30
Jul
2020

Jill Hagenkord’s Rags To Riches Story Reminds Us Why We Still Admire Entrepreneurs

David Shaywitz

Entrepreneurial stories, often told through the narrative framework of the hero’s journey, are by now well past the point of cliché. 

Yet, it’s important, perhaps even instructive, to remind ourselves every now and again about the exceptional, transformative power of entrepreneurship, the can-do thinking it motivates, and the remarkable progress it can propel.

This potential emerged as a central theme of Dr. Jill Hagenkord’s recent appearance on the Tech Tonics podcast that Lisa Suennen and I regularly host, as Hagenkord shared her journey that Suennen nicely characterized as “a rags to riches story in the most American of ways.”

A Tough Childhood in Rural Iowa

Hagenkord grew up in rural Iowa, an already difficult childhood made worse, she says, by her parents divorce when she was ten. Dependent on government assistance for housing and food, she was a self-described “behavior problem” throughout school.

Jill Hagenkord

She chose to attend college — an almost unheard of decision for girls in her area, according to Hagenkord — because she wanted to get away, and heard there were “great parties and cute guys” at the University of Iowa, in Iowa City, 90 minutes away.

At college, she partied hard but also worked hard, both in her classes — she made the Dean’s List first semester, despite the nearly complete absence of college prep in high school — and beyond, where she typically held down 2-3 jobs to make ends meet. 

Initially, she focused on fortifying the humanities education she realized she missed in high school. 

However, her life direction was then profoundly influenced, as she tells it, by a “jerk boyfriend,” a medical student who she dated for six years. When the guy told her she was only doing well because she was taking easy humanities classes, she took science classes in order to prove him wrong – which she did. 

Then he bet her she could never succeed in the most difficult pre-med classes, a biology lab. She aced it, despite lacking any of the prerequisites. She won the wager and claimed the prize: dinner at the “nicest restaurant in town” – the local Red Lobster. 

Unimpressed, Hagenkord’s perversely significant other assured her she could never get into Harvard or Stanford University. So she applied and won admission to the MD/PhD program at Stanford.

The Bay Area, Part I

Hagenkord was excited about coming to the Bay Area, but never felt “culturally comfortable” at Stanford’s campus in suburban Palo Alto. So she lived in the city, almost an hour away, and never showed up for class, just for the exams, which she apparently crushed anyway. 

She dropped the PhD part, and decided to pursue a medical residency in pathology — a discipline without a lot of one-on-one contact with (living) patients. She had found aspects of clinical medicine — like telling a patient or a family that there was nothing that could be done — overwhelming sad. 

She started her pathology residency training at UCSF, but was drawn away by the lure of a startup. It was the boom of the late 1990s, she said, and it seemed everyone in the Valley was joining a startup, where new millionaires appeared to be minted by the day. 

The experience, she said, was “exhilarating.” She was surrounded by “all of these super bright science PhDs and tech people, super bright and super ambitious.”  

She added, “I learned so much and it opened my mind up so much to the possibility of how can I be an entrepreneur in medicine.” 

Hagenkord joined the company when it was relatively small, stayed with it through growth to over 500 people, saw it expand internationally, and was there for its IPO. While it doesn’t sound like she saw a large financial return, the startup experience clearly affected the way she thought about problems. 

Even when she returned to finish her pathology residency — which she did back in Iowa — “every step of the way,” she said, “I was constantly thinking — this could be done better, this could be done more efficiently, how do we do this better?”

As Suennen points out on the podcast, this must have represented a huge contrast for Hagenkord: “After hearing all your life that ‘things cannot be done’ or ‘you cannot do this,’ on the entrepreneurial side, things are characterized by ‘you can do anything, if you work hard enough.’” 

It sounds like this more hopeful attitude suited Hagenkord. “It’s such a long shot but you can will it to happen,” she explains. “It was something that had never been done before. And I did get criticized — but it gave me all the courage I needed to think, ‘I can start my own company.’”

