Introducing Raising Health: Fireside Chat with Sean Duffy

0:00I'm never calling ourselves a startup. We were three people and Nomada was a digital health company. What needs to happen for an innovation ecosystem to flourish in a way that wasn't there before? Could it be done more effectively or efficiently? Like, look anywhere besides the U .S. and you find ways that one could. Let's just pretend I was a higher gun CEO brought in today. What would I be doing differently? Day one, great. Just joined Nomada. I'm the CEO. What would be the next play? There's a reason that artificial intelligence is a buzzword and artificial empathy is not. Digital Health has undergone a remarkable transformation over the past decade, involving from simple health tracking applications to an interconnected ecosystem of solutions that are totally redefining the way we prevent, treat, and manage medical conditions.

0:50And today's guest has actually witnessed this entire shift. Sean Duffy co -founded Omoda Health in 2011, with the mission to enable people everywhere to live free of chronic disease. Over the last decade, Sean has actually grown Omoda from zero to one million patients, giving him a front row seat into the evolution of the digital health industry. So in today's episode, Sean sits down with A16Z by own health founding partner, BJ Pandey. for the inaugural episode of Raising Health, formerly known as Bite Weets World. John and Vijay discussed the building and growth of Amata, how AI is changing the digital health landscape, and what the future of the industry will look like as Amata plants a scale from 1 to 100 million patients.

1:36And if you do like this episode, don't forget to go check out our sister podcast, Raising Health, that again, just relaunch and has some pretty incredible episodes on the docket. In the meantime, enjoy the episode.

1:52Hello and welcome. You know us as BioEats World, a podcast at the intersection of bio, health care and tech. But today, we're evolving to bring you raising health.

2:07Raising health as a show four and about the builders who are leading the companies behind the bio and health innovations. In each episode, we'll continue to engage with industry leaders such as Nobel Laureate Jennifer Dowdna, esteemed clinician Carl June, AI pioneer Daphne Kohler, and many more. Today's episode is with Sean Duffy. I'm Olivia, and I'm Chris. Sean is the co -founder and CEO of Omada Health. He is joined by Vijay Pandey, founding partner of A16Z Bio and Health. Sean and Vijay celebrated the milestone of Omada achieving 1 million members, and looked back to how digital health has evolved since Sean first started raising capital for Omada more than 10 years ago.

2:46To be honest, I mean the last 10 years has been that scene from Apollo 13, like the Square CO2 cartridge and round hole, we just try to somehow pull it off with the parts on the ship before your oxygen plate, which is your bank account, you know, and start up language. Maybe because he spent so many years in the wilderness of early digital health, Sean is an optimist about the future of AI. He shared how Omada is leveraging AI today and how the company is shaping its caregiving strategy accordingly. There's a reason that artificial intelligence is a buzzword and artificial empathy is not. And I don't think there is any substitute for just the human accountability.

3:20And in fact, I actually think that maybe in this era of AI, it may be actually come more valuable. Human time, handcrafted goods, like proper human caregivers, that may feel more valuable. So in the same vein, you can leverage not just them, but TIP and augmented support through these models in a way that I think just will transform outcomes and impact the world. You're listening to Raising Health from A16Z Bio and Health.

3:51Welcome to Raising Health. The news for 2024 is that BioEats World is getting up great. We're rebranding as Raising Health. And as our very first guest on Raising Health, It's my pleasure to welcome Sean Duffy, CEO and co -founder of Mono Health. So Sean, thank you so much for joining us. Yeah, Vijay, thank you and thanks for allowing me to be the first, what, an honor. This starts with actually that email that you sent me. I think I was actually maybe even a tweet that I saw that a Mono hit a million patients. That's right. And so that was a huge deal. And I think that made us very sentimental about all the whole path that you've been through and the path that we've been through together.

4:27Oh, for sure. Now, I mean, a million, you know, we're really proud of it. I'm proud of it. I'm proud of the team. You know, I think it's a lot of people. It's big impact. And I think if you pull up, I think it is a statement on where digital health has come from and that it's possible. Admittedly, I feel two ways about it. I think the positives are, my gosh, it took, you know, so many years of toil to even get to the couple of thousand. But then if you compare the million to the task at hand of actually impacting epidemiology and really doing what we need to do for the business. We haven't really made it yet, kind of told our teams.

