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Where top VCs are investing in healthcare B2B and infrastructure

Rising healthcare costs, an aging population, stifling regulations and the complexity of present-day technological offerings make the trillion-dollar healthcare industry ripe for disruption.

Not only are we finding new and innovative ways to get medical help, this global pandemic has led to explosive growth in telemedicine, digital devices and health-tracking apps — much of which needs a digital overhaul for doctors’ offices, insurance and the cumbersome HIPAA compliance.

While an infrastructure focus might not seem exciting, it is necessary to fix a broken, profit-driven system of paperwork and delays while the sick and suffering are saddled with mountains of debt.

Our current climate is the perfect illustration of just how critical new and innovative investments in the space truly are. It’s also a lucrative opportunity. According to Deloitte, healthcare infrastructure is expected to continue growing above pace into 2023.

But finding those disruptive technologies is the tricky part. In a recent survey, we asked VCs to evaluate the digital health sector; for today, we reached out to active investors to find out what they are seeing within the healthcare infrastructure landscape, what they are most interested in right now and where they think the industry is headed.

In this survey, we hear from:

Carl Byers, F-Prime Capital

Data and automation are the most interesting themes to me right now. We are only beginning to see the efficiencies and new capabilities opened up by getting the data organized and applying modern techniques. I’m more excited about the practical impact of robotic process automation (RPA) than I am enamored with AI, though both are exciting. I’d point to Notable Health in San Mateo as a company that has a great use of both technologies. I think we are about to embark on a new era of open data in healthcare where we finally solve the longstanding quest for interoperability with privacy mediated by patients. This will require a new developer ecosystem to come about built on new protocols rather than tired, legacy models. The key is for there to be demand pull from new services like virtual primary care (e.g. Firefly) or at-home solutions (like Ro or LetsGetChecked), instead of just a regulatory push (though that also will be important).

I’m spending time on RPA and open data, which is the key to improving healthcare B2B/infrastructure (see above). I think all markets have been overheated from a valuation standpoint, but if you find the right company, the opportunity is vast. If healthcare today is roughly 2x too expensive, getting data flowing is key to eliminating most of that waste. RPA can attack the administrative bloat while data exchange will allow doctors and patients to finally shop for the best value without the worry that something will be lost clinically in the translation.

Tech’s coveted internships are getting canceled due to COVID-19

Victoria Stafford, a third-year student at UC Berkeley, was set to begin working at Yelp in June as a sales intern — the only internship she applied to. And then it was canceled because of the COVID-19 pandemic.

“When I first read the cancellation email, I didn’t believe it. I refreshed my inbox; I rubbed my eyes as if I were waking up from a dream. It was clear that COVID-19 was becoming a mounting concern, but it never occurred to me that my internship was in jeopardy,” Stafford said.

Internship cancellations hurt more than just summer plans. The programs are often pipelines into future jobs and access to valuable work experience.

For Stafford, a business and domestic environmental major from a small town in rural Utah, there are very few business and policy-related opportunities.

“I ask that employers do everything they can to make their internship opportunities more accessible in these upcoming months, and come next year and the year after, show understanding and compassion for employment gaps,” she said.

Dozens of other students from across the country flooded my inbox, sharing stories about the impact on internship cancellations on their paths toward employment.

One student turned down offers and interviews from Google, JP Morgan and Goldman Sachs to pursue a software engineering position. The offer they accepted was yanked weeks later. Another student lost their chance at a post-graduate job at their dream company because their offer was revoked. One only had an offer in their hands for three weeks before it was rescinded.

A number of companies across the country, including Google, Glassdoor, StubHub, Funding Circle, Yelp, Checkr and even the National Institutes of Health, have canceled their internship programs due to COVID-19, TechCrunch has learned. The cancellations, which will likely increase in the days and weeks to come, are unsurprising, due to the uncertainty the pandemic has caused. Still, fewer internships jeopardize the postgraduate job prospects for thousands of college students, and, beyond that, limit the talent pipeline on which tech companies so often are dependent

There’s even a Twitter account that tracks the status of 2020 internships.

