Recap: Evive’s Prashant Srivastava talks hiring, culture and healthcare entrepreneurship

At our September Tales from the Trenches™, Prashant Srivastava joined us to share stories from the past 12 years at the helm of Evive.

Prashant built Evive in 2007 with his co-founder, Peter Saravis, with the understanding that when employees live healthier lives, they produce better work. The company uses consumer-focused predictive analytics to provide employees with the right benefits information at the right time. This process makes benefits easier to understand, use and manage while delivering economic value for the employer.

“For a long time, benefits managers have been viewed as a cost center,” Prashant shared at the event. “[They] have a responsibility to a healthcare budget that’s growing at five, six, seven percent a year. But…you’re really driving retention through benefits. That’s why they were first invented in 1929.”

Throughout his life, Prashant has been driven by a passion to use healthcare data and technology for social good. “You can talk about artificial intelligence, machine learning and user experience, but not all platforms are using technology to advance the health and wellbeing of the workforce,” said Prashant. “It’s our genuine interest in the human impact that really sets us apart.”

During the event, Prashant shared more about Evive’s origin story, his thoughts on hiring, values, and culture and his outlook on the future of healthcare. Here are our key takeaways:

The journey from chemical engineer to entrepreneur

“I was a chemical engineer in the thick of commercializing new drugs…By the time I came to work for Pfizer, I [felt like] I’d already done everything I’d ever wanted to do…And then I stopped and really thought, ‘Wow. What am I going to do next?’ And I thought that I should learn more about business, so I went to the Booth School of Business.

“When I [graduated], I wanted to learn more about the mechanics of healthcare. When you’re in a pharma business, you know very little about payment. Your [focus is], ‘We’re going to invent the next best therapy for X’…you don’t know anything about the business of healthcare. I learned about this massive area called healthcare services — which was unregulated, so it didn’t [require] the millions of dollars [you need] to commercialize a drug. You could go find a niche and fill it. [So] I joined a disease management business where I learned how things got paid, and who actually paid for healthcare in America.”

“I realized that there was a huge need to take data and turn it into information for people.”

“As I learned that, I realized that there was a huge need to take data and turn it into information for people. We all laughed when 10 years ago we heard [people say that] healthcare is going to be a consumer business. And I [didn’t] see anything about healthcare that was consumer friendly.”

A lightbulb moment

“I remember sitting in a restaurant in Waukegan…and my cofounder had come back from a U.S. preventive services conference. And he comes to me and says, ‘These guys have the guidelines for evidence-based medicine. They’ve looked up all the evidence, they’ve come up with guidelines…but nobody knows it.’

“So we thought, ‘Why don’t we send people reminders for that? But not only should we send them reminders — we should send them in the way that consumer marketers talk to them. We should create content that’s indexed to people’s mental decision models so that we can learn something from their response.’

“And by the way, this is happening to us all the time — every ad you click on the internet is added to your digital profile. And that’s how they’re making content better. But 12 years ago, there was no buzz [around artificial intelligence or machine learning]. But we thought [to have] a closed loop system where we can help people through the basics of healthcare: mammograms, colonoscopies, etcetera, and run everything as a constant A/B test. That idea is still at the center of Evive.”

Reflections on bootstrapping

“One of the benefits of bootstrapping is that you’re forced to deliver value to customers, because you have no business otherwise. You’re not in the business of running through money and not figuring out the market fit fast enough. We didn’t know any better at the time, but I wouldn’t do it any other way. It forced us to figure out how to describe the value we were delivering to customers, and how to measure it so we could sustainably extract data from them with the promise of delivering much more.”

The economic value of great benefits

“The economic value should be viewed in two terms: One is recruitment and retention, which [Evive] measures using a benefits net promoter score. [The second] is the cost of those benefits. A great benefits manager optimizes the ratio of those. You’re willing to spend more money sometimes because the key economic driver is those employees staying and producing [great work].

“There are situations where you might want to raise the deductible and narrow your networks and cut the formulary…but you have to think about the employee as an economic asset to the company, and [reducing benefits could] make them upset enough to get out of there. You really need to think about the balance…Every corporation has a cost-benefit equation.”

On making pivots over the last 12 years

“The name on the front is still the same, but we’re probably on our third or fourth company. While our thesis was on data-driven guidance, the topics have expanded widely…We listened [to our customers] all along the way and got to expand the portfolio.”

