Episode 3: Launching in the Time of COVID with Heather Lavoie

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Sean (00:00):
Welcome everyone to our third episode of How I Launched This. This is a podcast about supporting the entrepreneurial spirit and talking to founders, CEOs, product leaders of companies who are building cool solutions in the market and the journey they’ve taken to launch their solution, change and alter their strategies, and ultimately provide lessons learned to give back to the community to help other entrepreneurs get better and stronger at their innovations and market success. And I am very pleased to ask and have Heather Lavoie join us. She is the CEO and president of the Geneia. Geneia is a data science and healthcare analytics company.

Sean (00:50):
Geneia clients are healthcare providers and payers who want to more efficiently provide elective and preventative care to their end customers. How Geneia provides that as they have a really cool cloud-based AI solution, they have replatformed some of their technology onto the Salesforce platform. And because of that combined solution Geneia’s customers gain insights, and identify, and engage the right patients at the right time and drive a lot of positive outcomes for both patient care and costs. So, with that said, Heather, welcome to the podcast. Thank you for joining me today on this discussion.

Heather Lavoie (01:31):
Thank you Sean, for having me.

Sean (01:33):
So, we’ve had the pleasure of working together for a couple years now through the fun process of launching products into the market. And before we dive into your very impressive background, tell us a little bit about yourself and personal level. What did you study in school and what’d you think before you became CEO of Geneia, what you were going to do in your career?

Heather Lavoie (02:00):
Great. Well, thank you again for having me. I’m a first-generation college graduate and so I didn’t have a strong idea of what I was going to do. I had a love of languages, and so I decided to go to Boston University and study Spanish. And I think initially I thought, well, maybe I could be an interpreter, maybe work at the UN, but I’m not much of a city person. So, I don’t know that that necessarily was going to work out. I actually changed my major while I was in college and decided to study bilingual education. And my intent was to come out and teach English as a second language, which has nothing to do with being a tech CEO. But certainly made sense for me at the time. And I think it just speaks to how oftentimes your career path can take lots of twists and turns.

Sean (02:55):
Absolutely. And so, you then decided to become of a healthcare expert and spent about 30 years so far, studying the industry and being very involved in it. You speak at a lot of industry events and are on a number of boards. Tell us a little bit about that journey.

Heather Lavoie (03:14):
Sure. So, I started actually working in physician practice operations while I was in high school, and worked my way all the way through college and then continued on even after college. And so, by the time I graduated and actually went on to pursue an MBA, I had a number of years already in the field and really enjoyed healthcare. I think healthcare like law, like education, there’s a strong social justice component to it. It also provides for, I think, infinite complexity and an opportunity to continually learn. You never get to a learning endpoint in healthcare. And I think as we all can probably fully appreciate, you never actually solve for all of the challenges in healthcare.

Heather Lavoie (04:01):
So, for someone who may be goal-oriented continuing to solve new and unique challenges, that is always an opportunity afforded to you. So, coming out of my MBA program, I actually worked for a health plan running a number of physician practices that they owned. And when they decided to divest of those practices, I moved over into health plan operations and that’s really where I put my toe in the water, as it relates to technology. Taking on work, I learned how to do some coding. I actually interacted a lot with data warehousing capabilities when data warehousing was very new and help to actually to do some building and to do some conversions of data warehouses and just worked in a variety of areas.

Heather Lavoie (04:47):
I worked kind of in a strategy and planning department, which allowed me to have wide berth to join onto all range of new and unique projects. And I think that that diversity certainly helped me further on my career. Subsequent to work into that organization was acquired by Cigna and I went on to then become involved in the startup world. And built as a founder and had a successful exit all the benefits technology company, and then have gone on to pursue other entrepreneurial pursuits with Geneia being just one of those.

Sean (05:25):
Yeah. In our prep call, you talked about being kind of a serial entrepreneur. For some of the younger folks in the audience just getting started in their career, what was a cool job in the healthcare industry that really locked you in to be like, I want to dedicate a lot of years in this space in this industry? Was there one that kind of helped you launch that passion?

