Connecticut Innovations: Congratulations on founding your third startup, Eric. How did the idea for this new company come about?
Eric Rosow: The idea for Conduce Health was conceived by my co-founders, Dr. Najib Jai and Dr. Jeffrey DeFlavio at AlleyCorp, a firm based in New York City that builds and invests in tech companies. Both Najib and Jeff, whom I met through our mutual network, are physician entrepreneurs who have deep domain experience in value-based care. I was immediately impressed with their track records, their domain knowledge about value-based care, their intelligence and work ethic, and most importantly, their integrity, passion and shared vision for building a transformational and much needed healthtech company.
CI: What problem does the company solve?
ER: Conduce Health is a value-based specialty care marketplace. Our marketplace provides a single platform for managing specialty care risk, streamlines contracting and payment processes with specialists, and uses actuarial and data science to optimize the matching of complex patients and specialists. Conduce’s mission is to build the bridge to value-based specialty care and realize the vision of a world where patients receive personalized specialty care the first time, every time—all the time.
CI: That sounds fantastic! Five years ago, you and I talked about some of the challenges of starting and growing a company. You mentioned that determining the right product-market fit, coupled with “relentless focus and execution,” was a challenge throughout a company’s life cycle. Do you still feel that way?
ER: One hundred percent. Listening to and understanding the market, customers and partners to figure out product-market fit, building the right team to execute and staying focused on the most important tasks are each critically important initiatives throughout a company’s evolution—but especially so during the early phases of a startup.
CI: You also mentioned being proud of how capital-efficient Diameter Health was as it scaled. What advice would you give to other entrepreneurs who are looking to do the same?
ER: I’ve always been a fan of being scrappy and proving value and product-market fit in the early days of new venture creation. I’ve seen too many companies take on too much capital too early in their journey. I’m a big fan of “customer financing,” in which you can validate the need for and differentiation of your solution or service by signing up paying customers who have a shared pain point or need that can be addressed across a wide, and ideally growing, marketplace. If you’re able to do this, raising capital to grow and scale is a much easier process.
CI: We talked about the importance of building a great team, and how rewarding but also incredibly difficult it can be to find talent. Has that gotten easier?
ER: It’s never easy to build a super high-performing team because the best talent has so many options and will always be in high demand. It’s one thing to recruit top talent, but it’s an entirely different thing to align and retain that talent over the long run. In my experience, to do this, team members want to be part of an organization and culture that they trust and respect and where they are part of building something meaningful. As this is my third startup, I’m fortunate to have worked with so many talented colleagues, and I have tremendous gratitude that several of them have signed up for the second and third time to build an important and valuable company together.
CI: Your previous company, Diameter Health, was acquired in 2022. Do you have advice for other founders who are looking to exit?
ER: While there are several paths for exits, my experience has been acquisition by larger organizations where there were strategic synergies that could be leveraged to accelerate growth and impact. A mentor told me many years ago that the best companies are bought, not sold, so while we’ve had many unsolicited inquiries throughout the Diameter Health journey, we always maintained our focus on our strategic objectives and delivering unique and sustainable value to our customers and partners. We were also very fortunate to have a fantastic investor syndicate—Connecticut Innovations, LRV Health, Activate Venture Partners, Excelerate Health Ventures, Optum Ventures and Centene—and a highly engaged and valued board of directors that helped me and my executive team evaluate strategic options with respect to M&A opportunities.
CI: Last time we talked, you mentioned that Connecticut Innovations provided a great deal of support to you as you scaled Diameter Health. Do you anticipate working with them in the same way with your new company?
ER: Connecticut Innovations has been a tremendous partner and investor throughout my first two companies, and it was an easy decision to work with CI again as we scale Conduce Health. In addition to being a trusted thought partner, CI has been especially helpful with respect to recruiting and introductions to potential partners, clients and other investors. Connecticut is a great place to start and build companies, and we’re so fortunate to have an organization like Connecticut Innovations as a resource to so many tech companies throughout the state.
CI: What do you like about Connecticut as a place to start a company?
ER: Connecticut is a fantastic state to build and scale tech companies. In addition to a great quality of life and school systems, Connecticut offers easy access to train stations, airports and world-class health systems, colleges and universities. While several of our team members are based in Connecticut, others live in Boston, New York City and the Midwest, so it’s easy to meet up in person in addition to leveraging online collaboration tools.
CI: You’ve been highly successful in your career. How important is work-life balance at this point? Are you still making time to row competitively?
ER: Company building is both a team sport and an endurance sport, so it’s critically important to make time for self-care, exercise and “decompression.” Many members of our team are competitive athletes, and the discipline, work ethic and collaboration that come from athletics absolutely translates to new venture creation. While I no longer coach the Avon high school crew team, I continue to row competitively with my club, Riverfront Recapture, and we’ll be attending US Rowing’s Masters Nationals in July. I’ve always found that balancing work and recreational activities makes you a better team member and leader.
CI: Agreed. Have you learned something new with each successive company you’ve founded? Anything you wish you’d known before you started each one?
ER: New venture creation teaches you new things every day. Throughout my entrepreneurial journeys, I’ve learned that an essential truism is prioritizing the importance of building a high-performing team, including the board and investor syndicate, and a culture of transparency, trust and humility. In short, we strive to build a culture that is fun, data-driven and a meritocracy where the best ideas win, and that shares a common vision and passion for the company’s mission.
CI: What’s next for Conduce Health?
ER: Continued focus on executing our product roadmap, commercial traction and building out our team of “Conductors” to scale our company and its impact.
CI: Best of luck with that and the US Rowing Masters Nationals.
ER: Thank you.