This is Rachel Feller, co-host of The Pulse Podcast. Today’s guest is Dr. Anne-Marie Cantwell. Anne-Marie is a venture partner at Impactful Capital, an early-stage venture capital firm focused on digital health companies within the value-based care and behavioral health verticals. Prior to Impactful Capital, Anne-Marie spent over 20 years at Kaiser Permanente, where she played a critical role in driving adoption of telemedicine prior to the pandemic. Anne-Marie holds an MBA degree from the Wharton School, where she attended the Lauder Institute. She also has an MD degree and graduated Alpha Omega Alpha from Loma Linda University. She is an internist by training and worked as both a hospitalist and a primary care physician. In this episode, I spoke with Anne-Marie about her fascinating career journey, her experiences at Impactful Capital, and her perspectives on the future of behavioral health and digital health moving forward. I hope you enjoy the conversation. Anne-Marie, thank you for joining me today on The Pulse Podcast. How are you? I’m doing fine. Thank you for asking. I’m pleased to be here. We’re very excited to have you. Now to kick us off, we have a tradition on The Pulse of asking our guests this icebreaker question. What did you want to be when you grew up? So I’ve always dreamed of improving people’s lives through better health care. And I think this stems from my upbringing. My dad is a pediatrician. My mom is a nurse and she ran an ICU for many years. So I sort of grew up with health care in my veins. I definitely know a lot of my friends here in the health care management program can relate. I personally was very interested to learn about your career path before Impactful, and I’m sure our listeners would be interested as well. Could you share with us a bit about your journey from finance through medical school and ultimately to digital health, as well as what made you pivot into VC more recently? So when I was at Wharton, I actually attended the Lauder Institute, because at that time I was interested in international management. And as many of the listeners on this podcast would know that the Lauder Institute is Wharton’s international management program. So after that, I actually worked in investment and corporate banking overseas. I worked in London and Sao Paulo, and then came back home and worked in New York and Los Angeles. And during that time, I actually had some health care accounts. So I got a taste for what was going on in health care, at least from a financial standpoint. But it wasn’t until I was doing some volunteer work at an emergency department in Los Angeles that I really realized my true calling was to be a physician. And so I made that transition and went to medical school. After medical school, I actually spent my entire career as an internist at Kaiser Permanente in Marin County, which is just north of San Francisco. And I actually went to medical school thinking I would work at Kaiser. And I think that was basically due to two reasons. I saw that Kaiser was an integrated health care system, which I really liked the doctors, the hospital, and the health plan all being under one roof. And I liked the emphasis on preventive care, because at Kaiser, they do a lot to prevent disease, cancer screenings and the like. So I really liked that. And I worked there at Kaiser as a hospitalist first for about seven years. And then I made a transition to the outpatient world and worked as a primary care physician. And during that time, in addition to my role as a primary care physician, I actually helped launch the telemedicine program at my medical center and at three satellite facilities where I was involved with. And it was really a huge leap for us at the time, because we hadn’t incorporated virtual medicine into our daily practice. So that was really just an eye-opening and great experience for me. And then when I left Kaiser in 2021, I was very passionate about digital medicine based on all the work I had done at Kaiser and just really wanted to continue in that field. Through networking, I met Sal Dutrain, who’s the managing director of Impactful Capital. And I really liked his philosophy of investing, which we’ll talk more about in a minute. But equally important, I really liked the group of partners and advisors that Sal had put together, as they all had deep industry and subject matter expertise. So I decided to join the group and it’s been a great move for me. Along those lines, how, if at all, does being a physician help you succeed as a healthcare venture capitalist? That’s a great question. I kind of see it helping in two ways. First of all, from being a frontline physician, I can really understand the problems that need solving in healthcare, as well as some of the solutions that the digital healthcare companies are offering. So that’s number one. And then number two, I think I can really understand what works from a provider and patient adoption level. So if you don’t understand how healthcare is delivered and what happens on a day-to-day basis in the clinic, it’s going to be hard to understand how some of the workflows that are offered in digital healthcare will actually fit in. Absolutely. You really need to look at the underlying problem to solve before identifying the technology that can solve it. So it makes a lot of sense how being a doctor would help you there. And as you mentioned, you spent a lot of time developing Kaiser’s telemedicine efforts even before the pandemic. Why was virtual care a priority for you and how were you able to get physicians and patients to adopt video technology pre-pandemic? So at Kaiser, it’s kind of an interesting, unique situation in that reimbursement issues were not so much of a driver of how healthcare was delivered. So for example, in 2016, when I got the idea to launch the video visit practice at my medical center, we had already been doing phone visits for at least 15 years. Most of the fee-for-service world had not been doing that. And the reason for that is that we didn’t look to anybody to reimburse us for the work that we were doing. We were just trying to take care of the patients as efficiently and most cost effectively as we could. So in 2014, I saw that the video technology had been built into our Epic EHR, which was huge. I mean, Kaiser was way ahead of its time with that. However, the doctors and patients weren’t really using it that much. And so in 2016, I saw that with the growth of broadband internet, 5G networks, smartphones, tablets, this was going to become a key way that we were going to deliver healthcare. It’s just that our clinics and doctors and patients hadn’t transitioned to that mode of care yet. So I approached senior management and convinced them to let me lead the effort to really launch the video visit practice and educate our doctors and patients on what they could do a video visit for and how they could use the technology to their advantage in diagnosing and treating different health conditions. The real payback on all of that was that in 2016, less than 1% of all the encounters we were doing were by video. And by 2021, it had gone up to more than 30%. And really, I just give a lot of credit to the team I worked with as I led a team of tech and education specialists. Together as a team, we were able to work with all the physicians and providers and help them overcome technology fears, fears about making the wrong diagnosis via telehealth. And we were able to get everyone comfortable using the technology. Wow, it really is incredible that you had the foresight to adopt that technology even before the pandemic. What do you think needs to be in place for a telehealth program to be a successful program? I would say in general, the elephant in the room is reimbursement. So currently, healthcare providers are getting reimbursed for telehealth, and that needs to continue. The technology needs to be built into the EHR so doctors don’t have to go to a separate site to log in. It needs to be technologically easy. So no technological glitches while you’re doing the exam, having difficulty seeing or hearing. Patients need to be able to do it on mobile devices because that’s the way that most people are using the internet now is some on