From Denver to San Francisco

Like the concerts, conferences, universities and schools, these cancellations are because of the COVID-19 pandemic ravaging the world right now. While some companies cited health concerns, others pointed to the uncertain economic landscape. 

In a statement, job search and review platform Glassdoor said the rapid spread of COVID-19 has grown “beyond a health concern into an economic one.” As a result, it has “decided to pause hiring and reprioritize some initiatives internally to ensure we are well positioned for both the downturn and recovery.” 

A Funding Circle spokesperson confirmed that the company halted its internship program, “given the travel and relocation” for the upcoming intern cohort to San Francisco. In an email obtained by TechCrunch, the National Institute of Health canceled its prestigious internship — which has a 20% acceptance rate — to “stop community spread of Sars-Cov-2 through social distancing.”

“Therefore, hosting 1000+ early career scientists who deserve close supervision and intense mentoring is not appropriate at this time,” the email reads. “The cancellation of the NIH SIP applies to all students, whether you were planning to volunteer or were offered a fellowship position. It also applies, even if you were planning to do computational work that could be done remotely.”

In a statement to TechCrunch, NIH said its program has been reduced to “maintenance-only and mission critical (including research on COVID-19) operation due to spread of the novel coronavirus.”

“Regrettably, as part of this effort to keep people safe and limit the spread through social/physical distancing, it has been necessary to cancel the Summer Internship Program for young trainees at NIH for 2020, but those students already selected for the program will be given priority for summer internship positions in 2021.”

Checkr, based in Denver and San Francisco, put its summer internship program on hold due to “the challenges of onboarding interns while everyone is remote.”

Google has rescinded some internship offers for its UX design internship, per a LinkedIn post. Google denied this. 

“If you log on to a laptop, you can access an opportunity”

While a number of tech companies have put their internship programs on hold, others are piecing together experimental remote internship programs for their students. 

Quizlet is preparing for its annual internship program and is preparing a “contingency plan for an internship that will be virtual if necessary.” Uber has formed a dedicated team to start working on an online internship program “should the situation remain unchanged.” Lyft and Twitter, depending on the state of the pandemic, plan to onboard San Francisco interns virtually.

The pandemic has certainly put remote internship management services in high demand. That said, a handful of startups have been working on the sector for years. 

San Francisco-based Symba, which helps companies offer virtual internship programs, was founded in 2017. Co-founder Ahva Sadeghi said that last week more than 100 companies and 1,000 students reached out to Symba in regards to internship cancellations because of COVID-19.

“The companies we reached out to in the beginning who said, ‘This is great but not top of mind for us,’ are now calling us back asking us to jump on the phone today or tomorrow to get something implemented,” Sadeghi said in a phone call. “We thought we didn’t have product-market fit and now the conversation has completely changed.”

Sadeghi noted how internships assume a certain level of privilege in applicants, prioritizing those who can afford to move to a highly populated city with little to no pay. A remote internship, even in a time of health and prosperity, is important, she said.

“If you can log on to a laptop, you can access an opportunity,” she said. Another program, Chicago-based Sage Corps, founded in 2013, is pushing companies to sponsor the students impacted by internship cancellations. If sponsored, students can still participate in career growth development workshops virtually from Sage Corps, at $1,250 per student. 

Thomas Brunskill, the founder of InsideSherpa, which helps companies host virtual internships, said he’s seen nearly 1,000 students a day sign up for the platform, from Northern Italy, to South-East Asia, to the United States. He started the company, which went through Y Combinator last year, to give students courses and online simulations of jobs through the comfort of their own homes.

He said his customers are mainly larger companies that employ upwards of 1,000 students, like JPMorgan Chase, Deloitte, Citi, BCG and GE.

On one end, Brunskill said the interest makes sense, as larger companies have to meet significant hiring demands. Per the National Association of Colleges and Employers, 70.4% of interns get return offers from the company where they intern. 

On the other end, this concentration further showcases how smaller businesses will be impacted disproportionately from this pandemic. Many will freeze hiring altogether.

“Obviously [this] matters for students, but it also matters for companies who are now going to have this blackhole of talent,” Brunskill said. “Nobody wins in that situation — companies end up with less work-ready students who don’t really know what they’re getting into and students end up in full-time jobs that might not be aligned to their interest or skills because they never had an opportunity to test it out first.”

