Real estate decisions are crucial to your telemedicine business. Here’s why.
Digital and mobile health companies need to develop a comprehensive real estate strategy that supports their ecosystem and projected growth in the sector.
A report last year suggested that the digital healthcare market in the U.S. – comprising digital health records systems, health analytics, mobile health (mhealth - wearables and apps) and telemedicine - could reach $219.7 billion by 2025. Another report projected that telemedicine alone could grow to be a $64 billion business in the next five years.
The growing dependence on mobile technology among patients and the healthcare community, combined with a need to rein in healthcare costs and improve efficiency, enabled by rapidly developing technology such as 5G broadband, are just some of the factors behind these growth projections.
Consider though, that pace of growth was projected before the coronavirus pandemic. It most likely is conservative given the new realities created by the global COVID-19 pandemic and a growing dependence on telemedicine as a first line of defense.
This means digital health companies could find themselves in an accelerated market environment. Many of these companies are at Series B and C (or later) funding stages, having shown real promise in proof-of-concept. As such, they may have to expand at a much faster pace than originally planned to match surged demand. This could, in turn, put pressure on their real estate infrastructure.
A diverse real estate ecosystem
Most digital health companies need a diverse real estate support structure: remote working, headquarters and administrative office locations, research and development facilities, manufacturing (for wearables), call centers, and flexible space (to accommodate sudden or short-term growth).
Often, digital health companies providing real-time healthcare coaches incorporate remote working strategies, a strategy currently being put to a broader test due to COVID-19 work from home mandates. Structuring an effective strategy to meet these needs takes a unified team with deep market knowledge in different regions, coordinated by a single point of contact to streamline execution.
Questions you should ask yourself
Developing such a strategy also needs to include detailed insight into the right ecosystem for the business. Where is the right talent for engineering and other key clusters? Does the business have close access to the appropriate venture capital? Are there other physical assets which the business would benefit from being close to, such as a major medical center, nationally-recognized nursing program or teaching hospital?
While many sectors of the economy are facing physical and financial challenges that have quickly emerged as a result of global uncertainty caused by the pandemic, the digital health sector is at an inflection point.
Companies hoping to be part of the projected growth of the market need to prudently plan their real estate strategies to make the most of current and future opportunities.