their computer, obviously, but a lot on mobile devices. And obviously, little to no physical exam needs to be required. So if it’s someone with chest pain or abdominal pain where I need to do a physical exam, that’s not a suitable condition to do a video visit for. What were some of your biggest takeaways about virtual care coming out of the pandemic given the shift we saw? My colleagues and I decided that virtual care is a real great add-on tool that provides convenience where the patient doesn’t have to go anywhere, doesn’t have to battle with traffic or the parking lot or the waiting room. And it’s also great when used for the right indication. So some simple things would be kind of like a hospital follow-up visit or perhaps a simple wound care visit or other simple primary care issues such as allergies or colds and things like that. Behavioral health specifically really, really lends itself towards a virtual visit. And the other thing I think is really great is that using this technology over time, we can really reduce the cost of care. So if you think about how big medical facilities are now, just fast forward 10, 20 years when medical facilities will be smaller in size because we just won’t need all that real estate to take care of our patients. And I have to say the patients do love the convenience of video visits. I can’t tell you how many patients have said they’d rather just do everything by video because for the reasons I explained, they don’t have to battle traffic or get in their car and go anywhere. And the other great thing about virtual care is that if you think about people that live in rural areas where perhaps it’s 45 minutes to an hour to get to a clinic or medical center, or if you think about those that don’t have health insurance, getting onto an online platform where they can do that from their home, it’s so convenient and provides a level of access that people don’t currently have. The only thing I would say with that is there are some people that are still going to have a hard time if they’re not digitally literate, or they don’t have a high speed internet, or especially for some very elderly folks that haven’t yet been able to master the technology. I know I myself benefited from having a telehealth appointment this morning that I squeezed in between other meetings. So I definitely have come on board the trend. I know it’s been adopted much more widespread post pandemic, but what do you think the future of virtual care looks like moving forward? Yeah, so we’ve seen a little bit of a pullback from the pandemic where video visits were being used almost exclusively to deliver care. And now it’s pulled back significantly, but it’s nowhere near where it was pre pandemic. So virtual care is definitely here to stay. And I can envision as technology advances, perhaps there will eventually be 3D video visits being done. So that would help a physician with doing part of the physical exam. And I think we’re going to see home devices have evolved to assist with the physical exam as well. And for example, there is a company called Remy, where they have a smart otoscope that looks in the ears and the pictures of the eardrum are transmitted virtually back to a physician who can review them in real time during a patient video visit. And that’s just a huge advance in technology. And then I recently met a company that had a smart stethoscope where they could take an audio file of the heart and lung sounds, and that could be transmitted back to the physician. So all of these things are going to help supplement and enhance virtual care as we move forward. And the other thing I’ve seen happening that’s really exciting is a lot of what I call asynchronous care where, for example, if you have a particular healthcare problem, you’ll be sent a smart questionnaire online that will ask you specific questions. And the next question you get asked will depend on how you answered the previous one. And at the end of the questionnaire, you’ll be triaged, oh, you need to go to the emergency department, or this would be great for a video visit, or you actually need an in-person appointment with your doctor. And then the technology will actually help you make that specific visit appointment. So all of those things I think are really exciting. I think patients are going to continue to see increased convenience with virtual care, and I’m just really excited about the future. I’m very excited as well, especially after listening to you describe it all. Now I’d like to pivot towards discussing Impactful Capital. Could you please provide us with an overview of the fund and elaborate on your investment thesis and strategy? And as part of doing so, I’d love to hear your thoughts on what sets Impactful Capital apart from other digital health funds in the venture capital space. I’d like to address fund one and fund two in just a minute, but first I’d like to talk about what sets us apart from other venture capital companies. And I think there’s a couple of different points. One is that we’re truly entrepreneur friendly, and we like to form partnerships with our entrepreneurs and help the companies grow. And I think that’s because we have empathy for the entrepreneurial journey and understand how hard it is to build a company. Impactful Capital has over 40 partners and advisors who have a national footprint, and they all have collective experience in some of the nation’s largest healthcare systems and health plans, as well as other startups. So we really have a lot of operational expertise on our side that we can help lend to entrepreneurs to help them grow their business. The second thing is we really do have favorable term sheets. And most of the investments we make are structured as just simple preferred stock that functions economically like common stock. We do take a board seat, however, as we do want to assist with corporate governance and just have an oversight in what’s going on in the company operations. And the final thing I think that sets us apart from a lot of funds is that the partners and advisors have all invested in the fund. And in fact, we collectively account for about 20% of the total fund size of Fund 2. And so the benefit of that is we wouldn’t ask a limited partner to invest in a company that we ourselves aren’t willing to invest in. You started touching a bit on the two funds, Fund 1 and Fund 2. Could you speak a little bit more about each of these funds? Fund 1 started in 2017 and investment process went on until 2021. And it was a group of eight investments. So far, we’ve had three full or partial successful exits. And through all those investments too, we were able to hone our investment thesis and investment philosophy around investing in behavioral health and value-based care. So now we’ve launched Fund 2. We’ve actually had the first close of our $50 million fund. We’re in the process of raising the rest of the fund early in 2023. And as I mentioned, our investment thesis is really around behavioral health and value-based care models, as these are two areas that are particularly dynamic, they lend themselves to being tech enabled, and there’s a huge total addressable market of the two areas combined of roughly $100 billion. So we’re very interested in that and very focused on that. We plan to invest in approximately 10 to 14 new companies with a milestone-based follow-on portfolio investment approach. And approximately two-thirds of the fund will be invested in Series A companies, and probably about one-third will be invested in the Series B stage. Another unique thing that we have is an LP co-investment program, where we have an LP that really likes a particular investment that we’re making. They can do a co-investment alongside us so that they can invest more in that particular company. I’m sure many of our listeners, myself included, would love to hear about one to two of the recent investments that Impactful Capital has made. Could you share that with us? So Fund 1 made a great investment in a company called Care Continuity. Care Continuity is a tech-enabled, white-glove concierge solution for navigating patient care. So if you can envision when a patient gets discharged from the hospital or the emergency department, how many