Even so, she initially elected to continue her training in Iowa because:

“I tried to be a ‘normal’ pathologist, live a quiet life, make a good paycheck pushing glass slides — but as I finished my residency, there was too much happening on the bleeding edge. What I saw coming were these massively parallel testing technologies, where instead of looking at one analyte at a time, we were looking at hundreds or millions at a time, and were going to need computational tools to distill this information into medically meaningful nuggets. That’s what I was the most excited about and wanted to learn the most about.”

Consequently, she pursued a customized dual pathology fellowship program. The faculty at the University of Pittsburgh Medical Center liked her proposal so much that they “invented” the fellowship for her. The program allowed Hagenkord to gain specialized pathology training in both molecular genetics and oncology informatics – a combination she says has since become more common. 

When she told the head of her residency program about her plans, Hagenkord says, he told her “Jill, why don’t you do a real fellowship? You’re never going to get a job.” 

She adds, with a grin, “When the old curmudgeonly white dude is telling you that you don’t know what you’re doing, you should feel reassured that you’re onto something.”

Bay Area, Part II

She then returned to Silicon Valley, in a series of roles at genetics companies. Early on, she got to know the co-founders of 23andMe. As she tells the story, “I got to know [23andMe co-founders] Anne [Wojcicki] and Linda [Avey — see her Tech Tonics episode here] through the Silicon Valley network. We’re around the same age, have kids, are working moms, live in the same town.”

She continues, “I could look at what they were doing from a regulatory point of view and recognize gaps. I would always say [to Anne and Linda] the consumer aspect of health is so exciting and you are leading the charge, let me help you any way I can. It wouldn’t hurt you to fix these gaps.”

For while, it seems, Hagenkord offered occasional, informal advice.  But “after they got the warning letter [from the FDA] in November  2013, this led to another long conversation and wound up in a job offer [as Chief Medical Officer]. So I joined the company after they were shut down by the FDA, to try to re-build bridges with medical community.”

Hagenkord worked through that thorny set of issues with the team at 23andMe. These efforts paid off, and over time the company worked itself back into the Agency’s good graces. While Hagenkord left the company, she distinctly remembers the day she sold her 23andMe shares (on the secondary market, as the company hasn’t sold shares to the public). Her shares in the private company were worth enough to be “truly life-changing.”

A “Silicon Valley” Moment

On vacation in Mexico, when she heard the funds had been deposited in her account, she says she left a $1,000 tip for the bartender. 

“It felt awesome — and we got really good service rest of time we were there.”

Reflecting on the experience, she describes it as “one of those Silicon Valley moments — not a ‘founder of Google Silicon Valley moment,’ but a decent Silicon Valley moment, when you have more money that you ever, ever, ever thought you’d have shows up in your bank account one day.”

She then reveled in the opportunity to play what she called, tongue-in-check, “Hillbilly Millionaire”:

“I called family — in Iowa — flew back, and said ‘everybody, get in the car, we’re going to the mall, buy anything you’ve ever, ever wanted.’ They were really bad at it, at first.  They went into Target, went back to the clearance sale rack — spent like $250, and I was like, ‘I didn’t fly back here so you could buy $250 at the clearance sale rack — now get out there and really shop!’ They really did.” 

The experience, she says, was “the best feeling ever” — though she also apparently enjoyed the 50th birthday present she treated herself to — a trip with 22 family members on a private yacht around coastal Turkey,” which she viewed as a chance to appreciate the “people who really supported me.”

After several more years advising health tech companies, she recently took on a new role, as head of genetics at Optum a subsidiary that’s been described as “the information technology and services arm” of UnitedHealth Group.

Once again, she is thinking of moving back to Iowa.

Lessons About Medicine And Tech

In addition to her inspiring story, Hagenkord shared several lessons about her experiences as an entrepreneurial physician working with technology entrepreneurs in Silicon Valley. 

