GovTech in Focus Top Tenders and Awards July-August
Startups, we know that selling to the public sector is tough. In a monthly series, PUBLIC – in partnership with Tussell, the data provider on UK government contracts and spend – provides the GovTech community with the lowdown on the most valuable and exciting GovTech tenders issued by public-sector bodies every month – as well as the opportunities you might have missed.
In July, Crown Commercial Services published two huge Pre Information Notices including a £550m framework for Debt Resolution Services. As noted in our previous editions, AI is in high demand within public services and awards for COVID Tech continue to be issued across the UK.
Crown Commercial Services – £90m Artificial Intelligence Dynamic Purchasing System
The Crown Commercial Service is looking to put in place a ‘Pan Government Collaborative Agreement’ for the provision of AI services. Published at the end of July, this £90m PIN will cover discovery and consultancy work related to the use of AI in public services, development, implementation and support of AI systems in the public sector, data analytics using AI and the implementation of intelligent virtual assistants.
The second CCS PIN is a £550m framework for Debt Resolution Services. Key core services may include debt collection agency services, warrant recovery services, debt analytics, data aggregation services, debt business process outsourcing and fraud and error prevention and analysis.
Live Tender: £45m Robotics Clinical Partnership
NHS Wales is seeking an industry partner to develop a countrywide robotic surgical network aiming to make available the most advanced surgical techniques to the entire population. As a result of the unique geography in Wales, NHS Wales would require a robotic partner that shares NHS Wales vision in utilising technological solutions to overcome environmental challenges.
Tender deadline = 28th August 2020
Opportunities you may have missed:
Student Loans Company awarded Talend Ltd a £500k contract to run a real-time big data project in Scotland which is expected to run for the next year.
Also in Scotland, the University of Aberdeen awarded Fenix Media a £250k contract for a “Cloud-hosted Social Intelligence Tool” to help them in the “collection and intelligent analysis of acquired social media data”. The technology will be used to monitor internet traffic which includes the University’s name as well as key words that are identified as related to the University’s interests.
Covid-19 continues to spur on the uptake and necessity of new digital technologies. One of the many tenders awarded was the Government Digital Service’s “work on the Vulnerable People Services” which was awarded to Method’s in April for £400k and was completed in July.
Public Health England purchased over 1,000 laptops for Test and Trace from Stone Computers. Across the two contracts won, the award came to a total of nearly £1m.
Unsurprisingly, many contracts have been awarded in the past month to suppliers with technology to aid homeworking and video conferencing. Total Computer Networks Limited were awarded a three year contract to provide The Competition & Markets Authority (CMA) with monitors for homeworking and Kcom Group supplied Hull University Teaching Hospitals with video conferencing equipment and associated annual support for 5 years.
If you are a tech company that wants unparalleled insights into the key government opportunities and trends, get in touch with us about how we can help – you might be interested in applying to our GovStart programme!
How to deal with a full inbox of tech offers: A public sector guide
If you are a public sector worker, chances are you currently have a very full inbox. Huge numbers of companies and organisations, particularly in the tech sector, are stepping forward to offer solutions and products to support government frontline services. It’s fantastic – but if you are the person fielding the offers of help, it can also be very overwhelming. Answer one email and two more appear – how are you ever meant to cut through the noise and find the solutions that will actually help, let alone do it among all the other challenges COVID-19 has created?
Here at PUBLIC we regularly run innovation challenges with government bodies, sifting through hundreds of applications to find the new technology solutions with the potential to dramatically improve public services. In our most recent programme, TechForce19 delivered in partnership with NHSX, we received over 1600 applications from tech companies and appraised all applications in less than a week. Here are a few quick tips we’ve learned for quickly assessing offers of help from tech companies and finding the solution you need.
Tip #1: Have a clear idea of the challenges you are trying to solve
This might sound obvious, but the fastest way – if not the only way – to sort the solutions that are useful from the solutions that aren’t useful, is to have a clear idea of the problem you are trying to solve. In times of stress or high workloads, it can be really easy to lose sight of the end goal. Don’t let the rush distract you, keep your end goal in mind.
Often a good way to maintain laser-like focus on what is useful versus what is not, is to write down your challenges in really simple questions – for example, how can we check on dementia patients’ well-being without visiting them? Phrasing challenges in this way gives a very clear idea of the desired end result, whilst also keeping the means of reaching this end result open enough for new & innovative ideas to provide you with solutions you might not have even thought about.
