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Episode 8: Why Israel is known as the Startup Nation—and how it can help the US (with Antidote Health CEO)

Nixon Law Group

Listen in as co-host Rebecca Gwilt chats with Antidote Health CEO Avihai Soudri about the startup scene in Israel, his vision for America's first virtual HMO, and a bit about the shift in VC investment in seed stage companies.

And an extra shout to Antidote Health for closing a $12M seed round of funding last week! 

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In this episode you’ll discover:

  • Why this NY-based company still does so much R&D in Tel Aviv

  • What drove Antidote to create an AI-driven virtual HMO

  • How Antidote wants to help the large uninsured and underinsured populations in the US

  • And a fun final question we don’t want to give away

Read the transcript:

Avihai Soudri (00:00):

In United States, there are two parts. There are the insurance and the other part is the HE caregiver. So by combining those two together, we're creating alignment of interest with the patient.

Speaker 3 (00:14):

You're listening to Decoding Healthcare Innovation with Carrie Nixon and Rebecca Gwilt a podcast for novel and destructive healthcare business leaders seeking to transform how we receive and experience healthcare.

Rebecca Gwilt (00:26):

All right. Hello everyone, and welcome back to Decoding Healthcare Innovation. I'm Rebecca Gwilt, one of the hosts, and I'm thrilled to be joined by Avihai Soudri, the co-founder and CEO of Antidote Health.

Avihai Soudri (00:42):

Hi, thanks.

Rebecca Gwilt (00:43):

Hi, welcome. Welcome.

(00:45):

I was just going to say, so today we're going to be talking about the startup scene in Israel, particularly in Tel Aviv, a little bit about Avihai's vision for America's first virtual HMO, and a little bit about the shift in VC investment at CH stage companies. It's a really interesting time right now. A lot of my clients are pretty amazed at the level of interest in healthcare innovation among VC investors. So anyway, I'm so excited to have you. Avihai. Welcome. Welcome.

Avihai Soudri (01:20):

Thank you very much. Thank you for having me.

Rebecca Gwilt (01:23):

Yes, yes. Okay, so let's just get right into it. So Israel has been called Startup Nation. I'm sure you've, you've heard of this. And according to a 2019 report they have the largest number of startups per capita of any country in the world in particular, they're a global leader in research and development. And I know that your company Antidote does have their research and development in Tel Aviv. There've been massive levels of funding for Israeli digital health companies. I think almost a billion dollars, at least in Q1 and Q2. So anyway, so Antidote is a New York based company, but much of its R and D happens and is conducted in Tel Aviv. I know you have several team members there and you've recently moved to the us but prior to that you were in Tel Aviv in your previous life. I'd love to get a sense of your thinking around the magic that's happening in Tel Aviv, what's driving so much innovation there, and maybe talk a little bit about digital health and health innovation in particular.

Avihai Soudri (02:35):

Okay. So first of all to talk about the startups in general it's a medal of culture. The Israeli culture is used to live in some kind of uncertainty level, level. So people are not afraid of doing big steps and to risk their I don't know, their financial life or the financial life of the families by starting something on their own. So this one major thing that creates this buzz or this major activity in Israel. And the second thing is I think that the army have a lot to do with the situation because a lot of the young people entering the elite units, the computer elite units in the IDF and start walking on major things from the age of 18. So they have a lot of experience during the Army, like three very intensive years that they develop a lot. And they have a lot of things that usually they will not meet until be a very much older if they will not be in the Army. So I think these two social cultural things are the one that expedite or created this kind of culture and reality in the United States and in Israel. Sorry,

Rebecca Gwilt (04:21):

It's so interesting. It's so interesting. So you're saying that sort of the conscription into the army there, in addition to the cultural things that are happening, the conflicts that are happening in Israel have created a culture of risk takers and Yeah, dreamers.

Avihai Soudri (04:37):

Yeah. Yeah, exactly.

Rebecca Gwilt (04:39):

That's so interesting. That's so interesting. Do you recommend that entrepreneurs go to Israel or check out Tel Aviv or at the very least think about connecting there for R and D work? I imagine there are a lot of people out here thinking, gosh, what's going on there? Should I hop over there? What are your thoughts about that?

Avihai Soudri (05:07):

Well, there's a lot of people from United States that work in Israeli startups, live in Tel Aviv and works in Israeli startups. So yeah, it's a great experience. It's a great experience to work in a company with a different culture. But regarding outsourcing r d activities to Tel Aviv, it's a bit of a problem because first of all, it'll be expensive. And second of all, we are lacking developers. We have teams in India, we have teams in Ukraine, and we have teams in the United States and in Israel in order to bridge the gap of R and D people. And it's part of the boom in fundraising as well. A lot of money is going on. There's a lot of activity. So there's not enough developers in the market. But yeah, it's a struggle. We have a lot of international companies like Facebook, Google, and TikTok and companies like that that works in Israel have r and d things in Israel, and they work really hard in order to find the right developers. So it's a tough market.

