Building a Healthcare IT Company to $100 Million: Dr. Rob Langdon, Co-Founder of T-System (Part 4)

Sramana Mitra: You earned $30 to $40 million just licensing the paper product?

Rob Langdon: Yes. The paper product continues to this day.

Sramana Mitra: Obviously, you built the software using the revenue of the paper product, right?

Rob Langdon: Yes, we bootstrapped. We were able to use a highly profitable product line and we used those revenues to start the development.

Sramana Mitra: In 2000, you released the software product, which was built with the revenue you generated from the paper product. This is where we are in 2000?

Rob Langdon: Sure.

Sramana Mitra: When you come out in the market with the software product, what happened? What was the configuration of the software product? Sounds like the paper product continues to be the interface tool through which people input their material. Where do you position the software product?

Rob Langdon: The software replaces the paper. The goal has always been this paperless emergency department. It has been the Holy Grail where everything is done in software, and data flows to everyone who needs it.

Sramana Mitra: What was the usage model? If software has to replace that paper, what is the usage model in 2000 to 2001? Today, I imagine you switched this to tablet.

Rob Langdon: It has gone increasingly mobile for sure. There was WiFi within a few years. There wasn’t a moment when everyone in every hospital switched to a mobile solution. There are a variety of preferences. Many doctors will just carry a laptop to the patient’s bedside. They liked having a bigger screen and a full key board.

Sramana Mitra: WiFi configuration is what you’re describing?

Rob Langdon: Yes.

Sramana Mitra: You launched this software in early 2000. People were using this on a laptop-WiFi configuration and you were trying to replace the paper so that all these data would go directly to a health informatics system?

Rob Langdon: Yes.

Sramana Mitra: How did the software revenue ramp? Was it a direct sales to hospital?

Rob Langdon: Yes, but we also have clients who are physician groups. Our biggest proponents tend to be physician groups because it really benefits the doctor. It sounds a little harsh but hospitals don’t care as much about the physicians other than they want to track the physicians and to not hear complaints from physicians. The complaints about software abound. It can’t be a major project to integrate it to the information system of the hospital. The interfaces have to be built. There has to be collaboration and changing the workflow between hospital staff and physician groups. Any proper project within a hospital can be a complex effort. We can install quickly within months whereas software projects will take years in hospitals. Ours was pretty efficient.

This segment is part 4 in the series : Building a Healthcare IT Company to $100 Million: Dr. Rob Langdon, Co-Founder of T-System
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