Heather Lavoie (05:49):
That’s a good question. I mean, I certainly think the variety, even when I worked for the plan early in my career, so that was in my late twenties, they were really very entrepreneurial. It was really more like a startup than it was like a well-established plan and had a number of them. And it was why it was an acquisition target for Cigna at the time. And so as opposed to forcing people into silos and departments, everyone was allowed to you kind of collaborate and work on projects that might be completely outside of their domain, which is why in that plan that I didn’t build it, but they built like a case management.

Heather Lavoie (06:31):
So one of the first case management systems in the country. Data warehouse were a very early adopter of technology. And I think that part is being able to do a variety of roles and also take on brand new technology and bring it to market that seemed to really appeal to me. It was seemed to challenge, it was very novel and it stretched my skillset. And that’s what I liked. I never found myself as being a great fit for a large bureaucratic organization where my role was well-defined

Sean (07:07):
Yeah. I had a similar path, lots of different roles just to get that variety, and experience and ultimately see what I enjoyed. And so, kind of foundationally who you’ve been build up many years of an industry expertise and try as best you can to understand the dynamics and where real problems are, and then try to provide solutions to those problems. And that’s a really coveted skillset within the spills force ecosystem, because you had mentioned, you’re not a tech CEO, but what you rarely are, is tech aware enough, but also have that real industry domain expertise.

Sean (07:47):
And that always is a good fit for not only innovation, but commercial success. And it also can be a little intimidating sometimes if you don’t have some of that tech background of running a technology company. You got to hire really good people and teammates to help fill some of those gaps. Tell us a little bit about Geneia as a company and its journey, so the audience understands.

Heather Lavoie (08:14):
Sure. So Geneia originally started out actually as a consulting services organization. So, there were few of us that were part of it, former healthcare executives who were doing projects for plans and in the public sector, working with employers kind of a range of projects in one engagement that we took on was for a Blue plan that was in central Pennsylvania that was looking to do a range of things. One of which was to develop a diversified services arm of the organization. It was a time that the Affordable Care Act was in place that there was diversification that was beginning to happen at a number of the large nationals like United, where they were looking at non-insurance based lines of business. And that was of interest to Capital BlueCross in central Pennsylvania.

Heather Lavoie (09:14):
And so, they brought our team down and I was tasked with helping to actually put together the business plan, the financial plan, and then launch Newco. And when we launched Newco Capital BlueCross actually then acquired the consulting practice and named Newco, Geneia. So, we took on the name of the consulting firm and a couple of us stayed with Geneia. One of the principals actually became the chief marketing officer and is a top digital influencer at Capital BlueCross. And so, it really began from there. The intent of the plan was not just to diversify for outside revenue non-insurance based revenue, but really to bring in innovative capabilities to support their value-based or their risk arrangements in the marketplace to help drive improvements in quality and costs.

Heather Lavoie (10:08):
And they knew as a small to midsize plan, it was difficult for them to do so and be really innovative without scale. And so by actually setting us up as a subsidiary to sell to outside parties as well, we can continue to bring innovation into the plan, as well as scale organization and operations. I began working on it end of 2010, and we officially launched Geneia in June of 2012 with a clinical services arm. And then in 2014, we launched our first analytics product into the market, which is called Theon, named after a Greek mathematician, not The Game of Thrones.

Sean (10:52):
Nice. So, it’s a story of an entrepreneur in residence working in a large firm, incubating a small little spin out and trying to get that small entity into a larger one, as well as a transformation from services to a full subscription software company. So very, very common repeatable use case that a lot of the younglings I think can relate to.

Sean (11:24):
And then you kind of got talking to Salesforce and started a process of figuring out, hey, maybe some of your solution could be better optimized on the Salesforce platform to attack a certain section of the market. And I know we helped you with that process and got you kind of in market officially around the summer of 2019, but obviously there was a little story beforehand of what brought you to replatform. Maybe you could share some light on that process.

