Eric Langshur is the co-founder of Chicago-based Abundant Venture Partners, whose Abundant Alliance is a coalition of 22 health systems that includes MedStar Health, Health Henry Ford Health, ChristianaCare, and Northwestern Medicine. Together, they collaborate to identify, build and scale solutions. He recently spoke with Healthcare Innovation about why more health systems are rethinking their traditional venture and commercialization approaches. Many are exploring models that allow them to participate more directly in ownership, commercialization and value creation.

Besides his work at Abundant, Langshur also serves as co-founder and executive chairman of AVIA, a health system innovation network that helps identify and implement emerging tech-enabled solutions at scale.

Healthcare Innovation: Eric, could you first talk about AVIA and then about how the Abundant Alliance came together?

Langshur: One of our core ideas was organizing our work with regional delivery systems around the value of collaboration. AVIA is organized around the idea that health systems are all trying to drive transformation. By pulling systems together around a specialized expertise around digital, we can help them in a much more efficient way in knowledge acquisition and strategy development and sharing learnings across the network. That accelerates their work in a dollar-for-dollar way that is more efficient because it's essentially syndicating the knowledge across a significant network.

HCI: Was the work at AVIA a springboard for the Abundant Alliance?  

Langshur: Yes. We listen really carefully to our health system partners' needs. One of the the needs that was being communicated was to help them gain and grow financial value through equity ownership in these enterprises and help them start businesses or spin out and commercialize IP into the broader network — not just solve important strategic and operational challenges, but capture the economic value of doing that. 

Many of our members have direct investing engines, but there's an appreciation that there's a specialized skill set here that they don't bring to it. So we've started 16 companies over the years and we've sold 14. We're really good at building, and we're really great at identifying commercialization opportunities that might exist to solve a set of needs that are shared across the network. We’ve developed great processes for not just the identification of that, but for the validation of that work, and that's the work of the Alliance. 

There's an additional element to that. There are really cool solution companies that are desperate for clients who reach out to these health systems every day. We act as a purpose-built extender for our Alliance members to help them evaluate and understand the landscape. 

HCI: I have interviewed Chris Heckler, the CEO of SpendRule, a supply chain solution startup who worked with the Alliance. He said nine of the health systems in the Alliance agreed to be co-development partners. He got people from those nine health systems to meet every week for six months, and it created this co-development project team for him. That seems like such a great opportunity for someone in his position. Has that required some fine-tuning in terms of the best ways for the health systems to engage with those startups?

Langshur: For sure. To do that in a repeatable way is the art of it. What we've learned is that because all health systems are different, we need to find in each health system the right decision-makers who own the problem. In that case, it's a supply chain solution. I'm glad you spoke with Chris because it's a great example of how we helped start his business and in a way that's massively efficient for him and wonderful for our members. 

Our approach is that there are multiple ways for a health system to capture economic value. No. 1 is if they have an idea that we commercialize and spin out. For example, MedStar spun out a company called Auxira. [Auxira pairs clinical support teams with cardiologists to increase care access for patients.]

HCI: Yes, I interviewed them, too. 

Langshur: Yes, great. No. 2 is they can make a direct investment in a company. No. 3 is they can earn co-development equity. That working group that met weekly with SpendRule was rewarded with equity in the company. No. 4 is that we organized what we call the S1 fund, which enables our limited partners (LPs) to participate in seed rounds through Abundant. 

But if you think about it, the machinery within a health system to make a one-off investment decision sometimes can be arduous, so making a decision to invest and become an LP in the fund lets us wrap the professional management around that, and then deploy the capital. They're getting a portfolio, they're getting efficiency, and we've removed all the guesswork out of it because we're validating demand and organizing clients. 

The last thing, which I think is probably the most powerful, is they get the operational benefit of the solution. SpendRule is going to save them millions of dollars a year. Auxira will improve doctor and patient satisfaction.

HCI: When the Alliance was first announced, there were 17 members and now there are 22. Are you planning for more growth? 

Langshur: We have an amazing pipeline now. We've been very purposeful about how we grow because we've had to build repeatable processes.

We've developed a process for intaking and screening ideas. The scarce resource, ironically, isn't capital, but it's people's time. That fine-tuning has to be incredibly respectful of our members' time, and incredibly efficient, and engage them in a way where they can add maximum value in the right moment, and then get us to the right person within their organization. What we've learned is when we're working the right problems, it's amazing how they have all the time in the world to lean in. That's the buying signal.

If we're working something that's cool, but just not important enough to prioritize, that tells us a lot, too. So we listen with a very tuned ear.

HCI: Is there room for smaller community health systems to engage in this type of investment, too, or is it mostly large health systems that can make this kind of investment of money and time to do this kind of work?

Langshur: This work cannot be reserved for the well-heeled health systems. For sure, the most sophisticated health systems are our founding members, and we love that. Now we're really focused on creating cohorts of like systems. For example, we're now working with our first safety net system. We’re subsidizing it, but the economics for the safety net is huge. They really need the gain, and the same thing is true with rural health systems. 

HCI: Do you think that the AI boom is having an impact on people's interest in participating in networks like this and moving upstream in terms of investment?

Langshur: Yes. Every leader in every boardroom in the country is asking this question. I have the privilege of being in a lot of boardrooms talking about this. Health systems recognize they need help.

We've entered into a partnership with the American Hospital Association. We call it AI Ready. We are helping health systems upskill all their people from the boardroom to the breakroom with a curriculum and delivery modality that recognizes their roles — a special curriculum for doctors or nurses or finance execs. We think that's a prerequisite for these health systems to leverage value. 

There's also a giant need for a governance system to complement that. If you're a chief information officer, your CEO is pounding on you to make sure that from a cybersecurity perspective things are safe and that everything is documented, and that from a token utilization perspective, it's efficient. You need to develop a governance system that will help with the safe deployment of these tools.

HCI: Anything else about your approach that you would like to share? 

Langshur: We’re very humble and practical. We think the way to score runs is like the Billy Beane approach — let's hit singles. Let's move people around the bases. Let's be practical. Let's understand workflow with our members. Let’s solve the problems that really matter in ways that are practical and implementable. Let's look after doctors and nurses and overburdened administrators. Let's acknowledge that P&L margins are crazy thin. The playing field is littered with dead carcasses of people who just don't get this stuff right.