Breaking into Healthcare as a Startup with Patient Advocacy and Personal Branding [005]

Written By Gus Joseph

Episode Summary

In this episode, Gus speaks with Matt Toresco, founder of Archo Advocacy Group, about the complex world of healthcare advocacy and his journey bootstrapping a business in the medical consulting space. Matt shares insights on navigating healthcare systems, building a value proposition, and making strategic first hires as a founder.

Key Topics

  • The biggest issue in today's healthcare system: health literacy
  • How pharma and biotech companies can better serve patient communities
  • Building a value proposition based on personal expertise rather than product
  • Content strategy for founders and thought leadership
  • Making your first hire and managing cash flow as a bootstrapped business

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Full Transcript

Introduction to Matt and Archo Advocacy

Gus: Welcome back to another episode of the Founder Facing podcast. I'm joined today by Matt Toresco. Matt is the founder of Archo Advocacy Group, which works in medical consulting. So Matt, thanks so much for being on the podcast.

Matt: I appreciate you having me. Yeah, of course, man. Super excited.

Gus: So just real quick, give us a quick idea of what you do at Archo and what you're trying to accomplish because you're obviously in the healthcare space.

Matt: So ultimately there's a lot of feelings about pharma and biotech and what do they do? What do they not do? Are they looking to get us healthy? So on and so forth. These organizations all have what are called advocacy functions. So there are a team of people whose job it is to get out to the patient community, understand any needs or issues that the patients are facing, try to look to overcome those in whatever means are best for the patient and spend that, you know, anywhere from, let's say 10 million to $25 million in a year to maximize the patient impact that they can have.

Gus: That's awesome. Yeah. And so you take, you work with these companies to talk to consumers and talk to patients to try to get them better outcomes within the healthcare system, right?

Matt: Yeah, it's working with them to figure out the best ways to spend those dollars truly so that depending on what we're seeing. For example, you have a lot of policy changes going on. You have issues within the community, something called social determinants of health, which quite simply puts the zip code that you live in has an impact on your healthcare. How can a pharma company utilize the dollars that they have to impact those issues? And then something as simple as the current statistics are 50% of patients who are prescribed a drug that needs to be infused actually get it. So what about those other 50%? And that's the focus of the advocacy function and the work that we do is to try to figure out what those issues are and work to overcome them on behalf of patients.

"The current statistics are 50% of patients who are prescribed a drug that needs to be infused actually get it. So what about those other 50%? That's the focus of the advocacy function."

– Matt Toresco, Founder of Archo Advocacy Group

Biggest Challenges in Healthcare

Gus: As someone who started in the healthcare space and now is consulting and advising these different healthcare companies, if you could single it down to a single issue, what do you see as the biggest issue in our healthcare system today?

Matt: Unfortunately, it's individual education or what we call health literacy. And it's the inability and age time constraints be the complexity of the system itself of how do we ensure that when you do get sick or you're facing a medical issue, that you know what you're doing, that you know where to go, you know how to deal with insurance, you know about your insurance. Most people don't know about the insurance they picked, unfortunately, until they have to use it. And then they recognize that, oh man, that plan that I picked requires me to pay a lot of money before the insurance company does anything.

Matt: And that's the unfortunate feature of our healthcare system is that I would say it's somewhat unnecessarily or purposefully complex. And just because now you've gotten to a doctor doesn't mean they're the right doctor. Doesn't mean they're the right doctor for you. Doesn't mean they can fix your issue.

Matt: And I came across this in my own personal life. I broke my neck in 2005. So I was playing lacrosse at Ohio state. It took five months for them to recognize that I had blown out a bunch of discs and vertebrae in my spine. So there was a, I was already kind of behind the eight ball. Then I got into the healthcare industry and it took me 20 years to get off of pain meds that they decided that was the best route and option to deal with the pain that I had from a massive spinal injury.

Matt: And if I work in it and I know how to have the fights with insurance companies and who to contact and that I can leave the state that I'm in of South Carolina to go have surgery somewhere else, what does it take for someone who doesn't know those things? And that's what brought me into doing what I do is that there are plenty of people who were in my situation or other disease states or whatever it might be that aren't aware of how to have the educated conversation with a physician or maybe afraid to. And it's how do we better educate them to take that on?

Gus: Yeah, I have a buddy of mine who's a neurosurgeon and he had some stomach issues and this is the same thing. He's like, I'm literally in med school, like, or just finished med school. I'm like, I'm a doctor right now and I'm going to other doctors and I like, I don't know exactly what's wrong with me, but it's definitely not what they're telling me is the issue.

