Jason Krantz started his first company in 2000, which was an amazing year to found a business followed by 3 very tough years for early-stage businesses. That environment forced Jason to build a capital efficient, bootstrapped business from day 1. When considering his 2nd act, Jason identified 3 factors that he felt would reshape the healthcare industry:
- An explosion of data as organizations adopted electronic health record systems for the first time.
- The passing of the affordable care act.
- Tremendous market consolidation.
Jason decided Definitive Healthcare would be the GPS system for the healthcare universe. Definitive helps customers understand how all the organizations in the industry are related and how patients flow through the entire healthcare ecosystem.
Example - Definitive helps life science companies take new drugs to market in a more effective & efficient manner (lower time and cost).
Today Definitive has > $200M in ARR with plans to reach over $1bn over the next 5-7 years. After spending the last 12 years building data sets that are not available anywhere else and investing in data science to draw out detailed market insights from this data, Definitive also has an enviable moat as their product is incredibly difficult to replicate.
Jason joins Scott Britton and Andrei Newman on the Built By Humans podcast. Here are some key takeaways from the conversation:
- Scaling a business is incredibly challenging. What is interesting is that the challenges are not necessarily related or transferable across stages. Your challenges with 100 employees are different from 200, and different from what you will face at 300. As a founder, you must constantly evolve to be effective in each phase.
- Data businesses take a long time to build but the reward can be very large if you aggregate a dataset that is truly unique.
- Data companies must invest in having strategic (market insights) and tactical (contact info) data if they want to drive high user engagement.
- Founders who understand the power of capital efficiency and invest in it early will have a ton of leverage in future fundraising conversations.
- It is quite common for companies to drastically underestimate the size of their market. It takes time and effort to properly identify and carve out your addressable market.