people might be confused about when’s their next follow-up visit, what medicines are they supposed to be taking, what’s the next step in their care? This is when Care Continuity will step in to enhance and navigate the patient’s journey through the healthcare system. Care Continuity provides highly trained patient concierges who help the patients complete their follow-up appointments, and they try to reduce the patient being readmitted to the hospital or the emergency department. The concierge team will coordinate with home health and nursing homes regarding follow-up appointments, and they can even arrange transportation. The hospital clients can also use their own staff if they want, but if not, Care Continuity can provide the concierges. The tech-enablement part of the solution also includes the patients getting text reminders regarding medications and regarding their follow-up appointments. They don’t need to download an app, they don’t need to log into a website, so it’s really, really easy for them. The clients also have dashboards that are built into the electronic medical records that show where the patients are in the navigation process, so they can see if the patients have actually completed their follow-up visits, for example, if they needed to see a cardiologist, if they’ve actually completed that visit or not. The dashboard also helps prioritize which complex patients should be navigated more closely. The results have been nothing short of remarkable, with one health system saying they had a reduction of inpatient readmissions by 49%, and in addition to that, 88% of their patients were followed up by an in-network physician, thereby reducing out-of-network costs. Extremely interesting, and I appreciate you sharing that with us. I’m curious, when you are looking to make this investment as a fund and others like it, what do you look for in the founding teams that you evaluate? So looking at the founding team is probably about 70% of the investment decision, because early-stage companies usually don’t have that much in terms of financial data to look at, so it’s really about the founding company. And then also, I’d have to add on to that just the solution and the problem that they’re solving. So what we look for in a founding company or a founding team, rather, is deep entrepreneurial experience with successful exits, ideally, and also really deep operating experience and a knowledge of the industry that they’re starting their company in. I am aware that many of your investments do take place at the earlier stages, so the founding team and product-market fit are probably most critical to evaluate, as you mentioned. But in terms of some of the more quantitative metrics regarding your Series A investments and the like, what are some of the metrics that you look to as a fund in order to assess whether or not you want to make an investment in a company? A few things that we look at are, first of all, margins. We really like the company to show a path towards a 60% to 80% margin, because what we’re really interested in investing in is that intersection between technology and healthcare. So the company would have technology at its product core with some elements of healthcare. Another thing we look at is the break-even on revenues, and we’d like that to be somewhere between $8 million and $12 million. We also look at their customers and how much each one is contributing to the overall revenue. So we like to see sort of 10 to 20 enterprise-level customers averaging about $100K in a contract value, which leads to a total amount in revenue of perhaps $1 to $5 million in annual recurring revenue. Also, as mentioned, we’d like to see a validated product-market fit and a return on investment, obviously, to the health plans or the employers or whoever is actually going to be the client. Regarding the sales and channel partnerships, we want to make sure there’s not one client or partner responsible for too much of the revenue, because obviously that’s more of a risky situation. And we look for sustainable business models and companies that don’t burn through a lot of cash and marketing. We also like companies to be aware of how long their sales cycle is, and that just is all surrounding their working capital, right? Because if it takes too long to close a contract and you’ve got ongoing expenses, you’re not going to make it if your sales cycle is too long and you hadn’t budgeted and foreseen that. Now, I’d love to pivot towards chatting about some of the broader trends you foresee coming up in digital healthcare in 2023, specifically within behavioral health. Would you mind sharing with us some of your key insights in this area and what you see as the biggest trends emerging over the course of the next year? So a couple of things to keep your eye on in 2023 for behavioral health surrounds, first of all, federal oversight. So many of us have heard or are aware of the over-prescribing that Cerebral and TruPill did of ADHD, attention deficit disorder drugs, last year. And this was really just an unfortunate occurrence because the online platforms were working very well for the vast majority of psychiatrists in prescribing controlled substances, but you’re going to see more fed oversight as a result of what happened with Cerebral. And so currently the waiver to have a face-to-face visit with a provider prior to a controlled substance being prescribed has been waived, and that will continue through 2023, which is a really good sign. But I just want to point out with that waiver being in place, and despite what happened at Cerebral and TruPill, the vast majority of telepsychiatrists are doing adequate screenings for ADHD and are prescribing completely appropriately. And if the waiver is taken away such that patients do have to have a face-to-face visit before they can get online ADHD meds, it’s going to result in tens of thousands of children and probably adults too having significant challenges getting their medications. So I’m hoping that with the federal oversight, it’ll gently settle down over time and that newer companies coming into the space will prescribe responsibly. The other thing I think to notice in 2023 will be how higher acuity mental health disorders are going to be moved online. So during the pandemic, billions of dollars poured into behavioral health startups, and most of them focused on the mild to moderate mental health conditions, but more serious health conditions weren’t necessarily addressed. And so now you’re going to see more of this happening. And there’s one company I’d like to highlight called Quartet Health that you may have heard of that’s doing really an excellent job in this area. So in 2021, Quartet acquired another online mental health provider called Inovatel. Inovatel was actually one of the Fund One companies of Impactful Capital. And in 2022, Quartet launched a new virtual clinic that focuses uniquely on treating patients with serious mental illnesses. And the former CEO of Inovatel, John Evans, helped navigate all this at Quartet where a high touch, high tech system was launched with the idea that they wanted patients to engage with their care in between visits. So they launched a platform whereby patients can feedback their current daily symptoms to their providers, and this would enable them to stay engaged in their care. And the company is also transitioning to a measurement-based care approach, whereby they’re looking at whole person outcomes, not just necessarily mental health, but the entire physical outcome of the patient. And they’re doing that rather than just focusing on fee for service revenue. So really some just engaging, cutting edge stuff that’s happening there. And I really wish them all the best in their new model for 2023. As it pertains to digital healthcare in general, I’m just so excited about what AI is doing. And I would say if there’s just one word to remember for digital healthcare for 2023, it’s AI. So of course, we’ve all heard about chat GPT in the recent weeks and just the possibilities that that can represent across the board, across industries. So I could just see, perhaps not in 2023, but at some point in the future where there’ll be these query systems where both patients