Literacy

All consumers need is a nudge at just the right times, in just the right ways, to change from a hapless ignoramus into a hero of their own life story.

We’re making a market for health literacy. Say whaaat? I’ll parse that claim.

Every market is a space for commerce. Where buyers with certain needs look for sellers to satisfy them. Humaginarium is making a market for health literacy and selling in it. This market hasn’t existed before; we’re not improving on some mediocrity in the health care industry. Ours will be the first and most likely the best market for health literacy for a very long time to come.

A glance at the dictionary reminds us that health may be many things; or maybe nothing after we think about it. That’s because everybody wants or claims to be “healthy” but nobody ever is. Our real lives compare to the paragon of health somewhat like our appearance compares to models in Vogue magazine. Without thinking deeply about it, personal health is a state of mind more than a condition.

Humaginarium doesn’t buy that conceit of popular culture. Health for us is tangible, not ethereal: it’s physical well-being. Health is the state of a body within the normal range growth and decay over time. Mind you, normal isn’t necessarily good; it’s actually more like meh when it’s not dreadful. That may be why many healthy people are troubled by their bodies while the unhealthy try not to think about it.

Bringing this down to the level of how we live versus what we’re taught to believe, for most of us health is merely shorthand for the ability to function. “How are you?” “I’m good.” (I may have a tumor the size of a grapefruit in my bowels, but forgetaboutit, “I’m good.”) Most of us run our bodies the way we run our cars, with minimal preventive maintenance and no clue what’s under the hood. Works great until it doesn’t. Then we find a mechanic or doctor for expensive and inconvenient repairs.

Now for the most important word in our syntax. Basic literacy is the ability to read. From reading we get knowledge, from knowledge we get competence or the ability to do things. Few people care about reading for its own sake (and no one knows this better than a jaded English professor). But most people put a very high value on the utilities of literacy. Literacy makes people smart and capable, maybe effective and successful too.

Health literacy is a variation on the textual kind. It’s the ability to read a body, develop insight into its condition and needs, make shrewd choices for or about it, and consequently become its good steward. Those who have health literacy are competent consumers and patients. They engage in preventive maintenance and clinical care, and are eager to learn what’s under their skin. Those who don’t have health literacy check their look in the mirror and say, “I’m good, forgetaboutit.”

Only 10% of American adults have health literacy. The other 90% can’t read their bodies worth a damn. Compare this with 80% of Americans who read the newspaper and email, books and blogs. How can this be? Why can 80% of adults understand the enormously complex fantasy of The Lord of the Rings while only 10% can comprehend the physical reality of their own bodies?

Believe it or not, no one has asked that question until now. While the health care industry bets big on scientific breakthroughs, nobody is asking the more important question: “How about regular folks like you and me?” Can they become good stewards of their bodies and stop running to mechanics every time a weird sound comes from under the hood?

Yes, they can, and they will, but no mechanic is going to do it for them. All they need is a nudge at just the right times, in just the right ways, to change from a hapless ignoramus into a hero of their own life story. The nudge isn’t coming from health care. It’s coming from Humaginarium.

SBIR Phase 0

We’ll join the I-Corps Summer Cohort in New York in July 2018.

2018 is becoming our Year of I-Corps. Made possible by the National Science Foundation and a program innovation known as SBIR Phase 0.

  • SBIR stands for Small Business Innovation Research
  • Phase 0 prepares qualified startups for a Phase 1 SBIR grant

Our Phase 0 boot camp in January was a Customer Discovery course run by the Midwest I-Corps Node at the University of Michigan. Great experience! We discovered much about our business ecosystem and even more about our capacity to deliver.

After boot camp the Midwest Node facilitated our application to SBIR Phase 0. We’ll join the I-Corps Summer Cohort in New York City starting in July. Phase 0 includes seven weeks of intensive customer discovery and related business formation supported by the new I-Corps Go Entrepreneur Assistance program.

Boot camp convinced us that it’ll be best to start Phase 0 before it formally begins. We actually began preparing in February and will continue right up until the kickoff meeting in July. By that time we’ll have enumerated many of our critical success factors; written our business, technical, scientific, and clinical assumptions to test with stakeholders; and made a balanced, vetted list of over 100 scheduled interviews around the United States. Rather than leave New York at the end of the kickoff meeting, we’ll stay to conduct stakeholder interviews in the metropolitan area.

Two members of our team along with our industry mentor will attend Phase 0 meetings in New York and weekly online. All four founders are helping to prepare and analyze our results. One will manage the project and the process that leads Humaginarium to a December submission of a Phase 1 SBIR grant from the National Science Foundation.

Boucher

Scientific entertainment. Variation on Ruhendes Madchen, by François Boucher

Democratization

The tools of Humaginarium are collectively known as health literacy.

