“A brilliant idea is not enough” – Dos and Don’ts that early-stage start-ups need to know

Covid-19 has put a bigger focus on the healthcare market all around the world. This boom has an effect on the EU as well, there are more and more start-ups that want to enter the market. We sat down with Tamás Békási, RIS Business Creation Manager at EIT Health InnoStars, who shared all the essentials early-stage start-ups need to know.

1. What are the most important skills early-stage start-ups/entrepreneurs need to acquire? 

A critical criteria for success is having somebody on board – a co-worker or a fellow student – who can cover the business part of a product or service from day one. The most brilliant idea is not enough, the entrepreneurial “gene” is essential. You have to find somebody who is extrovert enough and has the proper skills and background to cover the business. If you are an introvert, involve a networker who will be at the table with accelerators, incubators, investors, the media, etc.

From the technical and feasibility point of view, early-stage start-ups need to check if there is a real need in the market for their solution and whether it is feasible. Certain accelerators and experts can help with that.

Early-stage start-ups should also think on a global level from day one. When looking at the competitors, they should not shrink it down to the local market: if something does not exist in their home country, it does not mean that it doesn’t exist in Europe or elsewhere.

2. How can EIT Health help early-stage start-ups?

EIT Health has a well-diversified accelerator journey, which contains programmes for early-stage start-ups as well. For example, for EIT Health Jumpstarter, all you need to have is an idea. While EIT Health InnoStars Awards will support you further when you have an MVP or a prototype.  EIT Health offers various modes of education. As part of it, we organise different types of bootcamps, based on the start-ups’ maturity level. Most of the bootcamps are related to business essentials and various types of business knowledge. For instance, within our programmes, we teach early-stage companies how to pitch, create their pitch deck, define their value proposition, formulate unique selling points, team formation, and position themselves from the pricing point of view. That is the most essential knowledge for a very early-stage company. In the case of MVPs or prototype-stage companies, we teach them how to create and improve their business plan introduce them to European regulation, healthcare marketing and sales, networking.

We have special training covering GDPR, cyber-security, IP and many other specialised fields. Besides the knowledge, EIT Health has an extensive network that start-ups can benefit enormously through matchmaking and networking events. We can also directly connect them with some of the companies in their interest. EIT Health has approximately 150 official partners, including the biggest pharmaceutical companies, healthcare providers and universities. Our start-ups can do business with them. We have specific programmes to connect start-ups with pharmaceutical companies and healthcare providers to work together within a project.

We also provide them with mentoring: we have our own Mentoring and Coaching Network with over 500 mentors.  Giving them access to our database that contains pre-filtered experts to guarantee quality. We can also provide them with investment opportunities.

Last but not least, in almost all of our accelerator programmes, companies have the chance to receive smart-funding, which is equity and share-free, so as a start-up, you don’t have to pay anything back. All you need is to report back to us. 

3. You have tremendous experience and have worked with many start-ups: what does a good team look like? What kind of personalities have the biggest chance to make a start-up thrive?

This is the recipe everybody is looking for, and usually, this can’t be taught. One of the most essential things is team dynamics. Everything is based on personal relations, especially in the first time. It is imperative to have the proper internal dynamics within the team. The founders and the team members have to agree on where they are going, what the goals for the future are and how they want to achieve them.

Regarding the mindset, people should be open. Have the ability to learn and be adaptive! The innovation market is very fast-moving. You have to be adaptive to changes, especially in the first times when you have to handle changes daily.

4. What are the most important Dos and Don’ts that you usually advice early-stage start-ups?

Let’s start with the Dos. Try to participate in as many accelerators as you can and be prepared. Allocate your time to really be part of the programme. Be there actively, prepare for the mentoring sessions, do your homework. Networking is also crucial; try to meet as many people as possible. Building an investment strategy is also a must: know where you would like to invest or how you want to finance your project in the longer term.

Regarding the Don’ts, I would say, gaining investment is not the final goal. Investments are just assets to reach that goal.  From a financial perspective, start-ups should be self-financing and go for the revenue. Accelerator programmes are just assets to know more people, get more knowledge and get into the blood circulation of innovation. 

5. What makes a pitch good?

Short, effective, impactful. Many of the investors are investing in people, not projects or start-ups. If you take part in a good accelerator programme, they teach you how to pitch. A pitch should usually be 3 minutes, and it should demonstrate the size and the importance of the problem you want to solve, you need to detail the product, the value proposition, the unique selling points, and your projections from a financial and product point of view. Pretty much, this is what you need to show to your audience. But of course, you are still in a big competition with others, so credibility is critical. And this starts with finding the right person to pitch. Pitching is a sales situation, so you need to become a good storyteller and a salesperson. If you can cover the pitch as a story, that is the best. People remember things much better if they are covered in stories. Investors listen to hundreds of pitches a year. But if you have a nice story around it, it becomes easier to remember. Of course, this depends on the type of product you have.

7. What do you think are the biggest trends of the near future in healthcare in the EU?

We can observe the biggest boom around telehealth and digital therapy solutions. It is not a real surprise if we consider that one of the biggest challenges – connected to the COVID-19 pandemic – is how healthcare institutes can cover the significantly increased workload with resources and how they can manage certain diagnostic, follow-up and rehabilitation tasks without using the institutes’ physical environment and resources. From a regulatory and commercial perspective, telehealth solutions are considered manageable, and therefore in both start-up and investor communities, it has a widescale acceptance and support.

The past few years made the fact – what the healthcare community knew before – crystal clear that the enormous amount of data could and should be utilised to improve internal processes and service quality. European Health Data Space (EHDS), one of the priorities of the European Commission, was created to strengthen the exchange and access to health data. This could not only have a tremendous impact on the quality of healthcare but support research and policymaking.