While layoffs are devastating, and obviously well upon us in the tech world, internship cancellations offer a harsh window into how COVID-19 doesn’t just impact our current workforce, but our future one as well.

Mya Systems gets $18.75M to keep scaling its recruitment chatbot

Hiring chatbot Mya Systems — which uses a conversational AI to grease the recruitment pipeline by automating sourcing for agencies and large enterprises needing to fill lots of vacancies in areas such as retail and warehouse jobs — has closed an $18.75 million Series C.

The funding round was led by Notion Capital with participation from earlier investors, Foundation Capital and Emergence Capital, along with Workday Ventures . The 2012-founded company, which was previously known as FirstJob, raised an $11.4M Series A back in 2017.

Touting growth over the past year, Mya said it saw 3x customer subscription growth in 2019.

In all it says it now has more than 460 brands using its tools — including six of the eight largest staffing agencies, and 29 of the Fortune 100 — name checking the likes of Hays, Adecco, L’Oreal, Deloitte, and Anheuser Busch.

Its chatbot approach to engaging and “deeply” screening applicants via a mobile app has led to more than 400,000 interviews being scheduled with “qualified and interested” candidates, it added. 

Pointing to the COVID-19 pandemic, founder and CEO Eyal Grayevsky suggested there could be increased demand for AI job screening as companies face highly dynamic recruitment needs. “Now more than ever, organizations in healthcare, e-commerce, light industrial, transportation, logistics, retail, and other industries impacted by COVID-19 need help scaling recruitment to serve large, unexpected spikes in demand. Mya is uniquely positioned to help organizations with high volume recruitment needs and the increasing reliance on temp and contract-based work,” he said in a statement.

“While some hiring is slowing down due to COVID-19, we are seeing spikes in demand from industries such as healthcare, light industrial, call center, logistics, grocery, and supply chain. We have received multiple requests from our healthcare, light industrial and e-commerce customers seeking additional support to rapidly scale engagement with nurses, in-home care professionals, warehouse workers, call center representatives, etc. to serve rapidly growing demand for those functions,” he also told us, saying the team is prioritizing helping those dealing with spikes in demand as a result of the coronavirus public health emergency.

In addition to conversational AI, Mya has focused on integrating its platform with other tools used for recruitment, including CRM, ATS and HRIS systems — plugging into the likes of Bullhorn, Workday, and SAP SuccessFactors. Asked what the new funding will be put towards, Grayevsky told us deeper integrations with such partners is on the cards, along with expanding use-cases for the product.

“Mya will be using the funds to invest in our platform, further expanding the use cases designed to support the end-to-end recruiting and post hire engagement process, and continuing to deepen our integrations with partner ATS solutions like Bullhorn, Workday, and SAP Successfactors. In addition to deepening our integrations, we are also investing heavily in turnkey, fully-featured solutions built alongside our ATS partners that allow for even greater ease and speed to implement Mya,” he said.

“Mya will also be investing in deepening our core platform and conversational AI technology, specifically to expand our conversational capabilities across new industries. We will further enhance our self-service conversation design and configuration capabilities to make it even easier for our customers to rapidly scale the Mya conversational experience across both high volume, hourly and professional roles. Lastly, we are strengthening our infrastructure and support for global customers who are rapidly scaling internationally (e.g. L’Oreal is now live in 18 countries globally).”

At this point Mya is selling its product into more than 35 countries — predominantly in North America, EMEA and APAC — with a focus on large and mid-sized employers that operate globally, including staffing businesses and corporations across high-volume recruitment industries such as healthcare, light industrial, call center, retail, transportation and logistics, hospitality, grocery and automotive.

“We have teams in both the US and Europe to support our expanding global customer base,” Grayevsky added. “With the new funding, we will continue to invest in the distribution, infrastructure and support needed to address demand across target markets globally.”

