Five Questions: The Journey Venture Studio’s Mark Moeremans

In this series, Digital Health Business & Technology interviews a range of digital health investors from those who work at venture capital firms and at health system and health insurance venture funds to individual and angel investors. If you’re interested in participating, email us here. 

Mark Moeremans is part of a new concept merging healthcare venture capital firms with non-profit work.

He is co-founder and managing partner at The Journey Venture Studio, which aims to reach young entrepreneurs who want to tackle health equity problems. In addition to providing financial support, the studio will also provide mentorship and place an emphasis on identifying founders from underprivileged backgrounds, Moeremans said.

“2022 funding levels among black and female founders actually went down from their previous year,” Moeremans said. “There are systemic challenges, very real-world obstacles that some other initiatives aren't tackling.”

Moeremans talked about specific changes the fund hopes to make in venture capital and why healthcare is the fund’s primary focus.

The interview has been edited for clarity and length.

What specific areas are you and your co-founder Justin Bayless, interested in addressing within digital health?

Mental health challenges are very different based on community. [Therefore] the digital health tools that exist to address mental health disparities and challenges need to look different as well. We've all gotten on the bandwagon of telehealth, which is a great innovation and works well for a lot of people. But who are they? Who are [the companies] receiving support from? What are the topics that maybe mental health providers are not prepared to speak to? We have to make sure that there's a broad array of [foundational] experiences, the product is relevant to certain customers, price points are accessible to certain groups of people and that the marketing and go-to-market [strategy] is reaching certain communities versus just selling into the same groups that have always been sold into.

What can you share about how you'll operate and choose individuals?

We are out looking for partners that believe in this mission and see this gap. We're going to deploy that money to develop these leaders to help them validate these concepts and launch disruptive healthcare companies.

That's going to be an investment in these individuals and their validation stage of around $100,000 per individual. There are going to be cohorts of three to four to six founders a couple times a year. We're going to be implementing a kind of founder development and residence program. [Overall funding] is going to be between half a million dollars to $2 million per year.  Then companies that emerge from the program will receive follow-up funding.

You said you were trying to find people often overlooked by Silicon Valley. Why have they been overlooked?

Venture has always been a network-based business. I see it now. I saw it when I was at Stanford. If you've got the right relationships, if you know the right people, if you went to the right school, you get those warm intros. You get those first meetings, maybe you get sponsorship, coaching and mentors. We know that talent is distributed equitably. We know that venture funding that opportunity is not. How do we build new networks? How do we build new programs and opportunities? There's a brilliant individual right now studying at University of California, Santa Barbara that maybe isn't getting the same on-campus recruiting opportunities as someone at Harvard. So how do we find those people?

Can traditional venture capital solve many of the problems you're outlining?

I think they can for sure, but I don't think that they have. I think our decision to move forward as a nonprofit, and build this new model is because we know that we are building something new. We know [and value] the leadership development component. We know taking these high potential individuals that might have been overlooked is a different risk profile than your standard investor [will assume]. We are committed to the mission of closing the opportunity gap through entrepreneurship.

We've seen the broader digital health market to begin to contract while providers face mounting financial challenges. Does that worry you at all to be so focused on digital and healthcare companies?

Trends that we've seen prioritizing growth over profitability, raising really large rounds, and then immediately going into your next fundraise—some of those dynamics are for sure changing, but I don't think that means that now is not the time to continue launching startups.

The idea is that we're providing a structured, systematic approach to entrepreneurship to de-risk the startups as much as possible. Obviously, in startup life, you can never de-risk anything entirely, but the idea is to provide sort of that safety net [or] bubble to stress [and] test these concepts before they even go out to market.

[We plan on] using our internal team to really validate what areas are worth pursuing in the first place. Whether that is mental health, aging [or] reproductive health, we're going to be looking at data and using our network of expertise and insights to determine what direction we want to encourage our founders to validate and test in.