Shutting Down a Health Tech Startup: CEO of Astarte Medical Tells All

What REALLY happens when a health tech startup decides to shut down? We blow past the harsh coolness of the ‘out-of-business’ headlines to explore the real, personal aspects of a wind-down story, thanks to the tell-it-like-it-is spirit of Tracy Warren, co-founder & CEO of Astarte Medical.

Astarte Medical was in the health tech software business, with a platform that helped hospital NICU’s better manage feeding protocol for its babies. In total they raised $14 Million through a Series A and A-1, boasted an awesome Board that included Marcus Osborne of Walmart Health fame, had four solid hospital contracts, and was 6-years into operations when the runway started to run out. So, what happened and, as a CEO, how does one handle it?

Tracy gets into ALL the details and damnable decisions that she faced – and likely many other digital health CEOs and investors will want to learn from – when the end of a start-up is imminent.

We get into:
• The marathon of decision-making that is shutting down
• Telling employees and customers ‘it’s over’
• Handling investors – when to bring them in and what to do if they push for staying afloat
• If debt funding comes with regrets
• Managing red flags and warning signs along the way
• The REAL macro-economic factors behind why health tech is contracting
• Why hospitals – and other incumbents – need to rethink how they innovate
• Feelings! How it feels to be a CEO struggling to keep the business going, coming to terms with shutting down, then suffering the grief and stigma of closure

It’s not all unicorns, rainbows, and funding rounds, Health Tech, and I can’t thank Tracy enough for helping us understand a very normal part of our collective startup story. As she says, we need to talk about these experiences, and do more to de-stigmatize a really common reality that’s inherent in venture-backed healthcare.

Astarte Medical is currently selling its assets – both its NICU software and IP (three issued patents and one pending) around quantifying gut health and creating health plans around gut microbiome for all patient populations.

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[wenprofiri]

Respect! Honesty is what's needed in digital health and AI.

[growingisgood]

Dear Tracey, You've absolutely nailed it !!

[SilviaPfeiffer]

Healthcare digital transformation is hard and it's great that you had a frank conversation about how it can fail because the timelines we set ourselves for success in venture funded businesses don't meet the timelines of transition of the industry.

[davidroberts]

Incredible. Thanks for your insightful commentary and openness

[DrPaulAMarkham]

Excellent overview and factual - a reminder that these are smart business people with market research, funding, a good board, and more. But the invisible hand of the market and trying to sell software to hospitals is nearly impossible. Wheel in an ultrasound machine and the hospital knows it is an ATM, otherwise, it is a drama.

[healthsaavy]

Feels like i heard these exact words
"I started a business for Ishtar, raised millions of dollars for her, and then ditched the business." 🧐