"The way that I've heard it put best is that you get dropped into the Home Depot of healthcare that nobody ever wanted to shop in, and there's nobody there to help you."

– Matt Toresco, Founder of Archo Advocacy Group

Matt: Right. It took him months to get that. And as a doctor, he might be comfortable challenging or asking questions and I'm sure he was frustrated with all of that too. Imagine not being someone or being an individual who thinks they're subordinate to their doctor. And it's definitely a generational thing. We are seeing those that are, let's say 60 and older who bow down to their doctor, do what the doctor says for the most part. But you have to be able to challenge that, you know, you are a part of this healthcare economy.

Matt: The way that I've heard it put best is that you get dropped into the home depot, so to speak of healthcare that nobody ever wanted to shop in and there's nobody there to help you. There's no friends around. There's no guides. You don't know what you're buying, why you're buying it. You just know what your problem is and you're hoping to find somebody else that's like you in that store that can help provide some guidance. And that's where we're helping the industry itself recognize that they need to be in the aisles helping to facilitate these patients along the way.

Bootstrapping a Business

Gus: Let's jump into the business itself a little bit and talk about how you got started. I know we talked about your bootstrapped. So tell us a little bit about the story from how you, what you did before and how that kind of turned into the business that you're running now.

Matt: Yeah, it was one of those things that I wanted to make this move for a number of years and just didn't know if I could do it. You know, you have to talk yourself into it and talk yourself through it and had some misalignment with an ex-employer. And we just did not see eye to eye on the work that I do, which was very different than anything that anyone else at the organization did - this patient advocacy focused work and research and trying to ensure that we were giving feedback back to these nonprofits who depend on it.

Matt: So I decided, all right, we're going to start on our own. Let's see what we can do. And you have to have the faith in yourself to make the jump. And it took some time to get there, but I got there. And ultimately from there, it's once you're jumping in, how can you ensure that you've cemented a value prop that people can come and latch onto and appreciate. But then you kind of have to become a master of all traits because there are so many elements in business - bookkeeping, one of them that becomes the bane of my existence.

Matt: But you quickly learn what you don't know and where you need assistance and you have to be comfortable with that. You have to be okay being uncomfortable because for the first two years minimum, it's going to be uncomfortable. There's going to be boom and bust scenarios where, you know, I'm in one right now, we're waiting on a payment, right. And with pharma companies, you typically have a 90 day payment term. And that's difficult when you're running a small business and you have employees and I have two kids and it's all of those little things that end up in the success or failure of a business.

Matt: And for us, it was, we had backing from customers. We had the ability to make the move financially as a family. And we knew that we were bringing value to the market. So with those three things, we jumped.

Building a Strong Value Proposition

Gus: I'd love to kind of dive in on that value prop thing because I feel like that is something that founders can struggle with. Especially, you know, you identify your ICP, you try to figure out what do they care about? How do I position my product or service within that space that appeals to these ICPs? But it can be a really challenging thing to commit to. What's your process for that value prop?

Matt: Yeah. It's something I teach, actually. I teach this to the pharma industry, to their account managers and mainly the folks that go and talk to folks in a hospital. Because as you might imagine, you have a product and there could be a lot of people in the hospital that use that product, which means central purchasing, but there's other influences on that.

Matt: The product's the product. At the end of the day, a product is a product. People aren't going to buy the product for the product. They're going to buy who's behind the product. So the base of your value proposition, and we've seen this in many different domains - if you make the base of your value proposition price, you will lose.

Matt: If you make the base of your value proposition you and all that you've done, all that you know, all the places you've been and what makes you special - no one can take that from you. So that base of your value proposition has to be you. You have to do a personal inventory. I don't care if it's where you went to school, what your grades were or what your degree was in, who you know, what you've done in business, if anything, because believe me, I have someone who works for me that this is his first, as he calls it, big boy job, right?

"If you make the base of your value proposition price, you will lose. If you make the base of your value proposition you and all that you've done, all that you know, what makes you special - no one can take that from you."

– Matt Toresco, Founder of Archo Advocacy Group

Matt: But there's value to the individual and the passion can only come through about what you do if you've built in who you are first and foremost. Then from there, it becomes the product secondary, the company third and pricing last.

Matt: So you have to get a sense for who you are and what you care about. And I tell this to young folks all the time - at the end of the day, it doesn't matter what you do, just make sure it's something that you enjoy, something that you find passion in, because then it's not really work. There's no such thing as work life balance. It's choices, right? You've made a choice to focus on the work or you made a choice to focus on something else. But when you can enjoy all of it, that's really what it comes down to. So what is your value prop based off of the industry that you are so happen to be in? What are what about you? What is it about you that sets you apart?