Heather Lavoie (11:57):
Sure. I think for many organizations who might be innovation arm that is part of a larger, maybe a subsidiary of a larger organization. They feel the draw or the pressure from the interest of the parent organization on their roadmap, on their services. It’s hard to ignore your single biggest funder and at the outset and probably one of your biggest customers at the outside of an organization. And so our product roadmap was really dominated by the needs of this insurer in central Pennsylvania. But that didn’t necessarily mean that that was the best commercialization of analytics. And as we look to what the market broadly needed, it was quite different and they didn’t need an enterprise platform.

Heather Lavoie (12:52):
And the way we had constructed it, the market was very interested in analytic insights, they were very interested in AI, but they wanted it to be actionable. And the actionable piece was where I think, Salesforce came into play. We recognize that we had a strong backend and core infrastructure for our analytics, but we needed to get it into the hands of people that could then take action on that. And so Salesforce, as the largest most successful CRM tool, we saw that putting it into a CRM for the use of people like those in the call center, those care managers and the plan, nurses in a practice, physicians putting information into that CRM then made it actionable. They could identify patients and they could take action on them.

Heather Lavoie (13:43):
And so we endeavored in 2017 after a sizable customer base already, but really to take it any further, we knew we needed to pursue an integration with Salesforce at that point. And so we began our journey in 2017 and with CodeScience as a tremendous partner — we didn’t have Salesforce DNA in our organization. We weren’t in a position to design this on our own. We didn’t understand the Salesforce ecosystem. And so we needed assistance in a whole range of ways, one of which was development, but there were so many other commercialization aspects that we needed help with, including go-to-market, including existing within the AppExchange, including even just some of the architectural decisions that we wouldn’t have understood if not led there by someone who really had done this repeatedly for ISV partners.

Heather Lavoie (14:40):
So, understanding some of the implications of architectural decisions we were making — affected revenue, it affected in customer installs. And so CodeScience was a phenomenal partner in helping us through that as we began the process of trying to bring in at least some Salesforce talent into our organization so that we could run and own this thereafter. But we launched in 2019, we had all of our apps on the AppExchange, our population analytics application, as well as our care management application that then quickly began to be used by customers.

Sean (15:20):
Yeah. And it’s a story of timing. You found a platform that could provide a different type of value and lift, Health Cloud at the time was coming online also, and being able to leverage that, the investment Salesforce was making and continues to make. So, all of that fit and seemed to fit well. And we had the pleasure working with your team on that. So, you get into market, you’ve now replatformed, you have this combined solution shiny object that you want to sell and market and support and innovate on. And it’s around the summer of 2019.

Sean (16:03):
And when we were talking in our prep call, you had a similar situation happened back in 1999, where you were leading an organization. And then a little thing that you referred to as a black swan moment happened back then, tell us a little bit about that moment before we talk about what then happened in the winter of 2020.

Heather Lavoie (16:28):
Sure. So, I was a co-founder of another company back in 1999. And it was benefits technology company that allowed for customization of benefits. We had a strong organization and we were out for a round of funding. And we were coming out of a customer meeting when the planes hit the twin towers on 9/11 and the market dried up. And nothing that we could have ever foreseen. We literally had to halve the company at that point.

Heather Lavoie (17:03):
We couldn’t make payroll and because the capital markets were so shocked at that point, for some period of time, we had to really bridge payroll to payroll cycle to keep the organization running. And ultimately through a dedicated team, committed individuals, strong talent, and just a lot of passion and customers who believed in us, we were able to successfully exit that to Cigna in 2005. So, I certainly never wanted to live through a black swan event again. And didn’t anticipate that I necessarily would have to.

Sean (17:46):
That’s right, none of us did. But unfortunately the markets change and changed very rapidly as COVID came upon us. And as you are bringing to market a solution that’s designed to help payers and providers with their elective and preventative care offerings that they’re providing their customers, your market radically changed because COVID hit and there was nothing you could do. It was completely out of your control.

