Say it ain’t so Joe

Say it ain’t so Joe

According to legend after “Shoeless” Joe Jackson one of the greatest ballplayers of his time, admitted during testimony that he was one of eight players who took brides to fix a world series, a young boy came up to him and in a state of disbelief said “Say it ain’t so Joe.” We have a feeling that investors in Theranos, once a high flying Silicon Valley start-up with an impressive board and billion-dollar valuation, are feeling the same way. While still in business it’s fair to state that this once high flying company has gone from the Penthouse to the outhouse in a matter of months.

We mention this as we see a correlation between what’s happening at Theranos and many of the high tech way cool whiz bang companies now in the diabetes space. Many of whom have great PowerPoints, lots of admirers on Facebook, Twitter and Instagram but little in the way of real solutions. Some are desperately trying to prove that they are different that they actually have something new and/or different but in the end they are just more of the same in a different box.

Having seen more than our share of start-ups over the years the pattern is all too familiar. Just as 75% of drugs in development never make it past the clinical stage, the same can said for start-ups. Although it’s not an easy task raising millions of dollars as we have stated many times in the diabetes space more money can be stolen with a good PowerPoint than a gun. Quite frankly raising money isn’t the hard part, the hard part as we have seen over and over is actually running a diabetes company.

Recently Diabetic Investor has been spending a great deal of time on the west coast much of it in or around Silicon Valley. As everyone knows we see Silicon Valley as a central player in the future of diabetes management. That as the diabetes drug and device markets continue to commoditize it will be Silicon Valley that develops and promotes the systems which will change diabetes management.

The reality is there is a sharp and distinct contrast between the attitude of companies based in and around Silicon Valley then those of the older, shall we say more established companies based in the Midwest or East Coast. The simplest way to put this is Silicon Valley offers the promise of tomorrow while East Coast deals in the realities of today. In Silicon Valley it’s about what can be done, on the East Coast its about what’s being done.

Yet like all things in this wacky world, these two very different attitudes, these two very different approaches to doing business must come together IF diabetes management is to change. That although neither side likes to admit it, they need each other, that diabetes management cannot and will not change if they do not work together.

Now we will not claim that is going to be an easy task as to be quite frank these two very different worlds each bring with them a certain amount of arrogance. Yes, it’s true that many of the high tech cash rich companies can buy the components they need to build a diabetes management system however this does not mean they can run this system effectively.  The flip side is also true as just because what we like to call the old guard makes the drugs and devices that are essential components of this system does not mean they can go it alone.

What’s needed more than ever is not just vision but leadership. Someone that will take the bull by the horns, understand the differences between the two worlds and acknowledge this mutual interdependence. Someone who understands that old way of doing business just isn’t working anymore yet understands how things work in the real world. Most importantly of all someone must have the strength to acknowledge that as much as the current system isn’t working the existing infrastructure cannot simply be blown up and replaced with something entirely new no matter how good it looks on paper.

The $64 question as they say is who will assume this role. Will it be the visionaries of Silicon Valley or the hardened realists of old guard? To be quite honest Diabetic Investor isn’t quite sure who it will be but whoever is willing to take on this task we would advise them to remember the words of Winston Churchill, a great leader who once said; “Success is not final, failure is not fatal, it is the courage to continue that counts.”