Scaling a Healthcare Business Through a Pandemic With Kenny Schiff

John Corcoran 10:06

there’s plenty people, though it sounded like you were enjoying a lot of the elements of this role. But was there something missing that led you to think I want to go out and do this for myself

Kenny Schiff 10:17

now. So the way I like to talk about it is it, I did not identify as being the guy in charge until that moment in time. So I needed to feel the confidence of some of these things on my own. And it’s not that I was nervous or risk averse, I just didn’t know I didn’t. The opportunity hadn’t existed prior to that moment in time to actually say, You know what, I can do this. And it’s not that we have Tom and I have a fantastic relationship. Still, to this day, he was an investor and in care, sigh. But I knew at that moment in time, that it was time for me to spread my wings. And look, he he understood and supported me in so doing so that I could do my own own thing, because it was time for me to do that.

John Corcoran 11:13

And was that a hard conversation?

Kenny Schiff 11:18

Let’s just say that it was, it had multi, it had a lot of dimensions to it. And it was not something that happened right away. It took some time. I think we eventually arrived at a good thing for both of us. But look, you know, it’s it, anytime an individual decides to break out of X, Y or Z it? It can be awkward. 

John Corcoran 11:52

Yeah. Now, as you make this decision to go out on your own, have your own company, it’s one thing Yeah, we all know that. It’s one thing to say, I’m gonna go out there and McCreight solutions, I’m excited. It’s another to get paying clients. What was the vision? What was the gap in the marketplace? Or what was the vision? What? How are you going to make this into a business, at least in the in the early days imagined pride changed over time? Well, I would

Kenny Schiff 12:18

say the common thread from then till now was that technology is sold to people as though it’s magic, you buy X, Y or Z. And this is true, whether if it’s it’s industrial business to business or consumer marketing, that we want to snare as marketers snare people and say, they’ll just take a leap and buy it. But then there is the reality of after you buy it. And I understood that there was a missing place between the technology and the actual application of the technology, and that that gap needed to be filled, not by technology, but by people. And it wasn’t tech support. It was actually the whole arc of how do I think about deploying this technology? What happens on day one, what happens on day 30? What happens on day 360, that there was a lifecycle to living with technology. And I think that’s, you know, now that we’re 40 years into the post, you know, PC era, I think it’s really been damaging that technology, manufacturers solutions, providers, haven’t really thought about how people will live with their technology after the fact. It’s

John Corcoran 13:40

such an interesting conversation, because I was just talking with someone at a yo event recently about this. Because there’s a lot of companies these days, including our own, where the foundation might be a professional service, but you’re leveraging a lot of technology. And then on the other side of that gap is companies that are a technology that have a service component to them. And we’re talking about that difference between those two in that transition because it can make a big difference in terms of how you describe the company and its valuation. What are your thoughts on that in terms of like, your company and like, was it fundamentally a software? Was it fundamentally a service or is it there are elements of both like how do you describe what it is?

Kenny Schiff 14:34

Topping and a floor wax? to bar the Saturday Night Live skit? I would say that it was always really a service with tools. One of the Dan Oyster who works with me as a content marketer. He likes to call it technology plus a team. The difficulty that anybody has who tries to do the services first approach is that customers are reluctant to pay for those things. And, and push comes to shove, money becomes difficult, they’ll try to do without. But what really if a company buys technology, that is a core aspect of how they operate and do business, they have inherent vulnerability. If they rely on that technology, and they don’t have the ability to support it properly. And the technology that really triggered that, for me was from a company, a California company called Vocera, which is now owned by Stryker. And, well, Sarah had a voice-activated, kind of a Star Trek communicator thing that used Wi-Fi back in early 2000s. And Wi-Fi is inherently wonky. So if you don’t have a good Wi-Fi network, this stuff will never work. But there were so many other elements of the technology that left the customer completely vulnerable. And what were people using this for, to cling on to something a radiologist or an anesthesiologist or an emergency department, doctor or, or an ER nurse in a hospital setup setting? And if the stuff didn’t work, or people didn’t have workflows all worked out, then all that investment, left the customer ultimately at risk. So I would say thematically, whether it was in 2003, or in 2023, that there’s a lot of risk to deploying and depending on technology without the necessary wrapping. And and I would say for me as a passion, and as a mission. I’m, I feel in service to that. So does it make it challenging as an entrepreneur, given the that people don’t want to often don’t want to pay for that, especially if it is the one footing the bill? Yeah, it has made it really difficult along the way. But you know, that’s what makes entrepreneurs, entrepreneurs, sometimes we decide to do things even though they’re really hard. Speaking

