Little has generated as a lot media consideration up to now week as Elon Musk’s $44B potential takeover of Twitter. “My robust intuitive sense is that having a public platform that’s maximally trusted and broadly inclusive is extraordinarily necessary to the way forward for civilization,” Musk famous at a current TED convention. By most accounts, ‘inclusive’ right here means the safety of speech; it’s not sure what he means by ‘trusted’, though addressing that element will likely be vital to the success of this new endeavor, as Twitter is a platform whose supply of worth isn’t the product itself, however the community of 396 million individuals (of whom 77 million are within the U.S.).
In that respect, Twitter represents a really completely different kind of enterprise than the opposite three firms Musk runs in Tesla, SpaceX, and The Boring Firm. These different firms are all ‘pipeline’ firms, which create worth by controlling facets of a worth chain; Tesla, as an illustration, could depend on suppliers for some parts, however controls the design of the tip product and the way these parts are put collectively.
Twitter manufactures nothing, and if something, the merchandise themselves are tweets produced and consumed by the individuals utilizing the platform.
Musk has confirmed good at engineering new options to among the world’s hardest challenges. And he was an early government at PayPal, a cost platform. However that was 20 years in the past.
Can Musk efficiently run a can he run a multi-billion greenback platform firm, the place he received’t be capable to flip a change to flip a change to alter human conduct? And what can the healthcare trade and digital well being platform firms study from a pipeline professional taking up a platform enterprise, particularly in an trade that’s vastly completely different from these wherein he’s operated up to now?
Beneath are among the vital factors that healthcare platform firms, buyers and companions should bear in mind as they develop, launch and develop their companies, based mostly on Musk’s proposed acquisition of Twitter:
Pipelines versus platforms:
- Twitter: Elon Musk is a talented operator of pipeline companies, with Tesla and SpaceX his two greatest endeavors. Per the above, pipeline companies take possession of a portion of the group’s worth chain, create worth by means of differentiation of a particular set of actions, after which promote the fruits of their labor (e.g., Tesla proudly owning the end-to-end manufacturing and gross sales channels). Versus pipeline companies, platforms facilitate change between completely different sides of a community; usually, one aspect is a producer or provider (of data, providers, or items), and one aspect is a client, with monetization based mostly on the energy and breadth of the community.
- Healthcare: There are only a few (however growing) digital well being platform success tales: Surescripts, CoverMyMeds, GoodRx and Doximity being among the pack leaders. Platform companies are notoriously tough to scale in any trade, and healthcare is extra complicated than most: it’s extremely regulated, has a fancy cost system, interacts with individuals’s most delicate information and serves them throughout essentially the most delicate occasions of their lives, and healthcare itself isn’t a traditional financial good.
- Lesson: platforms are completely different, and require very completely different experience to run, develop and scale than most skilled healthcare executives have. Corporations looking for to construct platforms ought to search to grasp the variations between pipeline and platform companies. There’s a burgeoning discipline of literature on the enterprise of platforms; sadly, a lot of it interprets solely loosely to healthcare, so founders, buyers and executives ought to be aware and practical about what it should take to realize the flywheel impact of platforms in healthcare.
Energy of platforms:
- Twitter: Twitter is only one of many platforms that’s modified the way in which society interacts; Musk calls it the “public sq..” Platforms are normally pushed by network effects: the concept the platform positive aspects extra worth because the variety of customers will increase. Listening to not simply the platform capabilities, however how these capabilities manifest in consumer transactions with one another, is vital. For platform networks, it’s the presence of different customers that can almost certainly appeal to them and preserve them there (or repel them), so growing a detailed eye on consumer interactions themselves is vital.
- Healthcare: Alternatives for network-effects pushed platforms in healthcare abound. Take into consideration the flexibility to attach individuals trying to find healthcare providers with suppliers (for instance, Buoy Well being). Or a community that connects major care physicians with specialists in a position to present well timed consults nearly (reminiscent of RubiconMD). Or a expertise platform that connects digital well being firms to hundreds of well being methods, lowering the necessity for an costly one-to-one integration (reminiscent of Redox). There are quite a few alternatives for platforms to match individuals with providers they want, to scale back info asymmetry, and to resolve for info silos. There’s maybe no different trade exterior of healthcare who may benefit from these capabilities extra.