Tip #2: Create a contact form with your key questions
When comparing two potential solutions, ideally you want to be comparing like for like. This can be tough though when you are receiving inbound offers. Enquirers will be sending you presentations and product demos, all of which will be answering different questions in different ways. A fast way to cut through this noise is to draw up a quick contact form.
A contact form will allow you to set the questions, making it easy to find the information you need in a style that will be quick and easy to assess. Using Tip#1, think of the challenges you want to solve and the questions you will want to ask to be confident that this offer of support can help you. What metrics or data do they have to show they are solving your problem in a way that is faster or easier or cheaper? What technical or commercial standards will they need to meet? Set the questions you want answered and let them to the leg work to tell you how they can help.
(NB: If you are looking for effective contact form tools to use, I would recommend Typeform, Airtable, and SurveyMonkey which are all quick and easy to use).
Tip #3: Categorise prerequisite questions from qualitative questions
Some questions you want answered will be prerequisite ‘yes or no’ questions – ‘Do you have Cyber Essentials qualifications?’ for example. Others will be more qualitative – ‘Describe how you would intend to implement your product or service?’. Whether you are setting up a contact form or just replying to an email, it is important to work out in your mind which questions are which and approach them accordingly.
If you are pressed for time or sifting through lots of enquiries, focus on the prerequisite questions first. Once you have worked out which solutions don’t meet your criteria, you can set them aside as non-immediate and spend more of your time reading and evaluating the solutions that are more likely to fit your needs.
Tip #4: Set aside a period of time to focus
Nothing speeds up a process like repetition. Don’t try and answer the enquiries as they come in. Set aside a time every two days or every week and concentrate solely on reading through inbound offers. Not only will this make it easier to compare similar offerings or solutions, but through the repetition your brain will quickly find ways to hone in on the key information quickly and save time.
For peak productivity: find time slots that work well for you – early mornings are often particularly effective; make sure you have a coffee; and put headphones on to ensure you won’t be disturbed.
Tip #5: Don’t be afraid to be honest
Speaking from the point of view of a tech supplier, nothing is worse than being strung along a series of meetings only to find nothing was ever possible in the first place. Be honest with the people who are sending you offers: if their solution either doesn’t fit your needs, tell them that it is not what you are looking for right now. You will be helping them by saving them time. If your priorities or challenges change, you can always return to the correspondence.
Similarly, don’t be afraid to be honest about your timelines. If it is likely that you will not be able to respond to their email or evaluate their solution for a week or two weeks, let them know. It will save them from chasing you and you from being chased.
As the offers to help mount up, don’t drown in correspondence. Get ahead of the curve and put in place some systems that will help you make smart decisions quickly and easily.
Conversations with founders: How to build a GovTech startup (Part II)
Ever wondered how startup founders decided to build their company? Or what experience they had in that industry that made it possible? As part of our research for PUBLIC’s upcoming report on the background of GovTech founders we interviewed 8 startup founders to explore some of the challenges and successes encountered when building a GovTech startup. To ensure a diverse cohort of experience and expertise we interviewed founders of startups across multiple sectors including healthtech, policetech, edtech and civtech.
In the second in our series of ‘Conversations with founders’, we interview three GovTech founders about their experiences building a startup.
John Witt is the co-founder and CEO of public-sector sales-tech platform Stotles. John and his co-founders Taj and Carsten met, and founded Stotles, during their time at London Business School.
Stotles plunged into the market with its sales-enablement SaaS focused on opening up public sector procurement to more suppliers. Their product uses data science to help suppliers proactively find the hottest leads in the public sector and boost sales productivity.
John gained relevant public sector exposure while working as a financial auditor of U.S. public sector agencies and tech companies who sold to the public sector. Before founding Stotles, he also worked at the World Economic Forum on the digital transformation of public bodies. Like many founders, John found that his previous experience working beside the public sector helped him understand how governments are approaching digital transformation; this enabled him to understand the opportunities for Stotles.
His previous experience founding a financial inclusion start-up taught him valuable skills, such as unearthing customer pain points, conveying the “art of the possible”, and learning the types of businesses he most enjoyed: B2B, rather than B2C, at the intersection of business and government.
John considers one of the best ways to find problems worth solving is to get your hands dirty in messy experiences, and to connect dots across those experiences. His experience and connections across the public and private sectors helped him identify problems he wanted to solve.
John sees no substitutes for hard work and a world-class team. But he’s also convinced that much of Stotles’ early success has also come through the support of family, friends, networks, and luck. During their funding round, Stotles worked hard to change the stigma that working in the vicinity of the public sector is “boring”. The team firmly believes “boring” is actually not-so-boring at all.
