A conference table. Six to ten people around it. A health care startup is being evaluated for a multimillion-dollar investment. The people in the room are smart, with MBAs from top programs, former management consultants, ex-bankers who pivoted into health care venture capital. They have built financial models, analyzed market sizing data, and stress-tested the company’s revenue projections.
They are about to commit capital to a product designed for use inside hospitals, on patients, by physicians.
Not one person at the table has ever treated a patient.
Nobody in the room has ever run a code, managed a ventilator, navigated a prior authorization, or explained to a patient why their insurance will not cover the treatment they need. Nobody has ever been woken up at 3 a.m. to manage a GI bleed, or spent 45 minutes charting after a 15-minute patient encounter, or held a family meeting about withdrawing care.
These are the people deciding which health care solutions get funded. And the people who actually deliver health care, the physicians, the nurses, the frontline clinicians who will use these products every day, are almost never in the room when those decisions are made.
The numbers behind the absence
This is not an abstract concern. Health care is a $5.3 trillion industry, the largest sector in the American economy, consuming 18 percent of GDP. In 2024 alone, over $23 billion in venture capital and $115 billion in private equity flowed into health care companies. That is nearly $140 billion in private capital deployed in a single year to shape how medicine is practiced, delivered, and paid for.
The vast majority of that capital is allocated by investment professionals with no clinical background. They rely on market reports, consultant interviews, and management presentations to evaluate whether a clinical problem is real, whether a product will be adopted, and whether a health care company can scale.
Physicians, the people with the deepest understanding of how health care actually works at the point of care, participate in almost none of this capital allocation. They are not on the investment committees. They are not on the advisory panels that matter. They are not in the rooms where the checks get written.
What gets lost when physicians are not in the room
I have seen what happens when health care investment decisions are made without clinical input. I have seen it from both sides, first as a physician watching products arrive at my hospital that nobody on the clinical staff asked for, and later as a health care investor watching colleagues evaluate deals without the clinical context needed to assess them properly.
When physicians are not in the room, three things consistently go wrong.
First, capital flows to problems that look important on a slide deck but are not painful enough at the point of care to drive adoption. I have reviewed companies with FDA-cleared products, published clinical data, and institutional backing that could not gain traction because the clinical problem they solved was manageable with existing tools. The investors who funded those companies did not know that because they had never managed the condition themselves.
Second, products get designed for how investors imagine health care works rather than how it actually works. A surgical device that adds two extra steps to a procedure surgeons have optimized for speed. A patient app that requires behavior change nobody will sustain. A hospital platform that needs IT integration the already-stretched technical team cannot support. These design failures are invisible to a financial analyst reviewing a TAM slide. They are immediately obvious to a physician who lives inside the workflow.
Third, reimbursement assumptions go untested until it is too late. I have seen companies build entire business models around billing codes that are under review, reimbursement pathways that require new CPT code applications, a process that can take years, or payment assumptions that do not survive contact with how hospitals actually make purchasing decisions. A physician who has navigated these systems from the clinical side can identify these gaps in minutes. A financial analyst often does not discover them until the company runs out of runway.
What changes when physicians are in the room
After transitioning from clinical practice to health care venture capital, I built a network of over 200 physicians across more than 20 specialties. When a health care deal comes across my desk, I do not evaluate it with a financial model first. I send it to the physicians who would actually use the product.
The difference in signal quality is enormous. When five surgeons independently tell me that a device does not solve a problem worth solving, that is not an opinion, it is a clinical consensus that no consultant report could produce. When 17 frontline health care professionals validate a product and describe the specific workflow pain it eliminates, that is adoption data you cannot buy. When 10 specialists review a therapeutic and six of them invest their own money, that is the highest-conviction validation signal in health care investing.
None of this happens in a traditional investment committee. It happens because physicians are in the room, not as decoration on an advisory board, but as the primary evaluators of whether a health care product deserves capital.
The question we should be asking
The conversation about physician involvement in health care investing is usually framed as an opportunity for physicians, a way to diversify income, build wealth outside of clinical practice, or explore an alternative career path. Those are all valid reasons.
But I think the framing is backwards. The question is not whether physicians would benefit from being involved in health care capital allocation. Of course they would. The question is whether health care capital allocation can continue to function well without them.
Nearly $140 billion per year is being invested in products designed for physicians, patients, and health systems, by people who have never been any of those things. That is not a physician problem. That is a health care system problem. And until physicians have a meaningful seat at the capital allocation table, we will keep funding solutions that look compelling in a boardroom and fail at the bedside.
We train for over a decade to understand health care at the deepest level. We should be the ones deciding where the resources go.
Harsha Moole is an internal medicine-trained physician-scientist with more than 100 peer-reviewed publications, including work featured in the New England Journal of Medicine. After years of clinical practice and gastroenterology outcomes research, he made an unconventional transition from the bedside to the boardroom by founding PhysicianEstate, a health care-focused venture capital firm.
Over the past seven years, Dr. Moole has made 22 early-stage health care investments across digital health, medical devices, biotech, and therapeutics. He has also built a network of more than 200 physicians from institutions such as Johns Hopkins and Stanford who help source opportunities and provide clinical diligence before capital is deployed. His core thesis is that physician-scientists with firsthand clinical experience are uniquely positioned to identify health care investments that generalist investors often miss.
His research background is reflected in his publication record on Google Scholar, and he shares professional updates on LinkedIn.
