Silicon Valley is getting interested in healthcare -- here's why that could be a good thing

Krishna highres (2) (2)GVGV general partner Krishna Yeshwant

Major tech companies are eyeing the healthcare world.

Amazon is seriously considering entering the pharmacy business, according to CNBC, while Apple has been reportedly working on a non-invasive glucose monitor.

That could be a good thing for the industry, according to Dr. Krishna Yeshwant, a general partner and head of the Life Sciences team at GV (formerly Google Ventures).

He told Business Insider that when tech companies try to enter the healthcare space, their approach to competition could put them at an advantage. One of his colleagues once compared the different levels of competition to growing up as a bacteria versus growing up as a mammal.

Here’s what that means: It’s relatively easy to start a consumer tech company. There are platforms to use, and you really only need a little bit of capital. So you’ll frequently see a bunch of companies enter a particular space, which makes the competitive pressure that much more. It’s similar to how bacteria duke it out on surfaces.

For health startups, particularly in life sciences, you’re dealing with an entirely different organism (they’re the mammals in this analogy).

“Competitive pressures for mammals are far less than the competitive pressures for bacteria,” Yeshwant said.

For example, there are often only one or two companies in a particular space. Yeshwant pointed to Aspire Health, a company GV invested in that’s in the palliative health space. “There’s not another company like that that I’ve ever come across,” he said. That’s because of all of the regulatory and health insurance hurdles that exist in healthcare that don’t in tech.

How a tech mentality could transform healthcare

The entrance of more people with tech backgrounds into healthcare could have a dramatic impact on the industry, if they’re able to approach the business with the same level of competition as a tech company.

“Whenever that person is willing to apply that same sort of thinking to the healthcare space, where nobody’s used to that intensity, we can often find really exciting things can happen,” he said.

Yeshwant pointed to Flatiron Health, a company GV’s invested in. Its founders had worked at Google before starting the cancer information technology company. Coming from the advertising technology world, they were able to carry that competitive energy into building the team that would start diving into cancer data.

“I don’t know if they would have done that if they hadn’t had the exposure,” to the competitive pressures of advertising technology, Yeshwant said.

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