Key takeaway from founding Stotles? People are everything. Build something people love and find the people with the right values to build it. Particularly in a software business, employees and customers are the foundation of our product; of our growth plan; of our mission to unlock the potential of two largest institutions on the face of the planet – business and government – working better together.
Stotles is currently running a private beta of its platform for suppliers aiming to grow in the public sector, bringing hundreds of UK businesses onto its early-access list. Sign up for the private beta here: stotles.com/w/PUBLIC
GovStart 2019 founder Alfonso Zamarro co-founded Unblur in Barcelona in 2014. Unblur helps emergency services make faster and better decisions and grew out of a previous startup that Alfonso founded. The idea for Unblur came when they were trying to develop a platform for drones, and the emergency services they were talking to were interested in certain aspects of the software but not the drones, hence why they decided to turn the software into a new startup.
Like many other founders, Alfonso met his co-founder at business school – the founding team of the previous company they co-founded were no longer relevant for the new company, but played an instrumental role in using their connections to help Alfonso fill the new c-suite roles. They interviewed over 100 emergency response organisations across Europe for their previous startup, and this network proved crucial for getting Unblur off the ground.
After bootstrapping in the original stages, they got an Enisa loan from the Spanish government and used this money to build the product. Alfonso admits once they had the product it was easier to get other investors interested.
Biggest obstacle? Being taken seriously by the emergency services, this involved building credibility and gaining their trust and cooperation in co-developing the solution.
Simon speaks from experience when it comes to building, running and innovating companies, as Coeus Software is not the first company he has started. Prior to Coeus Software, Simon founded HeliMedia, a leading supplier of Intelligence, Surveillance and Reconnaissance (ISR) communications solutions. Before that, he held a number of roles, from spending 10 years as an engineer for the BBC to heading operations for three years at a Californian startup.
Coeus was created from the vision of developing technology to help frontline police officers with their day to day duties through digitising manual paper-based processes. Coeus completed an initial trial with Lancashire Constabulary and this won the APPSS Innovation Award judged by the Home Office Scientific Development Branch in 2008.
However, Coeus soon learned that there are many barriers which prevent innovative solutions, created by SMEs, from being commercially successful in the UK Police Market. Coeus has continued to build on the initial innovation to rapidly and continuously test and adapt ideas to provide enough evidence from the field to prove they will work. This has included working with the NPIA and CPS on Electronic Witness Statements and with the Home Office and BAE Applied Intelligence on a technology demonstrator to showcase UK technology at the Security and Policing Show. This evidence-gathering approach helps to reduce the risk and uncertainty for those in the public sector that are looking at new ideas, but as Simon points out, it is no guarantee of immediate success.
As a start-up in the police sector, Simon points out that the only way to gain contracts is through larger prime contractors as there is a reluctance to work with SMEs, especially if you are not on any of the government frameworks. The disadvantage of this is that you are one step removed from the customer which can make it more difficult to understand their needs.
Greatest challenge? Breaking the ‘cosy cartel’ that currently exists in the market where forces complain about the high costs and poor service they are being provided by the incumbents but yet they still go back to them because of the ‘better the devil you know’ attitude.
If he could change one thing about his experience as a founder he would wish that the talk from the government sector would be matched with the same action and enthusiasm that exists in GovTech Startups.
Calling all GovTech founders! Help shape the future of digital governance by filling out our short survey – this will greatly help our research team who are working on their latest report. Click here to fill out survey.
Conversations with founders: How to build a GovTech startup
Ever wondered how startup founders decided to build their company? Or what experience they had in that industry that made it possible? As part of our research for PUBLIC’s upcoming report on the background of GovTech founders we interviewed 8 startup founders to explore some of the challenges and successes encountered when building a GovTech startup. To ensure a diverse cohort of experience and expertise we interviewed founders of startups across multiple sectors including HealthTech, PoliceTech, EdTech and CivTech.
While founders had differing experiences working within the public sector, most had attended business school and had previous experience as a founder of a startup in a similar sector. Those that had worked in the public sector before founding their startup had learnt from the challenges that they came across and used their experiences to build a solution. Here are the first four startup founders that we spoke to!
Slava Kremerman founded EdTech startup Zen Educate in 2017 after meeting his co-founder in business school. Zen Educate helps schools cover staff absences – a problem which was first identified by a family member. Having worked in banking and consulting, Slava had no relevant public sector experience although he had previously helped to build FinTech startups.
How to break into the EdTech market? Schools have autonomy that most public authorities don’t have and so are able to procure many products and services on the spot. Roughly 30% of their clients come through referrals from other schools that use their products. Having raised three rounds, Zen Educate currently has about 50 employees and Slava argues that prioritising values and passion over skills when hiring is something that he found to be important during his journey as a founder.
