I recently came across an interesting article in Entrepreneur magazine authored by Girish Navani, CEO and Co-founder of eClinicalWorks. If you read this site, you know doubt are familiar with the quite popular eCW EHR software. In this article Girish gives some interesting insight into the future of eCW as a company:
After grad school, I set out to create my own version of my father’s bridge. After working many odd jobs developing software, I created credit check software for an acquaintance’s business. This made him a lot of money, which prompted me to ask (perhaps naively) for a share of the profit. I had developed a very successful facet of the company – didn’t I deserve it? His response surprised me, but I will never forget it. He said, “If you build something you like, don’t sell it.”
Twenty years later, I still remember my acquaintance’s advice. For that reason, my company, eClinicalWorks is, and always will be, a privately-held company. I have no interest in selling it, regardless of any offer I may get. In addition, we don’t use investor cash or spend money we don’t have.
This is not a philosophy that is unique to eCW. #1 on Epic’s list of principles is “Do not go public.” I imagine that Judy Faulkner (CEO of Epic) has a somewhat similar philosophy to Girish. There are certainly a lot of advantages to not going public and most of them get down to control. I’ll never forget when I heard one of the Marriott children talk about their decision to stay a private company. He said that Marriott would likely be a lot bigger if they had become a public company, but they would have lost a lot of the company culture if they’d chose to do so.
I imagine this is a similar feeling that Epic and eCW share. However, there’s also some accountability that comes with being a public company as well. It’s not easy for an organization to assess the financial well being of a private company. During the golden age of EHR which we just experienced, that hasn’t been an issue for either eCW or Epic. However, as we exit this golden age of EHR that was propped up by $36 billion in government stimulus money, the financial future may be quite different.
As in most things in life, there are pros and cons to staying private or going public. It’s interesting that two of the major EHR players (eCW and Epic) have made it clear that they have no interest in ever going public. We’ll see how that plays out long term.