On a recent episode of The Heart of Healthcare, Halle Tecco and I sat down with my longtime friend and collaborator, Emily Melton. We covered a lot of ground, but one theme kept resurfacing: In this market, the founders who succeed are generally the ones anchored by a strong “why,” a deep sense of humility, and a willingness to take their medicine when reality demands it.
Emily put it bluntly: Founding a company, especially in healthcare, is not a rational choice. The path can be hard, long, and uncertain. The founders who endure aren’t driven by optics or momentum; they’re driven by something internal and immovable. Emily talked about founders who’ve lived the problem, who’ve seen firsthand what happens when the system fails, and who treat their work less like a startup and more like a mission. The what of the company will evolve; the why can’t.
We also dug into something we’re both seeing every day: misplaced expectations. A generation of founders came up in a market where everything went up and to the right. But the real stories, even the biggest success stories are full of near-death moments, down rounds, and “sleeping-on-the-factory-floor” stretches. Humility isn’t optional. In healthcare, it’s a prerequisite.
That humility matters now more than ever as term sheets get complicated, extensions pile up, and investors try to avoid pain. Emily, Halle, and I have all seen companies raise money without a plan for what that capital is bridging to. Insiders pass the hat. Boards avoid hard conversations. Some investors push for structures that protect their fund optics rather than the long-term health of the company. And founders (often for the first time) are facing down rounds, recaps, and a very different psychological reality than the one they imagined.
I’ve shared this position numerous times: Take the down round with clean terms over a “flat” or “up” round with toxic structure—every time. I know it’s emotional. I know it’s painful. But bad terms stick with you. Clean cap tables can let you move forward. As Emily said, avoiding reality only makes the problems bigger. You don’t grow out of issues; you face them and fix them.
And here’s the upside: Constraints can unlock better companies. Some of the most iconic businesses only became great because they were forced to operate with discipline. No blank checks. No shortcuts. Just focus, resourcefulness, and clarity of purpose.
Founders who embrace this moment by leaning into their mission, resetting expectations, and dealing honestly with where they are will be better able to build the durable, category-defining companies of the next decade. The ones who cling to the illusion of the last cycle won’t.
It’s not an easy time. But it’s a defining one. If you’re willing to do the hard work, this market isn’t just survivable, it’s an opportunity.