Five Questions: Flare Capital’s Bill Geary

In this series, Digital Health Business & Technology will interview a wide cross section 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. To be considered for this series, email us here. 

Bill Geary, co-founder and general partner at venture capital firm Flare Capital, has worked in healthcare for more than two decades. While the space has evolved significantly since he first entered it, Geary, said the balance between profitability and growth is an increasingly complicated negotiation. 

“I think the challenge in any young company you build is to separate out the investment components that relate to growth versus showing that the fundamental business can be profitable,” Geary said.  

He spoke with Digital Health Business & Technology about navigating an increasingly competitive digital health ecosystem and the types of solutions the providers are demanding. The interview has been edited for length and clarity. 

Did COVID-19 provide the spark that ignited how consumers interact with healthcare?

Like most areas of innovation, it has come under the spotlight recently. People think it's kind of just started but it's been happening for some time. There’s a new model now for care delivery. We've gone from bricks and mortar, to all virtual care, to hybrid. And now, there's a new tri-brid model. The new complete care delivery model is all three of those. Of course, this depends on the situation, geographic location, the acuity and a whole host of factors. 

Do health systems demand something different from their digital health vendors?

There's a renewed focus on reducing administrative costs and it's a trend that's going to persist. In more challenging times, like we're living through today, the focus on administrative cost reduction is across the board. The reality is there are one thousand little things that add up to substantial administrative cost savings. There is no one magic silver bullet, there's no one magic solution. It kind of comes and goes in waves. 

Is capital today moving toward companies more focused on integrating data?

The original repository, historically, has been payers.  They’ve had it since the industry was spawned, and they’ve used it only fractionally. They’ve used it to develop different insurance products, but it hasn't, until recently, [been] combined EHR data, lab results and patient reported data. It's super important to have it all. It's crucial for consumers, as well. It's the combination of [all] that, that the industry has been talking about for some time.  It will retool drug discovery, pharma and providers, and of course it shapes what consumers are looking for. 

Consumers are consistently seeking behavioral health virtually. Where are the opportunities there?

We are just beginning to scratch the surface of behavioral health needs. Historically, we've thought about behavioral health as its own set of issues. The reality isbehavioral health issues make every other condition worse. And behavioral health is not a siloed condition that needs to be taken care of in isolation. It affects every other condition. I think it becomes a powerful entry point for digital health solutions. That is the focus on behavioral health, whether geriatric care, or for teens. The focus on behavioral health, as the entry point is different for our healthcare system. 

What do you make of the influx of capital into digital health?

It used to be that people were drawn, at least initially, to whoever had the most money that they were throwing around. That capital source has pretty much dried up. By and large, the people who are active in this climate are those in healthcare that understand the domain and have experience. Entrepreneurs are coming back to those investors, I think. It seemed like money was freewheeling as high valuations [came in]. Unachievable outcomes had to happen in order for it to make sense. The fact is, that category of investor doesn't really exist any longer in this climate.