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Welcome to another episode of Category Visionaries — the show that explores GTM stories from tech’s most innovative B2B founders. In today’s episode, we’re speaking with James Bates, CEO and founder of AdviNOW Medical, an AI healthcare automation company that has raised $24 million in funding.

  • James’s diverse background in technology, from working on the first digital cell phone chipset in Japan to leading a billion-dollar business in self-driving vehicle technologies at Freescale.
  • The shocking discovery that physicians spend two-thirds of their time on clerical work due to their medical and regulatory knowledge, leading to burnout and financial strain on practices.
  • AdviNOW’s solution of using AI and augmented reality to automate data collection, documentation, and coding, eliminating the need for scribes and reducing overhead costs.
  • The company’s initial focus on urgent care and primary care clinics, which serve as loss leaders for hospital systems and suffer from chronic understaffing and low profitability.
  • James’s unconventional approach to fundraising, investing nearly $10 million of his own money and partnering with strategic investors in the medical device space.
  • The counterintuitive incentives in the healthcare industry that discourage insurance companies and hospital systems from truly reducing costs and improving patient outcomes.


Identify Inefficiencies by Shadowing Your Customers:

James uncovered the massive problem of physician time wasted on clerical work by conducting a Six Sigma cost analysis of a client's urgent care clinics. By meticulously tracking every movement and task performed by staff, he was able to pinpoint the root causes of inefficiency and design a targeted solution. Founders should immerse themselves in their customers' day-to-day operations to surface hidden pain points and opportunities for automation.

Build Credibility Through Founder Investment:

By investing nearly $10 million of his own money into AdviNOW, James sends a powerful signal to investors, employees, and customers that he is fully committed to the company's success. This level of skin in the game helps to overcome skepticism and build trust in the face of a complex, entrenched industry. Founders should consider ways to demonstrate their conviction beyond just sweat equity, even if at a smaller scale.

Seek Out Strategic Investors for Distribution and Validation:

In addition to traditional VCs, AdviNOW has brought on strategic investors like medical device manufacturers who can bundle the company's software with their equipment and accelerate market adoption. These partners not only provide capital but also lend credibility and open up new distribution channels. Founders should map out the key players in their ecosystem and explore opportunities for strategic alignment.

Prepare for Resistance from Incumbents with Misaligned Incentives:

James candidly acknowledges that many of the dominant players in healthcare, from insurance companies to hospital systems, are not financially motivated to reduce costs or improve patient outcomes. By understanding these perverse incentives, AdviNOW can tailor its messaging to emphasize wins for all stakeholders and gradually shift the industry towards a more preventative, value-based model. Founders should deeply examine the incentive structures in their target markets and adapt their positioning accordingly.

Design Your Solution to Evolve with Regulatory Shifts:

While AdviNOW currently requires a physician to review and approve diagnoses and treatment plans, James envisions a future where the AI can autonomously make these decisions with FDA approval. By architecting the platform with this regulatory evolution in mind, the company can stay ahead of the curve and expand its addressable market over time. Founders should anticipate how changing regulations may open up new opportunities for their offerings and build in the flexibility to capitalize on them.

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