5:00Let's celebrate for 30 seconds and let's go try to get it to 10, 20, 50 and beyond. Well, you make a great point because a million is hitting scale, but in principle, you could get to 10s, hundreds of millions and even beyond. How do you view the next steps? Well, how do you get to that type of scale? Well, I think you're at a million, you're on strong foundations, as long as you're serving your members well and you're serving your customers well, it does become slightly easier because we're in a new state in digital health. We're a little bit more accepted. There's a little bit more trust. We now have, you know, published trials, you know, data, etc.

5:33So we're staying hungry as possible. And I think it just shows that the space, though, has progressed a lot. It's still relative to nascent relative to having the impact that it can and will. So before we get too far ahead of ourselves, actually, I'd love to take us back to the beginning. Sure. So to set the stage, I guess it's 2011. That's right. And when you start a moda, obviously there's zero patients. Then, what do that zero to one part of the startup look like? What was that like? Yeah, it's the first just, you know, you know, I'm here in the, you know, in recent offices, speaking with someone who probably isn't in the same camp, but I've always been pulled between technology and science and healthcare.

6:08And originally I thought I had a choice. I had to pick, okay, tech or healthcare. So after undergrad, even though I did my pre -medrex, I worked at Google for a couple of years. It went off to medical school. I was enrolled in Harvard's MDMBA. Through that came up with the idea for a moda. And really the key reflection was a statement of where the mark was out of the time. I'd be with my tech friends from Google. And oh my gosh, these Fitbits are going to change health care. My medical school classmates were like, well, where the level one evidence? What disease are you targeting? And so the idea for a moda was to build a convergence company.

6:39One that didn't sacrifice on technology and design, but tried to do so in such a way where it earned the trust of the existing healthcare market. So that led to the business and it ended zero to one. It was a journey. I mean, we were a little ahead of our times. I think when we founded the company, the world kind of didn't know what to do with us. So tell us more, like you were a tech company, but you were also a healthcare company. Yeah, I know. And I mean, it's in the early days of Ramada, as a friend since you'd say hi to a health plan and say I want to contract as a provider. I'm like, okay, great.

7:12Where are your clinics? We don't have any. like it would excuse me, where, where are your clinics? No, no, no, no, no, we're provider. We don't have offices to like, well, you can't contract with our network team. It's like a hotel chain without hotels. Yeah, exactly. And so to be honest, I mean, the last 10 years has been, you know, that scene from a pull of 13, like the square CO2 cartridge and round hole, we just try to like somehow pull it off with the parts on the ship before your, you know, your oxygen and plates, which is your bank account, you know, in startup language. Yeah, well, and I mean that analogy to the hotel company without hotels.

7:42Yeah, that was the Airbnb. And then there's, you know, totally fleets without cars and so on. Yep. It makes sense in that zero to one time, there is probably some surprises. I don't know if there's any known surprises makes sense to recount. I quickly realized how hard it was to sell in the enterprise healthcare. It was a surprise to me now it's not a surprise at all. And I'll kind of relay that to any tech founder. It's like the key thing was that it was not sexy to be a startup. This was kind of a moment in time where, you know, it's like, oh my gosh, Zeitgeist was that 20 -something founder that goes off and builds like a $10 billion company and you'd be with these health plans.

8:16I'm like, I'm never calling ourselves a startup. We were three people and Omada was a digital health company. But you had to quickly try to frame yourself as a measured thoughtful business in order to have success. When you were raising, you were raising probably from tech VCs primarily. And now there are examples of tech biobacies or health tech VCs that are sort of doing both, and actually, you know, it's worth noting that actually, A6 and Z's investment in a model creates the bottom fund itself. How has the sort of investor landscape changed for you? It's not, it's not in day different. Yeah, we were the first major healthcare investment from in recent, but there were very few conversions funds and you'd be on the healthcare kind of fund track and they're like, well, excuse me, like, where specifically is your monopolistic IP and it's gonna be just so easy for any health plan and to build software.