Formula for success? Attention to execution – constantly improving and delivering a high quality service.
One of the greatest challenges Zen Educate faced was the limited access to funding for GovTech companies, combined with lack of procurement opportunities.
Iraklis Bourantas, Co-Founder and COO of Novoville
Iraklis Bourantas worked for a software company, a tech institute and the Greek Ministry of Foreign Affairs before co-founding CivTech startup Novoville. His family was deeply embedded in local government and his father and aunt were both Deputy Mayors. Being a politically active citizen, the idea for Novoville came out of his own frustration in engaging with the local government, and through his own connections he pitched it to newly elected, younger mayors, who loved it. Iraklis found that the best knowledge and experience came through working with the first couple of client’s and they adapted the product to these challenges. Through scaling into different countries they learnt that 80-90% of the challenges local authorities face in different countries are roughly the same.
Iraklis and his co-founder Fotis Talantzis personally funded the development of the prototype and raised funds after their first few clients in order to grow. They approached a local VC that was partially funded by the European Investment Fund; it took about 6 months to convince them to invest because they were weary of the GovTech sector and had a mistrust towards the public sector. For the second round they wanted an international range of VCs, and once again struggled to convince VCs about the viability of the sector.
Despite having won 56 contracts across 3 countries, Novoville’s biggest challenge was continuing to grow in new markets, and managing remote teams across countries. Iraklis told us that understanding the local realities of new countries often feels like starting a new startup from scratch and every time you have to convince new local stakeholders of the business’ viability and the sector’s potential.
If you could go back – what would you do differently? Iraklis said he would change their approach to hiring and prioritise hiring people who would fit in with the culture and mentality of the company. When it comes to investors, they regret wasting time on VC’s that were not serious which caused delays in the company’s plans.
Advice to new startups? Start small with one client, adapt your product based on the feedback from this client, and only then try to scale.
Daniel Mohamed studied urban planning and regeneration before founding Urban Intelligence. He previously worked as an urban planner for 3 years during which he observed many opportunities to change things. He claims he wouldn’t have known the the problem which his startup solves existed if he hadn’t worked as a planner.
Daniel didn’t have any networks in technology, venture or finance and admits that being self employed was difficult. To finance the business initially he took out two loans, one from a bank which he personally guaranteed, the other he received from UCL as a result of winning an entrepreneurship award. It took him a long time to find the right investors. When the company made it onto an accelerator, they weren’t VC ready by the time they graduated from the accelerator, and so had to go hunting for angels. Daniel argues that accelerators are good at putting you in touch with VCs but not with angels. He met an angel through luck at a networking event, who then introduced him to further angels.
The biggest challenges Daniel faced were having to rely on 3rd party public sector data, recruiting the right people with the right skills and building a good team dynamic, and raising funding. If Daniel could go back and do things again he said he would take a much leaner approach to building a startup as he regrets spending too much time on spec when they could have got an MVP out of the door much faster.
Most important skill gained? Emotional intelligence – to deal with the shocks and unpredictability of founding a startup.
How could the public sector change for the better? Move away from document based systems and turn plans into models that are constantly updated with the latest data so you can track things in real time and make predictions for the future.
Before founding Cyan Forensics, Ian worked as an engineer, consultant and CTO. After having spent time in business school, Ian worked with startups to help create businesses, raise money and facilitate university spin-outs. He was called in by Napier University in Edinburgh to assess some research to see if it had potential for commercialisation.
After deciding that the research did have potential he chose to spin it out with Bruce Ramsay, a key member of the research team, and Cyan Forensics was born. Ian found that his network contributed strongly to getting Cyan going and he knew where to look for professional services, legal and financial advice, recruiters, office space and other support. Cyan Forensics has won a major contract with the Home Office as well as several contracts with individual police forces, including some in Europe.
What needs to change? Startups need investors who understand the benefits of public sector markets – this could be achieved through greater dialogue between the two. If the public sector wants innovation it needs to be willing to listen to new ideas, and learn that they will not always be presented with final products.
Public sector bodies need to be willing to try new things, run pilot programs, and to become a good customer, because people won’t innovate if there is no reward. Investors will not back companies that are trying to sell to the public sector if the process is so convoluted that ultimately there is no return. A problematic public sector mindset is that ‘things must succeed when you do them’, which is incompatible with the startup mindset of ‘try something and see if it works’. Success emerges from failure – risks shouldn’t be taken in all areas of government, for good reason, but there need to be dedicated spaces for risk-taking if the public sector wants to support innovation.
