Go­ing Global

Sta­sis Labs found its first mar­ket overseas. What’s its best next move?

Inc. (USA) - - CONTENTS - BY LEIGH BUCHANAN

Sta­sis Labs was formed in America— but launched overseas where it was most needed

IN 2012, DI­NESH SEEMAKURTY was study­ing biomed­i­cal en­gi­neer­ing as a pre­lude to med­i­cal school when his ca­reer plans jack­knifed. Seemakurty, then a stu­dent at USC, was vis­it­ing rel­a­tives in In­dia when his grandfather fell ill and checked into the hos­pi­tal. But there was no med­i­cal su­per­vi­sion there, be­yond nurses look­ing in ev­ery six hours, and no one no­ticed that his grandfather’s con­di­tion had desta­bi­lized un­til it was too late.

As a for­mer emer­gency med­i­cal tech­ni­cian, Seemakurty knew that lives of­ten de­pend on the in­for­ma­tion med­i­cal work­ers get about a pa­tient and how quickly they get it. “In these emerg­ing coun­tries—and even in im­pov­er­ished ar­eas of the U.S.—you don’t have that ac­cess to pa­tient in­for­ma­tion,” says Seemakurty. “When you don’t know, you can’t con­duct treat­ment.”

In 2015, Seemakurty, then 21, and his class­mate Michael May­lahn, then 23, launched Sta­sis Labs in Los Angeles. The com­pany makes sys­tems that mon­i­tor vi­tal signs and de­liver data to clin­i­cians’ smart­phones. Sta­sis ex­pects to of­fer prod­ucts in the United States. But it first went where it was most needed—far from home.

The right fea­tures

U.S. com­pa­nies that spy op­por­tu­ni­ties in devel­op­ing mar­kets of­ten strip down prod­ucts to make ver­sions that can be pro­duced cheaply enough to sell there, and Seemakurty and May­lahn thought they could suc­ceed with an inexpensive, bare-bones ma­chine. To make sure, Seemakurty asked the physi­cians he met in In­dia a ques­tion. The top man­u­fac­tur­ers of vi­tals mon­i­tor­ing de­vices are GE and Philips, whose prod­ucts cost as much as $10,000. “We said, ‘If we gave you a Philips mon­i­tor for $500 rather than $10,000, would you buy it?’ ” says Seemakurty.

The an­swer, sur­pris­ingly, was no.

“In emerg­ing coun­tries—and im­pov­er­ished ar­eas of the U.S.—you don’t have ac­cess to pa­tient in­for­ma­tion.”

The prob­lem, physi­cians ex­plained, wasn’t price. It was man­power. Vi­tals mon­i­tors track things like pulse rate, tem­per­a­ture, and blood pres­sure. That data means noth­ing un­less some­one sees it. In In­dia and other devel­op­ing coun­tries, hos­pi­tals are of­ten se­verely un­der­staffed—so a pa­tient’s con­di­tion can de­te­ri­o­rate for hours be­fore a nurse takes note.

Seemakurty and May­lahn stopped prun­ing fea­tures that didn’t mat­ter and dou­bled down on fea­tures that did. They de­vel­oped a cloud-based sys­tem to de­liver pa­tient data di­rectly to doc­tors’ and nurses’ smart­phones.

Price still mat­tered—and would mat­ter more should Sta­sis decide to ex­pand into places like Africa. So the two looked for costs to cut. One idea: mak­ing mon­i­tors for use out­side of in­ten­sive care units. In­side an ICU, a pa­tient’s con­di­tion can change in seconds, so real-time data is crit­i­cal. But for other pa­tients, pro­vid­ing data in five-minute in­ter­vals is ad­e­quate, and costs sig­nif­i­cantly less. Also, the founders opted to charge hos­pi­tals an an­nual fee per de­vice that in­cludes all hard­ware, soft­ware, and con­nec­tiv­ity. “It cre­ates a part­ner­ship,” says Seemakurty. “We are in­cen­tivized to make sure this prod­uct is up and run­ning.”

