The grand prize winner of Hartford’s Strong Cities, Strong Communities (SC2) Challenge was announced at the end of May 2015. Hartford.Health.Works (HHW), which was formed by a team of health care and medical technology companies, received $500,000 for its plan to create a medical device prototyping and manufacturing campus in Hartford and create thousands of jobs in the city.
A key element of President Obama’s SC2 Initiative, the SC2 Challenge aims to help cities benefit from innovative business concepts that create economic development plans and put them into action. The winning teams were awarded a total of $800,000, which was funded by the U.S. Economic Development Administration.
HHW was founded by the Biomedical Engineering Alliance & Consortium (BEACON), Rising-Tide Health Care and Movia Robotics. The team received the grand prize for developing a local, innovative and feasible business development model.
Innovation Destination: Hartford spoke with Mark Borton, Founder of Rising-Tide Health Care, about HHW’s plans for the future of Hartford.
INNOVATION DESTINATION: HARTFORD: Tell us a little about your background.
BORTON: I’m a serial entrepreneur. I’ve been in the health care technology area for about a dozen years and have experienced some of the challenges of being an entrepreneur in this area. I worked in public policy and the research area in commercialization and business development, so I have experience with all of those different pieces.
My company, Rising-Tide Health Care, is trying to bring those pieces together because you rarely have successful solutions unless you bring those pieces together.
INNOVATION DESTINATION: HARTFORD: How did you get the concept for your business plan?
BORTON: When the SC2 Challenge was announced, I brainstormed up a batch of ideas and a lot of them focused on health care technology. I looked at those ideas and wondered: Who knows where this challenge is going to go? I thought this might be an interesting way to figure out if we could bring all the pieces together for a more collaborative environment and make Hartford more effective at company creation and product creation, and hence job creation.
We have a lot of assets in Connecticut, but they’re not organized for optimal company creation or job creation. That was the whole premise of HHW: to take that basic idea and scale it up to be a whole series of programs that would address unmet needs.
Hartford wants to be “the city for entrepreneurs.” Our basic approach is that you can’t be all things to all people. So, instead of going wide but shallow, we’re going to go narrow and deep, and focus on health care technology.
INNOVATION DESTINATION: HARTFORD: Why is it so important expand the health care technology sector in the Hartford area?
BORTON: You need to have something to work with. Starting from scratch on everything is really difficult, expensive and time-consuming.
Connecticut has a lot of health care technology-related assets. We have two big research universities, lots of other universities and a robust—but not enormous—high-tech manufacturing sector. We also have a lot of big hospitals and we have an extraordinary market in our backyard, meaning the insurance companies. Within 20 miles of Hartford you’ve got about 20% of that nationwide buying power in health care.
Connecticut doesn’t tap any of those resources very well; they sort of all exist in their own little places. But if you look at it as a whole, you’ve got a lot of assets to work with. It’s really the connecting tissue that needs to be built, and that’s what a lot of these programs are about is getting good at making the transition from raw idea to prototype.
For instance, prototyping in the medical technology area is very difficult and expensive. You often need access to million-dollar machines and, as a startup, that’s hard. So part of the idea is to identify those barriers to effective commercialization. For example, access to expensive equipment for prototyping purposes, no one company can afford to really buy that, but we may be able to buy that and make it available to startups, effectively breaking the barrier to success.
This approach is called a “shared service.” So what you end up doing is reducing cost, reducing risk and reducing time to market. And those are all competitive advantages.
We can do that for a whole batch of things. For instance, the Food and Drug Administration (FDA) approval process, and how do you get your stuff purchased by the insurance companies. How do you do that with Medicare and Medicaid? If Connecticut can get good at all of those things, we can become a place where people come to start their businesses, grow their businesses and build their products.
INNOVATION DESTINATION: HARTFORD: Can you explain how your business model will benefit Hartford-area entrepreneurs and startups?