Interested in hearing from more startup founders? Stay tuned for Part 2!
Earlier this month, previous GovStart company Cera Care acquired Mears Care in a deal worth more than £30m. The acquisition will boost Cera’s employee numbers to 2,000, with 20 offices across the country and the ability to deliver more than 10,000 visits a day. We spoke to co-founder Dr Ben Maruthappu about how Cera has grown since leaving the GovStart programme and what their plans are for 2020!
What is Cera Care and why did you embark on this venture?
We are a tech-enabled home care provider with the ambition of revolutionising the social care sector, supporting older people in living their best lives in their own homes, by receiving great & modern home care. We established Cera as it was clear that multiple parts of social care were outdated, leading to numerous challenges in the industry, from inefficient operations, to low-paid staff, from highly reactive care leading to greater hospital admissions and pressures on the NHS. We firmly believe that technology and innovation can help remedy some of these issues, which is why we set up Cera.
How does your solution help the elderly?
We have digitalised the full care process, from the on-boarding of users, to matching them to carers, back-office logistics, to reporting of care visits and real-time decision making via our online platform and App. This improves the quality of care and makes care more efficient, scalable and transparent. We can reduce overhead costs through our technology and so invest more in our carers, meaning they are better rewarded and valued, while using our digital platform to monitor care standards and ensure our users receive the best care possible. We also use data collected from care visits to predict and prevent health deteriorations in our users, with 83% accuracy, so we can be proactive in looking after their health, while avoiding hospitalisations.
How far do you think you’ve got in solving this problem?
We launched just over 3 years ago and have made significant traction, now delivering 10,000 care visits a day, with 20 offices across the country. We are the largest care-tech company in Europe, and one of the largest care businesses in the UK outright. Rolling out our technology has shown to improve user satisfaction significantly (eNPS scores increase by over 30 points). We also improve carer retention, health outcomes and deliver a safer service, while transforming the experience users, families, staff and carers have through offering a more modern service.
Tell us what’s new since leaving the GovStart programme
GovStart provided an outstanding foundation for us to build our startup. Since the programme we have grown to over 2000 employees, reaching national scale with over 50 public sector partnerships, and were rated ‘Good’ by the healthcare regulator, the CQC. We have raised significant amounts of capital and are fortunate to have a fantastic Advisory Board Chaired by Sir David Behan, and formerly, Sir Nick Clegg.
Looking forward, what are your plans for 2020?
We want to continue our expansion across the UK, acquire traditional care businesses that we can transform with our technology, and double-down on our use of Machine Learning to predict and prevent health deteriorations in our users, so that they can stay healthier for longer in their own homes.
What advice would you give to early GovTech founders?
First, invest in your team; having the right people around you who are committed to your startup’s mission is invaluable and will be what makes your company a success. Second, PUBLIC has a phenomenal network, with an excellent leadership team so I would fully recommend you reach out to them for advice on how to navigate the public sector, to forge long-term and successful public sector partnerships. Third, be resilient – building a startup that collaborates with the public sector takes real persistence and patience; there will definitely be ups and downs – keep going!
Building a gateway between the elderly and the digital world: An Interview with Nepos
We interviewed Alexandra Böhmer, CEO of GovStart 2019 company Nepos, to hear about their experience as part of the German cohort and how their solution helps digitalise the older generation.
What is Nepos and why did you embark on this venture?
We believe that every generation deserves to benefit from advancing technologies. Therefore, we have embarked on a quest of optimising, transforming and curating the technological revolution for the generation 65+. Our passion for technology and respect for the older generation is what drives us to build the gateway between the elderly and the digital world. We developed the world’s first universal user interface and are optimising all current and future technologies for the 65+ generation.
How does your solution help elderly people?
Our user interface is suitable for any application or service and covers all areas of everyday life. Elderly people can independently use obligatory services and existing online offers from which they are currently still excluded. Networking in the neighbourhood, staying in touch with loved ones by email, remaining active – physically and mentally, all this prevents loneliness, isolation and further diseases. We enable the generation 65+ to remain a part of society and to actively participate in social interaction.
Your journey with PUBLIC
Administrations, public offices and local communities are digitising their services. To enable everyone – including the elderly – in our society to participate in the digital world, PUBLIC introduced us to various municipals and supported us to secure a pilot project. They actively support us to define the use cases for the public sector.
What was the highlight of 2019 for Nepos?
