The Lemonade Stand: Diabetes Diagnosis Leads to Healthy Businesses

The Lemonade Stand

In 1994, David Kliff learned he had diabetes. Unlike the millions of others who get this glum diagnosis he looked for and found ways to help himself and others, and to make money along the way.

The Chicagoan started two businesses that center on diabetes. One, DiabeticInvestor.com, provides information investors can use to make informed decisions about companies that produce drugs and devices to treat diabetes. The other, HealthyOutcomes.com, allows users to learn about diabetes by playing online games, reading articles and contacting endocrinologists and diabetes educators with questions.

The Investor website played on his background as an investment adviser for a money management firm. The subscription-based site follows and reports news, and sometimes breaks news itself. When Pfizer released a drug called Exubera, Kliff says, "Everyone else was saying this would be mega blockbuster drug; I kept telling everyone it would fail," he says.The company pulled the drug after barely a year on the market, so, "ultimately, I was right," he says.


Relying on Family For Business Number Two

Kliff is hoping to woo a critical mass of the 24 million diabetics in the US. by allowing people who use his Healthy Outcomes site to accumulate points for doing so. Instead of free trips, this loyalty program wins users merchandise like diabetes-friendly beverages and glucose meters, which cost about $50 if a patient has to buy one.

Kliff relied heavily on in-house help to develop Healthy Outcomes, literally-his wife and brother-in-law gave him some of his best ideas for it.

"For years I had been writing that the industry wasn't doing enough to educate patients, so I told my wife Debbie, who is a web site designer, that I wanted to offer patients a free web site where they could learn," Kliff explains. "My target audience was adults with diabetes." He reasoned that children have parents to help them and seniors "would prefer to receive their education from the guy in the white lab coat." The adults in between, however, embrace the internet and self-education.

He and his wife were working on the site when Kliff's brother-in-law, Chuck Feldman, dropped in. Feldman was the president of a promotional products company and an expert in incentive programs. "He told us that if we offered incentives, people would be more likely to participate in what we were working on. And Healthy Outcomes as it stands today was born."


Small Company Attracts Big Names

Major companies like Johnson & Johnson and Medtronic provide the products for Healthy Outcomes. They signed on, despite the start-ups small size, because of its niche audience.

"Ninety percent of our registered users have diabetes, 62% use insulin, nearly 70% monitor their glucose levels three or more times each day and 78% are 31 to 64 years old," Kliff explains. Moreover, "Healthy Outcomes does not have an agenda other than to educate patients, empowering them to take control of their health and wellness. These companies understood that educated patients would use more of the products they sell."

Kliff says his site appeals to diabetics more than other sources of information because it's a low pressure environment. "We respect our users and don't tell them they have to do anything. Our role is to provide information and allow the user to use that information any way they please," he says.

The fact that Kliff is a diabetic himself lends an added level of credibility to the websites. By combining expertise and personal experience he's been able to help people make savvy investment decisions and better health-care choices. Everybody wins.

The Lemonade Stand is a series about entrepreneurs finding new niches in old areas and profiting. These people have made lemonade out of lemons to great success.

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