BORTON: We tried to address the question of: what do you need if you’re an entrepreneur? And entrepreneurs come in different flavors. There are raw startups, second-stage companies that are viable and in growing mode, and then the big companies. Regardless, it boils down to three basic things: access to capital, access to specialized experts and equipment, and access to markets. There’s also another parallel issue of workforce development. You need skilled people to produce high-quality products.
INNOVATION DESTINATION: HARTFORD: How will HHW’s business model create more jobs in Greater Hartford?
BORTON: We put together a portfolio of 16 different programs that would address all of those unmet needs at each stage of the companies’ growth. In combination, you have a pretty robust way to generate a lot of jobs. The effect is to generate thousands of new jobs for Hartford.
Our concept started out small, but it’s been growing and accelerating rather steadily and it’s been a lot of fun because many people have said: We like this idea; how can we help? So it gets stronger with each conversation we have.
INNOVATION DESTINATION: HARTFORD: So, how do you get the ball rolling?
BORTON: It all comes down to a couple of different things. One is to get good at forming businesses and building products and the other is to get good at recruiting companies to come here.
You start with the small companies and when you get a critical mass of what we’ll call “suppliers,” which are the companies that make component parts, each one of those new component part manufacturers makes the area more attractive to the next component part manufacturer because you create what’s called “the catalyst model.”
It’s also known as “the shopping mall.” The idea is to make Hartford into a shopping mall full of component part manufacturers of medical technologies. And when you do that, you also become attractive to the big original equipment manufacturers (or brand-name companies), such as Johnson & Johnson. Each stage of this process—the startups, the suppliers, the original equipment manufacturers—brings larger and larger numbers of jobs to Hartford.
INNOVATION DESTINATION: HARTFORD: Where do you see the future of the overall business concept and how do you plan to use the SC2 Award money?
BORTON: Technically, by providing the SC2 prize money to the contest winners, the city of Hartford bought all of the winning SC2 plans. Basically, the city paid for all of the work that we’ve all been doing for the last year and a half. The city can now choose which parts of which plans to implement, how, when and with whom.
With HHW, the city has chosen to implement our plan and has asked us to assist them. In the case of HHW, the prize went to the three organizations—BEACON, Rising-Tide Health Care and Movia Robotics—that did the planning and are continuing to volunteer time to get HHW up and running.
The whole idea of the SC2 Challenge is that people in the area understand what the issues are and care about getting solutions implemented.
This is a decade-long project. It is very large in scale. We did it as a portfolio of programs because we didn’t know what kind of funding was going to be available. We’re working that out with the city. So we really won’t know what funding will available and how it will be used for several months.
It’s such a big project that you can’t do all of it, especially not all at once, so depending on what kind of resources we can make available, various things will get prioritized.
INNOVATION DESTINATION: HARTFORD: What is the best thing about living/working in the Greater Hartford region?
BORTON: There’s been an enormous amount of collaboration on this project. I would say that what’s so cool about working in Greater Hartford is that you can be in a capital city—a small capital city—and with the right idea you can get to the right people and really start to get things going. And that’s really neat because there are a lot of resources here, there is a lot of opportunity and there are great cultural things. We have the technology, we have the resources; we just have to figure out how to combine them.
I live in Chester, which is a little town 45 minutes outside of Hartford. I have an understanding of the health care technology industry and entrepreneurial experience, but I didn’t know Hartford well. That’s why I went to BEACON, it’s located in Hartford and the principals there have a combined 50 years of knowledge of Hartford. Also Tim Gifford lives in Hartford and his company, Movia Robotics, a UConn startup, is based in Hartford. We each brought important perspectives to the HHW planning.
The partnership we have created between our three companies has been fabulous, as has the expansion that’s grown from it. We got 40 letters of support from different organizations in Hartford, outside of Hartford, around Hartford, into Massachusetts, even international, and that’s very cool when you can be in a city where that kind of thing can go on.