John Corcoran 17:27

of challenges, you start this company in mid 2007. Actually, sure, it looks like it’s July 2007, around the time you started this company. Interestingly, I’m graduating from law school at this period of time, take the bar exam, and then also start my first entrepreneurial venture, which lasted for about a year before I ended up going back and getting a law job for a couple of years, and then eventually starting my second company, which was much better, but what was it like starting this company with this vision in, you know, going into what became a global economic recession?

Kenny Schiff 18:08

Well, interestingly enough, I was able to kind of bring the customers that I had developed relationships along to my new business. So I had some built in business. And I would say that help first, the first two, three years of, of the predecessor business to CareSight went well, in it. And but you have to understand the way funding cycles go. So by the time the the recession started to hit the money supporting what I was doing was already in the tank, if you will. And customers had already bought these technologies. And if anything, it opened the door because they couldn’t necessarily fund their own supporting staff. So the idea to use kind of fractional resources to support them with Okay, so then

John Corcoran 19:00

I think you just sleep at night, because, yeah, because I had these plays the contracts in place. Yeah.

Kenny Schiff 19:06

Right. Right. Right. And I think, you know, what, what the problem about the kind of business that I envision and started is it was about other it was leveraging other people’s technologies. So many of those people became unfriendly to me, because they did not want to admit that what I was doing was necessary. So Vocera, as an example, was about to go public at the time. So they couldn’t basically tell their investors oh, by the way, we have a great idea great technology, but after somebody puts it in, who knows what’s going to happen.

John Corcoran 19:48

And so a lot with technology companies where they don’t, they don’t even invest in that kind of product support stuff, which is really critical to then a whole industry crops up of like certified provider enters in help people with the technology.

Kenny Schiff 20:01

Yeah, and a mature company can do that. So they were evolving, and it was very difficult for them from a sales perspective because on one hand, they needed to look good for the investors that they were had, you know, quarter over quarter growth and, and year over year growth. So they needed to kind of pump their numbers. And it was less important for the sustainability at that point in time. Very successful company anyway, just the, if you are an independent, the doing consultative and augmentative products and services, the big big players, you know, whether it’d be a Cisco or Microsoft or in healthcare and epic or Cerner or Baxter Hill ROM, they, they want customers to feel like they got it all. We got you, we got you covered. And but the reality is, it’s not. It’s not specific to health care. They don’t. And and people waste a lot of money by on technology spend, because they don’t think about the realities of living with that technology.

John Corcoran 21:22

Yeah, yeah. You’re 48 years old, when you start this company. What’s the reaction of your family, your friends, I don’t know if you have kids or or a spouse at this period of time. And then I want to get into for you personally, what it was like to step into this role.

Kenny Schiff 21:41

I would say that people were incredibly supportive of me in every imaginable way. So I’m married my wife, she did say to me, when I came home and said, Hey, I think I’m gonna go out and do this on my own. And she said to me, yes, sure, you want to do this?

John Corcoran 21:58

By the way, here it is. This is like 1516 years ago, 16 years ago, maybe or something. 17 years. Yeah, notice how you recall that statement. Notice how Yeah, your mind.