9:10The software you just do is. That's what they're known for, right? Yeah, and then you go to the tech side and they're like, how about that budget item for that million dollar peer reviewed study and the RCT you're thinking about running? I don't think we need that. And so you'd work to kind of explain. And I think that was very much sort of in our mind for launching the BioFun, which came after the investment in the model that realizing that you were a tech company and there were other tech companies that happened to be in life sciences or in healthcare. But we're being built like tech companies, and that was the opportunity.

9:41Yeah, 100%. Yeah. So any other changes that you've seen to the space, I mean, digital health, I mean, you're very much a pioneer of digital health. That's probably changed over this decade as well. Yeah, I mean, we'll, we talked about the investment landscape, I think, equally, you've seen drastic differences in both the go -to market, landscape and the talent, the talent landscape. Yeah, we should take each and turn. Yeah, yeah, yeah. So I mean, the go -to market, it's very different. I think there are like more plays. There's still kind of things to be learned. I think if you use Armada as an example, we started targeting self -intraternals that can turn into business with plans.

10:13There's a little bit of emotion now that is slightly more codified. Now, albeit, it's still very difficult, very capital intensive, but it's more of a known thing. And there's been examples of what makes it difficult. I mean, there's a lot of stakeholders. The buying cycles are really long. You're dealing with not just HR leaders, but consultants and their plans and their channels. and it's a very multi -state corbalsairist process and instill a risk in person environment, but there's a little bit of like a known way to do it. And when Omaudah found it, that was far less so. I mean, you would see in cast light work towards selling ended employers, but a little bit not the way that Omaudah was doing it, we figured out a way to build through claims.

10:51We took our trials to the American Medical Association, got them to issue the first ever digital -specific CPT code, just literally for billing infrastructure. Now there's many startups that have figured out on the back of that, how to build through claims and contract as a provider like we talked about before. So, the world is evolved. If I could make one statement that I think is the most beneficial relative of the go -to market, is buyers better know how to buy? So how do you make that happen? It's coming to a lot of that. I remember in the early days, you'd be talking to the network teams and you're like, I'm imagining a world where there's actually specific individuals on the network team focused just on your digital provider network.

11:31And you just kind of paint this future that could be but that's not there yet. And then you just kind of work your way to it. And a bit of is learning together with your partners, like how do you implement, what are the claim systems? And then the next one that comes in the door, they're like, oh, we've kind of done this before. And I remember one experience, it was a health plan, related to health plan. So I get a call from a CEO of another digital health company. I'm just like, okay, I just want to take five minutes to thank you. I'm like, well, why? And he's like, I just did this deal with the health plan.

11:59and kind of named it. And they sent over the papers, the contract. And they just forgot to take quite a minute. They didn't name out of it all. That's like, how long did that take into close? He's like, you know, three months. I was like, well, that took a year and a half. And what that means is, all right, there are plenty of ambitious, digitally forward people in enterprise healthcare, but like there's also like laid down processes and infrastructure and ways of buying. Now, that are pretty solidified. So it takes a little bit of time to like chip at it more fit, you know, he did make it a little bit malleable and then and then kind of lay new foundations on how to just ingest things like a moda.

12:37Yeah, once you've re -tempered that steel. That's exactly right. That's right. It's ready to go and then mention something on the talent side too. This changes from everything to current state to kind of the feeder, the feeder world. And I remember in medical school, it was kind of like me and like two other people in my med school class who had an entrepreneurial and then there was about two out of what, out of like hundreds? Like 250, and I restarted the Harvard Medical School like entrepreneurship society, died, it had died, literally. It existed. There was all the society of three, the wither on the vine, and I had to give it CPR and get that thing back going.

13:12And now I think that's different. It's like, today's cursive is JavaScript. There's just more tech fluidity coming out of the, you know, I think the life sciences, which speaks to more talent that can appreciate both worlds, which speaks to cultures that can pull the best of both worlds together, which speaks to, it's just being easier to build a convergence business. Yeah, I'd love to see this. I don't know if a graph of time and the fraction of med school students would have taken a CS course. Yeah, no, no. And I'd probably just like growing dramatically. It's growing dramatically. Well, it's key because if you really weren't sort of just visiting on the tech side, you wouldn't be able to handle that side of it.

