Better Society Capital, through its funds, has now invested in over 150 impact ventures in the UK. Back in 2021 we started looking at what drove success in impact startups. We started seeing how impact was acting as a source of value - how delivering impact drives commercial success. More recently we have been speaking with founders in the portfolio, to understand how they see being an impact company drives their success in building talent, accessing capital, acquiring and retaining customers and working with regulators. I sat down with Finn Stevenson, Co-Founder and CEO of Flok Health, who shared a number of insights from his experience.
First up, how does Flok Health create impact?
Flok Health is the UK’s first AI-powered physiotherapy clinic, enabling NHS patients to access same-day video call appointments for back pain. It is the first platform of its kind to be approved by the Care Quality Commission as a healthcare provider. Musculoskeletal problems, such as back pain, account for 30% of GP consultations in England and waiting lists for treatment have grown by 27% since January 2023. People living with these conditions are living with pain, stiffness, loss of mobility and often, significant mental health implications. As part of a three-month pilot with over 1000 NHS staff, all surveyed patients said their experience with Flok had been at least equivalent to seeing a human physiotherapist and 57% of patients said the AI experience was better. More than 4 in 5 participants reported their symptoms had improved during treatment.
So, how does this focus on providing immediate access to world-class care at scale, not only help society, but drive value for Flok?
We started by asking Finn about talent:
“By far the biggest benefit of being an impact company is talent. As an early stage company hiring the right people is one of the hardest things you have to do, but those you bring into the team will have the greatest impact on what you are trying to achieve. We have attracted world class people who could be in lots of places, but they choose you – with no track record, no revenue, because they believe in the impact we will have.
“Focusing on impact also acts as an operating advantage – a shared belief in something is such a binding force for the team. You want people to be diverse and have different opinions. The unifying central mission creates a cohesive set of values, priorities, and ways of working. It shows us how to tackle forks in the road and think about trade-offs. Our purpose is achieving a population scale impact; we make decisions around that.
“It is really important to make sure that the impact you are having is visible and accessible to the team. We have a slack channel where we report on the delivery of appointments and share feedback from patients. At team offsite days we always include a voice from someone who has been a patient in our service.
“For founders, impact helps with your own personal resilience. Building a company is hard so doing it for a cause you care deeply about is really helpful. It brings that level of relentless determination that you need to stay on the ride.”
We then moved on to asking about if there was any benefit of being an impact company in accessing capital:
“Impact investors with a clear thesis of what they want to achieve make it easier for us to know who to approach. Some people say that when raising finance you should speak to every investor you can find, but that isn’t an effective use of time. You want to be more targeted and have a high quality conversation with them – this is where identifying impact investors who have a clear thesis really helped.
“Once you have investors on board, you have a shared understanding of what you want to achieve. It feels simpler as you are more aligned with your investors
“Being an impact company does expand the pool of investors we can raise from – both impact investors and regular investors, but it also helps us raise different types of capital. For example, we were able to access more funding pots like Innovate UK – one of their main criteria is around impact. Being able to access that non-dilutive funding has been really helpful for us.”
Lastly, we talked about the regulatory process and the ways in which being an impact-focused company helped Flok:
“The crux of medical regulation is a risk-benefit analysis. The regulatory process is judging whether the impact your product or service has is worth any residual risks involved. When you think about impact, it’s both impact per person and the number of people who are going to benefit. We have always been focused on population scale delivery and so the scale of that impact is huge.”
“We had a really positive experience working with the regulators – these organisations want to see better care for patients, and so when you have a service that can improve the lives of millions of patients, they want to work with you to help you reach those patients safely and effectively.”
As a result, Flok Health were able to achieve a regulatory first – they are the first digital MSK service to be approved by the CQC. They are also the first technology to achieve medical device clearance under MHRA regulations to fully automate the triage, assessment, and treatment of back pain.
As the above demonstrates, there are multiple ways focusing on impact at scale has helped Flok on its scaling journey. We are excited to see how they continue to grow, with their AI clinic now operating in the NHS, and scheduled to launch with new NHS partners later this year.