From the beginning, the company planned to help health startups both crowdfund and beta test their products with patients and physicians. But now, founder and CEO Patricia Salber said Health Tech Hatch plans to focus more closely on the beta testing side, while working on the crowdfunding piece through Indiegogo.
“We quickly learned that it’s really, really hard to raise much money if you’re trying to raise for a startup company [that isn't] any of the companies that have a cool device,” she said.
Startups like Misfit Wearables, which is developing a wearable activity tracker, and Scanadu, which recently set an Indiegogo record for its tricorder-like device, succeed in crowdfunding because they’re essentially offering a pre-sale through their campaigns, she said. But for startups focused on software, general crowdfunding can be tricky, because funders don’t get anything tangible for their contribution and they may want equity in return for their early support. Companies can raise from $5,000 to $20,000, but it’s often not worth the administrative effort and time they have to put in, Salber added.
By working with Indiegogo, Health Tech Hatch can give companies an opportunity to reach a wider community of interested funders. Once the partner page is live on Indiegogo (Salber said that while the deal is done, the page isn’t live quite yet), health startups can sign up to create campaigns supported by both companies.
Startups could obviously launch a campaign outside of the Health Tech Hatch Indiegogo page. But the company will carefully vet campaigns and its hope is that health entrepreneurs will want the added benefit of its “seal approval” — given the sea of campaigns on Indiegogo, extra support from Health Tech Hatch could make potential funders more willing to shell out some cash. Salber said her company will share the revenues from each campaign with Indiegogo and will also charge for optional administrative and campaign management services.
Salber’s larger focus is encouraging collaboration in health care – among health care innovators, as well as patients and doctors. The site enables startups to get usability feedback on ideas and prototypes from patients and doctors, a process it calls “codesign.” This week, for example, it launched a project with the Office of the National Coordinator for Health Information Technology to solicit patient ideas how to use data accessed through the government’s Blue Button initiative.
It’s worth noting that while Health Tech Hatch is teaming up Indiegogo for crowdfunding, other startups are continuing to go it alone. MedStartr enables new startups to raise small amounts of funding (few campaigns ask for more than $30,000 and most appear to ask for far less) and Healthfundr and VentureHealth are bringing different approaches to equity crowdfunding to healthcare.