Kenny Schiff 22:11

Very, very clear. But but in the end, what we want to do for our partners, our spouses, or significant others, our family members is we want them to be happy, and we want them to be fulfilled. And I needed to do this. And she knew that and she she was she was ultimately cool with it. And, and look, being the partner to an entrepreneur is very burdensome. And, you know, we definitely went through some tough times, I have a daughter who’s 25. So this is what she knows, you know, from from a very, very young age. But, you know, the other side of it is that I was I work from home a lot of that time, you know, so I was both my wife and my daughter were very important parts of my life. So it wasn’t like I was on the road, and, you know, never home and all that stuff. So so that that was there. And then just from a financial standpoint, I definitely this is a bootstrap company. My my mom and my stepdad and you know, all helped me out from a financial standpoint. My mother in law and father in law saying, so. And they did it for the right reasons. There was never an expectation that I, they had to get a return per se, he was about doing something that allowed me to fulfill my destiny. And that was a great thing. And then we talked a little bit about before. So around 2008, I was vacationing in St. Maarten. And on the last day of the trip, we’re on the beach way, constant time before we were going to take our flight. And my daughter picked up another kid. And the kids parents were from the Boston area. And we’re entrepreneurs. And the guy says to me, you know, do you know about AEO you know what that is? You need to be you need to find out about EO so I went back from from from that. And because at that point, what did I know about peer groups support anything like that? I just knew that I jumped off the proverbial entrepreneurial cliff, but I didn’t realize that there were other people going through the same thing. And I am have always been a person who is ready willing, able to get what I needed from other people. So I joined eo 2008 And I was a card carrying member for eight years and in New York metropolitan area, and it’s sir served as a great reality buffer in that the ability to be vulnerable with other people who are entrepreneurs, is something that I realized was, was an important part of being healthy while doing this.

John Corcoran 25:19

Yeah. Now, in addition to starting this company on the beginning of the global economic recession, so there’s that change that was affecting the economy, notwithstanding the fact that you said you had some longer term contracts, which was helpful. There was also some other major changes that were happening, just in terms of technology, Obamacare happens during this period of time. Take us back to this period of time, and we’re talking 2008 to 2016, time period before CareSight really becomes its own, I guess, going concern. But how do you serve these changes, as a relatively newer entrepreneur? Were there any big setbacks or anything like that, that you had to overcome?

Kenny Schiff 26:08

So healthcare, prior to that, that point was a very community oriented enterprise. So in New York, metropolitan area, Connecticut, New York, etc, a lot of community hospitals, many of them independent, or very, very small groups that might be working together. What it meant when I worked, especially when I worked at TPC early on was that you could walk in the door, you could, you know, get your way to a decision maker. What really shifted in the intervening years is that there’s it’s interesting, Obama has embraced Obamacare, it’s not considered a derisive term anymore. But the idea of somehow improving how healthcare is funded and supported in the United States started to take hold. And at the same time, the health systems started to consolidate. So no more. You were in fewer hardcore community hospitals, more IDs, integrated delivery, network, networks, health systems. So what changed there is that all of a sudden, a smaller player, regardless of the value one could provide to a health system was less attractive, and that the decision making at a healthcare level became very much more big business oriented. So harder to connect with the people, the decision makers, harder to differentiate yourself. And then the combination of that alongside some of what I talked about earlier of these very large healthcare, especially in the technology, space healthcare IT companies who really didn’t want to leave room for smaller players. So the two of those made it be incredibly challenging. So what it forced for me over the next intervening years, which really led to the starting of CareSight, is I had to think about what I could do, that would have the most visible value to the customer. And that would be consistently useful. In a broad fashion in a healthcare business. So the idea of CareSight was about extracting, and using data from systems that were mostly behind the scenes, kind of buried, and were the people who needed the outputs of that data just didn’t have access to that for whether it was old technology, or the various solution providers obfuscating that somehow or making it difficult for them. So combining that idea, so that the business need for me was to find something that was very tangible and visible. And that had value whether it be safety or or operational, or even patient experience value, and combining it with this notion that the customer that the health system couldn’t do those things themselves, and that these big technology companies, they were in business to sell their whatever their thing was in the weave. So that that was the germ of what CareSight was founded upon.