Our recent pivot from video game developer to market maker has lots of ramifications. Remember our motive was to match the speed and scale of operations with the opportunity that lies before us. Yet the more we think about it, the more we realize that the pivot changes everything. It re-frames us as a My Space of wellness.

Chris Anderson has a word for this: democratization. “Transformative change happens when industries democratize, when they’re ripped from the sole domain of companies, governments, and other institutions and handed over to regular folks.”

What industry are we aiming to democratize? What’s being handed over, and to whom?

The industries that matter to us are entertainment, education, and health. Thanks to thousands of companies like YouTube and Wikipedia, the first two of those industries have already been democratized. Not health though.

The health industry is not a democracy, but a syndicate of institutions (clinics, providers, payers, manufacturers, universities, agencies). The customers of this syndicate are not consumers or patients, but fellow institutions. This partly explains why consumers feel that health care is costly and dysfunctional while institutions keep increasing the costs and chaos.

A “market for health literacy” is what we’ve always said about Humaginarium, only greater. It’s where communities of interest get the health education they want, in the ways they want and can use it, from as many “teachers” as there are points of view. By teacher we mean experts with scientific and medical proficiency, and communicators with artistic talent; and we also mean peers who have learned from the greatest teacher of all: personal experience. The market we make is where “regular folks” enjoy and learn from others; and co-create insights with others; and endow others including experts with the gift of their own knowledge and perspective.

Chris Anderson goes on to observe that “We all have our own needs, our own expertise, our own ideas. If we are all empowered to use tools to meet those needs, or modify them with our own ideas, we will collectively find the full range of what a tool can do.”

The tools of Humaginarium are collectively known as health literacy. There’s no central store or world market for these tools that speaks in the vernacular of regular folks rather than the jargon of institutions. At least, there hasn’t been until now. Stand back, we hear the rumble of Shadowfax approaching!

Value Proposition

Our pivot gives credence to our value propositions. It lets us promise meaningful results.

Our recent pivot from producer to market maker is a paradigm shift. Though it preserves and even strengthens vision, it also re-frames everything we call execution: what we do and how we do it. CSFs like speed and scale can now emerge from the mist and glisten in the light of certainty.

Another outcome of the pivot is a good value proposition. This is the central pillar of a Business Model Canvas, the holy grail of tech startups, the secret sauce of innovation, and maybe the hardest thing to get just right. In our case it’s taken years of ideation that resembled a blind search under the Lonely Mountain.

So then, returning to early drafts of our Business Model Canvas, the pivot prompted us to replace one rickety post holding up a low roof with five flying buttresses reaching for the stars. One new value proposition for each class of stakeholders in our venture:

Customer Value Proposition
Making health literacy easy, fun, useful, and rewarding; and making wellness a reasonable choice for everybody.
Customers are buyers and users in our market.

Partner Value Proposition
Increasing access to targeted customers, developing new revenue streams, and enhancing brand equity.
Partners are producers, sponsors, and advertisers in our market.

Investor Value Proposition
Achieving superior return on investment while improving population health.
Investors are shareholders, foundations, and companies with stakes in our market.

Provider Value Proposition
Increasing patient engagement and compliance with medical protocols; and improving outcomes that rely on patient agency.
Providers are caregivers who send patients to our market to increase insight.

Payer Value Proposition
Lowering the lifetime cost of subscribers who deliberately choose wellness.
Payers are insurers who send customers to our market to lower risks.

Our pivot gives credence to each of these value propositions. It lets us promise meaningful results to each stakeholder: promises we can reasonably expect to keep. That’s why we quoted Merry Brandybuck on our website, when speaking about those we serve:

You can trust us to stick to you through thick and thin — to the bitter end. And you can trust us to keep any secret of yours — closer than you keep it yourself. But you cannot trust us to let you face trouble alone, and go off without a word. We are your friends.

 

CSF

A Market for Health Literacy quickly achieves social and economic impact.

Reductionism is how we promote science to non scientists. And also how we present opportunity to investors. After all a pitch deck, a commercialization plan, a valuation, a business model: all are simplifications that make innovation easier to understand and risk easier to accept.

A handy tool of reductionism is the CSF: critical success factor. Rather than feeling overwhelmed by the many ways our venture could fail, we focus instead on a few that increase the probability of success. Do we know what our CSFs are?

Reductionism itself is certainly one. By virtue of integrated modeling, simulation, game mechanics, and visualization, we think we’ve come up with powerful technology to handle reductionism efficiently. Consumers become health literate with Humaginarium because we make it fun and easy for them.

Two other CSFs are speed and scale. They mean we must:

  • Make things really fast
  • Offer many different things to a very diverse audience

Pondering these CSFs changes the role of Humaginarium. We’ve been seeing ourselves as product developers; we are pivoting into market makers.

