While Nashville is no Silicon Valley, its status as the leading healthcare center of the Mid-South has prompted a startup boom in that field that's not letting up anytime soon.
At this point, nearly 400 healthcare companies are up and running in Metro Nashville. Given the city’s sense of community, the number of new residents arriving daily, and its growing reputation for both livability and economic opportunity, it’s no wonder that people are heading to Music City to tap into its resources and start their companies.
The startup community in Nashville plays a major role in the success of these young companies. The Entrepreneur Center and Jumpstart Foundry both provide valuable resources, networking and other opportunities for startups in Nashville and beyond.
Gretchen Napier, the CEO of senior care company LifeLinks, praised this sense of community, and credits some of her company’s success to its participation in the healthcare-focused Jumpstart Foundry.
“Jumpstart and the EC both really contribute to the startup community in Nashville," Napier said. "There's so many experienced healthcare people, and there's a lot of encouragement. Here, there's kind of the seven degrees of separation, where whoever you're talking to probably knows the people you need to get to.”
Networking is essential
Belle, an in-home beauty operation that became a healthcare company, made the switch after finding it increasingly difficult to receive funding and clearly articulate the company’s vision.
“As we have pivoted our company to senior care, and healthcare specifically, we have been seeing a lot more interest and the conversations are a lot easier," said Armand Lauzon, Belle’s founder and CEO. "I think that's a result of the healthcare industry here. We have all these great companies and investors. Networking in this town is phenomenal.”
Jumpstart Foundry’s Platform Manager Eller Mallchok explained that the scale and size of the industry in Nashville make the city a hotbed for all kinds of healthcare startups. In fact, 2005 to 2015 saw more than $1.6 billion invested in Nashville healthcare companies, according to the Nashville Health Care Council.
“This is where most of their clients are going to be,” she explained.
But while Nashville may present the ideal environment for these companies, startups and challenges are synonymous – and the healthcare industry is no different.
When asked about these challenges, Mallchok immediately mentioned the industry’s extremely long sales cycle. For the most part, the sales process in healthcare takes anywhere from a year to 18 months, whereas in another industry just a few months might pass. These companies constantly try to work out the funding part for 12 months, and if they don’t get it they are back to square one.
Despite these challenges, Mallchok doesn’t see an end to this startup boom anytime soon.
“I don't think Nashville is saturated yet," she said. "There are a lot of great healthcare startups across the country, but the market in Nashville is great for healthcare. The industry is so massive and there's a lot of room to go around.”