John Corcoran 29:48

So many questions around that. That sounds like a big bet. Sounds like a big investment. And it also sounded like a big bet because you know it Do you go all in on this vision, this idea, and then you know, some other company, Microsoft or something comes along, you can get obliterated pretty quickly. So take me through that, like, how did you fund this new vision for CareSight? Did it scare you to go all in on this new vision, this new idea? How did you get company, you know, the hospital systems to, to sign up for it? There’s so many questions here.

Kenny Schiff 30:28

Um, the thing about being an entrepreneur is that you’re when you’re in the center of the volcano, if you will be, you don’t necessarily go through the same type of strategic analysis that somebody who’s got a larger, more mature concern might go through, or if somebody is, say, funded, venture funded or otherwise funded. I was bootstrapping this company. And yeah, it was incredibly crazy from a risk perspective. And it, it took on a life of its own, and I’m sure you’ve talked to many, many guests along the way. And probably a lot of people have told you the same thing, that that these things do take on a life of its own. And, and the scary thing is that they these businesses are hungry, they, they, they need to be fed. And I would say in retrospect, my biggest weakness, and the place that I probably made the biggest mistakes was I needed, had I had more money 10 years ago. Because this was a big idea. I could have gotten much farther, faster. But I was I was the wrong guy to raise money. I was a good evangelist. And then Jellicle founder, I there’s a lot of things I’m good at but but the raising the money thing was just not my damn. And there wasn’t anybody else in on my team, or that I had partnered with that. That was the right. So, I started this thing and I and had a life of its own, and I had to keep it going. See need

John Corcoran 32:16

made it work bootstrapping it, you know, yeah. Many, like many do probably taking some funds from the existing business and investing it in the future. Yeah,

Kenny Schiff 32:25

yes. And, you know, taking money out of my 401 K and Ira and you know, just doing and borrowing more more money from friends and family, you know, it’s when this this is the hardest thing, you have a great idea. You have great customers, you are connecting with all that there is the business reality. And and there. Arguably, there were many points where I probably should have stopped. But but it was very, very difficult to do that. Yeah. So which ultimately, so all that is happening, I’m trying to do listen to as many people as I can to help me figure this out. It’s a puzzle. And then the pandemic is.

John Corcoran 33:12

And so tell me what that was like for you. I mean, did Did you see your life flash before your eyes? Or does it? You know, did it was it an opportunity for your business?

Kenny Schiff 33:24

Um, I would say we hung on for dear life, but I am grateful for the people that worked with me. Renee Solinsky, Eileen Sullivan and Sarah hefty. Boy tech rub lupski ed McNeil, Joanie, the whole, the whole group, they, everybody, we all love this thing. It was our baby. And we we all made tremendous sacrifices. And we also knew what we were doing was important. So we cut as many corners as we possibly could. We really skinny it ourselves up as much as we possibly could. And then I started to spend a tremendous amount of time trying to find, say, Hey, I have this thing. It’s great. It’s absolutely necessary. We have a working model of it. Somebody else has got complementary things that this matches up with. Who is that? And and then, you know, I mentioned earlier that I’m a strong relationship person, I’m a really good networker. And I started working it and kept working on it, because really, at the end, there was no, there was no other choice, that that, you know, I knew that there was a softer a softer landing for this thing. Yeah.

John Corcoran 34:49

And that led you to search for the right strategic partner, a journey that took about three years. How did you find how did you end up finding the right strategic partner for you.