A tale of two head­quar­ters

At first, Seemakurty and May­lahn thought they could man­age ev­ery­thing from Cal­i­for­nia. But af­ter Seemakurty spent 35 days vis­it­ing 33 hos­pi­tals across In­dia to show off a pro­to­type, he re­al­ized launch­ing there re­quired liv­ing there. A dis­trib­u­tor or part­ner might suc­ceed with a fin­ished, proven prod­uct. But a prod­uct as new as Sta­sis Labs’ mon­i­tor “is very much driven by the mar­ket,” says

Seemakurty. “Be­ing in the hos­pi­tals, do­ing in­stal­la­tions, train­ing nurses, talk­ing to doc­tors—that in­flu­ences not just the de­sign but the way your team thinks.”

They also learned that founders on two con­ti­nents can scout money in both. Sta­sis raised $5 mil­lion in a seed round for U.S. in­vestors. But In­dian ven­ture cap­i­tal­ists also an­ted up. “We were two kids com­ing out of col­lege and tack­ling in­cum­bents,” says Seemakurty. “Hav­ing In­dian in­vestors was a sign that val­i­dated us with U.S. in­vestors.”

Seven Sta­sis em­ploy­ees, in­clud­ing May­lahn, work in Cal­i­for­nia; 18 are in In­dia. Sales and busi­ness de­vel­op­ment re­side in Bengaluru, be­cause In­dia is where the cus­tomers are. The founders di­vided en­gi­neer­ing staff be­tween the lo­ca­tions to main­tain a 24-hour de­vel­op­ment cy­cle. They could have based tech­ni­cal staff in In­dia, where pro­gram­mers are cheaper, but did not like the mes­sage that sent. “Out­sourc­ing is pretty common, but that is not the kind of or­ga­ni­za­tion we want to build,” says Seemakurty. “We want to be one co­he­sive com­pany.”

Sta­sis ex­pects to fo­cus on In­dia through 2018. Its size and rel­a­tively so­phis­ti­cated tech in­fra­struc­ture make it an ideal first mar­ket, says Seemakurty. And, he adds, most hos­pi­tals are small: Eighty-four per­cent have just 50 to 100 beds. That means less bu­reau­cracy and faster buy­ing de­ci­sions—crit­i­cal for any startup.

Seemakurty and May­lahn are still mulling ways to ex­pand. Now that they have a fin­ished prod­uct, they ex­pect to sell through lo­cal dis­trib­u­tors in new mar­kets. They also ex­pect to sell it on­line.

The road back home

Po­ten­tial next mar­kets in­clude Africa, other parts of South­east Asia, and the Mid­dle East. Also: the U.S. With money in the bank and a solid track record, the com­pany ex­pects U.S. reg­u­la­tions will be eas­ier to sur­mount.

“Each mar­ket has its own re­quire­ments and reg­u­la­tions,” says Seemakurty. “If it turns out the prod­uct we have makes more sense in emerg­ing mar­kets, that’s where we will ex­pand. But if the prod­uct also has what is re­quired for the full global mar­ket, there is no rea­son we can’t do de­vel­oped and devel­op­ing coun­tries at the same time.”

The founders be­lieve price will make it pop­u­lar in poorer re­gions, and hope de­sign will make it pop­u­lar else­where. In­dian doc­tors of­fered a key in­sight: Com­pet­ing ma­chines have com­plex in­ter­faces with flash­ing screens, which may frighten and con­fuse pa­tients. So Sta­sis de­signed a stream­lined black box with six simple icons, each rep­re­sent­ing a vi­tal sign. If the icon is green, all is well. If it’s yel­low, some­thing’s wrong. (Data de­liv­ered to clin­i­cians’ phones is more de­tailed.)

That simple, non­threat­en­ing de­vice could serve a do­mes­tic niche un­filled by the com­pany’s huge com­peti­tors. “Sta­sis was not built just for emerg­ing mar­kets,” says Seemakurty. “It was built to rein­vent how you mon­i­tor pa­tients every­where.”

! VI­TAL SIGN Sta­sis Labs’ mon­i­tor­ing sys­tem is winning clin­i­cal cus­tomers, thanks to its sim­plic­ity.

IN BAL­ANCE Di­nesh Seemakurty, co-founder of Sta­sis Labs. A fam­ily tragedy de­railed his ca­reer plans—but in­spired his busi­ness.

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