"You don't have product market fit until customers are dragging you into the market." It's a brutal truth that most founders learn the hard way, and Grant Gordon learned it after 2.5 years of building what he thought the market wanted.
Gordon is the co-founder and CEO of Artemis Health, a healthcare data analytics platform that serves 600 employers including Google, Amazon, and Boeing, managing data for 12 million lives. After raising $60 million and navigating the complex world of US employer-sponsored healthcare, Artemis was recently acquired by Nomi Health.
In this candid interview, Gordon reveals the painful reality of mistaking early interest for product-market fit, the chicken-and-egg problem of building healthcare software without data, and how a father's cancer diagnosis sparked a mission to fix America's broken healthcare system through better software.
Watch the full interview now on EO's YouTube channel! Below is the complete transcription of the interview. Minor edits have been made for clarity and readability.
Key Highlights:
"When you're a founder, you're looking for reasons to believe in what you're doing, but a really important thing to not kid yourself about and not be duped by is product market fit. You don't have product market fit until customers are dragging you into the market. That's when you've got product market fit."
"The tricky thing about building analytics software with healthcare data is it's very hard to build data software without the data that you're going to be analyzing, but nobody wants to give you any data until you've already sold your software to somebody and they're using it, so it's a chicken and the egg kind of problem."
"I think we thought we had a product market fit a little bit too early and it was kind of hard to catch up as we were going and that was really painful. It took us 2.5 years actually to get our first customers."
"So it's not like a computer that's 15% faster, it's like weeks faster."
"The tricky thing about building analytics software with healthcare data is it's very hard to build data software without the data that you're going to be analyzing, but nobody wants to give you any data until you've already sold your software to somebody and they're using it, so it's a chicken and the egg kind of problem."
"I think we thought we had a product market fit a little bit too early and it was kind of hard to catch up as we were going and that was really painful. It took us 2.5 years actually to get our first customers."
"So it's not like a computer that's 15% faster, it's like weeks faster."
When Cancer Sparked a Mission
What drove you to start Artemis Health and focus on the healthcare industry?
Grant Gordon: In 2012 my dad got cancer. I was waiting with him at the Huntsman Institute and I was distracting myself by looking over the shoulder of the doctors and nurses who were trying to use the software on the computer in the room, and I kept thinking, wow, this is just like the worst software I've ever seen in my life.
Everyone says that US healthcare is really broken. I'm seeing one perspective on that right now, and I don't know anything about healthcare, but I know a lot about software, so maybe if my co-founders and I put our humble hats on and look around, we can find something to chip away at, and that would be a good way to spend our lives, but we didn't really know what.
A lot of startup stories, it's like a light bulb moment like, oh, I wanna go do this, and for us it was just very gradual, just trying to follow our passion and follow something that would help us make a difference in the world.
Everyone says that US healthcare is really broken. I'm seeing one perspective on that right now, and I don't know anything about healthcare, but I know a lot about software, so maybe if my co-founders and I put our humble hats on and look around, we can find something to chip away at, and that would be a good way to spend our lives, but we didn't really know what.
A lot of startup stories, it's like a light bulb moment like, oh, I wanna go do this, and for us it was just very gradual, just trying to follow our passion and follow something that would help us make a difference in the world.
From Red-Eye to Blueprint Health
How did you get connected with Blueprint Health and what was that early experience like?
Grant Gordon: We started making concepts. We were introduced to some investors in New York called Blueprint Health, and they had an amazing network. They actually flew out to Salt Lake City, which is pretty crazy. They kind of grilled us on what we wanted to do, and they decided that they wanted to back us.
On July 6th, 2013, we stepped off of a red-eye in New York City, we got an apartment for the summer and we started working at Blueprint's loft every day. The way that they introduced us to so many people, we got to learn really fast.
We were pitching our concepts to a lot of employers and we got a few employers to sign things that are called letters of intent, basically saying if you build this, I will buy it. Based on that kind of early commitment, we were able to raise about $1.2 million. Once we got that we kept our burn very low. We paid ourselves almost nothing even though we were living in New York for the first 2 years.
