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the big pivot
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James Bateman, bottom centre, co-founder of health-care records software company Medchart, with members of his team in Toronto.J.P. MOCZULSKI/THE GLOBE AND MAIL

Watching helplessly as a relative undergoes treatment for cancer, or any other disease, is never easy, but James Bateman was struck by just how complicated the paperwork side of it was.

Helping co-ordinate his father-in-law’s care involved trips to four different hospitals for cardiac treatments, urology, a clinical trial, and visits to his community hospital.

Though his father-in-law died in 2013, lugging an accordion binder of medical records from appointment to appointment left a lasting impression on the former University of Toronto PhD student.

So, along with fellow engineering student Derrick Chow, Mr. Bateman founded Medchart in 2015 as a cloud-based, online portal to enable easy sharing of health records with the consent of patients.

However, while something like Medchart would have been a blessing for Mr. Bateman as his family member went through treatment, he quickly found that not everyone felt the same way.

“We released it to consumers, but we quickly realized, and I think this was one of the major turning points, was that concept of ‘if you build they will come’ is not true,” he says.

In 2017, the company entered into a partnership with Southlake Regional Health Centre in Newmarket, Ont., which allowed Southlake patients to access the Medchart portal to retrieve medical records and share them.

The success of that partnership, which led to a Federal Development Ontario grant, was “really one of the launching pads to move us into the B2B [business-to-business] model,” Mr. Bateman says.

That shift in emphasis quickly resulted in interest from others involved with requesting health records, such as medical researchers, insurance companies and law firms, as well as other health-care providers, who can access the records of patients who have filled out authorization forms.

As someone who worked as a carpenter for nine years, before leaving that profession for quantum physics and several startups before pursuing his PhD and co-founding Medchart, Mr. Bateman was no stranger to a change in direction.

So the company overhauled the website, making it less consumer focused and more in tune with what law firms and others wanted. And though the company still attracts about 200 consumers a month wanting a comprehensive record of their bloodwork and other medical records, the company is more focused on a B2B approach, with a team of about 20 people across offices in both Toronto and Kitchener.

In addition, the startup has raised a total of $3.3-million in angel investment and seed funding, and also received $1-million through Ontario’s Health Technologies Fund.

Medchart surpassed the million-dollar revenue mark earlier than it had originally projected and plans to launch its Series A funding round this year in conjunction with its U.S. expansion plans, Mr. Bateman says.

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Andrew Au, chair of the Canadian Marketing Association’s B2B Thought Leadership Council: 'The biggest difference between B2C and B2B is the number of decision makers and how you need to cater your strategy.'Agnes Kiesz/Agnes Kiesz/Canadian Marketing Association

The global trend to ditch paper and go digital is helping growth, too, with campaigns such as Britain’s National Health Service “Axe the Fax,” which has prohibited the use of fax machines.

“We’re seeing these major movements, which are really pushing health care globally to go completely paperless, that are just adding to our rate of growth,” Mr. Bateman says.

But while pivoting in the direction of a B2B model made perfect sense for a company such as Medchart, not every company finds that transition as appealing.

One factor that some companies, particularly smaller startups, might find off-putting is the complex decision-making process that businesses use when it comes to signing contracts.

According to the Harvard Business Review, an average of almost seven people are involved in any B2B-solutions purchases, compared with likely just one or two in a B2C model. Decision makers can range from business owners to the finance department, to procurement, operations and any other number of departments.

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Gil Gruber, founder of marketing consultancy Direct Objective Consulting in Montreal: 'Sometimes, if you’re a startup, you can’t afford having a very long sales cycle,' so one way to speed up the process is by automation.Direct Objective

That time lag needs to be factored into a startup’s business strategy, says Gil Gruber, founder of marketing consultancy Direct Objective Consulting in Montreal.

“Sometimes, if you’re a startup, you can’t afford having a very long sales cycle,” he says.

One way to speed up that process is by automating the decision-making process of clients and use the resulting data to highlight the ones who are ready to embrace the product or service a company is bringing to market.

“When you start automating the process, you start shortening the sales cycle and you’re able to target the potential clients that are more ready [for your offering] versus the ones that are still thinking about it,” he says.

Another factor worth considering, he says, is that while B2B purchase decisions are very rational, consumer decision making is mostly based upon emotion.

“There is also a rational part,” he says, “but we tend to buy based on our mood and based on security and comfort and quality as a consumer.”

One B2C marketing strategy that is starting to carry over to B2B is the idea of personalization, experts say. While consumers have come to expect it, such as Inc. giving recommended products based on purchasing history, businesses are increasingly beginning to expect the same.

But while B2C purchase decisions tend to revolve around a single decision maker, in B2B you have multiple decision makers, sometimes with differing priorities.

“The biggest difference between B2C and B2B is the number of decision makers and how you need to cater your strategy,” says Andrew Au, chair of the Canadian Marketing Association’s B2B Thought Leadership Council.

He says that successful B2B companies target individual decision makers along that chain, and ensure that their pitches appeal to and address each differing priority.

“The other thing about B2B that’s very unique is you now need to align your sales and marketing teams much more effectively than in the B2C game,” he adds.

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