Rebecca Gwilt (06:31):

Yeah, I'm sure that's, that's a problem that lots of companies are facing in and outside of Israel, certainly. And it's especially a challenge for digital health companies because there's so many limitations on what you can do with the actual live patient data. So let's get a little bit further into what you are building right now, your company antidote. I'd love to hear a little bit about what it is, certainly, but even more, I'd love to know what your inspiration was to get involved, co-found it and build it.

Avihai Soudri (07:07):

Okay. So you asked in the last question about the digital health in Tel Aviv as well. I think that in Israel we have a good example of effective and working a health industry or health services. And so it was for me, as someone that came from this industry we have the blueprint of how doing it right and how to create a situation that most of the people will be able to allow to, will be able to achieve affordable healthcare. Okay. So what we're trying to create or what we're creating as an HMO, we actually combining the two parts of the industry today in United States. As you know in United States, there are two parts there, the insurance and the other part is the healthcare giver. So by combining those two together, we are creating alignment of interest with the patient. Once you are the healthcare provider and the insurance, you don't have any incentive to default to the most expensive solution when you're providing the service, or you have the incentive to invest a lot in preventive care and you can manage the patient from with a better knowledge about these daily activities. And you can use all this approach in order to reduce the premiums. So that's the holistic part. That's the holistic model of an HMO,

Rebecca Gwilt (09:08):

Right? It's like the Kaiser Model. But the interesting thing about what you are building is you're trying to do this virtually. Yeah. Whereas we're used to the HMO model back to the eighties here that it had its special problems. But what you are building is truly a virtual hmo. Is that right?

Avihai Soudri (09:29):

Yeah, you're definitely right. We injecting a lot of the technology and a lot of AI in order to reduce the cost of treatment and in order to be super accurate when we provide the service and it allows us the digital actually platform allows us to be so affordable for our patients. So I think that what happened, and since the pandemic is that people realize that we reached a point of no return when it comes to healthcare and when it comes to digital health. So that's the new reality that, and it's al it'll only grow. So yeah, we take an advantage. When we began before the pandemic, we didn't thought that people will use telehealth services as they are today but the pandemic expedited process and we can benefit from it. And it's only the beginning, more and more services will go online, will be digital, will be on the hand of each and every patient.

(10:44):

And it should be affordable as well. The situation that almost 80% of the American GDP goes to healthcare and still tens of millions of people can't allow themselves as to receive healthcare. It's insane. It's not. It's the most it's the thing that bother us the most. And it's the main it's our main aim goal to change this reality. Just to give a little bit of details about Europe and Israel. Europe and Israel spent about 7 to 8% of the GDP in order to provide healthcare services. And all the citizens are covered. So the situation of 80% and still going up and still tons, the meals are not cannot afford themselves in proper healthcare is something that we want to change.

Rebecca Gwilt (11:49):

I mean, one of the things that strikes me about you and this company is that I can tell it's fairly mission driven. I read a quote by your president and chairman that what motivates you and your company is a belief. I'm going to read the quote here. A belief that guides everything we do is that every person is born with a fundamental to receive proper medical treatment. And here in the US we're, we're very used to this phenomenon of 30 million plus people without health insurance. Not to mention the other folks that are sort of underinsured, even though they have insurance, they truly can't afford good medical care. But one of the things that I love about working in healthcare innovation is that we are, I'm working with entrepreneurs like you every day that are looking at the way that healthcare is delivered and the quality of healthcare. And they're just saying, this is the right thing. The right thing is to make this better accessible. So anyway, I love that and that the second thing I wanted to ask you about was I'm going to butcher the pronunciation here, is I was researching your company and there was an article that said that you wanted to bring something called the Kupot Holim.

Avihai Soudri (13:09):

Yes. It's an HMO. Yeah.

Rebecca Gwilt (13:10):

Did I say it correctly?

Avihai Soudri (13:12):

Yeah, you said correctly. Yeah.

Rebecca Gwilt (13:13):

Okay, perfect. So I'm dying to know what that is and what it means and how you think that can translate to here in the US.

Avihai Soudri (13:24):

So it's actually an HMO. We just translated it to what the American people are familiar with. It's actually the service that is provided by one entity discovers the health insurance and the services themselves. In Israel, there are four I worked in Leumit. I was the head of innovation and business development of Leumit for several years. And yeah, that, that's Theat model. What we doing actually we're providing and digital <inaudible>.

Rebecca Gwilt (14:11):

Oh, perfect. Okay. Now I know. I'm just going to drop that term every once in a while just to impress people, see what they say

Avihai Soudri (14:18):

You should.

Rebecca Gwilt (14:21):

Okay. So the other thing I wanted to talk about today was well, I wanted to give you a congratulations. I know that Antidote just closed a 12 million seed round recently. Was it last week?

Avihai Soudri (14:37):

Yeah, we announced it last week. Right?

Rebecca Gwilt (14:39):

Yes. So super exciting. But for those of us that work in startup world, a 12 million seed round is pretty big. It's a pretty big seed round. And I'm seeing more and more of these lately. I'm interested because you've been sort of entrepreneur yield for a while. Have you been surprised at the amount of resources available for seed investments? Do you think that this is in particular a phenomenon in the healthcare innovation space or you're seeing it across the board? I'm just interested in your thoughts if you're as blown away as I have been in the last year about how this is changing.

