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eHealth business cases

Emfit Oy

FACTS:

What: Emfit is a world-leading manufacturer of nocturnal tonic-clonic seizure monitors for care of children with epilepsy and heart beat detection based bed occupancy monitors for elder care. Company is now expanding into consumer wellness market with world’s first heart-rate-variability enabled non-contact sleep monitor and full 3-stage sleep classification.

Established: 1990

Operates in: Europe, USA, Canada & Asia

Number of employees: 20

www-site: www.emfit.com

Interview of CEO Heikki Räisänen

1. Can you describe your solution and what it does?

Emfit provides movement activity and sleep monitoring applications based a unique sensor technology. Sensor applications are based on a flexible bed sensor placed under the mattress. Emfit has tailored several applications covering sleep monitor applications for several target customers. Safebed Cloud improves the safety and security of senior citizens and helps maintain their independence. The tonic-clonic seizure monitor is for individual who, during sleep, may experience convulsive seizure and caregiver or family member should be alerted to. Emfit QS is new sleep monitor and web application service for recovery, stress and sleep quality analysis targeted to athletes for optimizing their training.

2. Tell us how your business got started.

Emfit business has a strong base in sensor technology and signal acquisition with embedded electronics. The basic technological application and software was developed in-house already at the beginning of 2000 and in 2004 the first proof of concept applications was delivered. However, Emfit realised very soon that the sensor technology itself is only a starting point for business and application development is key to success.

 

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3. Can you describe your business model?

Emfit focuses on developing and selling solutions to customers at b-to-b and b-to-c markets. High value applications are sold via several channels depending on target customers. Currently, Emfit monetizes most of it services by selling monitoring devices without subscription based user fees. In the future, subscription based fees are probably developed for the premium services related to the monitoring products.

4. What were the most important decisions or pivots while developing your current business model?

In 2011, Emfit got medical device approval for its general ward non-contact patient monitor application. It turned quickly out that even after gaining medical devices status constantly following regulations and maintaining status requirements for new features is very resource consuming. A slowly moving hospital market was extremely difficult environment to profitably launch a new type of application. Time and resources required for operating with specific requirements and selling to hospitals made it impossible to find a profitable niche at that market. After this pivot Emfit quickly made a radical decision to continue development work and focus on a consumer market with new browser and cloud based applications.

5. Do you use the same business model in every country at international market? Or have you done some changes adapting to the market in each country?

The biggest differences in the marketing and business model are dependent on target market, not geographical area. Currently over 50 % of our sales come from Europe and the rest from the USA and Asia. In different markets, we have also different kind of wholesales and retailer partners.

6. Can you tell some lessons learned during the business development process? Find early and actively contacts and interactions with customers – go to fairs, be active in professional events, contribute to discussions or presentations. A very typical mistake is to aim to develop ready to sell a product without active interaction with potential customers. Active interaction with all possible stakeholders on your market makes it much easier to determine if there is real traction available for your business idea.

When you put ‘all in’ to the development of a prototype and business model building make sure there is enough resources and financing left for finding the customer and selling to them. It might take much longer than expected to get first profitable

 

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customers. Even when the business idea starts to fly, an ambitious entrepreneur is never happy with the product and keeps collecting feedback and making it better constantly.

Another strategy when planning new business models is to do proactive patent follow-ups. Through analysing new patent claims within the business area you are operating in provides an overview about current development and possible limitations to your own business. The patens are not always in active use but the patent owners are prepared to cash out when new services conflicting with their patent appears at the market. Even these sleeping patents might make it impossible for a new solution to enter the market.

Take advantage of the lean approach at the applicable parts. Lean is very good strategy for the software based business. If your solution includes also hardware things get more complicated. Hardware based products are always more challenging to finance, develop, maintain and sell.

One challenge for an innovative entrepreneur is to recognize the right leads. If you are too enthusiastic and follow all possible interesting leads you are misusing your scarce resources. Important skill is to analytically evaluate leads and learn to say no to less promising one. One key difference is to recognise already in the beginning if an expert, customer or some other interesting contact has not only will but also real capacity and power to contribute to your business. It is also critical to identify if your lead takes you to the real interface with a paying customer.

7. Do you see some new opportunities or threats to your business model in the near future?

Emfit provided solutions to “quantify yourself” years before the trend itself was born. I see in health care the new technological evolution started around 2000-2003 as tcp-ip protocol together with emerging cloud based services enabled new type of services. This development combined years later with the launch of smart phones and latest tablets with very high computing capability and standardized user interface, has created possibilities for new eHealth market. Today we can see the first significant changes in user behaviour among early adopters. Efficiency and cost saving pressures create incentive for changes in the regulated area of health market. Changes in user behaviour take place over the years, and the majority of population start to use new health solutions probably at the beginning of the 2020s. So we see plenty of opportunities as a major shift on the market has just started.