and providers can query a chat healthcare GPT, if you will, and get really high accurate, up-to-date, evidence-based diagnoses and treatment plans. And I don’t think it will ever take the place of providers. I think it’s just going to enhance what providers do and just make all their diagnosing and treatment plans that much more accurate. And other really exciting things that we’ve seen recently is AI and data being used to help diagnose breast cancer and mammography. And then we saw in 2019, Google showed that by using AI and CT scans, they could diagnose lung cancer more efficiently than actually a group of radiologists. So that was really groundbreaking. And then Johns Hopkins researchers recently showed that by using AI and patient data in conjunction with cardiac MRIs, they were able to accurately predict who could die of a sudden cardiac arrest in the next 10 years. And so that just has huge implications for, number one, streamlining care plans to specific patients so that we help prevent that from happening before it does. The other trend that we’re going to see is continued use of consumer devices to really function almost like medical devices. And we already saw this last year that the Apple Watch was approved by the FDA to actually diagnose atrial fibrillation. And I think along those lines, there’s going to be more things that come out that are going to enhance diagnosis. So for example, Google launched an app this year using a smartphone where you could take an image of a skin lesion, a nail or a hair concern, and then using some self-reported answers in AI, this app was able to pretty accurately give consumers a list of possible conditions that obviously still need to go to a healthcare provider to confirm it, but it just helped narrow down a list of possibly what could be going on. We also saw in 2022, the Mayo Clinic that used Apple Watches and a single lead ECG reading to help predict who would be at risk for heart failure or who might actually have heart failure. And this is groundbreaking because traditionally to diagnose heart failure, you need an echocardiogram or some form of CT scan or a cardiac MRI. These are expensive tests. And so if you can just envision just by having an Apple Watch, if that could accurately diagnose this condition, which by the way, up to 9% of the people over the age of 60 have, it just could be hugely advantageous for getting treatment before the hospitalization would have to occur or for some exacerbation to happen. And then the final thing I’m really excited about is everything that Google is doing in research with evaluating how it can use its smartphone to help with diagnosis and healthcare. And so for example, they’re right now evaluating how just the camera on their smartphone can use AI to pick up diabetic retinopathy. So if you have diabetes, diabetic retinopathy is a real risk and concern, and you could potentially lose some, if not all of your eyesight if it’s not reliably detected and treated. And up until now, you needed a visit to an ophthalmologist with a dilated eye exam. So imagine if you could just hold the camera of the smartphone up to your eye and the AI could work and reliably tell you if you had this condition, it would just be huge to warn patients that they need to get care sooner rather than later. The other thing Google is looking at is using the microphone on their smartphones to listen to heart and lung sounds. So again, if you’re sitting at home, you could record an audio file or in real time, if you’re doing a televisit with a physician, is they could hear your heart and lungs while they’re talking to you over video. So I don’t know about you, but I’m just super excited about all of this. I mean, these are huge breakthroughs. It’s just the ideal way where technology can be used in a positive way to help prevent disease, to help diagnose disease and just help with treatment plans. Wow. I’m incredibly fascinated by all of your insights, especially those around AI. Just as you embrace telehealth before it was widespread, I think it’s going to be incredibly important for doctors to embrace the use of AI even before it’s commonplace or comfortable to do so. So I’m excited to see as well how that takes shape in the coming year. One other thing I’d like to highlight is that in 2021, following the pandemic, we saw a lot of investment in digital health, arguably overinvestment. We both know behavioral health was the most commonly funded condition area, and we saw some behavioral health companies doing whatever it took to acquire patients. But now that looking ahead in 2023, funding is tightening and given the significantly lower digital health funding that existed in 2022, what do you think it will take for behavioral health companies to win moving forward? I do think there’ll be some consolidation in the industry for sure, but in terms of new companies that are just starting out, I would say it’s all going to be around having a real world solution to a real world problem and then focus, focus, focus, focus, get your solution out to market, have a good go to market plan and get some contracts and revenue as fast as you can. Now Annemarie, it’s been incredibly interesting hearing about your experiences as a doctor and as an investor. In terms of your other career aspirations, I understand that you’re also interested in board service. What drives this interest of yours and how have you made this a reality in your career? So I think it just expands from the broad and diverse experiences that I’ve had in telemedicine, finance, venture capital, and medicine that all give me a skill set to provide good oversight and governance for a growing digital healthcare company. And I’m particularly interested in private healthcare boards that want the perspective and experience of a physician leader, but someone who also has finance and business knowledge as well. I’m a huge proponent of diversity in the boardroom, and I think companies with more diverse boards have been shown to perform better financially and then also do better on ESG issues. So this is part of my career that I’m also looking to develop over the next five to 10 years. I’m excited to see how that progresses. You’ve had a breadth of experiences across the healthcare sector, and I’m sure you’ve left our listeners feeling both inspired and curious about how to carve a path of their own in the venture capital space or in digital healthcare more broadly. Do you have any advice for people such as myself looking to get into the digital health space, either as a venture capitalist or more broadly? I would say get to know the industry really well. And the best way to do that, honestly, is to get an operating role at a digital healthcare company. And that doesn’t necessarily have to be a startup, but just somewhere where you can take on a lot of different operational roles and get a feel for really how a company has grown and what it takes to succeed as a startup. Healthcare is a highly regulated industry, and you really need to be in it to appreciate how the regulation affects your business. And the operating experience will later give you the skillset to then branch out to become an investor or a venture capitalist or even a board member. The other piece of advice I would give people is to really grow your network. So venture capitalists need to have a broad network of people who are entrepreneurs, operators, fellow VC investors, and also downstream investors such as people in private equity who are the ones that are going to give you that successful exit. So I would say devote a couple of hours a month just to networking. And then when you’re done networking, network some more. I can’t overestimate how important your network is. And so I would highly encourage you to get onto LinkedIn, meet some people, and you’ll have a lot of fun doing it too. I guess it’s time for me to get on LinkedIn and start sending out some networking emails this afternoon. I think you’ll be very successful doing that. Well, Anne-Marie, thank you so much for joining me on the Pulse podcast today. Your insights have been incredibly valuable and I really appreciate your time. Thank you so much. It’s been great for me to be here. Thank you for having me.

