A tech-enabled service is a business that delivers the finished service itself, with its own clinicians, labs, staff or logistics running on its technology, instead of selling software to the firms that do the work. The customer pays for the outcome. Chris Dixon called these full-stack startups.
Also calledfull-stack startup (Dixon)tech-enabled service business
How Tech-Enabled Services work
Owning delivery lets the company redesign the whole service around its technology instead of waiting for incumbents to adopt a tool. It also controls quality and keeps the data the work produces. Teladoc's own credentialed physicians answered non-emergency calls around the clock, while Amwell sold software that health systems ran under their own brands. athenahealth paired its billing software with its own claims staff, and its clients made up 59% of the first Stage 2 Meaningful Use attesters in 2014.
The price is an operating business, with payroll, equipment and thinner margins.
Medical practice paperworkClaims, denials, Meaningful Use attestation
Who does the work?Sell software, or deliver the finished work
Practice FusionEHR software; billing handed to partner firms
athenahealthIts own claims staff on its software
Two answers to a medical practice's billing work: athenahealth delivered the finished work with its own staff, while Practice Fusion sold software and left the work to partners.
How companies won with Tech-Enabled Services
From the win chains in Strategy Canon case studies: what the winner did, and what its rival did at the same step.
vs. Practice Fusion
athenahealth
Software plus back-office work on one instance
What it did
athenaCollector (2000): web software, rules database and claims staff as one service
Practice Fusion
EHR only; billing handed to partners (Kareo, then three billing firms by 2013)
Discreet cash-pay online care for stigmatized conditions
What it did
Launched Nov 2017 for hair loss and ED: online intake, affiliated-physician review, prescription and home delivery in one flow, cash pay with no insurance
Ro
Roman launched Oct 31, 2017 with the same flow: physician-reviewed questionnaire, Roman Pharmacy Network, discreet free shipping and automatic refills
A services line sold alongside a product to help the product business
The product is still the business; services earn access or make it usable
CrowdStrike's incident-response practice before its first product shipped
How to tell if a company has it
It runs delivery itselfIt employs or contracts the providers, runs the lab, holds inventory or handles logistics, and sells the finished outcome.
A named alternative it replacedIncumbents who delivered the service before, or a software or marketplace model that leaves delivery to third parties.
A date when the model beganWhen the company started operating delivery, as with athenaCollector's software and claims staff in 2000.
Owning delivery changed the serviceSomething running the work let it redesign or control that a software vendor could not, compared with rivals' results.