
Bain Capital Ventures’ Kevin Zhang: The ‘Unlockable Potential’ in Lending, Investing, and Insurance
Kevin Zhang, partner at Bain Capital, assess the technological tailwinds for emerging players in lending, investing, and insurance....
General Catalyst makes healthcare investments aligned with our Health Assurance thesis. Our goal is to create consumer-centric, data-driven healthcare designed to help people stay well, while bending the cost curve.
Within healthcare I’m interested in delivering and coordinating care for everyone, including historically neglected groups. A large portion of the United States’ $4 trillion annual healthcare expenditures is driven by healthcare services, meaning the actual provision of care, making it a critical component of reducing spend. Moreover, Medicare and Medicaid represent roughly a third of this spend with both on track to exceed $1 trillion of annual spend each in 2023 and 2028, respectively. This level of spend and the pace at which it is growing is unsustainable. Luckily the government, regardless of political party for the most part, and the private sector are aligned around the need to curb spending while also improving access and quality.
As part of this, there has been a new wave of innovation around healthcare services that tackle upstream drivers of poor health outcomes and avoidable expenses. Examples include peer-support led care teams, the integration of physical, mental and social services, and the increased adoption of value-based care payment models that incentives higher quality care in conjunction with reduced spend.
MORE Q&A
Q: What do other market participants or observers misunderstand about these categories?
A: For founders, it’s realizing that there are often groups of people or organizations that have done this before – perhaps at a smaller scale, with limited technology, or in a different geography. We have a lot to learn from them. Examples are nonprofits, programs at the VA, community organizers or people working in public health. There are huge lessons we can learn if we go outside of the bubble of VC-backed companies. With healthcare services, we are rarely completely reinventing the wheel.
What’s new is the scale we are trying to achieve. The question is: can we take something at a local level (like point-of-care diagnostics in Rwanda or community initiatives to screen for prostate cancer in barber shops– things people have been doing for years) and use tech and capital to build scaled, enduring businesses that impact more lives. Let’s learn from and collaborate with the people who have done this before.
A lot of the nuances around value based contracting will be new. It will be hard. You need to work with investors that deeply understand your business and go-to-market, and are willing to roll up their sleeves. Finding a true anchor commercial partner is also critical. What you’re building should be solving one of their key strategic priorities. They should feel like co-builders who are on this journey with you for the long-haul.
Q: What can you say about the time horizon for the adoption of this thesis?
A: The next five years will be critical. At that point we will have much more visibility into the performance of specialty value based care, programs like ACO REACH, and the impact of the emerging mental health interventions on physical health and total cost of care spend. We are on a longer 30-year journey to transform the healthcare system to one that is truly consumer-friendly and dignified.
Cityblock Health, Eleanor Health, Homeward Health
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Technology, innovation, and the future, as told by those building it.