In 2019 we reached some great milestones, which we are very proud of. In the second half of the year I joined the founder of Nepos Paul as CEO, and manage the strategic direction of the company, the leadership of the team and the acquisition of further cooperation partners. Furthermore we integrated our first partners, including Klassik Radio, YouTube, Berliner Zeitung, and are glad to offer their services to our users. Our greatest highlight was the market entry with our platform www.nepos.app in November.
Looking forward, what are the next steps for Nepos?
We are very much looking forward to integrate new features and partners step by step into our platform. These will include adding video call and messaging services to the already existing features in communication and adding new categories such as online banking and online shopping. In addition, we are planning a new fundraising round and are expanding our team with new talents.
Searching for news and views on GovTech? The PUBLIC Blog isn’t the only place to look. The fast growing sector is quickly gaining a number of media outlets following dynamic startups transforming government. Whether it be new contracts or high profile fundraises, there is normally somewhere to turn.
Here is our pick for the Top 5 GovTech Media Influencers.
Young, scaling fast, outrageously brightly coloured – Sifted is the startup of publications covering startups. The online magazine was co-founded by John Thornhill (long-serving Editor at The Financial Times) in 2018 and covers Europe’s technology and public sector innovation landscape. Articles feature opinions and analysis on everything from health to fintech, and contributors have included Revolut’s Nikolay Storonsky and Seedcamp’s Reshma Sohoni. The place to go for fast, insightful opinions on GovTech.
For the French speaking, Acteurs Publics is the go-to source of public sector news. The sprawling media outlet now features an online magazine, print publication, daily newsletter and online TV channel. The reporting is comprehensive – if you are looking for the latest announcement from a ministry, Acteurs Publics will likely have it first – and the events section highlights many of the key dates in the French GovTech calendar. With more of a focus on the public sector rather than startups, Acteurs Publics may not be best for casting what technology will provide in the future – but for the here and now, it is an effective guide.
One of government’s greatest challenges when looking to employ innovative solutions is breaking out of its siloes. Put in other words: government isn’t always good at talking to innovators – it often struggles to even know where they are. Apolitical aims to solve this. The community and content platform provides upstream policy advice by connecting policy-makers to academics, entrepreneurs and leading government intrapreneurs pioneering dynamic approaches to common public sector problems. The site now has over tens of thousands of subscribers in over 170 countries.
Tech magazines are quickly becoming a dime a dozen, but the Hanover-based t3n is a cut above most. The print and online publication covers all things from big tech maneuvering to startup disruption, and although not strictly a ‘GovTech’ focused publication, t3n does have a consistent thread on smart city, digital identity and health tech themes. For community searchers, t3n also hosts a ‘Digital Pioneers’ thread to talk to other startup founders and thinkers, as well as a pretty wide reaching jobs board and events programme.
The nerdy younger brother of the New Statesman, NS Tech is one of the UK’s most incisive reporters on the interface between tech policy and society. Recent threads have included a series of articles on public sector cyber security and digital identity and the roll out of 5G. NS Tech also publishes the fortnightly ‘GovTech deals’ segment, a regular feature highlighting the juiciest tenders for startups published by government in that two week cycle. Defintely one to subscribe to.
Tenacity Beats Talent Every Time: An interview with Stephen Bourke, co-founder of Echo
Stephen Bourke, co-founder of Echo, speaks to PUBLIC about why he started Echo and what’s changed in healthtech since then.
When Stephen co-founded Echo, he was told it couldn’t be done and people didn’t need their product. Now, the healthcare app – regularly listed amongst the UK’s leading startups – delivers repeat prescriptions to over 50,000 users, and has most recently has been acquired by McKesson, a leading healthcare organisation which includes LloydsPharmacy. We spoke to co-founder Stephen Bourke about the next step in their journey, how attitudes have evolved since starting the company, and where the next big challenges lie for healthcare.
How does it feel to have reached the finish line? Is this a finish line for you?
Quite the opposite. This deal means Echo can scale and impact the lives of millions of patients across the UK. What drives us is improving medicines adherence, helping patients get and take their meds. This means providing people with choice – some prefer to visit a pharmacy in person, others want meds delivered to their office. Our tie-up with LloydsPharmacy enables us to serve more patients in more ways, so we’re very excited.
What are things that surprised you, or you didn’t expect, about having your startup acquired?
It’s humbling to think that something my co-founder Sai Lakshmi and I started in Joe and the Juice could make it this far. Before we started a lot of people told me it couldn’t be done, that there wasn’t a user need. I’m glad we ignored them and found backing from investors like PUBLIC.
Why did you start Echo? What was the problem you were trying to solve?
