Startups, Patents, and Me

This morning, Mobihealth news reported that Bosch Healthcare has sued three companies on alleged infringements of the Health Hero patent portfolio. Although I don't know the details of the lawsuit beyond what is reported, my former role as COO/CTO and author of several patents for Health Hero resulted in me waking to numerous emails asking me what I thought. There was even one that asked me if I felt like I had "blood on my hands." I searched around the bed for a horse head.

Of course, I had three options.

1. Keep my mouth shut
2. Reply "no comment"
3. Blog about my opinion

A smart person would have chosen one of the first two options.

The Caveat
Before I get to my biggest issue, let me be clear that I'm not against patents, only their abuse. Our patent portfolio saved us many times, and was, as a defensive mechanism, a brilliant device. It gave some people confidence to choose us in a competitive situation, for example, with Panasonic. It lead to a license with Philips Electronics and others, who were going to run over the top of us without it. It made us better partners to McKesson, and certainly enhanced our valuation. Most of the credit for the depth and size of the patent portfolio goes to Steve Brown, who started patenting many of these core ideas long before there was a Health Hero Network. If you look closely, priority dates go back to 1992. That's amazing foresight, and also why some of the claims which look "obvious" today are actually shockingly predictive. 

On Startups and Healthcare
My disappointment is predictable and obvious. Bosch is litigating MedApps, Waldo, and Express MD Solutions. These are hardly brand name companies. You only need to look at my dedication to Rock Health or view AngelList page to know I believe Healthcare and Technology (in general) are both best served by supporting entrepreneurs and startups.  Most will fail. Some will change the world. But there is nothing more motivating, exciting, and encouraging than seeing experts of all kinds coming together to solve real problems that scare other people away.

There is a sign that hangs at the doorway to Rock Health, paraphrasing something I wrote in response to a different topic, but it sums up the point of view.

(Credit to Ryan Panchadsaram for the layout and design)

Every "big" company has to decide how to work within its ecosystem. Most simply ignore it, outside large conferences and events. There are some who focus supporting the ecosystem, through the availability of APIs, Hackathons, incubation sponsorships, and other vehicles. There are, of course, also those that choose not to ignore it, and not to support it, but consciously attack. Nothing wrong with that either, but who you choose to pick on matters. I'm uneasy not so much with patent litigation, but with the targeted companies.  I hope the community does not quickly forget this action next time someone offers a conference sponsorship or speaking engagement.

Lawsuits like these have, much to the determent of true progress, become the new normal. With a sigh, I read through the quotes from Bosch defending the process:

"We feel it is important to demonstrate that IP is important, and not just to our company"

Does anyone - and I'm serious, is there a single person - who feels that this demonstrated IP was necessary for other companies? Did you read the article and think "thank you for clarifying that for me, I had no idea IP was important."

Just say it - you have a patent, the system allows you to protect it, and clearly there is some competitive threat from the market you feel the need to defend yourself. Okay, that's fine and within your rights. But when you start to talk about making a demonstration of someone, here's what I read: "We're going to take someone out behind the shed to make a point. We picked someone we know can't fight us with dollars or time, and we're sending a message to the rest of the market." When it's three startups with barely any traction, it's hard to read it any other way.

Now, I have no idea if there's a misquote in there or not, but read this one (emphasis added):

"Bosch is open to working with those companies that are interested in securing this technology through a licensing agreement."

I've got a better idea. Build something people want, and technology licensing won't require a shotgun. Again, I don't know the details, but if this is really about forcing severely outdated technology down the throats of others, that's an even more horrible state. I hope that's misquoted and pure patent license is on the table, if nothing else.

Bosch and Health Hero are better than this. There was a time when we built great, patient-centered solutions to real problems, and there are still so many high-quality people there who are, in the end, only motivated to fix a broken healthcare system. But this can't go without comment – the very companies being litigated against could be the next Health Hero, and the market, the healthcare system, and our patients deserve better. I want Bosch and HealthHero to be great, and I'm sure they can again rise to that greatness, but this is not the path.

While this "demonstration" may be Bosch's right, that doesn't make it right.

Did we miss something? Startups and Customer Acquisition

A few minutes ago, I signed up for @TotalHealthHub, after talking to one of the team members on Twitter.

They are using LaunchRock, an excellent landing page creator for pre-launch startups. Below is a picture of the LaunchRock page right after I signed up and tweeted it out. As you can see, easy to share via Facebook, Twitter, and even email. The email includes easy-to-use address book integration. For the 2 people left I know on Orkut, there's a URL I can provide, too. Spreading the digital word could not be easier, but it still got me to thinking, have we over-focused on the social media and pre-launch phases as a startup industry?