Gus: And I think that that's really great advice. A previous client of mine had a number of speaking coaches and different business coaches on his podcast. And he said very similar things to what you were saying - do a personal inventory and really talk about these were my experiences. And I think this man was a public speaking coach, but he's like, who are you really? And I think that's something that a lot of founders through the chaos and the hustle and bustle of starting a business, taking care of the bookkeeping, making sure you're getting paid on time, that piece of it can definitely get missed.

Matt: Yeah. And, you know, I was working with a client just yesterday and it's all about people want to buy products and services from other people. You're not a big, giant, well-established brand that's been around for 10, 15, 20 years. You know, having a fancy logo and a fancy name for your business and all of that, like there's no trust there. But if you can see a face and you can see the person that's behind the business and start to understand those values and understand, oh, wow, this person is worth the investment that I'm making.

Gus: I think that adds a lot. And I think that that can be something that founders miss out on sometimes.

Matt: I completely agree. I think a lot of founders get really hyped about their own product. Right. And as the saying goes from back in the day, don't get high on your own supply. You know, the products, the product. What is it like? Think about the simplest form of you introducing yourself to a new customer or just in the grocery store, introducing yourself and who you are. What is it that makes you you?

Matt: I'm the founder of Archo Advocacy, but my goal is to utilize the 20 plus years of experience that I have in health care, watching the way that the sausage gets made in pharma and biotech and med device and genomics to ease the process for a patient. Right. So you got to bring in all that you know and all that you do. Otherwise, you just become the product and we can replace the product with the next best one.

Matt: The only way you're going to stand out, I hate to say it in this AI world, is the, quote unquote, soft skills. Right. Those soft skills are not soft by any means. They are the most important thing that you can focus in on.

Making Your First Hire

Gus: Let's jump over to your first hire. You mentioned your first employee, first big boy job. Talk to me about what your process was for taking the jump and hiring the first person and all the things involved in finding that right person.

Matt: Ultimately, I knew it was time because there was just so much to do and there was only one of me. And I was working some really late nights and figured there's got to be a better way. And we were we wanted to start with a part time hire. So that was obviously in itself difficult to find someone who would be committed, but also only taken on on an hourly basis.

Matt: And I'm a big believer in constantly networking as much as you can. This hire actually came to me from a neighbor of mine. It was their nephew. When they heard that I had a potential opportunity, I had a 30 minute call scheduled to get a sense for his market knowledge, but more so what were the values that he could bring to the table. I knew he had a marketing degree. I knew he was under 25 at that point and knew social media. He understood that world. I didn't grow up in it.

Matt: So our initial 30 minute conversation ended up going three and a half hours. And that was telling for me because I remember sitting there going, man, here's a kid who graduated in the height of COVID, who all of his job opportunities were stripped because of COVID and the economy downsizing at that point, who opted to start his own business. And I wish I had the balls back when I was his age to do the very same thing.

Matt: So he had been successfully engaged in personal training in the Charleston area for two years. So he had a mindset for health and wellness. Different than health care, different than the domain that we're in, but he was hungry to learn. So we started with a couple hours a week and I set expectations for him of, A, that pest analysis, doing the reading, being engaged in it, starting to build his own brand on LinkedIn and putting out some posts each day.

Matt: And he took to it like a sponge and just really, really sucked it up and dove in. He's been a full-time employee now for just over a year. And it's something that has to work for both parties. So he had to be comfortable working, not just for me, but he had two other jobs at that time, too, and was willing to grind and do what was asked.

Matt: But with all the tools that are available now, building outbound emails, not very difficult. It's all about the consistency game. And that's what I needed was someone who could manage that side of things. When a client gets nurtured enough for us, they come over to me and we get them on a call.

Matt: To be able to hand off a couple of those key heavy items to him, that for me freed up time for me to actually re-engage with my family. So it's always opportunity costs, right? Same thing with bookkeeping. I know I harped on it before and it's not fun, especially when you're dealing with high marketing budgets and a lot of different vendors and making payments and collecting and all of that. But to find somebody who could do it for $10 an hour that was an actual accountant, albeit they are in the Philippines, but someone that I could trust to do that work and pull together P&Ls and keep track of expenses, but also keep track of invoices. I mean, that was a no brainer to bring in somebody like that.