We both take repeat prescriptions, so we started Echo to make our lives easier and stop monthly visits to the GP. It wasn’t until later that we realised that if you make it easier for people to get meds, they are more likely to take them, improving medicines adherence. This helps people live healthier, longer lives and, at scale, can save the NHS billions.
How far do you think you’ve got in solving this problem?
We’re only getting started. Over 75% of Echo users are adherent based on one measure, and across all meds, adherence was 88%. But in a recent patient survey, almost 30% of respondents had forgotten to take their medicine in the last two weeks. Making it easy for people to get medicine is the first step – now we need to figure out how to help them manage it.
How has the NHS changed since you founded Echo? Do you think the government is more willing to accept GovTech now than when you started Echo?
The NHS definitely has a better understanding of GovTech, our value and what needs to be true for us to succeed. Matthew Gould’s appointment and the creation of NHSX has been particularly useful. But it’s a marathon, not a sprint and what happens in Whitehall and Skipton House takes time to disseminate across CCGs and Trusts.
What do you see as the big challenges in healthcare that the next Echo will need to solve? What will they need to do to solve it?
There are lots to choose from, but I would like to say ‘dulltech’ – big, difficult infrastructure and interoperability projects that struggle to capture most journalists’ imagination but are so, so important to unlock the promise of HealthTech. For instance, a platform that gives hospitals access to GP records would be transformational; or an API to translate the health data patients create into information clinicians can trust, understand and action. We have lots of endpoints across the system – the challenge is to make them talk to each other. Think Open Banking for health.
What advice would you give to early GovTech founders?
Shaping a digital Lithuania: the GovTech Lab launch
Virginijus Sinkevicius, Lithuania’s Minister for Economy and Innovation, writes a guest article for us on the launch of Lithuania’s GovTech Lab: an initiative to foster and support the GovTech ecosystem in Lithuania.
Many believe that being an old democracy is an advantage for a state. I have the opposite view. Lithuania is a relatively young democratic country and that gives us ambition to innovate and employ a challenge-solving attitude to make changes faster, both in the public sector and in society.
While change in society and business is talked about often, we recognise that it must also be embraced by the public sector. In order for government to become a 21st century institution, we have to become more flexible and to create processes for government to partake in compartmentalised experimentation. We’ve taken steps towards creating an innovative public sector environment with the launch of Lithuania’s GovTech Lab, which aims to encourage young, innovative businesses and academics to develop, test and commercialise solutions that solve public sector challenges.
The GovTech Lab, an initiative led by the Ministry of the Economy and Innovation and the Create Lithuania program, aims to foster the country’s burgeoning GovTech ecosystem and to serve as a competence centre intended to enhance the innovativeness of the public sector. The Lab encourages startups, SMEs and academics to test their technology-based ideas with the public sector under real-time conditions. Lithuania currently has about 600 startups, some of which are leading GovTech startups like Trafi and Oxipit.
We have already observed part of the potential that the GovTech Lab holds. For example, the Lab is helping shift cultural norms inside government. We recognise that expertise in emerging technologies does not necessarily lie within the public sector, and the Lab allows institutions to raise challenges that they do not have answers to. Additionally, the Lab serves as a connector between the public, private and third sector that encourages us to look at public sector problems differently. Strengthened networks for the sharing of knowledge facilitate the creation of new solutions that maximise societal benefits and make the government more efficient and open.
During the GovTech Lab’s challenge series, public sector institutions distill and announce a challenge that can be solved more efficiently with an innovative technology-based solution and that is not necessarily available on the market. Four public sector institutions signed a memorandum of understanding and will be the Lab’s pioneer collaborators in the challenge series. These institutions include: Ministry of the Economy and Innovation, Bank of Lithuania, Lithuanian Energy Company Group, Lithuania Travel, Kaunas 2022 (the agency overseeing Kaunas’ preparations to become Europe’s cultural capital that year).
During a meeting with the CEO of Google Sundar Pichai, I invited him to join this initiative in Lithuania. I invite readers of this article to join as well. We recognise the importance of learning from international best practices and sharing our insights along the way to create innovative solutions in government that bring meaningful change across borders.
How to navigate GovTech: an industry obsessed with improving public services and empowering citizens
Last week a PUBLIC portfolio company, Echo, was sold to McKesson.
McKesson is a leading healthcare company for wholesale medical supplies and equipment, pharmaceutical distribution, and healthcare technology solutions, that reported revenues of over $200 billion in 2018. Echo is a free, easy-to-use service that delivers medicines, typically repeat prescriptions, to a patient’s door. Echo’s 2018 revenues – in case you didn’t know – were a little less than $200 billion!