Kenny Schiff 35:02

So, in the 90s, I worked for a company called Rauland-Borg. It was a healthcare company, the significant portion of their business was in healthcare. They were a limited distribution company. So they had very strong relationships with their resellers. And in my time there seven and a half years, I got to know a lot of their resellers. One of them was Lone Star Communications. And I did, I did know the owner, Ray Bailey. And I had remained peripherally in touch with him. I actually saw him the week before the pandemic, and I actually flew out to, to the Dallas area for a business conference, we were both part of to say, Hey, we should be doing some business together. And it was, it was a great meeting, but then the pandemic happen, then we. So I, let’s just say I went the whole arc of the possible people who my personal companies I might match up with, and do some pretty circuitous routes. A year and a half ago, we started talking, not necessarily me and Ray directly, but I started talking to some members of his team, Jeff Richard, who’s my my boss right now, don’t start a CTO. And I started developing a relationship and talking about big things. And we found that we were very, very aligned on a lot of things. And he, we recognized each other that we were missing, we were puzzle pieces of a Dell could fit together in something much bigger for both of us. And we kept at it. And then by, by the summer of 2022, the trajectory was there we were, we were moving in that direction. Yeah.

John Corcoran 37:00

Now, were you nervous going into this process that, you know, letting the cat out of the bag are revealing your secrets to a much larger company that they could just move into your space and compete with you or, you know, create it rather than buy it?

Kenny Schiff 37:16

I knew that we had enough special sauce that it would be very difficult for a company, even a company as evolved and mature as Lone Star, they would have a really difficult time getting to where we were at. And so no, I wasn’t nervous about that. I don’t know I at that point in time, you have to understand the relief of finding a partner, somebody who understands how stood what we were trying to do it. It just felt like it was the right thing.

John Corcoran 37:56

Yeah. Yeah. And for all the people that it believed in you for all the investors, what was that like for you? Finally, consummating that transaction? Well, it was, again,

Kenny Schiff 38:08

it was a relief. Right? It was a way of me. Making big having a reasonable outcome. Yeah. And you know, you asked before about, you know, what’s it like going through this? The biggest fear is is complete implosion. And I had always, that was not what I wanted to do that that was not the picture I had in my mind. Yeah, yeah.

John Corcoran 38:44

Well, this has been great. I want to wrap things up with you. Thank you for sharing your story here today. It was amazing. But you know, you mentioned you’re, you’re great at networking, you enjoy networking. And you’ve had so many different people that have helped you in your journey. So I’d love to hear just a little bit about those who have kind of helped you in your journey. I love to give people the opportunity just to you know, kind of publicly thank people that have helped you, especially peers, and especially contemporaries, you mentioned EO, you mentioned names of people. Team, of course, we always mentioned that we always thank our family. But in addition to that, you know, were there other peers or contemporaries or mentors who were there for you during this journey?

Kenny Schiff 39:26

So, I work for Maureen Primorsky, at at rollon during my tenure there in the 90s. And when I needed some guidance on what my next step would be professionally after I had left you at, I reached out to her and she’s the one who really kind of set me up with with Tom and TPC. So that was an important little glue there. And I would also say that during the pandemic of We had a virtual forum group not affiliated with EO but but run like an EO form. So, Robert mental sin to call Donnelly gasm for a minute or Brandon Lisi, those are people who really just helped me at a very, very dark time. And, and just some friends. I have some musical cohorts, Tom Schmidt, who he and I got reconnected during the pandemic, and we have been playing music together. And we had last been in the same place like 35 years ago. So the those kinds of things, so I’m very appreciative of all that and I’m sure I left out lots of people. And I’ll just say that in my current situation, you know, my, my, my Kalat I call them my collaborators, Jeff Richard, Chris Andrus, Justin Bailey, you know, those are people who are there for me and we we work together, Dan oyster, and I would say forget about the journey itself. For me the I’m grateful for the opportunity to work with amazing people and do great things together. And it’s, however, at the lowest of the low. I always had that.

John Corcoran 41:31

Yeah, yeah. This has been great. Kenny. Where can people go to connect with you and learn more about you? 

Kenny Schiff 41:38

Well, you can look me up on LinkedIn of course Kenny Schiff. is the Lone Star website. And then if you want to email me, [email protected] is the easiest. And yeah, so thanks for the opportunity to be in front of your audience. 

John Corcoran 42:00

Thank you, Kenny.

Outro 42:08

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