SIPA Presentation

1
SIPA Presentation

• Pavan Nigam

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How the Internet Changed my Life

• Netscape
• Ebay

3
Healtheon Background

• Founded in 1996 by Jim Clark and Pavan Nigam
• Business Plan - Connect everyone in 1.2 Trillion
  health-care industry and make some money in TBD
  fashion
• R1.0 (96-end) connected employees, employers
  plans
• ahead of the curve, limited success
• initial euphoria leads to despair
• Recruited CEO (Mike Long) in mid-97
• R2.0 (98-end) connected providers, labs and plans
• vision update rallies company
• real and significant revenues
• Oct 98 IPO attempt unsuccessful due to market
  conditions
• R3.0 (mid-99) simplifies offerings as consumer
  provider portals
• finally every employee can recite the Healtheon
  elevator-pitch
• Highly successful IPO in Feb/99 (2.5B company on
  opening day)
• Announced 7B acquisition of WebMD on 5/99
• Market cap of Healtheon/WebMD has moved within
  7B-26B range

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Top 10 Lessons Learnt/Enforced

• Constant assessment and refinement of Business
  Plan is important
• Real test of Leadership is during the down times
• Its never too early to acquire Domain expertise
• A True Internet companys growth has to be tied
  to the Internets growth
• It is easier to migrate an installed base than to
  acquire new customers
• A revenue-enhancing value proposition is easier
  to sell than a cost-cutting one
• Go for short-cycle staged product development
  where possible
• Simple ideas have a better shot at winning than
  complex ones
• Cut your losses early (especially when it comes
  to senior mgrs)
• There is nothing like too much Communication

5
Things to Remember

• Branding is critical to rise above the crowd
• advisors, board, VCs, management, partners,
  customers
• use equity liberally (pie growth test)
• Time to critical-mass usage is key
• funding, early customer/partner, domain experts,
  savvy mgmt
• Stay focused and balanced on the multiple value
  propositions
• actual users and actual revenue-customers
• Rely on your instincts - remember the 10 rule
• applies to VCs, bankers, analysts, industry
  experts also
• Eventually the Fundamentals will matter
• revenues, profits, execution, execution,
  execution

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Most of the Internet-era Wealth Creation is still
Ahead of us