Sean (18:16):
I mean, we lived it, we worked together to do as best we could chaotic moments, but you made reference of, not only did the hospitals kind of freeze and try to figure it out, but the healthcare plan and policies, everything that was foundational to an industry that was very mature, suddenly had to adjust and adjust rapidly. Walk us through a little bit of your observations, looking back of what that was like.

Heather Lavoie (18:48):
Sure. So for me, it was interesting because I had been serving as a president of the organization and literally in March was stepping in to be president and CEO at the same time. My boss who was the CEO became my biggest customer. He left and I got a new CEO boss at the same time in March. And we then had to send everyone home across the organizations and having new way of conducting business, new way of supporting our teams and you’re right. And our sales channel just really, I wouldn’t say it dried up. It just went on in the long gated pause, just a hold. And health payers, there were different state regulations and federal regulations that were causing them to pay for services differently, approve services differently.

Heather Lavoie (19:44):
They had no idea what to anticipate in terms of costs in whether this would have such a significant adverse impact on costs. How many people were going to be hospitalized and what was that going to mean and would the federal government step in and help out or not? And so because of all of that chaos, they stopped all discretionary expenses and stopped anything that was non-business critical to keeping the lights on and supporting the members, they stopped all of that. So, all of our markets dried up and we were well positioned and had a really strong go-to-market with Salesforce at that point. So, we had to think about what could we do differently. We had a team that was home, they were passionate, they wanted to be activated in some way. And when Salesforce offered out Health Cloud for free, they were offering out for first responders.

Heather Lavoie (20:45):
It’s where we partnered with CodeScience, actually CodeScience came to us to see if we might be interested in building a solution that we could offer out to the market. And so jointly, we built a COVID-19 triage response solution that we offered out for the year free to any first responders, any practices who might need it to assist them in identifying, assessing, triaging and managing patients. So, it served as a rallying cry for our organization. I know our respective organizations, our teams worked 24/7. They worked through the night for days, and days, and days to launch the initial solution. And then we had another opportunity to offer it out to a major market, a major public health entity. And our teams worked round the clock over a week to customize and build a solution for that public entity as well.

Heather Lavoie (21:44):
So, our teams really appreciated being able to give back. People come to our organization because healthcare is very mission-driven. They don’t want to just sell widgets. They really want to impact lives. And they felt like this was a great way of being able to help to impact lives when they felt very powerless over COVID-19.

Sean (22:03):
Yeah, it was an innovative give back moment for sure. And it really tested all three organizations, our organization, yours, as well as Salesforce. And I remember being on the phone with you at that time, as well as Steve and Lori, some of your product leadership and saying, “Okay, normally what an ISV of Salesforce goes through is a journey of many years. We’re now compressing that in a number of weeks.” And I think, even though it was hard, that compression, it built a lot of relationships that what you would have never gotten it had you not taken the investment to give back first. Talk a little bit about now, retrospectively, what that was like.

Heather Lavoie (22:53):
Sure. It certainly was. I mean, we made a lot of new friends in sectors across Salesforce that we had not had before. Even though we had been working with CodeScience for a couple of years, I think the bonds that we built across the team were never stronger than in those moments when we were working together. And we learned a lot internally, even just about implementation timeframe. So, now we’ve been able to cut down our overall implementation timeframe now by about 50% through the lessons that we’ve learned, through that process.

Heather Lavoie (23:33):
So, it actually ended up helping us. We made really strong connections across Salesforce sales leadership, as well as leadership on the ISV side with Aaron McGarry, but certainly with others across the Salesforce and Ed Leahy and others. I think people recognize that we stood up, and we gave back, and we were committed, and we worked hard and we cared. And at the end of the day it builds trust and people trust that we care about the customer in the end and we’re going to go to the nth degree to help support them.

Sean (24:11):
It’s an awesome story. Okay. So, we get that kind of done that’s in the early, early chaotic stage, but your fundamental market is still stalled and it remained stalled for quite some time. So, you shared with me in the prep call, you then had to get to the decisive moment of what to do next and you really broke it down into three areas for me.

