risks & mitigation strategies

While healthcare startups offer asymmetrical upside, they face outsized risks. Our diligence process includes structured mitigation plans:

Risk: Market Adoption Resistance

Mitigation: Focus on user-centric, cost-saving solutions with clinical buy-in and workflow integration. Prioritize those with pilots or contracts.

Risk: Regulatory Complexity

Mitigation: Invest in teams experienced with FDA, CMS, and EU MDR/AI Act processes. A track record with similar submissions is preferred.

Risk: Data Security & Compliance

Mitigation: Require HIPAA/GDPR compliance frameworks, strong cybersecurity protocols, and third-party audits.

Risk: Reimbursement Uncertainty

Mitigation: Emphasize alignment with value-based care models. Favor products with CMS coverage pathways.

Risk: Technological Obsolescence

Mitigation: Select companies with modular platforms and dedicated R&D pipelines.

Risk: Competitive Pressure

Mitigation: Insist on defensible IP and durable competitive advantages. Monitor the landscape with scenario planning.

Risk: Ethical/ESG Concerns

Mitigation: Ensure commitment to health equity, algorithmic fairness, and environmental responsibility

Download our investment thesis here.