Q&A with Sean Duffy, Co-Founder & CEO, Omada Health

Following Omada Health’s recent announcement of a Series B with Andreessen Horowitz, Oxeon Senior Associate and Editor of Oxeon’s newsletter ‘F.W.I.W.’ Lauren Brickman sat down with Sean Duffy, Founder and CEO at Omada. The two discussed Omada’s unique approach to digital therapeutics, their rapid growth since inception in 2011, the team they have built, and what the road ahead looks like as the company continues to expand it’s product lines and market focus. You can find the complete interview on our website. [dropcap]Q:[/dropcap] What was the inspiration behind launching Omada Health and how did the company get its start?

The founding thesis behind Omada Health was that by applying significant clinical rigor, to digital product experiences, we could build programs that delivered outcomes, that our users would love, and that the market would trust.

At the time when we incorporated (2011), a lot of the companies that built the best products in digital health didn’t necessarily have a desire to sell them into the enterprise. Additionally, their products didn’t necessarily solve clinical needs. This is the gap we saw, and we thought we could fill that void by building a company that did both things right; create engaging, delightful products, but also commercialize them on the basis of their outcomes in the enterprise health care world.

Our first product is called Prevent, and it helps people at risk for type 2 diabetes lose weight and make lifestyle change. It is based on a landmark clinical trial called the Diabetes Prevention Program (DPP) that the ACA is working to catalyze across the country via an effort called the National Diabetes Prevention Program. We work with plans, employers, and select providers to help them deploy DPP at scale.

Down the road, we’ll build a whole host of these digital programs that are increasingly known as digital therapeutics.

[dropcap]Q:[/dropcap] You had a big announcement a few months ago with a Series B round from Andreessen Horowitz, congratulations. With Omada being their first digital health investment, how did you two come together?

It was actually a fortuitous coincidence. A friend and advisor to Omada is the Chief Commercial Officer at a very successful health care company called Counsyl. One of Andreessen’s more recent GPs, Balaji Srinivasan, was one of the co-founders of Counsyl. Our advisor thought that Balaji and I would get along well, even outside the context of an investment. We met up, he was right, and the rest is history.

Andreessen Horowitz was an exciting lead for us, because the reason we’re different than other companies in our space is our blend of consumer-grade tech and design talent with serious enterprise health care chops. I wanted Omada to have a Board that reflected this diversity. Given that we already had stellar health care investors, joining forces with a16z accomplished this in spades. Many of our investors have never done deals together before, and I love that. This is the sort of diversity that will allow us to build a lasting, differentiated company.

[dropcap]Q:[/dropcap] As a first-time CEO, what has surprised you the most through Omada’s first few years?

The healthcare system in the US is complicated at a level above and beyond what I even thought was possible when I founded Omada. It’s amazing. I’m still learning every single day, and even people who’ve worked in the industry for 20 years are still turning over stones to find something new. This is equal parts frustrating and fun. You have to constantly be willing to learn and not be embarrassed to ask questions to experts. To this day, I still pick everybody’s brain possible.

The other thing that surprised me as a first-time CEO is the importance of the mentorship and infrastructure opportunities in Silicon Valley. If you’re new to this world and you’re working on your first venture – it’s extremely helpful to be surrounded by other people who have run that road ahead of you, or are running it alongside you. I left medical school to found Omada and had a lot of catching up to do on the business side. My peers and friends in the Valley have been exceptionally helpful – I appreciate them so very much.

[dropcap]Q:[/dropcap] What aspect of Omada are you most proud of? What are some of the milestone achievements that have defined the company’s success thus far?

Hands down, I’m most proud of our team. It’s a really fun mix of people, ranging from senior leaders in health care to some of the top design talent in the Valley. I mean, where else does the former Senior Director of Commercial Strategy at Gilead work alongside the former Executive Editor of Cosmopolitan?

Like our investor base, this group of people have never before sat in the same room together and worked toward the same aim. That’s the thing I’m most proud of. I’m in the fortunate place of slowly becoming the worst person to do any particular thing in my company, which is exactly how you should feel as CEO.

In terms of achievements that have defined our success, in healthcare it can be tough to get your first contract, especially with a product like ours that requires data and demonstration of results in order to get even the tiniest drop of commercial traction. There is a big lag from when you first start coding before you’re even able to sell.

Your commercial partners need to know that your program will work, and they also need to feel confident that you’re here to stay as an enterprise. Getting through the chasm this creates can be quite tricky. Signing our first big set of commercial contracts with large enterprises was an extremely meaningful milestone for us.

[dropcap]Q:[/dropcap] How have you approached building your team and can you describe the importance of culture to the organization?

The quality of our team is the thing I’ve cared about most from Day 1. I think every founder feels this. We put so much blood, sweat, and tears into recruiting the best people we could, even while we were still just a dream. This is especially important early on, because your first 10 people really help set the culture, which honestly can’t be defined or faked. The key is to hire people that put the company’s goals above their own and then reward the things you find valuable to your mission.

[dropcap]Q:[/dropcap] Oxeon first started working with you right as you were coming out of Rock Health and heading into your Series A, at which time your major focus was the employer market. Can you talk about traction you’ve gained in that space and how you’re contemplating further expansion into additional markets?

That’s actually going well – employers were a big focus for Omada early on and they continue to be a market that we serve in a significant way. We’re continuing this trajectory.

Honestly, we’ve been a little bit surprised on the plan side; we hadn’t really expected to have the level of interest from plans as we currently have. I think there are a couple reasons for that: healthplans know that they’re employer clients and member bases need innovative health-promotion solutions that work. Also, the CDC’s National Diabetes Prevention Program is gaining traction in certain pockets of the plan world. That’s why we dialed-up Oxeon again, but this time to find our head of health plan sales.

[dropcap]Q:[/dropcap] Looking forward, what are some exciting things on the horizon for Omada and can you talk about the company vision for the future?

We’re taking a swing at bat to build the Genentech for digital health. We believe it’s possible to create a whole host of behavioral science programs aimed at achieving a whole variety of health outcomes.

To get there, we’ll have to be quite deliberate, especially because getting these digital experiences right takes an extraordinary amount of time and energy. They’re not just apps. They involve a very careful cocktail of digital tools, curriculum, timelines, people, and more.

This year, we’re going to double down on our Prevent program and scale that even more broadly. In the background we’re in the planning process to see what things we might want to build next.