Can Scotland forge a healthy start-up partnership?
Two constituencies came together in September for an event designed to stimulate activity in an emerging technology cluster. At the Assembly Rooms in Edinburgh, members of the tech community met with academics and medical experts involved in innovation in the NHS.
The meeting was fronted by Mark Logan, Scotland’s “chief entrepreneur”, and Professor Dame Anna Dominiczak, the Scottish Government’s chief scientific adviser for health, who has led calls for the faster adoption of innovation in healthcare.
Specifically, the meeting was designed to promote awareness of the nationwide Techscaler scheme, the £42 million tech education and mentoring venture launched by government to foster entrepreneurship and start-up activity across the country, run by CodeBase.
It followed talks between Logan and Dominiczak, who wants to see more a “start-up mindset” within Scotland’s health service.
Logan, too, sees value in forging partnerships with certain industries, for whom innovation doesn’t always come easy. Reflecting on the event, he says: “I was pleasantly surprised by just how energetic the whole event felt, there was a real buzz in the room.
“And it was a great example of what happens when you start to bring together different areas of entrepreneurial activity so we can share common assets.
“Because I think there’s a real need, interest and desire from the start-ups and potential future start-ups from the biotech and medical sector, and universities, to access that next level of support and a roadmap to becoming a start-up with that exposure to a network of peer founders.”
The objective of the event was to explore how the interaction between tech start-ups and the health sector is working, and what could be done better.
Techscaler and the NHS’s “innovation hubs” have been aligned, ensuring that medical practitioners and innovators can access a programme designed to teach the business skills associated with building a start-up.
Logan sees the benefits going both ways. “It brings a stream of high quality, deep tech companies into the network, which will serve to strengthen and enhance the network,” he says.
“The innovation hubs benefit from their 10 organisations getting access to a strong and ever-improving network of founders, with world-class education and entrepreneurs in residence.”
This “cross-fertilisation”, as he describes it, has been key to developing some of the world’s most successful companies, such as Moderna, which was instrumental in the Covid vaccine discovery.
He said: “Moderna is not a bio company, it’s not a tech company, it’s simultaneously both. It uses powerful AI engines to analyse biological data, and huge automated labs to turn data back into biology.”
“When we start bringing experts in bio and medicine together with people from the internet economy, with that start-up and founders’ mindset, I think you’ll see a number of things start to happen.”
Logan predicts that the “mingling” will inevitably lead to more ideas, more creativity and hopefully new companies emerging. That in turn will help strengthen the products and – with proof of concept – further open the door to more industry partnerships.
He says: “You’re going to see us announce several more of these over the coming months, with major ecosystem players coming together in this way. And that will create a reach-through effect.
“Just to give you one example, because Techscaler is integrated with Reforge [the US-based start-up growth platform], these bio companies will then be able to access that network of entrepreneurs and potential investors in the US.”
Techscaler has also developed a partnership with Accelerate Her, the female founders network in Scotland, to facilitate greater access – and opportunities – for women in the tech sector.
“There’s actually a disproportionate number of female founders coming from the bio space,” says Logan. “So, we’re genuinely widening and deepening those networks, which is great.”
Logan is guarded about what industry sectors might be the next partners for Techscaler, until agreements are reached. But he also thinks the Techscaler programme could and should be widened to all start-ups. He says over 90 per cent of the techniques employed by successful tech start-ups are relevant to how you start any business, regardless of the domain.
Making it work in the healthcare context, however, would be a significant boon to Scotland’s economy. The NHS employs roughly 155,000 people, spread across 14 regional health boards. It is a behemoth of an organisation, with varying levels of centralisation and local autonomy. Understanding its complexity, and how procurement works, is key to furthering the adoption of innovation.
Many of Scotland’s most innovative health-tech companies have found more success in foreign economies, than their own. Current Health, the care-at-home platform, bought by Best Buy for $400m in 2021, has made greater in-roads in North America than in the UK.
Craneware, the health insurance platform, has also inevitably had greater impact across the Atlantic, given its particular application to the US market.
That’s not to say Scottish tech companies haven’t been able to engage with the NHS. My Way Digital Health, founded in Dundee, has seen success with the adoption of its diabetes management platform within certain NHS bodies.
But getting into the NHS, and scaling those innovations, remains a challenge. Many projects remain in pilot stage, run out of funding from state-backed agencies, or merely contribute to a growing body of healthcare research.
Logan agrees. “We have to start to industrialise the process of innovation within the NHS, so that we can integrate into daily treatment regimes tens or hundreds of integrations a year, not one every five years or something like that.
“If we don’t do that, then the other thing that is increasing almost exponentially is the demand on the NHS which is going to mean it faces very significant difficulties – if we’re not already there.”
He adds: “That requires the NHS to adopt a more entrepreneurial mindset, whilst recognising, of course, that it needs to marry up to a safety critical environment. But bringing that high-speed iteration mindset closer to the heart of the NHS – which is what the innovation hubs and Techscaler seeks to do – has got to be useful.”
Beyond that, there needs to be a rapid assessment and proliferation mechanism to allow those innovations to take hold, and scale to the appropriate level.
Logan himself is working closely with Dominiczak on the Innovation Design Authority, to look at what structural levers can be pulled to enable that faster adoption cycle to take hold.
He says: “I’m personally quite optimistic, because there’s no hard barrier that stops us innovating and proliferating those innovations within the NHS. It is largely a people and process problem, we have the people – a lot of very good people – within the NHS, and it’s easy enough to change a process.
“But it’s having the willingness, and the mindset again, to take the risk of doing that. And I hope we will do that. Because otherwise we’re going to find that the innovations queue up in their thousands at the door, and other health services and countries will have access to them.
“We don’t want to find ourselves in the position as laggards when we have so many problems in health in this country. Surely we can put in a sensible process for the adoption of innovation, and I believe we can.”
Part of that process, he adds, might mean challenging some of the accounting models that exist within healthcare. “Innovation is front-loaded in costs, and back-loaded in benefit,” he says.
“If you’re an NHS finance executive trying to make the numbers work, and an innovation arrives that will save you operating time over the next three years, but you have to put money up front to test that innovation, that’s very challenging. In existing accounting models, that’s challenging for anybody, for any organisation.
“We therefore need to find a way to treat that differently, but these are human choices and we can do it.”