Dr. Cantwell’s journey illustrates the importance of pursuing a career that aligns with your passion. Her early interest in healthcare, influenced by her parents, guided her path toward becoming a physician and later a venture capitalist.

Transitioning from finance to medicine and then to venture capital demonstrates the value of adaptability. Dr. Cantwell’s ability to pivot based on her experiences and interests is a reminder that career paths are not always linear.

Having a deep understanding of the healthcare industry, both from a clinical and business perspective, has been crucial for Dr. Cantwell’s success. This highlights the importance of gaining relevant experience before making significant career moves.

Dr. Cantwell’s foresight in adopting telemedicine before the pandemic showcases the importance of being proactive and innovative in one’s field. Recognizing emerging trends and technologies can set you apart.

Dr. Cantwell emphasizes the significance of teamwork in driving successful initiatives, such as launching telemedicine at Kaiser Permanente. This underscores that collaboration and building strong teams are essential for achieving goals.

Her focus on improving patient care through technology stresses the need to keep the end-user in mind when developing solutions. Understanding patient needs can lead to more effective healthcare solutions.

Dr. Cantwell advises building a strong professional network, which is crucial for opportunities in venture capital and healthcare. Networking can open doors and provide valuable insights into the industry.

Successful ventures should address real-world issues. Dr. Cantwell’s investment thesis revolves around solving significant problems in healthcare, emphasizing the importance of focusing on impactful solutions.

She advocates for diversity in the boardroom, suggesting that varied perspectives can enhance decision-making and company performance. A diverse leadership team can lead to better financial outcomes and greater innovation.

Dr. Cantwell’s pursuit of board service and her encouragement for others to gain operating experience reflect the importance of lifelong learning and seeking new challenges for personal and professional growth.

Growing up in a healthcare family with a pediatrician father and a nurse mother instilled in Anne-Marie a passion for improving people’s lives through better healthcare from a young age.

Anne-Marie pursued an MBA at the Wharton School, attending the Lauder Institute for international management, which broadened her perspective on healthcare beyond clinical settings.

She began her career in investment and corporate banking, working in major cities like London and Sao Paulo, where she gained exposure to healthcare accounts, sparking her interest in the field.

A volunteer experience in an emergency department in Los Angeles led Anne-Marie to realize her true calling was to become a physician, prompting her to transition to medical school.

After completing her MD at Loma Linda University, she chose to work at Kaiser Permanente, attracted by its integrated healthcare system and emphasis on preventive care.

Anne-Marie played a critical role in launching the telemedicine program at Kaiser, recognizing its potential to enhance patient care and improve efficiency even before the pandemic highlighted its importance.