Matt: So, you know, you always have to take a look at the opportunity costs. What are you able to free up your time to do? And then do you have something to fill that time with? Because I don't think it's valuable if you're just going to bring someone in just to bring somebody in. There has to be something that they're doing that you're not able to do on your own. And this is where Hunter really fit the bill for us. It was come in, learn. He's continuing to learn. He will learn the rest of his career. But at the end of the day, he can take a volume of work off of my shoulders that otherwise would get stuck.

Gus: Totally. Yeah, I think that's incredibly valuable. And I'm in the hiring process, the kind of early phases and it can definitely be overwhelming. But I think what you talked about with the part time versus full time, you know, that was an avenue that I was attempting to go down. But it was challenging because the buy in is not there in terms or it's hard to find someone who's fully bought in with the perspective of potentially becoming a full time employee.

Matt: The biggest thing I would say is transparency. Letting them know and I keep Hunter continuously in the loop, especially when we have down months on cash flow. It's like, look, here's where things are. This is why I have the KPIs that I have set for you where they are. And if they begin to slip, I have to be a good manager of that individual to let them know that they're slipping and they need to reengage.

Matt: But Hunter agreed that, listen, we'll take this as from an hourly hourly rate that I could afford to pay that ultimately at the end of the day became his full time salary. If you think about it from a pure hourly perspective, it became a full time salary in and of itself. And he was willing to devote more and more time, the more payoff he saw from it. And there was also a commission based component that came with that, too.

Matt: So, hey, listen, you know, you'll take a lower hourly rate for now, but you'll take a higher commission check if you do get a sale in this time. And then when you move to a full time that that becomes a little bit different and you get a lower commission check, but you're continuously getting paid. So it really becomes that initial conversation that you're having with them. What do they want out of this? If they're just looking for the check, then they're probably not the right person.

Business Model and Sales Cycles

Gus: What is your business model? Like maybe what's your sales cycle look like? And how did you determine, like, these are the packages or these are the services or these are the surveys that we're going to provide to these customers? What was that process like?

Matt: So the research is something that I came across a number of years ago. And in industry, you have a lot of benchmarking that's done on any commercial role. But unfortunately, this domain did not have industry benchmarking, which I always thought was interesting because they are, in my opinion, a vital asset to the organization. But because of federal law and the DOJ and the way that they see pharma, these teams cannot be commercial in nature. So they can't realistically and legally be tied to a commercial number. Well, how do then do they tell their organization that they're doing a good job? Or they're doing things that help?

Matt: That's where the research kind of grew out of - if we can go to their customers and get feedback from their customers, we can come back to them and say, here's where you are based off of their perspective. And now let's think about how we can work together strategically to change that opinion or to continue to drive that perception that you are doing the right thing. And then how do we sell that internally? How do we become a part of the business so that they see us as a business partner, not as what's often termed in advocacy? Oftentimes it's seen as shaping fog because it's the fluffy stuff, right?

Gus: Absolutely. You get to deal with patients on a daily basis and the nonprofits that support patients. And you're not building marketing decks and you're not doing the hard stuff.

Matt: No, they are doing the long term relationship building. That is the hard stuff because the company makes decisions all the time that impact that relationship.

Matt: From there, it's also become a let's provide the industry back a benchmark for this function. So we've launched a second report that's known as the bioadvocate benchmark, the first being Elevay, which is patient insights, elevated health care. And the industry, the bioadvocate benchmark was, again, because there's not been a ranking, so to speak, of the organizations themselves. There's also not been inputs on what your average team size looks like, what their budgets typically are, where they sit in an organization, because there's a lot of inside of these companies about where does advocacy actually fit because they're non-commercial.

Matt: So we did a study to help guide the industry on here's where the majority of teams sit, here's what their budgets typically look like. And it's all based off of, obviously, the number of disease states they're involved in, because at the end of the day, that's what drives your spending. The more disease states you're in, the more nonprofits there are, the more professional societies there are. So that drives your spend.

Matt: We knew that, but we didn't know what the actual numbers were going to look like. So to give you an example, your typical large pharma company has a budget of twenty five to fifty million and a team between thirty and fifty. And it's all dependent on that eight to twelve disease states. And that number can shift and change. But even your small ones that focus on one or two disease states have about a five million dollar budget and a team of three.

Matt: So it's having that benchmark and then figuring out, OK, what's the sale actually look like? How do we get them to, A, want to know the data? B, know the data when they don't look good. That's oftentimes a hard thing. And it becomes a carrot or the stick, right? Let us work with you to craft a narrative internally by subscribing to the data and we'll walk you through it. We'll show you exactly why you look the way that you do. Or there's a press release, right? And the press release that you don't have control over can be a difficult pill to swallow when leadership sees it and you weren't expecting it.

