Google Ventures is investing $US130 million in Flatiron Health, a two-year-old New York-based software company that focuses on cancer-related data.
It’s Google Ventures biggest investment in a healthcare startup.
Flatiron Health is organising oncology data to make it useful for physicians, researchers, and patients. For the most part, data collected on cancer patients isn’t used for any organised purpose, says Flatiron co-founder Nat Turner.
Flatiron will be using a portion of the funding to acquire Altos Solutions, which is a 10-year-old healthcare company that collects cancer patient data from 550,000 patients annually. Turner calls acquiring Altos a “huge” deal for Flatiron.
Flatiron was founded by Turner and Zach Weinberg. The duo had previously created ad tech startup Invite Media, which they sold to Google for $US81 million in 2010.
Over the phone, Turner told us that he and Weinberg are “effectively married,” since this is their third company. After two years at Google, they started getting the itch to do something else.
They considered starting an investment fund since they already done angel investing in 40 different companies. But, they’re young (in their late 20’s now) and they had enough energy to do another company.
“We were sitting at Google integrating the last business, and we were burned out on optimising click through rates and pushing pixels,” says Turner. So, they decided to do something in healthcare.
They didn’t know anything about the healthcare field, but that didn’t matter. Turner says they didn’t know anything about advertising when they started Invite Media. They just went to people in the industry — Brian O’Kelley from AppNexus in particular — and learned.They did the same thing in healthcare. “We lined up 1,000 meetings in 6 months. We made three day trips to Boston, we did rounds with physicians,” says Turner.
They chose to focus on cancer because they had seen friends and family members deal with cancer. Once they started looking at the field, they got hooked.
Part of the reason cancer patient data isn’t used is because only ~4% of patients are on clinical trials. Clinical trials are used because they can be controlled and outcomes can be compared. The risk for Flatiron is that it’s collecting a messy bunch of data that may be messier and harder to interpret.
Turner acknowledges that this is one of the big challenges Flatiron is trying to grapple with. However, he thinks that if you can get the data on 1 million cases of cancer, then there will be value in interpreting the data for physicians and researchers.
The business model for Flatiron is to sell its database to physicians, researchers, and ultimately patients, along with tools for each group to sort through the data.
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