After two decades at Kaiser, her experiences fueled a strong passion for digital medicine, leading her to leave the organization in 2021 to pursue opportunities in this growing field.

Through networking, Anne-Marie connected with Sal Dutrain at Impactful Capital, drawn to his investment philosophy and the expertise of his team, leading her to join the venture capital firm.

As a healthcare venture capitalist, her medical background enables her to identify real problems in healthcare and assess the viability of digital health solutions from both provider and patient perspectives.

Anne-Marie’s journey reflects a commitment to innovation in healthcare, focusing on how technology can effectively integrate into clinical workflows to enhance patient outcomes and streamline care delivery.

Recognizing the potential of broadband internet and smartphones, the speaker foresaw telehealth as a revolutionary method to deliver healthcare, despite the initial resistance from clinics and patients.

The speaker took the initiative to approach senior management, advocating for the launch of a video visit practice, demonstrating their belief in the necessity of adapting to technological advancements in healthcare.

Leading a dedicated team of tech and education specialists, they focused on educating physicians and patients about the advantages of telehealth, fostering a culture of innovation and collaboration.

From less than 1% video consultations in 2016 to over 30% by 2021, this transformation showcased the successful implementation of their vision and the team’s efforts in overcoming initial fears associated with technology.

The speaker emphasized the importance of reimbursement for telehealth services and the need for seamless technology integration into electronic health records (EHR), advocating for practical solutions to enhance accessibility.

The pandemic highlighted the convenience of virtual care, especially for follow-up visits and behavioral health, reinforcing the belief that telehealth can provide efficient, patient-centered care.

By recognizing the challenges faced by rural populations and uninsured individuals, the speaker underscored the critical role of telehealth in expanding access to healthcare services.

The speaker anticipates advancements such as 3D video visits and smart home devices that could enhance virtual examinations, demonstrating a forward-thinking approach to healthcare technology.

The introduction of smart questionnaires for efficient triaging represents a significant leap towards personalized healthcare, aligning with the belief that technology can streamline patient experiences.

The speaker’s enthusiasm for the ongoing evolution of virtual care reflects a deep-rooted belief in the transformative power of technology in healthcare, aiming for increased convenience and accessibility for all patients.

Impactful Capital was founded on the belief that understanding the entrepreneurial journey is crucial. The team recognizes the challenges of building a company and positions itself as a supportive partner for entrepreneurs.

With over 40 partners and advisors who have experience in major healthcare systems and startups, the fund leverages this collective knowledge to provide valuable guidance to its portfolio companies.

The fund structures investments with simple preferred stock that behaves like common stock, ensuring that entrepreneurs retain a significant stake in their companies while still benefiting from the fund’s governance.

The partners and advisors collectively invest about 20% of Fund 2, demonstrating their commitment and belief in the companies they back, which fosters trust with limited partners.

After launching Fund 1 in 2017, which focused on behavioral health and value-based care, the team refined its investment thesis through successful exits and learnings, leading to the launch of Fund 2.

Fund 2 targets the rapidly evolving fields of behavioral health and value-based care, which together represent a significant market opportunity of approximately $100 billion.

The fund plans to invest in 10 to 14 new companies, using a milestone-based approach for follow-on investments, ensuring that capital is deployed effectively based on company performance.

An LP co-investment program allows limited partners to invest alongside the fund in specific companies, enhancing their engagement and potential returns.

A standout investment from Fund 1 was Care Continuity, a tech-enabled service that significantly reduced hospital readmissions by providing personalized patient navigation and support.

The fund prioritizes investing in strong founding teams with deep industry knowledge and previous successful exits, as this is critical to the success of early-stage companies.

The journey begins with a clear investment philosophy centered on the intersection of technology and healthcare, aiming for companies with a potential margin of 60% to 80%. This belief drives the selection of ventures that blend innovation with healthcare applications.

They establish essential revenue benchmarks, seeking companies that can break even with revenues between $8 million and $12 million, reflecting a structured approach to financial viability.

A commitment to sustainable growth leads them to prioritize companies with a diverse customer base, ideally 10 to 20 enterprise-level clients contributing an average of $100K each, ensuring that revenue is not overly reliant on a single source.

Their focus on validated product-market fit underlines the importance of ensuring that the product meets real customer needs, which is crucial for long-term success.

The team emphasizes the need for a balanced revenue stream, avoiding over-dependence on any one client or partner, demonstrating a proactive approach to risk management in business models.

They stress the importance of understanding the sales cycle, recognizing that a lengthy cycle can jeopardize financial health if not properly budgeted, showcasing their strategic foresight.

As they pivot to broader trends in digital healthcare, they recognize the impact of federal oversight on behavioral health, particularly in response to over-prescribing incidents, highlighting their adaptability to regulatory changes.

They foresee a shift towards addressing higher acuity mental health disorders online, reflecting a belief in the potential of technology to enhance care for serious conditions, as evidenced by companies like Quartet Health.

The excitement around AI in healthcare emerges as a pivotal belief, with predictions about its transformative potential for diagnostics and treatment, indicating a forward-thinking mindset that embraces innovation.

They observe the trend of consumer devices functioning as medical devices, exemplified by the FDA approval of the Apple Watch for diagnosing atrial fibrillation, underscoring a belief in the convergence of technology and health monitoring.

The speaker highlights the launch of innovative diagnostic tools, such as Google’s smartphone app that analyzes skin lesions, showcasing a belief in technology’s potential to enhance patient care and diagnosis.