Sean (24:37):
One was doubled down on product in innovation, ruthless expense management because of the situation related to your customers, which was also no fault of their own, as well as culture and people protection. I think those were the three main pillars as a leader you had to help the organization through. And maybe highlight a few lessons learned for other entrepreneurs of what they could gain from that insight.

Heather Lavoie (25:07):
Sure. Lots of startups make pivots. And I think for us, it was a natural point to evaluate sort of the product and service lines that we were in. We had seeded the organization where the clinical services arm at the beginning. And it really forced us to look at whether A, where those services really were valued in the broader market. Did it make sense to run a services and our product organization, or would we be best served if we doubled down on product.

Heather Lavoie (25:40):
And so we were able to take that team by the end of 2020. Beginning of 2021 we packaged that team and brought them back into the parent organization. So, largely on a day-to-day basis, their jobs haven’t changed, who they report to feels different, but it allowed us to really focus on the product, which is now about 92% of our recurring revenue is technology-based. It’s all sort-

Sean (26:08):
So, the services component of your organization, you move back to your parent so they could continue to perform those tasks. And then you really pivoted the company to be technology only. Is that correct?

Heather Lavoie (26:22):
That’s correct.

Sean (26:22):
Okay. Great.

Heather Lavoie (26:23):
So, technology only some very limited professional services that help support with adoption of our technology. So, everything’s really technology aligned at this point. And then we looked at how… We knew the market was only going to continue to incredibly competitive, population health analytics is a competitive space as it is. And we knew there would be downward pressure on price, that this was kind of an opportunity for people to push down. And we also were obviously seeing revenue that was far below our 2020 expectations. And so myself and the VP of finance and operations went through 800 line items of expenses over, and over, and over and over again, to look at any opportunity to really rationalize those expenses, to examine whether they were necessary or not.

Heather Lavoie (27:21):
But also I think over years in particularly people that are in a cloud environment may see this, right? You can get sloppy in storage and overuse, maybe more high cost storage and not really attend to making sure that you’re using sort of the lowest possible cost storage. And no cloud provider is knocking on your door saying, “Hey, you really haven’t used that data. You might want to put that offline a bit.” And it’s elastic for a reason, and so we were able to cut and we’re completing that process now. Our cloud storage costs and computing costs by half by actually being really diligent, which means that we can provide better pricing to our customers.

Heather Lavoie (28:09):
That allows us to maintain margin, but offer a more affordable product to customers. So, it helped take some of the pressure off of the revenue miss, and then it certainly has helped us now on a go forward basis at being a far more lean organization that is able to price competitively and get a better return for customers.

Sean (28:29):
Nice. Yeah. One of the benefits of building on the platform on the Salesforce side is you pay as you sell as a general dynamic. But if you don’t, you’re not incurring stuff, but if you have a composite solution you might be. So, that’s an excellent tip to look at for, broad brush your expenses and try to control them as best you can. Then we talked about culture and people and how tough it was to manage in a very challenging environment. What lessons did you learn through that process, Heather? What are you proud of and what were you like, we could have done a little better job?

Heather Lavoie (29:09):
Sure. So, we didn’t necessarily have some of the tools that we’ve used have been governed by our parent organization and as a health insurer, their security protocols are just at another level than you might see in a traditional startup organization. So, we were pretty locked down in terms of what we’ve been able to use. We can’t use a whole range of tools that make cloud computing easy and collaboration easy. But we were able to spin some up that certainly fit within the framework of what we were allowed. And so we made greater use of easy things like, Slack and JIRA and Lucidchart and find other ways of any of the video conferencing. So, we really focused on what tools can help us do what we used to do in the office and do it effectively.