13:49It seems like at least a part of the problem early on was there are just so few people that were conversing in both. And it's funny. It's both like a vision issue that's super important, but it's also like a hiring issue. Because you need, you know, at the end of the day, like you need to be able to pull in incredible skill sets in your organization. And if the language you're using, like doesn't communicate that you understand the skills that that person is bringing to bear, and you can't just like over a beer, like riff on a specific thing in their world, they're not going to join. So I mean, that's one of the reasons why the legacy health services companies have had trouble hiring talent They'll put out a role for like you know, IT engineer And you know and it's your in the language and just the appreciation of the skill sets like matter And it's hard to get that if you don't if you're if you're in the top talent or not going to want to They're not gonna do it.

14:37Yeah, yeah Yeah, and the same you know the same as on the healthcare side like if you're I mean if you're just an amazing tech company You're trying to hire great healthcare talent. They're like they don't know They don't know what they're doing. Well, how's it going now? Like, how's it hiring sort of the latest crop like on the MLA eyesight? We know so much easier because it means specific to that. What's neat is we have just an awesome data corpus. The end of the day, like, these models are more or less commodities. It's what feeds them, so that's important. And then, um, umata has operated against our user's preferences, which is asynchronous messaging large part.

15:08So, you know, about 25 million messages that are flown back and forth between our care teams and our members, maybe the richest, you know, data asynchronous, data corpus in metabolic care, and, you know, LLMs are kind of like, they gave it a nice time for us. Candy store for any kid would love that. That's right. So that talent side is fine, but the neat thing relative to the last kind of couple minutes of conversation is now there's a crop of folks that have worked in tech and health here. Maybe they're the start up that tried to do both, but, you know, didn't work out or maybe a company that has scaled and they want to do something different.

15:45So there's just actually a richer crop of talent to pull from. It's no longer, you know, we're trying to steal from a moda for people that are experienced with both. It's kind of a broader set, which is great. I think it's an amazing thing. Oh, it's a really good system. Well, so 10 years, changes all of us, how have you changed? Oh my gosh. I mean, I was extremely green when I found it on moda. I was in an MDMBA program, but hadn't done any of the business side. And I had never hired any of you, honey. I didn't have any managerial experience. I didn't know what a venture capitalist was. You know, my goal has always been each year.

16:18I want to look back at last year Sean and just feel a little bit embarrassed. Wow, well, that's a really unique way to frame it. But embarrassed, is that being hard on yourself? I think it's purposely, you know, hard because it's like, it's the truth. So I think I have been just a little bit embarrassed about every per seating Sean. So the Sean now is very, very different than the vintage, the vintage 2011 Sean. And I mean, you've been on the board a number of years and you've seen it too. Well, actually, now I think about it after you said that, the thing that most people get embarrassed about is like when you watch yourself on video or when you listen to yourself, it's actually the fact it's getting embarrassed is not unusual, is the fact that you're willing to look at that and look at it in its face.

16:59I think that is really takes bravery and is most people don't do that. I think a way to think through the way that I think through it is to think through decisions or mistakes. Like, would that have happened with today's, you know, Sean, that misstep that we made with today, Sean, have fallen into that trap? And I think it's a good mindset. And I think similarly, I was always encouraged, entrepreneurs to like, especially founders, try to purposely decouple yourself from the founder mind and the CEO mind. OK, how would you differentiate those two? In fact, sometimes I purposely ask, like, let's just pretend I was a hired gun CEO brought in today.

17:35like what would I be doing differently? Day one, great. Just joined Omauta, I'm the CEO. Like what would be the next play? And then you can similarly ask, what do you think the organization needs from its CEO like next year? Yeah. And beyond. And then that, that like becomes your L &D plan. And also organization needs sometimes things from their founders too, which are unique from what they need from the CEOs presumably. That's right, you could reverse it too. You could reverse it too. And there have been things, I mean, And as the ore grows, you have to, even as a founder, especially learn how to work with your organization because your teams, you have so many bright people and they need to find the energy around a direction and you have to set the strategy.

18:15But there are certain things that I think is very helpful with a founder orientation. You almost, that optimism doesn't always tend to carry forward with scale. And if there's new things in the market like for us, this whole GLP one landscape or or even the generative air. I landscape those new things. Like I viewed as my job to just press the organization into seizing those. Yeah, to really sort of almost keep that spirit that you had when you were like 10 people or three people, but now to do that scale. You do that scale, exactly. Any advice you'd give to Sean? And Sean? That's a good question.