The Mayo Clinic’s use of Apple Watches for heart failure prediction is discussed, emphasizing the belief that accessible technology can lead to earlier diagnosis and treatment, ultimately improving patient outcomes.

The speaker expresses excitement about Google’s research on using smartphone cameras to detect diabetic retinopathy, illustrating a belief in proactive healthcare measures that could prevent serious complications for patients with diabetes.

The conversation stresses the importance of doctors adapting to AI and telehealth technologies, reflecting a belief in the necessity of evolution in the medical field to improve patient care.

The podcast notes the surge in digital health investments after the pandemic, particularly in behavioral health, highlighting a belief in the growing importance of mental health solutions in healthcare.

With funding tightening in 2023, the speaker emphasizes the need for behavioral health companies to focus on real-world solutions and quick market entry, showcasing a belief in strategic business practices for success.

The speaker expresses a strong commitment to diversity in healthcare boards, believing that diverse perspectives lead to better financial performance and social responsibility.

The speaker encourages aspiring professionals to gain operational experience in digital healthcare companies, emphasizing the belief that hands-on experience is crucial for understanding the industry.

The importance of building a robust professional network is underscored, reflecting a belief that connections can significantly influence career opportunities and success in venture capital.

The speaker’s aspirations for board service and continued involvement in digital health reflect a belief in the ongoing evolution of healthcare and the importance of leadership that combines medical expertise with business acumen.

The conversation opens with a recognition of the significance of networking, highlighting it as a critical step for professional growth.

The speaker expresses a commitment to taking immediate action by planning to create a LinkedIn profile and send networking emails, demonstrating a proactive mindset.

The guest, Anne-Marie, is thanked for her insights, indicating a belief in the power of shared knowledge and collaboration.

The expression of gratitude reflects a belief in the importance of appreciating others, which strengthens professional relationships.

The host encourages Anne-Marie’s success, showcasing a belief in uplifting others and fostering a supportive environment.

The conversation illustrates the value of engaging dialogue as a means of learning and growth, reinforcing the belief that communication is key to success.

The host acknowledges Anne-Marie’s expertise, emphasizing the belief in the importance of learning from others who have experience and knowledge.

The discussion underscores the belief that networking is essential for career advancement and personal development.

The overall tone of the conversation highlights the belief in the power of community and mutual support in achieving professional goals.

The commitment to networking and the appreciation shown during the podcast suggest a belief in the potential for future opportunities through connections made today.

In the latest episode of The Pulse Podcast, co-host Rachel Feller welcomes Dr. Anne-Marie Cantwell, a seasoned expert in digital health and venture capital. Dr. Cantwell, currently a venture partner at Impactful Capital, has an impressive background that includes over two decades at Kaiser Permanente, where she was instrumental in pioneering telemedicine initiatives long before the COVID-19 pandemic highlighted its importance. With dual degrees in medicine and business from prestigious institutions, including the Wharton School, she offers a unique perspective on the intersection of healthcare and technology.

Listeners can expect to gain valuable insights into Dr. Cantwell’s career journey, her transition from clinical practice to venture capital, and her vision for the future of behavioral health and digital healthcare. The conversation delves into the transformative potential of telehealth, the challenges and opportunities in the healthcare landscape, and the critical role of technology in enhancing patient care. Dr. Cantwell also shares her thoughts on emerging trends in digital health, emphasizing the importance of real-world solutions to address pressing healthcare issues. This episode is a must-listen for anyone interested in the evolving world of healthcare innovation and investment.

Anne-Marie Cantwell grew up in a healthcare-oriented family, with her father as a pediatrician and her mother as a nurse, instilling in her a passion for improving healthcare from a young age.

Anne-Marie Cantwell grew up in a healthcare-oriented family, with her father as a pediatrician and her mother as a nurse, instilling in her a passion for improving healthcare from a young age.

While volunteering in an emergency department in Los Angeles, she discovered her true passion for medicine, prompting her to transition to medical school.

After completing her MD at Loma Linda University, she joined Kaiser Permanente as an internist, appreciating its integrated healthcare model and focus on preventive care.

At Kaiser, Anne-Marie played a crucial role in launching the telemedicine program, significantly advancing virtual healthcare practices before the pandemic made it a necessity.

After spending seven years as a hospitalist, she transitioned to primary care, further deepening her understanding of patient needs and healthcare delivery.

Leaving Kaiser in 2021, she sought to continue her work in digital health, driven by her experiences and the desire to innovate in the field.

Through networking, she connected with Sal Dutrain at Impactful Capital, drawn to his investment philosophy and the expertise of the team, leading her to join the venture capital firm.

As a healthcare venture capitalist, Anne-Marie uses her frontline experience to identify healthcare problems and evaluate digital solutions, ensuring they align with real-world clinical workflows.

The speaker identified the potential of broadband internet, 5G networks, and mobile devices as pivotal tools for healthcare delivery, realizing that clinics and patients had not yet adapted to this technology.

The speaker successfully convinced senior management to allow them to spearhead the launch of a video visit practice, aiming to educate both doctors and patients on the benefits and usage of telehealth technology.

At the start of the initiative in 2016, video visits accounted for less than 1% of all patient encounters.

The speaker led a team of tech and education specialists to train physicians and providers, alleviating fears regarding technology and telehealth diagnoses, fostering a supportive environment for adaptation.

By 2021, video visits increased dramatically, reaching over 30% of all encounters, showcasing the effectiveness of the initiative and team efforts.