Avihai Soudri (15:25):

Well we can see the numbers. The one thing that is different in our story that during the last two years you can see less and less funding in young startups, the sea rounds are going lower and lower. While there are really big rounds in more mature companies. But our special and unique offering gave us the leverage of actually doing this round. And we're working right now on the next round with much less of an effort that what we thought we will be. VCs are usually approaching us. We didn't have the chance to approach VCs ourself. So it was kind of a very nice and smooth process. But it's due to the really unique offering that we have. We don't know any company that are working in the same route that we are. And it's a platform that we really believe that can do a tremendously in United States in fixing part of the problems that are here. So yeah,

Rebecca Gwilt (16:57):

I think it's really what I'm hearing more and more is that companies that have great ideas, that have great potential that they are, they're getting to be much more choosy about the money that they take because there's so many people out there that are looking to invest. There's just such a pot of private money that's sort of ready to find these companies. Did you find that you were able to be more discerning about the folks who you were accepting investment from?

Avihai Soudri (17:35):

For sure. I think that it's something that we were insist of even in if there will be difficulties to raise money because the partners that you choose, then we see the investors as our partners. We don't see them as just an entity that provide us with the funds. So it was super important to us and still super important to us during the next round that we're playing right now to choose the right partners for us. And for now the experience show that we choose the right partners. They're all amazing and they're super supportive and helpful and they're really great. So some is something that we insist on and I would recommend to insist on to any entrepreneur even if it, it'll take more time to raise the funds.

Rebecca Gwilt (18:36):

Yeah, it's heard of it phrased as smart money. You want money, but you also want connections. You want folks who believe in your vision. You want people who are good people that you want to work with for the long term. I think that's a really smart piece of advice.

Avihai Soudri (18:56):

Yeah, I agree. But actually regarding the smart money, we don't search for connections or things like that using our investors. It's just a matter of finding the investors that their heart is in the right place, that are believe in what we are doing and believe in our aims and our vision and can support it. And they have a proven track record of investments, an investor that speaks highly about them. That was the main goal. And the main thing I think that

Rebecca Gwilt (19:42):

I actually love that. I actually love that it's a much more human approach to talking about building businesses which is again, something that's, I'm seeing that's sort of new. Alright, so as we close today, I want to try something a little bit new. I often think about, actually very often think about if I had one additional life to live, what would that look like? Not a replacement life, I wouldn't want to do anything else. I love everything about what I'm doing right now, including having this conversation with you. But I often think about if I could clone myself and live through the same time but do it a different way, what would that look like? And I'm always curious about whether other people have thought the same thing. Maybe in future episodes I'll share a little bit about a couple of those parallel lives.

Avihai Soudri (20:42):

Well, it sounds like a good book, but

Rebecca Gwilt (20:46):

Yeah, exactly. Probably only interesting to me. But anyway, so I wanted to start with or end the interview rather with two lightning round questions that are sort of in this vein. So the first is, if you weren't right now building the first virtual HMO what kind of company might you want to grow and launch? What other kind of work do you think is important and has where there's big opportunity?

Avihai Soudri (21:21):

Well, actually I can see interest in so many topics and things that but I think that in antidote we combining so many aspects of things like we have the financial side, we have the insurance side, we have the healthcare side. And actually when it comes to helping people and to hear the things that our patients say and the way they feel after they're receiving the treatment, I can't think would, like if I said that I plan to be in the same exact point that I'm in right now. But I will never change it for nothing. It's a great thing and I get it.

Rebecca Gwilt (22:11):

You love what you're doing. It's actually the perfect entrepreneur's answer. That's fine. Okay. But let's say you could also do exactly what you're doing right now. This is my second question, but maybe you had another that could do something different. If you could do something completely different than being a healthcare entrepreneur, let's say you're, you rewind the clock, you haven't done anything you've done so far, what other just non-work related it could be, but what other completely different thing might you find yourself doing?

Avihai Soudri (22:50):

Maybe producing wine <laugh>, maybe to be an owner of the winery or to teach in university. I think that those two things are super exciting and yeah,

Rebecca Gwilt (23:05):

I love that. I love that. Yes. Yes. Okay. Alright. So that's it. I really, really appreciate you joining me. I wish you absolutely all the best of luck as you grow antidote. It sounds so exciting. And for those of you who are listening if there is anything else you'd like to ask me or Avihai you can find us on all the social medias and drop us a note. If you have any ideas for future interviews, you'd like me to conduct all ears. Otherwise, thank you so much for joining us and we'll see you in two weeks.

Avihai Soudri (23:44):

Thank you for having me.

Rebecca Gwilt (23:46):

You're very welcome.

Avihai Soudri (23:47):

Mm-hmm. Bye-bye.

Rebecca Gwilt (23:49):

Bye.

Learn more from Carrie and Rebecca: 

Healthcare insights (monthly email) | Telehealth/Virtual Care Mgmt Update (biweekly LinkedIn update)

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