He name-checks the likes of Olivia, AllyO, Job Pal, Roborecruiter, XOR, and TextRecruit as main competitors. In terms of differentiation, he points to Mya having processed “tens of millions” of candidate interactions thus far — amassing an “ever-growing domain specific conversational dataset” — which he said enables it to continue to enhance the experience the platform can deliver for candidates.

“We have the most robust conversational technology and platform enabling rich, dynamic, and natural conversational experiences that deliver higher engagement, conversion, and actionable insights,” he claimed “We have the most in-depth solutions that support use cases across the entire recruiting funnel (e.g. sourcing, talent pool nurturing and re-engagement, screening, scheduling, contractor redeployment, etc.).

“We have the most experience successfully delivering deeply integrated solutions that scale for the largest staffing business and corporations (e.g. our largest customer is now deployed in 600+ locations globally, across hundreds of job roles, and thousands of recruiters on the platform, engaging with millions of both passive and active candidates on an annual basis), and… we are closely partnered with the leading ATS providers such as Workday and Bullhorn, where we have differentiated integrations and channel relationships that give us a competitive advantage.”

We also asked Grayevsky how the recruitment tool is complying with different national employment and equality laws, and also avoiding introducing any discrimination/bias into its AI-aided screening.

On this he said: “Mya does not apply any advanced AI or machine learning to decision making (i.e. determining fit for a job role), we are squarely focused on developing a robust conversational experience that allows Mya to engage instantly, capture information with high response and completion rates, automate outbound sourcing and scheduling process, and provide ongoing engagement and support with both active applicants and passive candidates in our customer’s talent community.”

He also said they have put steps in place to confirm the accuracy of candidate responses through the conversation (such as by adding a confirmation step for core requirements); and by “employing processes that check for bias, both before a solution goes into production and once its launched”.

Another step it’s taken to “ensure a positive experience for all candidates”, as he put it, is to provides the user an option to reroute a question that the bot does not understand to a recruiter.

“Those queries are immediately submitted into our AI training and annotation pipeline, tested and deployed into production to continually expand our FAQ support within the platform,” he told us.

“Mya’s mission is to create a far more efficient and equitable job market powered by conversational AI, and a core principle of that mission is to level the playing field,” Grayevsky added. “Our AI, engineering and product teams (which includes individuals from highly diverse backgrounds) make all product design decisions to consciously remove bias from the hiring process and ensure that information surfaced to hiring teams is accurate and objective.”

“We are also investing extensively to ensure Mya is in full compliance with local employment laws, data protection and privacy regulations, rules around opt-in and consent, everywhere we operate in the world. Ahead of GDPR, we worked with outside counsel on a Privacy Impact Assessment. That led to our appointment of a Data Protection Officer, and informed our ‘Privacy by Default’ and ‘Privacy by Design’ philosophies. We’re continuing to keep an eye on regulations around AI in the EU, and are already in compliance with the seven key requirements identified in the European Commission’s white paper on artificial intelligence.”

Asked about the disproportionate admin burden automated hiring tools can place on candidates, as they grease up efficiencies of scale for employers — i.e. by requiring jobseekers respond individually to screening system vs just being able to submit a single CV to multiple companies — Grayevsky argued that dynamic data-capturing recruitment systems, such as Mya, offer a better experience to job seekers via increased responsiveness and through expanding potential future job-matching opportunities.

“Traditional job applications often have many steps, and can take a long time to complete, creating a negative experience and drop-off for the employer. Those questionnaires are not dynamic and often lead to no response. That time and effort invested often cannot be leveraged into other opportunities,” he argued.

“With Mya, everyone gets a response instantaneously and around the clock (24/7). They can ask questions and get answers in real-time, providing more transparency and insight into the opportunity, process, and employer. Mya can follow up and if deemed fit by the hiring team, schedule a phone call or on-site interview with the recruiter or hiring manager to help accelerate the process.

“If they are ultimately not deemed fit by the hiring team due to a missing requirement, Mya is able to re-engage to help that candidate connect to a role that is more suitable based on their profile, interests, and availability. The idea is that a candidate can build one profile and be connected to multiple jobs, quickly and efficiently. We built our solution through the lens of the candidate, making it easy to provide information about qualifications, interests, and availability, and get connected to the right opportunities.”