual care is the future of healthcare. But it has also created a tidal wave of point solutions trying to tackle narrow gaps as opposed to whole-person care. Add to this dynamic the suspension of some public health regulations due to the pandemic, and you have some companies that are not only unsustainable, but even dangerous.
And we’ve seen businesses of all stripes get into the game. When I said, tongue-in-cheek, that Amazon was “overrated” when pressed by CNBC’s Bertha Coombs in 2021, it wasn’t because I thought less of the retail giant. In fact, we partner with them in different ways. I just knew from my decade plus at Teladoc Health that regardless of whether you are a startup or big tech, delivering high quality, personalized care at scale is complex and far from a sure thing.
At the end of the cycle more than two decades ago, the companies focused on impact in that time of dot.com transition were the ones to prevail. So maybe the late ’90s were on to something.Solving real problems that real people face will always have value, versus bright ideas without a business plan. Those companies with strong balance sheets and a measurable impact on clinical quality and health outcomes will survive and thrive after the current shakeout. Improving the health of the whole person through hybrid virtual and in-person solutions is where consumer expectations are headed. These factors, combined with cost sustainability, will be what ultimately create a more mature and rational market in which virtual care is here to stay — and all people, everywhere, are empowered to live their healthiest lives.
Jason Gorevic is CEO of Teladoc Health.