Connected H Failure:Brutal truth beyond market realities crush Ambition
Capital-expensive startups had a very low probability of sustaining in the business market. Because many startups fail miserably because of funding crunch.
Today in What Went Wrong series, On Day 9 let’s unpack the story of Connected H and what went wrong in that startup with raw insights.
Healthcare and manufacturing were the two domains in which first-generation founders failed miserably due to huge requirements of capital. Health tech startup raised lifetime funding 2.8 million USD still failed.
Diagnostics and Healthcare domain is having more scope of implementing technology and innovation in process and hardware. Three tech and business enthusiasts health tech startup connected H with providing CRM solutions, online report management tools and integrated diagnostic lab procedures.
In 2018, Shubham Gupta, Rahul Kumar, and Suresh Singh launched a full-stack B2B diagnostic health tech startup. Shubham and Suresh worked with Car Dekho as Growth, and Rahul worked as a Data scientist with a startup earlier. They identified the potential to implement tech solutions in the diagnostic space to solve the problems. They researched with multiple hospitals and diagnostic labs and identified the need for CRM solutions.
In Feb 2020 raised Initial seed funding 277K USD from Angel investors namely Well Found, First Cheque, and prominent startup founders. Having a diverse background cohort of the founding team, they developed in-house applications and features for connected H to improve the process. Many investor firms and large healthcare conglomerates shown interest in adopting CRM solutions and online report management tools.
To expand the business into the enterprise, Connected H provides customized products to institutions.
Product Name
Product Description
Proton
A mobile application that digitizes the sample collection process, eliminating paper processes and manual data entry.
Engage
A tool to create instant websites for healthcare providers, enabling them to build their digital brand quickly.
One View
A patient relationship management tool to enhance interactions and build better bonds with patients.
Feedback Manager
A system to collect patient feedback post-visit and provide actionable insights.
Phleb
An app to manage and track the sample collection process, including automated patient communication and booking assignments
Specialized products improve the revenue and traction from patients and healthcare organizations. Founders raised 2.5 million USD from Kalaari Capital, Incubate Fund India, and startup founders of Cred, Unacademy, Share Chat, and others. The collaboration of startup founders creates a trajectory to connect large conglomerates and B2B organizations.
Connected H has served 5 lakh patients integrating more than 400 health care organizations in 5 cities in 4 years. They created a database of 10 million health data points which helps them in predictions and optimization strategies.
Founders were confident that they were providing technical abilities to healthcare organizations but they realized later that to sustain and run the game we need more capital for infrastructure and client acquisition cost. Competitors were very strong in healthcare which were backed by huge venture capital firms. In FY 2023, connected reported revenue of 249K USD with a loss-making of 765K USD. With the onboarding of 17 investors in the seed stage made chaotic to founders on financial decisions. Investors were expecting profitability and sustainability in business which founders realized they couldn’t achieve further. In Aug 2023, Co-Founder Suresh Singh shared a LinkedIn post that ConnectedH will be shutting down operations due to market realities and refused to comment.
What Went Wrong
· Capital-intensive processes proved the requirement of funding for long-term growth.
· Ineffective client acquisition strategies hindered long-term scalability.
· Missed opportunities to diversify business verticals stalled profitability.
· Investor pressure on short-term profitability stifled long-term growth potential.
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