Healthcare tech startup Patientory made headlines earlier this year when it announced it had raised $1.5 million in its latest funding round ahead of the launch of its new, HIPAA-compliant, consumer app and secure enterprise portal.
The funding is just the latest success for a promising startup whose real story is about how it overcame some enormous hurdles in its path. Those obstacles include not only the challenges of innovating in a healthcare industry that's notoriously resistant to change but also those that are unique to minority women founders.
Patientory is the brainchild of its African-American founder and CEO Chrissa McFarlane, who foresaw blockchain's disruptive potential in the healthcare industry as early as 2011, a time when Bitcoin itself was still in its infancy.
The distributed ledger technology was invented as a way for Bitcoin users to verify transactions on its network without the need for a centralized intermediary, and McFarlane was one of the first to realize it could also be applied to healthcare. By storing health data on a blockchain-based system instead of a regular database, patients would have better access to this information and gain insights from it that would help them lead healthier lives. Just as importantly, it would also allow patients to control who can access that data, and even monetize their data.
This is the basis of Patientory's smart health data wallet application, which allows users to securely store their health data on its specialized blockchain network, PTOYMatrix. The HIPAA-compliant Patientory app enables health data, including medical records and wearable fitness device data, to be synced across its blockchain and accessed by users at any time they wish. Its most popular feature is a clinical trial tracker that works by matching patients to suitable clinical trials. Patients are also able to monetize their data.
Breaking Down Silos
McFarlane founded Patientory back in 2015 and the launch of its app underscores an incredible achievement. Traditionally, sharing healthcare data has been seen as a major challenge that prohibited innovation in the industry. The problem is that healthcare information is extremely siloed, stored on a multitude of legacy technology systems used by different providers that lack interoperability with one another. Another issue is the industry's heavy reliance on paper documents, which are either filed away in a cabinet somewhere, or at best uploaded to a system as an image file that traditional software is unable to analyze. Add to that, the healthcare industry is one of the world's most heavily regulated, making it difficult to share data even if the systems are interoperable.
"Due to HIPAA policies and regulations, it has been difficult for organizations to freely share the information that resides in distinct and individual patient portals with all care providers and stakeholders who might need the information in order to provide the best care," McFarlane told Securities.io in a 2021 interview.
Patientory's solution was two-fold. On the one hand, it created a national health information blockchain network, PTOYMatrix.
At the same time, Patientory made huge efforts to ensure its platform is regulatory compliant. In Nov. 2021 it became a member of CommonWell Health Alliance, a nonprofit organization dedicated to creating universal access to health data via a person-centered, nationwide network.
Last year, Patientory scored a big regulatory win when it was granted the Patient Access Certification by CommonWell, paving the way for it to launch its healthcare app. Patientory also joined up with the Sequoia Project, which is a federal government-supported organization tasked with administering The Trusted Exchange Framework and Common Agreement, or TEFCA, which outlines a common set of principles, terms, and conditions for a common agreement that will enable the nationwide exchange of electronic health information across disparate healthcare networks.
Overcoming The Odds
As if the task of disrupting a notoriously static industry wasn't difficult enough, McFarlane herself faced a number of challenges that are unique to minority female entrepreneurs in the U.S.
These are well documented, with one of the most pressing problems being a lack of access to startup capital. Studies show that black women business owners who apply for funding are rejected, on average, three times more than white business owners. On top of that, just 2% of venture capital funding in the U.S. goes to female-only founding teams.
In her book, FUTURE WOMEN: Minority Female Entrepreneurship and the Fourth Industrial Revolution in the Era of Blockchain and Cryptocurrency, McFarlane recalled the difficulties of raising funds and how she was rejected multiple times in the early days. However, she was ultimately able to overcome these challenges. Partly, she was helped by a number of valued advisors and mentors who supported her during the difficult, early days of her company. Ultimately, Patientory was able to raise $7.2 million in just two days through the unconventional route of an early token sale. More than 1,000 individual investors acquired PTOY tokens during the company's ICO.
The value of mentors is not to be underestimated. In his book, The Startup Brain Trust, Arizona State University professor CJ Cornell notes that mentored entrepreneurs raise seven times more capital than those without mentors, and they experience 3.5 times more growth. In addition, if their founders have mentors, 70% of small businesses survive longer than five years, which is twice as much as those without mentors.
In an interview with Google's Keyword, McFarlane offered a couple of recommendations to minority female founders in the same position as she was, stressing the importance of connecting with an ecosystem, such as an accelerator or incubator and seeking as many funding alternatives as possible.
"In my opinion, flexibility is one of the most important attributes of a successful entrepreneur," McFarlane said. "Female entrepreneurs, specifically, are met with many obstacles and barriers to success and it is by remaining flexible that they are able to overcome these challenges."
On The Path To Success
McFarlane's flexible nature is finally paying off for Patientory with the big launch of its consumer app this year. On the path towards its launch, Patientory was twice named "Startup Company of the Year" by the World Economic Forum Tech Pioneer, while McFarlane herself was acknowledged as one of the "top women leaving their mark in MedTech" by Becker's Hospital Review.
Meanwhile, Patientory has been steadily gaining traction, growing its user base to more than 45,000 across its two offerings, while integrating with the healthcare systems of Cerner, Allscripts, Meditech, Athenahealth, and Epic, to name just a few.