- Lesson: Funding in digital well being has been rising steadily for years, reaching $29 billion in 2021. Rising even quicker? Funding in digital well being platforms, and for good motive.
The significance of belief and governance:
- Twitter: Musk purchased Twitter to scale back “content material moderation.” Twitter (and Fb) each carried out content material moderation in an try to scale back the unfold of misinformation. Questions now at hand embody how customers ought to be verified, and what kind of conduct and/or content material ought to be allowed on the platform so as, as Musk notes, to “construct belief” within the system. Whereas Musk could need to scale back content material moderation (or maybe change how content material is moderated), such motion is dangerous, as it could erode consumer and public belief within the security of the platform: if customers don’t really feel protected, they might drop off solely. Of word, the current mass account deactivations after the Musk deal was finalized, says Twitter, have been simply “natural fluctuations,” and never from any bot-purging. In actuality, this can be a warning-sign about Twitter customers’ notion of how the platform will likely be ruled going ahead.
- Healthcare: Belief in healthcare is sacrosanct: the doctor-patient relationship is paramount, and all the things should circulate from that. Whereas each well being expertise firm should implement stringent privateness and safety insurance policies as a part of their core operations, platform operators in healthcare should do with with the conclusion that each consumer depends on the platform to vouch for each different consumer.
- Lesson: Create guidelines of the street so customers trust within the integrity of the community, and supply the mandatory oversight to guarantee customers their finest pursuits are additionally your finest curiosity. Create mechanisms for suggestions loops – reminiscent of community advisory boards – to make sure that considerations are raised and heard, and additional insurance policies be established as crucial.
What high quality means in a platform context
- Twitter: Following and unfollowing, muting accounts and key phrases, and curating how a consumer’s feed is displayed are mechanisms that permit customers to handle their very own expertise on Twitter. Some have argued for an ‘edit’ operate as soon as tweets are posted (which raises its personal query, reminiscent of: what if I retweet one thing that turns into edited and now not displays what I appreciated in regards to the tweet?). A recent article catalogs user-generated concepts for performance to offer customers the flexibility to enhance their very own expertise of the platform.
- Healthcare: Investing early to determine the core use case is vital. Interoperability as a complete has largely failed due to poor concentrate on high quality of consumer expertise, and what represents the core use case for every constituent (trace: all people is on the lookout for various things at completely different occasions, which makes it tough). Customers throughout a wide-array of digital medical information (EMRs) and interoperability networks are fairly accustomed to the complexities and lack of high quality information that crosses these platforms every day. Purposes with a really slender focus and use case, like e-prescribing, are exceptions to the failures the broader and less-focused networks have seen up to now.
- Lesson: Begin with a slender focus and be use-case particular. Determine what makes the distinction between a profitable interplay and a nasty one for various customers, and preserve refining till there success will be repeated and scaled. Be aware that, as extra customers come onboard and new use circumstances are thought-about, every consumer’s wants and preferences could evolve.
Monetization choices:
- Twitter: The social platform has had bother monetizing its community of customers, however has primarily pushed income by means of conventional promoting on its customers’ feeds. It has not been in a position to match its social media opponents’ skill to monetize their networks, nevertheless, and has largely been seen as struggling enterprise within the social media world despite its outsized influence on public conversations. Given Musk’s $44 billion price ticket and Twitter’s 2021 income of $5 billion, it’s honest to imagine {that a} key space of focus would be the firm’s skill to monetize (Musk’s protestations however).
- Healthcare: Totally different firms have developed completely different methods, however monetization usually happens on one aspect of the community, with potential subsidization of the opposite aspect of the community. CoverMyMeds, a multi-sided platform that connects medical doctors, pharmacies and pharmacy profit managers to enhance the prior authorization course of, found out {that a} novel path to monetization: it charged no person utilizing the community, however bought information and analytics to pharma manufacturers looking for to benefit their very own merchandise out there.
- Lesson: Monetization in platforms is a completely completely different animal than pipeline companies. It’s necessary to evaluate all sides’s willingness to pay; understanding underlying economics of every aspect (and whether or not exterior events are related) may also be useful.
Whereas healthcare and social media are extraordinarily completely different industries, the ideas of platform technique growth can apply in each contexts. For Twitter’s sake, let’s hope that Musk is aware of as a lot about platform companies and folks as he does about constructing vehicles and sending his new Twitter customers to Mars.