On July 6th, 2013, we stepped off of a red-eye in New York City, we got an apartment for the summer and we started working at Blueprint's loft every day. The way that they introduced us to so many people, we got to learn really fast.
We were pitching our concepts to a lot of employers and we got a few employers to sign things that are called letters of intent, basically saying if you build this, I will buy it. Based on that kind of early commitment, we were able to raise about $1.2 million. Once we got that we kept our burn very low. We paid ourselves almost nothing even though we were living in New York for the first 2 years.
The Chicken and Egg Problem
What made building healthcare analytics software particularly challenging?
Grant Gordon: The industry that we picked was very well established and had a very small number of competitors, but they hadn't been improving their products for 15 or 20 years. It's a very conservative industry. They're very old, very hard to use, very slow. What we focused on was trying to make healthcare benefits data easy.
The tricky thing about building analytics software with healthcare data is it's very hard to build data software without the data that you're going to be analyzing, but nobody wants to give you any data until you've already sold your software to somebody and they're using it, so it's a chicken and the egg kind of problem.
When we were building our MVP that was a lot of what we were trying to get around. When customers were looking at our software, they were looking at essentially a very sophisticated clickable prototype, and then we started cold calling potential customers and asking for feedback by reaching out to these benefit teams without trying to sell them at all and just really honestly looking for feedback. Over time we were able to build really genuine relationships with these people.
The tricky thing about building analytics software with healthcare data is it's very hard to build data software without the data that you're going to be analyzing, but nobody wants to give you any data until you've already sold your software to somebody and they're using it, so it's a chicken and the egg kind of problem.
When we were building our MVP that was a lot of what we were trying to get around. When customers were looking at our software, they were looking at essentially a very sophisticated clickable prototype, and then we started cold calling potential customers and asking for feedback by reaching out to these benefit teams without trying to sell them at all and just really honestly looking for feedback. Over time we were able to build really genuine relationships with these people.
The Product-Market Fit Mirage
You mentioned the danger of thinking you have product-market fit too early. Can you elaborate on that experience?
Grant Gordon: When you're a founder, you're looking for reasons to believe in what you're doing, but a really important thing to not kid yourself about and not be duped by is product market fit. You don't have product market fit until customers are dragging you into the market. That's when you got product market fit.
I think we thought we had a product market fit a little bit too early and it was kind of hard to catch up as we were going and that was really painful. It took us a while to get our first customers. It took us 2.5 years actually. At the end of 2015, we signed our first two customers Intuit and Nielsen, and then we just started growing like crazy.
I think we thought we had a product market fit a little bit too early and it was kind of hard to catch up as we were going and that was really painful. It took us a while to get our first customers. It took us 2.5 years actually. At the end of 2015, we signed our first two customers Intuit and Nielsen, and then we just started growing like crazy.
Breaking Through the Legacy Stranglehold
What finally made customers switch from established competitors to Artemis?
Grant Gordon: I think the reason why customers switched was a few things. One, they hadn't had a new option in a very long time. Our competitors generally only integrated three data sets: medical claims, pharmacy claims, and what's called biometric data. Most modern benefit programs have many data sets. We built our technology to make it much, much easier for us to connect all of those data sets so that the employer could get a complete picture of everything that was going on.
And the other piece was our competitors' software wasn't really self-serviceable for most people. There is this massive lag where if you're a benefits manager, you would go and ask an analyst a question and it would take them a long time to set up the report and then it would take them a long time to run the report and then they would bring it back and you'd see it and say that's not what I actually wanted, so then they'd have to go do it again so it would take weeks and weeks to get answers to any questions.
Because Artemis is so fast they could get their own answers to their own questions like this. So it's not like a computer that's 15% faster, it's like weeks faster.
And the other piece was our competitors' software wasn't really self-serviceable for most people. There is this massive lag where if you're a benefits manager, you would go and ask an analyst a question and it would take them a long time to set up the report and then it would take them a long time to run the report and then they would bring it back and you'd see it and say that's not what I actually wanted, so then they'd have to go do it again so it would take weeks and weeks to get answers to any questions.
