Startup Cemetery

A big resource for entrepreneurs and startup owners, in which we have collected and analyzed why +100 big companies have failed. Learn from mistakes, and avoid being part of the 90% of businesses that fail.

Call9

On-demand doctors in emergency situations

General Information
Category
Health
Country
United States
Started
In 2015
Business Failure
Business Outcome
Shut Down
Closed
By 2019
Cause of Failure
Bad Business Model
Founders & Employees
Number of Founders
Three
Name of Founders
Celina Tenev, Timothy Peck, XiaoSong Mu
Number of Employees
Between 101 And 250
Funding
Number of Funding Rounds
3
Total Funding Amount
$34M
Number of Investors
10
Description

Instead of having to call 911 and wait for hours in a nursing room, not knowing if you were going to die or not, Call9 offered a different option. Call9 was especially targeted to patients in the home care industry who needed the urge to speak with a doctor right away about their issues.

The solution was simple. Instead of calling, each patient would be given some medical equipment and an iPad. Using the iPad, the patients could call in to their doctor and get medical advice - in their own living room instead of having to call an ambulance or even drive somewhere by themselves.

Cause of Failure

One of the core values of the company was to operate on a so-called “value cared basis”. What that meant was that doctors wouldn’t necessarily get paid a flat fee per hour or per consultation, but rather according to how the patient felt after they’d been treated.

So, if the patient felt that the doctor didn’t help them at all, they could justify paying less money or nothing at all. Naturally, this became a problem when dealing with employees who were demanding their money. And also, the USA adopted very slowly to dealing with this kind of relationship between doctors and patients. 

But there might have been other factors involved, too. Call9 had inked deals with Lyft for patient transportation and were planning to expand to Albany, NY, from their base located in Brooklyn. Not only that, but they also operated a community paramedicine division by using their emergency doctor network.

In other words, they had a big vision, and they were expanding their business. But they might have expanded a little too fast with too much money. And that is because, shortly before they shut down their operations, it was learned that the company was entering a bit of a ‘stealth mode’. That was likely because they were still in their early stages as a healthcare startup and struggled with their financial situation.

Call9 acquired some partnerships with various companies in the healthcare industry, and the idea was to make a turn and focus on technology in nursing homes. Ultimately, this plan failed and the company just didn’t have what it took to make it in the tough and cruel world of health tech startups.

One last point is that investors nowadays have less patience than what they did - they want to get back the money they invested rather quick. Things aren’t like they used to be in the early 2000’s where you’d make headlines by getting a 5 Million Dollar round from well-known investors and you’d get invited to conferences and VIP cocktail parties. Now, investors expect results fast. And if you can’t deliver, you won’t survive.

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