By Merlin carter
For anyone teleconferencing business, the great lockdown of 2020 was like a shot of adrenaline. Not just for mainstream players like Zoom but also for vendors that serve niche industries such as healthcare. The surge in demand for telemedicine has prompted more startups to pivot to video calling.
Take Klara, for example, a digital health startup that got video calling up and running in just over a week. A phenomenal achievement considering they had no experience with video telephony. What factors contribute to such a well-executed pivot? Generally speaking, you need the right leadership, product and engineering teams, company culture, and of course, the right timing. Klara’s story includes fantastic examples of each of these factors, so let’s take a closer look.
Background
Klara was (and still is) a medical messaging platform that serves the US healthcare industry. Their solution allows doctors to centralize their medical communication. But this communication was based on instant messaging — video consultations weren’t on their roadmap until recently.
Video consultations are an essential requirement for telemedicine. You might see the terms “telemedicine” and “telehealth” used interchangeably in the news. Specialists use the term “telehealth” as an umbrella term for any health-related services provided through telecommunications, such as instant messaging or a symptom checker app. However, “telemedicine” is a term that is generally reserved for some kind of service that is provided virtually by a medical practitioner. This usually involves a videoconferencing call between the doctor and the patient.
But providing this kind of service is a tricky business — and not just because of the technical aspects. In the US, there are also complex state and federal laws that govern what you can do through telemedicine. For example, there are regulations that cover patient privacy, medicare payments, reimbursements, and remote prescribing. This is why Klara was happy to let more specialized vendors tackle the highly-regulated telemedicine market. That is until Covid-19 happened.
The pandemic caused a sudden change in market conditions that prompted Klara to deftly pivot with astonishing speed. Within a week, Klara went from being a “telehealth” startup to a “telemedicine” startup — quite a complex maneuver, as we’ll soon see.
The right timing
Since we’re in a pandemic, urgency is everywhere. But as a digital health company, Klara saw an increase in product engagement during the crisis. For them, the urgency was borne from another more specific threat.
Let’s take a closer look at how it played out.
On March 13, the US government announced that many of the regulations concerning telehealth would be temporarily suspended. US Citizens were encouraged to use video calling instead of in-person doctor’s visits whenever possible. Suddenly, there was a surge in demand for telemedicine throughout the country.
That’s how video calling became a “must-have” for many of Klara’s customers. Many customers are dermatology practices — a key user group for telemedicine providers. By Monday, March 16, Klara’s customer success team had identified 195 customers who considered video calling to be an urgent requirement — one that couldn’t be satisfied by signing up an extra vendor. It wasn’t financially viable for them to allocate even more budget to telehealth. If Klara couldn’t support video calling by the following week, their customers would go to someone else who did.
In fact, Zoom had already been courting Klara’s biggest customer — a leading provider of medical and cosmetic dermatology in the Northeast of the US.
Alexander Bibighaus, Klara’s VP of Product and Engineering, recalls how close they came to losing the customer:
“Zoom has been really capitalizing on … the situation and … had already done effective marketing to them and we knew that Zoom was an option for them, but we felt like we had a better tool and still do”
The telehealth industry in the US was experiencing a sudden disruption, and Klara risked becoming irrelevant. After they’d launched their video consultation feature, Alexander made this clear to his team:
I told my team that the next 90 days are probably the biggest 90 days for our company. We can’t sit here and admire our numbers. All those positive exits are going to happen to those that are left standing at the end.
The right leadership
Klara was founded by Simon Bolz and Simon Lorenz (affectionately known to their team as “the Simons). During the crisis, they maintained close contact with their customers through daily webinars and immediately heard feedback on how urgently people needed a video consultation solution.
Alexander (VP of product and engineering) was already keeping an eye on how Klara’s competitors were reacting to the Covid-19 crisis. He noticed a competitor had already announced that they supported video calls. The promotional material looked rushed and unfinished, but he realized Klara would need to catch up.
“As an executive team, we felt we needed to be bolder,” Alexander recalls. But this didn’t mean that they would announce video consultations before they knew it was feasible. “At that point, it was definitely my problem to solve,” he adds.
They had this initial discussion on Tuesday morning, March 17. Alexander spent the afternoon getting estimates from his developers. When they reconvened at the end of the day, he had an answer: “we can do it”. After that, they spent little time deliberating and acted decisively. The launch date would be the following Tuesday: March 24. From then on, it was a race against the calendar. They had 8 days.
The right product team
After leadership had decided to green-light the project, Alexander’s team moved incredibly fast. They dropped everything and sprang into action — as if they were about to perform emergency surgery on their product.
They achieved a lot in the space of a day. The designer Kai created wireframes of the user flows. Dan, their product manager drafted the requirements. Both were ready in the afternoon when lead developer Fatos kicked off a task force to research and implement a solution. They started to research different technology options. Each team member had 4 hours to come up with a different idea. By the end of the day, they had reviewed six technology options and selected two video technology providers: Twilio as their main choice and Tokbox (now Vonage) as a backup.
Quite a result, considering the team had been abruptly pulled out of their quarterly planning sprint. There were mild protests but no kicking and screaming. Klara’s product team is used to turning things around on short notice. As product manager Dan Malinovksy puts it:
“We never know what’s coming up on the horizon. So we are constantly learning, trying new things, and iterating — with hits and misses along the way. I see our team as a group of explorers, bravely sailing for a new world”.