18:49I mean, also, it's a tactical stuff. Yeah. My number one advice to, in not just healthcare entrepreneurs, but in the enterprise side is put a ton of thought in how you price and package. kind of what you've bought buying. That has just so much path dependency. Yeah, and that sounds like a detail, but that's like the core future of your business, in a sense. Yeah, I know. It's funny. It's never the strategic stuff that tends to matter as much as the tactical things. And some of them you can read about. And others like it, you know, is it on the job training? Well, especially if you're creating a field, then there probably wasn't on the job training for digital health.

19:22Yeah, yeah. It was newer, yeah, exactly. Yeah, yeah. Okay, so let's take us to today. So, and actually, You brought up two great topics I want to hit, AI and GOPs. Let's start with the AI side. So you already mentioned that a mod has this huge corpus. What's your take for how AI is going to change a mod, where do you go with that, where do you go from here? Yeah, I mean, the whole team and the engineering team is just giddy with it. And there's yesterday's AI, which we've been doing, build models and ML models and recommend recent works. And we're like, small, ML, small AI versus a large foundation model.

19:53Yeah, exactly versus kind of the generative side. I mean, there's hundreds of ideas on how the best leverage our data, so we're still learning and growing, but to give you just some specific examples right now, the one thing we launched is the ability for our care teams to just see instantly summarized views of the eating history of their members. So what we found is like if they wanted to talk about food, we had a very beautifully structured view where they could scroll through the meal patterns, looking at the eating patterns, but they were spending about six minutes getting the context to be able to craft message.

20:28And so one quick hit was have the model do that. And then they can take that and craft it and craft a note to the member that allows them to just feel more insightful, more precise and likely more impactful and more efficient. It's like everybody wins in that one. And maybe even more empathetic sometimes. And more and yeah, absolutely more empathetic. There's like step one for a modder, which is all right, of these hundred ideas, what are the ones where you have high impact, you know, low regulatory risk because there are considerations that you need to think through here. we're trying to strike that balance of ensuring that, you know, at the end of the day, like, people feel the compassion of the amount of, you know, services as well as the intelligence, where, you know, you've got to have the human is trying through.

21:09And so for us right now, we built our care team platform homegrown by scratch. So it's about helping to enable our care teams to be authentic humans, to come across that way, do it more efficiently and put your point in, you know, many instances with a little tip, perhaps more empathetically. Well, it's really interesting because you sort of alluded to the history of virtual -based care, where not having brick and mortar was like kind of crazy, right? And now that's actually, especially post -COVID, it's actually been quite routine. Actually, many of us prefer it to some degree. It has its own conveniences and so on.

21:41Now you're almost like a different type of virtual, because now you're even like the caregivers themselves. How far does that go? So does it, are you always gonna have caregivers and you're just massively scaling them? Take us five years into the future, like maybe even 10 years in the future, how far does this go? I mean, it's gonna be balanced. I think the, you know, you remember in Pete COVID, it was like virtual care will do everything. And I felt like the crazy one being like, guys, like biops, he's still need to be done. Sure, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, he's, so it's on there.

22:11And it'll be the same, the same truth here. I do, there's a reason that artificial intelligence is a buzzword and artificial empathy is not. And I don't think there is any substitute for just the human accountability. And in fact, I actually think that maybe in this era of AI, it may be actually come more valuable. Like human time, handcrafted goods, proper human caregivers, that may feel more valuable. So in the same vein, you can leverage not just them, but T have been augmented support through these models in a way that I think just will transform outcomes and impact the world. Yeah, and you know, we talk about scaling and we talked about the million members.

22:51Maybe this is how you get there. Yeah, it helps. Yeah, no question. So it's such a crazy time because we've got AI like doing this insane thing and then generally unrelated AI but very related to our model. Exactly. It's like GLP ones. Yeah. You know, like how does that play into what you're doing in a moment? Yeah, I mean, kind of I just feel giddy with what's happening because you've got this two parallel tracks, like just extraordinary technology innovation, extraordinary life science is innovation, like two different silos. And I mean, similar to like the fact that your convergence investor or models of convergence company, they just hit each other.