All around the world, doctors continually bemoan the overload of administrative tasks that limits the amount of time they can spend with patients. A comprehensive study of US physicians' time found that for every hour doctors were seeing patients, they were spending nearly two additional hours on paperwork. The problem is not limited to the US, with British physicians also experiencing unsustainable workloads. Increased digitization in the healthcare sector has often compounded problems rather than relieving them, according to one study.
Tonic App was established in 2016 in Porto to help medical doctors in their administrative tasks and to save time on their day-to-day duties. The company's four founders are: CEO Daniela Seixas, a neuroradiologist and independent expert in ethics and scientific evaluation at the European Commission; Dávid Bórsos, a Luxembourg-based business analyst and officer at the European Investment Fund; Vancouver-based Andrew Barnes, currently a partner in a gaming consultancy and CEO of a shared community kitchen for food entrepreneurs; and Swiss Christophe de Kalbermatten, Head of Trading at Credit Suisse's Geneva Trading Floor. All met while studying the same MBA course at IE Business School in Madrid in 2014.
Gonçalo Vilaça, an economist, management consultant and educator with experience in healthcare management and also co-founder of healthcare investment company Alcea Advisors, joined Tonic App in late 2017 and has been its COO since April 2018.
CompassList sat down with Seixas and Vilaça at the Lisbon Investment Summit in June to discuss their objectives for Tonic App, winner of the pitch competition at 2018's edition of the same summit, best app runner-up at 2018's MEDICA health fair in Germany, and a finalist at Silicon Valley's TiE50.
This interview has been condensed and edited for clarity.
Q. How did the idea for Tonic App come about?
Daniela Seixas: I am also a medical doctor and the idea was born out of my professional need and the need of many other doctors. The problem is that all the documentation, resources, etc. that doctors need are fragmented throughout the Web, so the idea is to aggregate all useful resources in a single platform for the day-to-day use of medical doctors.
On your website, you mention the "failed promise of digital in the medical industry so far." Please explain.
DS: Basically, medical doctors want and need to be more productive. Previously, all records and prescriptions were just written on paper. When we digitized all that, we thought it would save time and we would have more time for the patients, but that's not what happened. Nowadays, doctors are with their patient during the appointment but they need to work with several systems at the same time, sometimes typing the same data into different systems. They are actually spending more time on the computer than with patients. That's what I mean by the failure of digital.
Why did you decide to be exclusively on mobile?
DS: We do not integrate with existing medical IT systems on purpose because that is where most barriers are. We are mobile so that doctors can use our app on the go and solve their problems without going to their systems or having to use computers with restricted access to the internet. The substitute for apps is often many other apps so it is common for doctors to have 10 apps on their phone for different uses. Sometimes doctors also have other resources saved on their own laptops, such as Excel spreadsheets or long PDFs. Now, we have everything together in one place for medical professionals.
What is the extent of content hosted on the platform?
DS: Users can already access clinical and non-clinical resources. By "resources," I mean content and ways to get content easily. Examples of our unique tools are diagnostic algorithms or special search engines to find guidelines faster, or reimbursement codes for surgery or other procedures. Regarding non-clinical resources, we have the safe discussion of clinical cases, or medical news and jobs.
Do you have a core customer group within the sector? Is the app only directed at medical doctors?
DS: We tried to be more flexible at the beginning but we discovered that the resources that are useful explicitly for one group of professionals are not used by another so we are now focusing on medical doctors only. However, it is our vision to extend the services to our patients and other healthcare services as well, meaning patients could communicate with doctors via our app without the healthcare provider. Again, we try to eliminate all barriers to doctors' productivity.
What is your business model?
DS: It's free for medical doctors because we want to have as many on the app as possible but we do business by giving curated access to all other healthcare players in this medical audience, for example, hospitals. Many doctors do not read the communications of these institutions so they and insurance companies, pharmas, medtechs, medical recruiters, publishers and government bodies are all interested in access to this audience. Our customer is any party interested in paying to have its resources in TonicApp.
We made our first sale 18 months after we published our app and we are experimenting with the business model to make it more scalable and to take fewer project hours to engage with our clients. Some of our clients include Medtronic, the largest medical devices company in the world, and Novartis.