Matt: So there is that approach. And the sales cycle is typically three, maybe six months, depending on where in the year we were actually beginning that dialogue. For the industry right now, honestly, you have another thirty five days before the industry shuts down. Most of pharma and biotech shut down the week before Christmas through the new year. So nothing's going to happen. And with 90 day payment terms, it's not like you're going to be collecting anything for the rest of the year.

Matt: But what ends up happening in November is they do budgeting kind of like the government, which is we're not starting at zero. We're starting at where we were last year. And if we didn't spend it all, you don't get that next year. So there's a lot of fallout money right now. And some of those sales cycles in November are much faster. And we even have some customers that want to prepay with spent with leftover money for next year's report that we're currently in the midst of fielding.

Matt: So you get them now, it's quick. You get them in January, February, March, a little bit slower. Summer sucks. And these are things that you have to learn as an entrepreneur to budget for. Right. Knowing that there's no money in August and September.

Gus: It is so funny because like, you know, when you're growing up, you're like summer vacation is awesome. And then you join the workforce and you're like, summer sucks. And then you realize eventually you're like, oh, no, people still have summer vacation. Nobody does a damn thing in the summer.

Matt: Wild. And, you know, as a small business owner, I don't know about you, but, you know, we don't have all of the federal holidays off. Right. I have some always a surprise to me. I'm like, well, you guys have today off. You have Veterans Day off. Like, OK, good. Good for you. I don't have Veterans Day off. But why do we have to then wait three weeks after Veterans Day to come back together? How about we get that a little bit faster? Right. So really do have to keep you have to be pushing and pushing in the summer if you want anything to happen.

Matt: But honestly, and then, you know, the difficult thing in this industry is budget cycling. Most people go into budget review in July. So they're looking at the following year's budgets and what they're going to need midway through the current.

Gus: So they're not planning out like a quarter in advance.

Matt: There are a couple of months in advance because, you know, you have big marketing budgets. And majority of those dollars in marketing go to ads on TV, which we will see plenty of them this evening on the news cycle. Right. And those take time to make those take time to get seated in the market and so on and so forth. So it's always about marketing first and foremost.

Matt: And then from there, the price point has to be right. Right. And it's been a very interesting dialogue and discussion with customers because really, you have to know where your customers are able to make the decision on their own versus where they're going to have to go above them to get sign offs. And we learned very quickly where that number is based off of some consulting calls with them and just what that looks like. And that's how it helped us to set our number for where we're at.

Matt: And mind you, we have one competitor and that competitor is free. Well, I'm dealing with a value prop, as I discussed before, if your only value is your price, well, we're lost, right? They're not going to pick us. So that's where the breadth and depth of the value of the data that we provide. And ultimately, they get a team member or two for a year with us when they buy the data, because as you can imagine, when you have about 200 slides worth of data, it's something that you can't go through on your own and it takes time.

Matt: And then when they want people internally to hear about it, they don't want to take the time to do it. It's on us to sell the data continuously, internally. And then typically once we can get them on the hook for one year, they don't do multi year contracts in pharma, just not the way that things happen. But if you're working with them, they are still with you that next cycle that comes around. So you're more than likely going to get them again in the coming year.

Gus: I think that's a really smart way to do it is like, you know, you can't just say, hey, here's the data, like, enjoy it. Right. You want to make sure that the internal team is actually utilizing that, looking at it, taking advantage of it.

Matt: Exactly. And then you're like, hey, you're ready for next year. And they're like, actually, like we don't really use it that much. But, you know, from a from a sheer business model, it's almost like a SAS product, right, where it's built ones distribute many. But it's just on a microcosm of a one year cycle. Right. The data is only as good as the year that it's in. And then when we get the next one, well, you know, it's one of the reasons that we go into currently right now we have 50 percent off of last year's report and a 10 percent discount if you go under contract for next for this coming year's report.

Matt: All right. So you got to get it out while you can, knowing that the next report's coming, the next marketing is needing to be paid for all the conferences that you have to attend are coming. So you got to price it right and know what your cogs are going into that so that when you do sell one, you know, I hope to cover the costs of running the report in selling one report. That way, everyone else is profit on top and can help cover the expenses of the business.

Gus: So that wraps up this episode of the Founder Facing Podcast with Matt Toresco. If you found this conversation valuable, please subscribe to the podcast and check out Archo Advocacy Group to learn more about healthcare advocacy. Stay tuned for more episodes where we'll be talking with other founders and business leaders about their journeys, challenges, and insights.

Resources Mentioned

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