Hiring for each stage

“People mistakes are the hardest. They waste a lot of time in a startup and cost a lot of money. Now, 80 percent of my job is thinking about people and talent, and that’s why I’m trying to get better at it because most of us are 50/50 on talent. And if we could be 80/20 on talent, we’d probably be a lot further along.

“But there are people for various courses. The first 30 have to be fearless. They’re in the trenches. They’re killing it. And then when you make it, at each stage you need different people that bring [in] different processes, systems and skill sets.”

Why entrepreneurs are often ‘unhireables’

“Most entrepreneurs, by the way, are unhireable. I’m untrainable. You don’t do this low probability stuff if you’re smart and hireable. At the very beginning, though, you need the unhireables — we’re the ones changing the world. If you’re an established business, you’re thinking ‘We can’t take this risk. What if it’s wrong?’ So some of this fearlessness comes from being unhireable. We wouldn’t want to hire ourselves today.”

Developing and defining culture

“When we were small, we were this band of 20 or 30. We had this [collective] mission, and everyone was connected to either [my co-founder] or I. When we got bigger, we deliberately sat down and thought about what Evive values. We put them down on paper. Those values allow us to have a language.”

“Our values, our managers and our leaders reflect who I am, what [my co-founder] and I stand for and what Evive stands for.”

Is work-life balance possible as a CEO?

“I prefer work-life integration. Your relationships demand consistency and they demand time. You have to make these trade-offs…When you’re in a startup, there’s no difference between work and life…what we have to ensure is that we’re present in each place.”

On making mistakes

“A lot of times, you fall in love with your own ideas. Validating those ideas with customers [is crucial]. Big strategic mistakes are when I fell in love with an idea. All I can say is, go validate. Early.

“Details matter. It’s not just the big idea. Most ideas fail because of poor execution, not because they were bad ideas. So I force myself to sit through enormous detail…because it matters.”

Leading by example

“You have to own every mistake, otherwise the whole organization doesn’t learn that they can own a mistake and it’s okay…We celebrate success a lot, but it’s really the failures that you have to be okay with to get to success. Failing is part of the journey.

“By the way, if I charted out my bad hires, my bad strategy decisions, I’ve failed more than I’ve succeeded — and I think that’s important for the organization to know. You have to lead [by example]. You can’t ask people to do something you don’t do yourself.”

On knowing when to raise

“When you start a business, you have to be ahead of the market — otherwise, you’re not doing anything new. You should just open up a pizza joint. There’s a lot of demand for pizza, right?

“For a long time, we just evangelized that this is the best use of data, period. And that healthcare data should be used for social good. And as we went along, we got customers who also believed that. We knew we were onto something when we had more inbound requests in one year than we had in the history of the company, period.

“We [realized that] we were creating a category now and the market wanted it. We didn’t want to be the people who created search engines we don’t remember — if we created a category, we wanted to own it. And that’s when we started to double down.”

Seven more innings for Evive

“We’re in the second inning of a nine-inning game…There’s a lot to do still in healthcare…Healthcare is [still] not a consumer business, despite 12 years of Prashant spending 24 hours [a day] thinking about it and trying to do something about it.”

“We’re in the second inning of a nine-inning game…There’s a lot to do still in healthcare.”

Predictions for the future of healthcare

“There’s an increased understanding of how data might change the world. It’s still not clear economically if data will be free [in order] to do that. It doesn’t happen overnight, but I think there’s more momentum to free data so that individuals control it more than ever before. And if that happens, there will be a lot of value created for the individual, because they’re driving who they can give [their information] to and what they get in return.”

Two pieces of advice for aspiring entrepreneurs

“Figure out how money flows in your industry. The real thing that helped Evive was figuring out how money flows in healthcare from self-insured employers to ASO plans to providers and how all of that works. Because no matter how good your technology or how good your idea, if you don’t figure out how your economic engine is going to run, nothing is going to happen.

“Figure out how money flows in your industry.”

“The second thing I’ll share, from my own experience is: If you can get a partner with complementary skills, do it…There are so many ups and downs…it’s super helpful to have someone [with you] in the trenches, because it’s super lonely when you make these make-or-break decisions…There’s a lot to do at the beginning — a lot. And if you’re a sole founder running around, there’s [only] so much you can do in 24 hours.

“If you can find a partner who can live this journey with you, it’s super helpful. I remember reading in the paper that if you have a partner, you have a 70% higher chance of succeeding. [Upon reading that] we looked at each other and said, ‘At least we got that right’.”

Want to hear from more healthcare innovators like Prashant? Join us on October 30 for a conversation with Nuna co-founder, David Chen. Livestream available.