How have you been financed to date? Which are your target markets?
DS: It was the founders' own money that first got us started. Then we got our first seed investment from Portugal Ventures, the leading VC in Portugal. Then we entered the [Madrid- and Miami-based] accelerator The Venture City, which got us another €100,000. We are just finishing their program now and we are currently closing our second round of seed investment, which we have signed with a VC specialized in healthcare.
VC money is really good to move fast across Europe without worrying much about business and retaining the ability to do that later on.
We are seeking several million euros for the app's extension across Europe in the next two years, to grow the number of users in Spain and France, and to start doing business in Spain. We are going to the largest markets in Europe and will consider Italy and Germany, but there is also a possibility we will move to the US sooner rather than later. The needs there are the same, though the market is completely different and there is a different legal and certification environment.
We will need to increase the team from eight people to about 28 and will be staying in Portugal for the talent – its high quality and the relatively inexpensive salaries – and also for the travel, as we are spending a lot of time in Madrid at the moment.
The team doesn't have IT experience. How did you build the app?
DS: I'm a techie doctor and have been working with computers since I was a child. I am a neuroradiologist so I already have experience working with technology in medicine, but obviously this is not strict tech expertise. Going to The Venture City was important.
Gonçalo Vilaça: The acceleration has given us experience in data instrumentation, mobile growth, product design and user experience in particular.
DS: The MVP had already been created by the time of the acceleration and we did everything ourselves. The project was born in January 2015 as my business school project from IE Business School in Madrid. The co-founders are from IE but they are non-executive. The project gained more momentum when we decided to incorporate. That was when we started developing the software.
So, TonicApp has been live since March 2017 and we have been growing our user base since then.
How have you gained users and how do you plan to keep on growing?
GV: We work in Portuguese and Spanish at the moment. Our primary first market was Portugal where, in two years, we reached 25% of all medical doctors by doing digital marketing but in a different way. We engage people through social media, especially Facebook, and make them feel the product is their own so they give us content and help us develop. That is how we grow organically.
DS: In Portugal, there are more than 43,000 doctors and we have more than 11,000 as users. For the product development itself, we do a lot of peer testing and focus groups so we make sure we have an app users want to use. On the scientific side, we have a person dedicated to scientific content curation and we have actually been certified as a medical device in the European Union (EU) since last week.
GV: We have Class 1 certification, which is the lowest risk or lowest degree. It took about six months to get that, so now obviously we plan to expand across the EU. The next language will actually be French, so France is the next market we will enter and then probably the UK.
Something really interesting is that we have a specific audience. We cater to young doctors and more than three-quarters of users are under aged 45. We are especially useful for the broader specialties such as general practitioners and we already have more than half of all Portuguese GPs on our platform.
What changes have there been in your personal life so far as a result of starting Tonic App?
DS: I can only dedicate myself to this project full time now, three years after it started.
GV: I was working at a healthcare consultancy in France and in the UK. We didn't know each other before and met through my healthcare experience and starting my own venture in this space. So I decided to join TonicApp's board as a non-executive director and then, when the opportunity came, I joined the executive team in May 2018. I was living in London and came back to Portugal with the idea that Portugal is a great place to launch businesses that force you to be global from day one. One of the key reasons for me joining is that we don't just have a Portuguese company but it will be a global one building the leading mobile ecosystem for doctors in Europe.
What advice would you give to other startups, particularly in your sector?
DS: That you can turn a "no" into a "yes." My advice would be: "Don't do healthcare if you don't understand healthcare." It's a very tempting sector to enter but you really need to surround yourself with a team that can understand all the specificities of how to sell in the sector and how different its users are. I would say digital health is faster than health but slower than digital. We also need to take into account that it is not that easy to fundraise in this sector; there are not so many dedicated investors. Being a medical professional helps you to be listened to initially by the community and by peers.
GV: You have to understand that healthcare is very sensitive so the risk tolerance is very low. Therefore, when we think of standard stages in startups like MVPs, they do not apply here so uniformly because there has to be such a high standard for the initial starting point of the product development.