Why? Because product developers can’t make things fast enough, with enough variety, and for enough people, to satisfy customer demand. They are relatively slow and specialized, like a tool maker that comes out with one new tool every so often; relying on it to fire up customers. This is cottage industry. A bad idea.

On the other hand, a market maker is fast and comprehensive. By making a Market for Health Literacy we (along with many other organizations and individuals) can offer a wide range of products and services, all with the common denominator of nudging consumers to wellness.

As the market maker we define standards and protocols for the marketplace. We set the bar high for things like quality and security. And we unleash the creativity and prowess of the market to fulfill our mission.

Market making somewhat follows the examples of Ebay and Amazon, Facebook and Reddit, Wikipedia and the App Store; it doesn’t follow analogs like WebMD or Lumocity. A Market for Health Literacy achieves social and economic impact of great magnitude, far greater than any product development model is likely to attain, in a relatively short time.

This paradigm shift suggests another CSF: reliability (so important in anything to do with health and science). That one’s for another discussion.

Flandrin_Jeune_homme_nu_assis

Scientific entertainment. Variation on Jeune Homme nu assis au bord de la mer, by Jean-Hippolyte Flandrin,

Revenue

Each thing we make will be purchased by as many customers as possible.

The right side of the Business Model Canvas concerns customers: those who want, use, liaise with, or pay for Humaginarium. The cornerstone of the right side is Revenue Streams. Accordingly, everything we believe about customers must boil down to income.

That isn’t how we think about customers when designing for them. We think instead about their practical needs, the experience they’ll have with our products, what they’ll learn, and how that may nudge them to wellness and a better way of life.

It’s tempting just to think that way about design and not mind the cornerstone. “If you build it, they will come.” Maybe that works in a field of dreams, not so much in a marketplace.

So, separate from what we’re doing for customers, we’re deciding what customers must to do for us. We’re sorting out a web of branching revenue streams so that we design more carefully to sustain them.

The branches so far look something like this:

  1. Customers who pay to play. These are consumers of entertainment who pay nothing to start, but then buy subscriptions or features or feeds that enhance their satisfaction.
  2. Customers who pay to learn. These are patients or students who pay nothing to start, but then buy subscriptions or features or feeds that reinforce their therapy or study.
  3. Customers who pay to connect. These are medical product or service providers. They buy ads, product placements, or patient referrals in order to build their businesses.
  4. Customers who pay to collect. These are researchers. They pay for data analytics generated by users of our games, to track consumer choice and behavior.
  5. Customers who pay for content. These are manufacturers and institutions like medical centers. They pay for branded content that introduces products and services to patients.
  6. Customers who pay to advocate. These are organizations that make program-related investments. They pay to sponsor themes, stories, or competitions in order to further their societal agendas.

We’re subdividing these six different revenue streams to reflect skinny customer segments; so that each individual and small group of customers can be optimally served with tailored benefits. At the same time we’re aggregating all six streams in one production path, so that each thing we make is purchased by as many different customers as possible.

Positioning

Like everything we’re doing right now, the elevator story will be tried on hundreds of people.

When we have seconds to say what Humaginarium is, what is it? The answer must be straightforward and intriguing, and elicit a response. Ideally something like, “How does it work?”

Humaginarium still needs an elevator story, but doesn’t have to write it on a blank sheet of paper. There’s a template and it goes like this:

For (target customers) who (have certain needs), the (product name) is a (product category) with a (compelling reason to buy). Unlike (competitive alternatives) our product (is different and better).

Filling the blanks of that template is surprisingly difficult because much of what we think must be left out. No room! The little that gets in has allusive meaning that stirs the imagination and doesn’t cotton to analysis. For that reason an elevator story is a little like poetry.

Few people can write good poetry, or understand it for that matter. Nonetheless we go where angels fear to tread: into the Shark Tank. Here’s what we have so far:

For adults 18 and older who worry about medical unknowns, Humaginarium is video games that increase health literacy and self-awareness; making people good stewards of their bodies. Unlike ordinary entertainment and education, it nudges people to wellness.

Not great, but not too shabby. Like everything we’re doing right now, the elevator story will be tried on hundreds of people from all walks of life. It’s not positioning per se, but a starting position.

Mature

Who the customer is, that’s a much harder question than how something works.

A proverbial stumper for startups is this very basic question: Who’s your customer? After all, the world has managed to turn well enough without your newfangled technology. What if the thing you make isn’t all that useful and worthwhile? Since it didn’t exist yesterday and nobody’s clamoring for it, are you sure of even one customer?

Humaginarium is pretty sure we have hundreds of thousands of customers. Not somewhere on the other side of a blue ocean, but here and now. Whose needs are undermet and whose goals are underachieved.