Heather Lavoie (30:05):
We also spent a lot of time doing town halls with employees, and being really open about how we all were doing and really doing check-ins from a mental health perspective. And check-ins from a physical health perspective with employees. We have a lot of young team members. We had a lot of women in the clinical staff in particular on our team. And so, there were nursing moms, they were people that had kids at home for almost the whole year and beyond, everybody was in crowded spaces. We had young developers who were alone and had social isolation. And so we really tried to just address it, head on in town halls.

Heather Lavoie (30:47):
And one of the first time halls I had, I made my kids come interrupt me on purpose so that everyone would see that we had to normalize family and animal interruptions and we encouraged it. And we got to know each other a lot better. And then there were a lot of check-ins through a lot of the social justice challenges that were going on. We had a lot of employees who had really had significant fears, and needed to be supported and we needed to take a position and support our team members. So, it was definitely a year of really thinking about how we can help our team, make it through some of the most difficult moments in their lives. I think we could always do better in communication. I wish we could have done better earlier on with some of the collaborative tools that certainly was a challenge.

Heather Lavoie (31:44):
I feel good that we were able to keep the team together for the year and made sure that people got through COVID-19 safely before we had to do any restructuring. And so I feel proud about that, but there’s a ton of moments in hindsight I wish I could take back. But I do think that we’ve had good retention because the team appreciated that they at least had a workplace that really cared about them as whole people and not just the performance on the job.

Sean (32:18):
Yeah. We all could have done better, but it was a tough and still remains a tough environment for sure. All right. So, one of the reasons I asked you to join me on this is, you called me up and you actually had some light at the end of the tunnel success now. So, product’s really focused, market’s coming back. The team is like razor focused aligned to this subscription software as a services company. And you share some of the metrics with me and I’m like, this is amazing. You’ve totally gotten the company in a great spot now to really capitalize on a turning market that is going to come back to you. And I was very impressed. And hence why I wanted to have you come and share your story and your journey in that process. Maybe in your own words, what are you guys now seeing, where’s the optimism and the light at the end of the tunnel with the product, with the organization? And where you think this is headed.

Heather Lavoie (33:28):
Sure. So, absolutely. I mean, we felt great last year about where we were heading from a go-to-market perspective in our alignment and work with Salesforce. And then things get stalled. And we have just the best PAM in Salesforce and from my perspective is Alex Sharpe. And she is just on it all day long every day in supporting us and ensuring our success. And so, she’s really helped us navigate. And so we’ve had phenomenal meetings with all the RVPs at Salesforce with pretty much all the AEs, they’re bringing us into pursuit. So we’ve got a really healthy pipeline. And in healthcare, unfortunately, deals don’t close quickly, and they certainly don’t close quickly for the kind of solutions that we provide. So, it’s a long journey, but in January, we already hit our pipeline goals for the year, which was phenomenal.

Heather Lavoie (34:33):
And we continue to build and get even more opportunities. So, that’s been wonderful, that has certainly breathed life into the organization. We’re closing deals, which is certainly helpful. Many problems, maybe not all problems, but most problems are solved with revenue in a company. And so closing deals is great momentum. The team’s excited about it. And we’re really excited about where we go next. We have a lot of outside parties that are interested in partnering. And so we’re really looking at what the future of Geneia is going to be. So, it’s an exciting time for all of us. Our team is excited about it. And I certainly hope that this is the last black swan event I have to encounter, but it’s not.

Sean (35:26):
Yeah. Well, the best thing I’ve heard is Mr. Market can buy again and they’re ready to buy, which is wonderful. And so now all you have to do is just do the normal pipeline build relationship and execution. So, that’s an awesome place to be back into doing. Heather, thank you so much for your time, and your knowledge, and giving back to the broader community to help other entrepreneurs with their thinking investment and in the launching of their solutions. Really appreciate you carving out some time with me.

Heather Lavoie (35:59):
Thank you for having me, and thank you for your continued partnership. We couldn’t have done anything without you, Brian and the whole team at CodeScience. And certainly the team at Salesforce. So, thank you.

Sean (36:11):
You’re welcome. Okay. Have a great weekend. And we will see you next time for episode four. Thank you everybody for attending. Take care.