Because Artemis is so fast they could get their own answers to their own questions like this. So it's not like a computer that's 15% faster, it's like weeks faster.
The Nomi Health Acquisition
What led to the decision to get acquired by Nomi Health?
Grant Gordon: I don't know that there's kind of one moment or a simple reason for deciding to go ahead and get acquired. For us it was a calculus involving the pandemic's impact on our industry, some ambition that we had to grow faster and build more products with more capital, access to customers.
7 or 8 years in, we just started getting phone calls from companies that wanted to acquire us. We ended up getting acquired by Nomi Health. We have very complementary products. I thought there was a ton of potential for our employees and team members to grow in the new combined company.
They acquired us, they just kept us as a wholly owned subsidiary and unlike most acquisitions, nobody lost their job. Everyone got a whole bunch more equity in Nomi, which is like the founder's dream. Like if you're gonna get acquired, you wanna do right by everybody, all the people who work with you. Technically I'm still the CEO of Artemis Health.
7 or 8 years in, we just started getting phone calls from companies that wanted to acquire us. We ended up getting acquired by Nomi Health. We have very complementary products. I thought there was a ton of potential for our employees and team members to grow in the new combined company.
They acquired us, they just kept us as a wholly owned subsidiary and unlike most acquisitions, nobody lost their job. Everyone got a whole bunch more equity in Nomi, which is like the founder's dream. Like if you're gonna get acquired, you wanna do right by everybody, all the people who work with you. Technically I'm still the CEO of Artemis Health.
Reverse Engineering Culture
How did you approach building and codifying company culture at Artemis?
Grant Gordon: As a company grows, if you're a founder, the only real lever you have after a while to improve the company is by improving the culture because when you hire an executive team and they hire people, you need to let them do their work and not interfere all the time.
A few years in, I realized that I needed to codify our values and really kind of create this brand to make sure that we are hiring people who fit our culture and that we're the kind of people that built the culture that we wanted to have and that we promoted those people.
I spent about one year watching people in Artemis and finding the people that I thought really represented what we were and how we wanted to work and how we wanted to build and so I kind of reverse engineered the way that they acted. That was when we started writing down what our culture was.
Our values aren't grow at all costs, win at all costs like we're not aggressive like that. Our values are things like wear other people's shoes, like try to put yourself in their mind and ask yourself how are they gonna react to this thing that I just said? How can I really be empathetic towards them and make an environment that everyone's happy in and things like make heroes out of the people around you like how do you really think about giving them credit and setting them up to win and do a good job and if everybody's doing that, then everyone's taken care of and it's just a really nice place to work.
A few years in, I realized that I needed to codify our values and really kind of create this brand to make sure that we are hiring people who fit our culture and that we're the kind of people that built the culture that we wanted to have and that we promoted those people.
I spent about one year watching people in Artemis and finding the people that I thought really represented what we were and how we wanted to work and how we wanted to build and so I kind of reverse engineered the way that they acted. That was when we started writing down what our culture was.
Our values aren't grow at all costs, win at all costs like we're not aggressive like that. Our values are things like wear other people's shoes, like try to put yourself in their mind and ask yourself how are they gonna react to this thing that I just said? How can I really be empathetic towards them and make an environment that everyone's happy in and things like make heroes out of the people around you like how do you really think about giving them credit and setting them up to win and do a good job and if everybody's doing that, then everyone's taken care of and it's just a really nice place to work.
Building Things That Matter
What's your dream and what drives you to keep building?
Grant Gordon: I don't know that I've ever articulated my dream. I just like to build things that matter and I'm not even sure what mattering means. I think every day I find new ways to measure mattering. When I meet amazing people who join Artemis and start working on this crazy project with us like that's part of my dream and you know seeing all these employers and all of these people benefiting from that data like that's part of my dream.
I'm definitely gonna be working on something that I care about, something that is hard and crazy and means a lot to me and hopefully it makes a big impact in the world.
I'm definitely gonna be working on something that I care about, something that is hard and crazy and means a lot to me and hopefully it makes a big impact in the world.
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