Our customer is an adult over 17 years old, healthy or not, any gender and ethnicity, any income bracket, any nationality and community. Among  billions of people worldwide who fit that description, our customer is one who plays video games online or downloaded to a device. Our customer has to have at least one modern device, electricity, reasonably fast Internet, and access to Amazon or Google cloud services. He or she can have any level of education but can’t be dumbass stupid. Simple, yes. Dumbass, no.

If you step back and consider these parameters, it’s clear that our customer is “mature.” The Entertainment Software Rating Board uses that word for consumers who are not easily bored by intense violence, blood and gore, sexual content and/or strong language. This is odd because those kinds of people are immature by Humaginarium standards.

Mature for Merriam-Webster and for us means having mental and emotional qualities of an adult, of being fully formed as a human being, and still developing to a desired level. That last clause is crucial, because our mature customer is not done with life no matter how old or impaired. He or she is still learning and yearning.

Maybe the reason why many technology entrepreneurs are stumped by the customer question is they’re makers and doers, while those who know customers are are observers, people who ask questions of others, empathize with them, care about them, make connections and reach fond conclusions about “them” rather than “us.”

Who the customer is, that’s a much harder question than how something works. We’re on it.

RouselSm

Scientific entertainment. Variation on The Reading Girl, by Theodore Roussel

Free

People say they’ll pay nothing, but in reality they pay, almost always with cash.

As Humaginarium develops a pitch to investors, a pre-money valuation, a robust business model, a commercialization plan, even our first working prototype, we’re struggling to answer the thorniest question: What should we charge?

It’s about more than dollars & cents price. It’s also about intrinsic worth, comparable value, fit with lifestyle, emotional appeal, unique affordances, and practical utility. These facets turn price into kaleidoscopic chimeras: none is fixed, each part depends on the others for reckoning, and all lead to the frightening concept of “free.”

Free of charge is frightening because we can’t make Humaginarium for free. If we give it away, we’ll need other ways to pay for it. The obvious way in the digital “freeconomy” is advertising. That’s of little use to a startup because advertisers require a mass audience that takes years to grow; and because advertising tends to undermine the credibility of mission.

Let’s not forget that our products develop insight and skills related to health. Can they do that honestly if we’re hawking snake oil in the margins? That’s what I asked when I learned the business model of Outcome Health, Chicago’s first unicorn. Don’t get me started.

Ask anybody what they would pay for Humaginarium and the answer will likely be “nothing.” Even if they like it, appreciate its benefits, recommend it to others, want to play it endlessly, they’ll still say they want it for free. Accordingly we should charge customers nothing and make money in other ways, like selling user data or product placements.

Yet there’s another view of economic reality. Consider:

  • Humaginarium makes entertainment. Consumers pay for entertainment. Try streaming from Netflix for free and see what happens.
  • Humaginarium makes education. Consumers pay for learning. Try enrolling in the School of the Art Institute of Chicago for free and see what happens.
  • Humaginarium makes therapy. Consumers pay for counseling. Try joining LA Fitness or Weight Watchers for free and see what happens.

Here lies the conundrum. People say they’ll pay nothing for things they need and enjoy, but in reality they pay, almost always with cash. When they don’t pay they wind up with sketchy customer experience. Facebook shows how that business model works.

Humaginarium is not sure how our thorny question will be answered. We’re working on it. The final answer may lie less in what we charge, and more in how we deliver.

Downloads

To prove that we’re actually going somewhere, for those who want to go with us.

The Peak Geek in the Head Shed is molding beautiful web pages from lumps of clay. Little lumps, because nobody’s going to spend hours reading about Humaginarium. Someday everybody may spend hours with our video games, but they’ll be playing and learning.

Right now there’s a downside to brevity: not enough space to tell a story. The website is for investors, business partners, and the media: people who want to work with us. A few who appreciate what we’re doing may want to know more. Will they have to call to find out?

Not at first. We’re attaching downloads to select web pages, so more details are available immediately online, without cluttering our virtual space. The downloads are:

  1. Analogs: companies and products that inspire our approach
  2. Evidence: research indicating our approach works
  3. Framework: concepts that organize our technical innovations
  4. Prototype: how things actually work in the first instance
  5. Business Model: how our company is set up to deliver
  6. Commercialization: how we’ll do well while doing good
  7. Pitch: the elevator version, less than 15 slides
  8. Valuation: what our investors are buying into

Does everybody need to see this material? Not by a long shot. It benefits those who can use it. Us walking the nudge talk. It’s also there to show each other that we’re thinking things through, working things out, sure of our steps and direction, ready to climb the ladder when the roof leaks. There’s nothing like text to prove that we’re actually going somewhere, for those who want to go with us.