David Sylvan is vice president and executive director of University Hospitals Ventures, an 18-month-old investment arm at University Hospitals that aims to drive an innovative culture and serve as an alternative revenue source for the system in the future.
“Most nonprofit integrated healthcare systems, like ourselves, are destined to experience a material revenue gap looming in the not too distant future,” said Mr. Sylvan. “That is largely a function of the pace that we are transitioning to value-based care, as well as the impact of market forces and shifting patient demographics. All of these factors are likely to collide simultaneously and it’s clear to us that the health systems that haven’t already commenced an aggressive attempt to capture alternative revenue sources will find themselves in a precarious situation. There will be smaller, regional and community hospitals where this will be an existential crisis.”
The Cleveland-based UH Ventures has already invested in a few companies and aims to grow rapidly over the next few years. Mr. Sylvan and his team invest in differentiated innovation platforms. “We are largely focused on technology commercialization and investing and co-developing commercial innovation with strategic partners,” he said. “These activities aim to create material return on investment within the next five to 10 years. But those activities take a substantial amount of lift, support and resourcing to become commercially viable.”
Here, Mr. Sylvan outlines his strategy for UH Ventures, building a culture of innovation and headwinds for 2020.