So whilst McKesson is a healthcare giant devoting huge resources to pharmaceutical distribution, supplies and healthcare technology solutions, they still opted to buy Echo instead of developing their own Echo-like solution. Why?
I personally think it was a very smart decision. McKesson now has the opportunity to bring Roger, Stephen and the rest of the Echo team into their ecosystem: if they allow Echo to continue to be obsessed about building elegant, user-focused tech and removing the barriers to prescription adherence, they will make a healthy return on their investment.
An exit like this is great for investors but it is not a new model. Incumbents have been buying innovative technology companies for many years. However, now is the time for government-facing organisations to start looking over their shoulders and turning to tech for growth. We will come to expect more and more of these acquisitions in GovTech. For that reason, it is time for investors to wake up to the massive potential of GovTech. To recap why PUBLIC is particularly obsessed with the GovTech opportunity:
BUY vs. BUILD
This battle – “Buy vs. Build” – has been playing out amongst corporates and government for centuries. With the advent of new technologies (e.g. cloud computing, machine-learning and APIs), smart, obsessed engineers and entrepreneurs can benefit from very cheap infrastructure to develop step change solutions that can perform at a scale and cost-effectiveness never-before available to the markets in which they look to operate. The caveat is that you need to find this smart, obsessed talent and more often than not it is not sitting inside a large corporation or government entity.
Corporates, led by the large tech companies (and particularly the Chinese tech companies) have been quick to recognise this, fuelling spectacular returns for early stage technology companies (e.g. Facebook’s acquisition of WhatsApp). It’s extraordinary to think that some of these acquisitions are even highly cannibalistic, such is the pace of change that threatens those corporates. Think of FinTech, think of eCommerce, think of the restaurant, taxi and travel industries: incumbents across these industries have been replaced or forced to acquire new entrants building on better, cheaper technologies and delivering consumer-obsessed products.
As briefly outlined above, product-focused entrants have transformed every major industry – the public sector being almost a sole exception. But this is changing.
Government and perhaps government suppliers in particular, represent one of the last frontiers for major technological disruption as we know it. Looking at the public sector, we see three key hallmarks of an industry ripe for disruption (excuse the anecdotal examples):
An over-reliance on legacy technologies: 70% of the US government’s $82bn IT budget is spent on maintaining legacy system
A lack of investment in technology: From 2010 to 2015, government IT expenditure was static vs. 25% growth in the private sector
A small number of incumbents dominate: The top ten UK Ministry of Defence suppliers account for 40% of total vendor spend
Governments have traditionally been slow to adapt to new technology and market entrants. Low risk appetite combined with a frequently non-technology fluent buying and policy-making layer have led to public sectors being behind the curve. Added to this, some departments are faced with low managerial bandwidth and financial restraint.
Change is coming, however. As citizens’ expectations rise and public sector challenges become steeper still – mental health, social care and cyber security to name but a few – more and more public buyers are looking to new solutions from new technology. Legacy systems and cumbersome procurement structures can only hold back the GovTech tide so long.
WHY GOVTECH COMPANIES WILL BE SO VALUABLE
When looking at investments like Echo, investors need to understand why these companies will almost always develop better solutions than incumbent players, and hence build attractive businesses that will fuel acquisitive exits:
Good value for money for investors (nascent sector)
Passionate founders (mission-driven)
This last point is critical in understanding why new, well-architected platforms can add such enormous value when implemented across the public sector.
Take Echo. Echo is not just a company when viewed with a GovTech hat on. Echo has the ability to provide Public Health England (PHE) with data that it never had access to before (but desperately wanted). Thanks to Echo, PHE could actually search through data: which patients are taking what medications, when, and in particular where adherence is lowest. Echo could allow drug companies to action product recalls via push notifications. Echo could allow PHE to analyse cohorts of patients by postcode and draw up statistically interesting facts on populations. The examples continue. Whether McKesson knows what a beautiful business they bought is beyond my pay grade, but if they are able to let Echo flourish, we will all as citizens benefit from their great tech, excellently executed.
Here at PUBLIC, we specialise in backing companies with public sector applications, helping them scale across government by reducing the barriers to entry that currently exist. Our platform gives us the insight, power, and capability to take on incumbent providers, therefore doubling or tripling the addressable market for the companies we support. We are passionate about what we are pioneering: creating the environment for any company looking to engage and scale within government. More VCs and investors are joining us in this mission – it’s time for us to recognise the returns, as well as the potential for public sector improvement, that investing in GovTech represents.