The pandemic highlighted the convenience of virtual care, particularly for follow-up visits, simple primary care issues, and behavioral health, confirming its value as a supplementary tool in healthcare.

The speaker noted that virtual care could reduce overall healthcare costs and lead to smaller medical facilities in the future, as more care is delivered remotely.

Telehealth provided significant access to healthcare for individuals living in rural areas or those without insurance, although challenges remained for those lacking digital literacy or high-speed internet.

The speaker envisions advancements such as 3D video visits and home devices that assist with physical exams, facilitating even more effective virtual consultations.

The emergence of smart questionnaires that triage patients based on their responses represents an exciting development in virtual care, enhancing the patient experience and streamlining access to appropriate care options.

Impactful Capital was founded, marking the beginning of their journey in the venture capital space focused on digital health.

Fund 1 was actively invested, comprising a total of eight investments, allowing the team to refine their investment thesis centered around behavioral health and value-based care.

Three successful exits were achieved from Fund 1, providing valuable insights and experience that informed their future investment strategies.

Launch of Fund 2 with a target of $50 million, focusing on expanding their investment in behavioral health and value-based care, which together represent a substantial market opportunity of approximately $100 billion.

First close of Fund 2 was completed, and efforts were initiated to raise the remaining capital for the fund.

Plans to invest in 10 to 14 new companies using a milestone-based follow-on investment approach, with about two-thirds of the capital allocated to Series A investments and one-third to Series B.

Introduction of an LP co-investment program, allowing limited partners to invest alongside Impactful Capital in specific companies they are particularly interested in.

Fund 1’s investment in Care Continuity, a tech-enabled concierge service that significantly reduces patient readmissions by enhancing patient navigation through the healthcare system.

The firm emphasizes entrepreneur-friendly partnerships, operational expertise from a diverse network of partners, and favorable investment terms structured to support long-term growth.

The evaluation of founding teams accounts for about 70% of their investment decision, prioritizing deep entrepreneurial and operational experience as well as a clear understanding of the industry challenges they aim to address.

The company aims to invest at the intersection of technology and healthcare, seeking products with a core technology component and elements of healthcare.

They prioritize companies that can break even on revenues between $8 million and $12 million, with a preference for 10 to 20 enterprise-level customers contributing an average of $100K each.

Emphasis is placed on validated product-market fit and ensuring a return on investment for clients like health plans and employers.

They seek companies with a diversified customer base to mitigate risk, avoiding reliance on a single client for a significant portion of revenue.

Companies should demonstrate sustainable business practices, avoiding excessive cash burn on marketing and being cognizant of their sales cycle.

Anticipating increased federal oversight in behavioral health, particularly following issues with over-prescribing by companies like Cerebral and TruPill.

Despite concerns, the majority of telepsychiatrists are effectively screening and prescribing for ADHD, with potential challenges arising if face-to-face visits become mandatory again.

There’s a shift towards addressing higher acuity mental health disorders online, with startups focusing on serious conditions, highlighted by Quartet Health’s initiatives.

Excitement surrounding the role of AI in digital healthcare, with potential for advanced query systems to enhance diagnosis and treatment plans, exemplified by breakthroughs in cancer diagnostics and predictive analytics.

Continued integration of consumer devices into healthcare, such as the FDA-approved Apple Watch for diagnosing atrial fibrillation, marking a trend towards everyday technology functioning as medical devices.

Google launched an innovative app allowing users to take images of skin lesions or hair concerns, utilizing AI to suggest possible conditions, emphasizing the need for professional confirmation.

The Mayo Clinic began using Apple Watches for single-lead ECG readings to predict heart failure risks, potentially revolutionizing early diagnosis without expensive imaging tests.

Google is exploring the use of smartphone cameras combined with AI to detect diabetic retinopathy, enabling early warnings for patients at risk of vision loss.

Following the pandemic, there was a surge in digital health investments, particularly in behavioral health, as companies sought to rapidly acquire patients.

As digital health funding decreased, companies are urged to focus on delivering real-world solutions and establishing market presence quickly to survive in a competitive landscape.

The speaker expressed a desire to serve on private healthcare boards, leveraging her diverse expertise in telemedicine, finance, and medicine to provide effective governance.

Emphasizing the importance of diversity, the speaker noted that companies with diverse boards tend to perform better financially and on ESG (Environmental, Social, and Governance) issues.

The speaker recommended gaining operational experience in a digital healthcare company to understand industry regulations and business growth.

Highlighting the significance of building a robust network, the speaker encouraged dedicating time to connect with entrepreneurs, operators, and fellow investors for future opportunities.

The speaker expressed excitement about developing her board service career, aiming to contribute to the growth of digital healthcare companies through her unique skill set.

The speaker realizes the need to enhance their professional connections via LinkedIn.

They make a commitment to start sending out networking emails that afternoon.

The host expresses gratitude and acknowledges the value of insights shared by Anne-Marie on the podcast.

The host appreciates Anne-Marie’s time and contributions, indicating a successful dialogue.

Anne-Marie shares her enjoyment of the experience, reinforcing the value of the conversation.

The podcast concludes with a sense of fulfillment from both participants, highlighting the importance of sharing knowledge.

The speaker’s intention to network suggests a proactive approach to career development.

The discussion emphasizes the significance of building connections in a professional context.

The podcast serves as a medium for sharing insights and fostering professional growth.

The interaction encourages listeners to engage in similar networking efforts and seek valuable conversations.