Although my own life journey could not have been more different from Hagenkord’s, we seem to have come to remarkably similarly conclusions from our experiences at the intersection for technology and medicine. 

“In the last ten years,” Hagenkord says,

“tens of billions of dollars have been invested in healthtech, with very, very few success stories. It’s like watching the same movie over and over again, and it’s pretty torturous, especially as I’m usually the only person with a medical background in the company. 

I know the recipe — there are no shortcuts, and if you try to skip a step, you’re going to set yourself back three years. But to watch these brilliant tech entrepreneurs, who’ve been wildly successful in consumer tech, try to take the recipe that’s worked in consumer tech — go fast and break things, fake it ‘til you make it. If you get it wrong trying to sell somebody a pair of shoes online, and they have to wait three days for their shoes instead of one day, it’s going to be OK. 

The same recipe does not work well when you apply it to a real health product –what we call that is ‘unconsented human subjects research’ in healthcare. You can’t sell someone a finished product that you know is full of bugs without telling them. The philosophical and cultural differences between tech and health need to be better balanced. 

Taking the best of these brilliant tech and design people and combining it with the best of the people with the medical experience and the understanding about how to access the medical market — having that balance are the healthtech companies that are going to be the most successful.

Hagenkord also weighed in on whether coastal entrepreneurs think about people in the middle of the country, and whether one can imagine Silicon Valley-type innovation in places like Iowa.

On how Silicon Valley tech entrepreneurs tend to see the world:

“One of the things you see is someone in love with their own technology looking for a place to stick their technology, as oppoed to looking at a problem and trying to solve the problem.

The Bay Area is such a weird bubble place — so not like middle America where I grew up. To be able to really understand — especially when you’re thinking about your commercialization strategy — the idea that ‘people will just buy this.’ People who can’t really pay their mortgage, and have their lights turned off, and are struggling to get milk — for them, looking at their genetics is a huge luxury that’s beyond comprehension, and I think that gets lost sometimes. But often times there are representative people like me in [startups] to remind them of that aspect.”

And the idea of entrepreneurship in the Midwest, as promoted by champions like J.D. Vance and Steve Case?

“I did spend a lot of time thinking about it — it’s really too hard to be an entrepreneur in the middle of the country, because none of the venture money is there. 

There are very smart people in the Midwest; if I had a good loving family, I’d have wanted to stay there and raise my family there. It’s a matter of access — [to capital] and to mentors — so much of the Silicon Valley game is who you know, and who can introduce you to who, and who can vouch for you. When you’re living in Des Moines, it’s hard to make those connections.”

I raised a final point with Hagenkord, by email, after the podcast, asking her about the thought process leading to her recent decision to join not a venture capital firm or a startup, but rather at a massive insurance company — over the summer, she took at new job as Vice President of Genetics at Optum. 

My own top of mind reaction echoed Hamilton’s King George III’s response to the news that President Washington would be succeeded by John Adams: “Good luck.”

But here’s how Hagenkord sees it:

“Health tech startups can raise an ungodly amount of funds, but they often struggle to 1) identify a real, tractable problem in health, and/or 2) try to apply a consumer tech go to market strategy to a health-related product. They are smart people and they learn and iterate, but often they waste valuable time and money learning how the health care market works and what kind of evidence they need to achieve widespread adoption.

At Optum, I can help tech entrepreneurs understand how to get on the market legally and how to successfully get to widespread adoption and payer coverage (if desired). Since Optum invests, partners with, and acquires health-related startups, the tech entrepreneurs and investors have a vested interest in engaging with Optum. They are more inclined to generate proper evidence data when Optum says they need it. I also have the support of an amazing team at Optum Genomics who are all aligned with this same vision. In short, I could do more good more quickly at Optum as part of a team than as an individual consultant.”

I hope her lived experience at Optum ultimately matches up to these lofty, worthy expectations. 

One thing I know for sure: I wouldn’t bet against her!

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