Today, we continue our previous discussion on fragmentation in the health sector. So how do you build in a deeply fragmented market? The classic answer is building a technology solution that enables aggregation across the market. But in healthcare, that is easier said than done. While technology can enable many parts of healthcare, by itself it cannot resolve most of the friction that fragmentation causes.

Today, I will share some tips that have helped me reduce the friction and scale my healthcare startup. 

1. Build what your customers need today and become a utility to them

Achieving a product-market fit is critical to building in a fragmented market, so this must be the first order of business. This means building what your customers need and can afford today and becoming a utility they cannot do without.

2. Build a trusted brand by delivering high value customer experiences

Fragmented markets are usually characterized by lack of trust among key stakeholders. Therefore, you must be intentional about building trust by delivering great experiences and being affordable to your beneficiaries. Building this trust makes scaling and growing your reach easier.

3. Leverage existing networks or become a network

To access a large pool of potential customers in fragmented markets, you must either leverage an existing network via partnership or start building your own network from scratch…or both! Doing this successfully increases your obtainable market size.

4. Explore different customer channels and aggregate across multiple channels

There are at least 7 customer channels in healthcare (out of pocket, insurance, business/corporate, diaspora, hospitals/other health providers, government, and NGOs/foundations). As you build, make sure to experiment with a variety of channels and even aggregate across channels if possible. Doing this can enable cross-subsidization and derisks your business significantly.