The right engineers
Given that Klara implemented Zoom-like functionality within a week, you might conclude that video calling is not technically complicated to set up — and in principle, it isn’t. Any experienced developer could follow Twilio’s tutorials and get something up and running within an afternoon.
What requires more skill is knowing how to test the implementation effectively and to get it to work at a production scale without reducing call quality.
As Twilio’s own documentation explains, quality is a complex subject and “an elusive concept that may have different meanings”. There are also many variables that can influence it. For example, playback resolution, frame rate, latency, battery consumption, the proximity and performance of network resources, and so on. But it’s not just a case of selecting the best settings for all variables — as Twilio points out, “Some of the variables affecting quality inversely impact one another.”
In fact, Klara did initially struggle with quality issues. Klara is based in New York, but their engineering team is in Berlin. One particular challenge was figuring out how to route traffic through the correct regional data centers. Call quality seemed fine in Berlin but not for staff in New York. They fixed the issue only to have it reemerge in other test scenarios. But they eventually got these problems under control.
Due to the fierce competition with Zoom, Klara decided to go live with their biggest customer on Monday, March 23, one day ahead of the general launch. That night, the customer sent an email that reported inconsistent image quality and audio latency.
This put a dent in their confidence. Dan, the product manager, wrote to Alexander, “I’m not sure we can go live today.” He wanted to buy more time to get on a call with Twilio: “I know this is tough, but I think it must be done,” he wrote.
However, the time difference between Germany and the East Coast meant that the Berlin team had around six more hours to solve the quality issues. And they did solve it once and for all. As Twilio’s specialists would later confirm, they had initially missed some optimization parameters — but these were now set to the correct settings. By the time Alexander and his team had their call with Twilio that evening, they had already launched their video consultation solution.
And their biggest customer was also grateful. On Tuesday, the quality significantly improved, and they were able to perform more video consultations. The same goes for the remainder of Klara’s customer base. Within a few days of the launch, they were exceeding 1,000 consultations a day.
Perseverance in the face of technical adversity is not a given. A less experienced team might have struggled to turn around such quick results with unfamiliar technology.
Alexander’s explanation for this is simple: “We have some really good engineers”.
The right culture
During the race to the finish line, Alexander pinpoints a moment that was key to their success.
The task force of engineers had been split into two equal groups. One group was building a solution with the Twilio toolkit, and the other with Tokbox’s tools. The idea was to have a fallback in case one of the solutions didn’t work. However, this approach provoked too much internal discussion about the technical merits and affordances of the competing toolkits.
Late on Friday night, an engineer confided in Alexander:
“He reached out to me on Slack and said ‘today didn’t go well … we weren’t organized … we’ve got too many things going on. We need to simplify our approach’.”
Alexander and his team lead decided to regroup. A couple of engineers still continued to work with Tokbox, but the Twilio-based solution was now considered the presumptive nominee. Over the weekend, they focused their energy on Twilio, and the comparative analysis was nipped in the bud.
Alexander was grateful for this: “for someone to tell me that in the middle of all this .. I have a great team, and they did stuff like this”.
Klara prioritizes this quality when hiring. When asked what he looks for in a teammate, product manager Dan Malinovsky sums it up nicely.
“Things move quickly at Klara, so the only way you can be successful is by talking and checking in — frequently. I really appreciate clear and concise communication and teammates who are not afraid of speaking up about issues or concerns”
What helps is that the company has a sense of solidarity and a higher purpose. Klara’s product has a significant influence on the well-being of the population. So naturally, they attract employees who are highly motivated by the idea that they are making a difference rather than by material gain alone.
As one employee stated:
“Klara addresses a clear need — to me, that was one of the most important considerations when selecting a company to work for”
During their one-week dash, it also helped that the entire company put their full support behind the engineering task force. Although Klara kicked off their effort on Tuesday the 17th, it wasn’t until Thursday when the task force really started coding. So they volunteered to work through the entire weekend to get it done by Monday.
That Thursday, Klara had their regular virtual all-hands meeting. The leadership team announced to the whole company that they would be launching video conferencing support in five days. They also introduced the task force who would build it, adding that they had volunteered to work through the weekend. The announcement was met with genuine applause from both sides of the Atlantic. Founder Simon Bolz also lauded the team publicly on LinkedIn:
“This week our amazing product and engineering teams decided to work around the clock to build fully integrated real-time video visits into Klara .. Thank you team! You are next level. It’s unreal.”
The founders and other employees chipped in during the weekend to help test the video calling. This made a huge difference in motivating the team:
The right kind of startup
Most of these qualities are intrinsic to startup culture in general. A startup won’t get funded without decisive and confident leadership and flexible, agile teams. A culture of open communication, on the other hand, is harder to maintain. Many companies only pay lip service to this principle. But in the healthcare industry, teamwork and clear communication have been burning issues that they’ve worked hard to improve.
Klara operates in an industry that has a tangible impact on people’s lives. But this doesn’t mean these qualities are unattainable in other industries, you just might have to get more creative in how you position your company’s mission internally.
And finally, what about the highly-skilled engineers? It’s no secret that they’re hard to come by. You have to build a culture that attracts the best talent. Klara was able to do this effectively — partly because their value proposition is so compelling. After all, we all stand to benefit by modernizing the healthcare industry — and few are as well equipped to do this as Klara.