When did we loose word-of-mouth? The thing that strikes me is there is no way for me to actually share this experience and participate in the virtual currency - in this case, early access to @TotalHealthHub - by telling my network verbally. It does not scale, but it's very powerful; looking someone in the eye and saying "you have to try this". The fact that there's no way to capitalize on that delivery mechanism is fertile ground for improvement.

The same is true post-launch. It's fantastic to have so many people signed up for your pre-launch and your VC/Angel/team wants to see that pop, so you can look at conversion rates and get real feedback from the community. It's critically important, even if you do not subscribe to the Lean Startup concepts on which it's based. But it's equally, if not more interesting, to see who is referring you after they have tried it. I have not seen many sites do a good job with referrals post-launch, which reflects who liked your execution (post-launch), not just your idea (pre-launch). There is a tool/solution gap here.

Last week I gave three presentations where I said "you have to try Earndit, it's a game changer for FitBit and the Wellness Market". I didn't stop to give everyone my custom URL - never mind reading it out, no way will I remember them all - it's hard enough to get EarndIt's name right. Yes, I could followup with a URL after the meeting,  but the conversion moment was right then, when I stood in front of them and told them they had to sign up or they were missing out.

These people represent your real users, who tried the product and want to tell people about it after the buzz settles. If nothing else, I want to be able to thank them - publicly, too - it's not only brands that like to see their mentions on Twitter and Facebook. Startups need to know these post-launch champions.

Can't I solve both of these the same way? Why can't I just put in the email of the person that recommended it to me when I sign up, be it pre-launch or post-launch? Or even their actual name, if I don't know the email - and I'm saying this as a guy whose name my mother still spells wrong sometimes, and she choose the name. Email and Names are still far more popular that Twitter or Facebook. You can find people without Twitter, and you may be able to find someone who is not on Facebook, but email is still the foundation that they are built on.

I'm not saying the current implementation misses the mark. It most certainly does not.  Twitter and Facebook are high-scale, low friction ways to get the word out to many people all at once. I also don't want to pick on LaunchRock. I know there are a lot of people that say they are selling picks in the gold rush, to which I say "thank god for them".

Creating a landing page, linking it to social media, and providing analytics are critically important to launching your startup and are exactly the type of activity that takes you away from your novel idea. LaunchRock makes this amazingly easy and productive. It's a good solution, along with others like it, such as Unbounce. Anything that helps you focus on your value add - be it AWS or LaunchRock, is a good thing. I was happy to see they are part of the latest 500Startups class, and I am sure they will tackle this issue - and many more - in the near future.

What do you think? Have I blown this out of proportion, or is it a gap in our customer development?

Update 6-13-2011: Although it's specific to Mobile Apps and the cycle of find-install-delete, I found this article  to be interesting, and if you are interested in on-boarding, may be interesting to you, too.

Lean Startup Mentor Awards

As you may know, AppSumo ran a great contest for Lean Startups, and I've listed the winners below. Although we didn't win, we're really thankful for the SXSW bundle, and the opportunity to put our views down on paper, if you will. All of these companies are very, very lucky - mentorship is what makes incubators/funds like i/o ventures, 500 Startups, and YC so much more than just investment dollars. Enjoy it!

Thank you as well for everyone who did vote for us - I'll be sending you a personal email later today. That said, you really should check out these winning entries, and AppSumo - it's a great resource for deals for startup junkies like me, and if you're reading this, like you.

Time to get back to work. Check out these great blog entries and the amazing entrepreneurs behind them.

Eric Ries and Parker Thompson will mentor the authors of "A Lean Mean Startup Machine"

Patrick Vaskovitz and Dan Martell will mentor the authors of "Lean...it's how we roll"

Andrew Chen will mentor the authors of "Lean Startup Guide to Building Software for Normals"

Dave McClure will mentor the authors of "Lean Startup Challenge"

Hiten Shah will mentor the authors of "Lean Startup (Day to Day) Challenge"

Noah Kagan and Ramit Sethi will mentor the authors of "How we are launching 15Five on $950"

Brad Feld will mentor the authors of "Using Lean to Get Elite University Students Top Tier Job Offers"

Rashmi and Brant Cooper will mentor the authors of "Keeping my startup lean like beef jerky"

David Hauser and Aaron Bell will mentor the authors of "Why rFave is a lean startup"

Ash Maurya will mentor the authors of "Team TripLingo:11 Ways we're lean & 1 way we're not"

Dharmesh Shah and Jason Cohen will mentor the team at Pizza Powered, who actually won twice (!) for their products EmberAds and SEOMEeasure. Nice work Pizza Powered. Just proves, I've been doing it wrong with this Red Bull, should be using Pizza.