AlleyCorp Founder Voices: Kristin Muhlner
Kristin Muhlner is Co-Founder and CEO of Affect Therapeutics, an AlleyCorp incubation tackling substance use disorder.
Introduction
We’re thrilled to feature Kristin Muhlner, co-founder and CEO of Affect Therapeutics, on the AlleyCorp Blog. Affect Therapeutics is a trailblazing digital health company delivering the world’s first evidence-based, substance-specific recovery program for stimulant use disorder.
Affect is an AlleyCorp incubation, and part of a growing portfolio segment in the healthcare space, which includes Reside Health, Diana Health, and Nomad Health. Recently, we launched a $100M Healthcare Fund, led by physicians Dr. Brenton Fargnoli and Jeff De Flavio, M.D, who is also a co-founder of Affect, to fuel this growing focus area.
“Improving the quality of addiction medicine is critical, as the death toll from the overdose epidemic continues to increase unabated,” said Dr. De Flavio. “It's been an honor to co-found Affect Therapeutics with Kristin Muhlner and Rachel Lin, as we are bringing highly-effective and life-saving treatment to people who would otherwise go without it.”
Kristin Muhlner is an accomplished executive who’s led numerous high-growth technology companies, bringing over two decades of experience to her role at Affect Therapeutics. We’re thrilled to have her on the blog this month to talk about co-founding Affect, the profound impact the company has already had, and insights garnered from across industries.
一 The AlleyCorp Team
Kristin Muhlner, Co-Founder and CEO of Affect Therapeutics
Affect Therapeutics is using technology to revolutionize addiction treatment. Tell us about what you do and the patients you serve.
Affect Therapeutics is a digital health company treating addiction — initially focused on methamphetamine, crack, and cocaine use disorder. Our smartphone app provides an integrated digital treatment program that’s always with a patient, giving them a discrete, accessible, and comprehensive way to access the help they need. The app provides a window into our entire treatment system, including secure telemedicine-based counseling and doctor appointments, private biologic screens, daily therapeutic tasks, appointment management, and progress tracking. The app also delivers rewards and incentives, including cash, for program adherence and streaks of sobriety. These incentives, known as contingency management, help drive patient engagement and motivation.
When we first started out, we were specifically focused on stimulant addiction. But as entrepreneurs, it’s important to listen to feedback and signals from the communities we work with, and the demand we saw from health insurance payers let us know that there was a need for this sort of intervention across other substance use disorders as well. As a result, we are launching our alcohol use disorder treatment program next quarter, and we’ll continue to expand our offerings so that we can serve a wider population and be equipped to deal with individuals with poly-substance use challenges.
We are currently serving members in California and Arizona, with Kentucky, Nevada, and Ohio coming online by the end of the year. And our goal is to build the largest nationwide provider network of addiction treatment programs leveraging contingency management in the country.
What inspired the founding of Affect Therapeutics?
The idea started with my co-founder Dr. Jeff De Flavio, who’s an Entrepreneur in Residence and Partner at AlleyCorp. He was troubled by the explosive growth in methamphetamine and cocaine use disorders and associated overdose deaths, and that there seemed to be no treatment specifically designed for this population. As he dug more deeply into it, speaking with advisors in the space, he learned that some of the most evidence-based treatments have not been widely available or effectively used.
Then the pandemic hit, and with the growth of telemedicine and the recognition that some of these evidence-based interventions were better delivered in a digital setting, the concept for Affect Therapeutics really took form. Once Dr. De Flavio realized that a digital platform made a lot of sense, that’s when I was introduced to him, since that’s my background. And then we got to work.
What lessons learned from other industries informed the strategy of Affect?
It’s interesting because when I stepped into the space, I was really shocked to see the extraordinary scarcity of data that would allow us to analyze patient state and patient activity in relation to patient outcomes. That lack of data is not unique to substance use disorder treatment. It's broadly true in healthcare, particularly true in psychiatry, and especially true in addiction psychiatry.
And, you know, in e-commerce, where I’ve built a lot of my career, we've known for decades how to use data to identify a prospective customer, draw them to our offering, to our website, educate them on what we do, use some sort of economic incentive to get them to take some behavior that they probably wouldn't have done otherwise, and then get them to do that over and over again.
That’s exactly what we’re trying to do here, with the goal being to have potential patients become interested in trying a new treatment approach, download our app, and ultimately, stick with it and stay on their sobriety journey.
But without robust data, it means providers are often using very blunt instruments to treat people. This is frustrating, because technological innovation has created such extraordinary machine learning tools that are at our fingertips, that could allow us to look at a patient and say: okay, he’s exhibiting these sorts of behaviors, or she’s presenting in these sort of ways over time, and then ask how we need to modify the treatment and what clinical decisions can be enabled through better decision support capabilities on the backend. So for example, we might ask “What events have happened in the last 24 hours that may increase this patient’s risk profile, including anxiety level, biometric information, sleep data, exercise?”, etc. All that information could be available to help customize treatment.
If you consider traditional treatment paradigms, counselors may see a patient once a week and then write some unstructured notes. In contrast, we're capturing hundreds of digital data points, right from patients. And over time that data will allow us to develop patient phenotypes and journeys, correlate these with patient outcomes, and develop customized care models that improve overall health.
This is a huge opportunity to individualize and improve care. Because of this, data is our north star.
One industry that people may be surprised to learn we sought inspiration from is actually the gaming industry. Ages ago, I remember reading an article where the CEO of Zynga said, “Everyone thinks we’re a game company, but we’re not. We’re a data company.” His comment sort of stuck around in the back of my mind. And so when we started looking at this issue, I realized, we have an opportunity to do the same thing here: we have an opportunity to leverage the best thinking from e-commerce, from games, from social networks, and have really finely tuned engagement.
So that's when I reached out to our advisors and asked if anyone knew a leader in the gaming industry. And it turned out Kevin did — Strauss Zelnick, a friend of AlleyCorp, has long been in the industry and had some great connections. And he introduced us to Haden Blackman, who is now one of our formal advisors, and one of the most celebrated game writers and game designers in the country. During our very first conversation, I probably took seven pages of notes.
There is a lot to learn from gaming, about how to keep people engaged and coming back to a platform. And while this is certainly a different situation and we don’t want to infantilize the process of recovery, we also know that there is a lot we can learn from very smart people across industries who can bring new perspectives on how to drive engagement and use data, so we can better serve our patients.
What has it been like being part of an AlleyCorp incubation?
One of the biggest initial reasons I wanted to join the founding team was the opportunity to work with AlleyCorp. Kevin, Brenton, and Jeff all have extraordinary reputations. They have a pragmatic approach to investing and advising which I really appreciate. I think this is because they have all been operators, and not purely been on the investment side of the world. I think this gives everyone around the table a much more nuanced perspective of what management is dealing with and what's realistic, what the timelines really are likely to look like and so on.
Throughout my career, I've had the opportunity to work with a number of the tier one venture investors in the country. And one thing that has continued to be true is that often, it's the company with the longest legs that wins. There are always going to be exogenous factors like economic cycles and new entrants. If you have investors who understand those factors and have experienced them first hand and are willing to have your back as you navigate those challenges — that is very key.
Helping people stay sober is such important work. Is there a moment or moments that stand out to you as especially rewarding from your time leading Affect Therapeutics so far?
Oh, wow. There are a million moments. Seeing patient feedback saying things like “You guys changed my life” or “I’m so excited to give my kids a sober dad for Christmas,” makes me feel so grateful to wake up every morning and do this work.
I spent a lot of my career selling software to people who, candidly, didn’t really need it, or selling home decor, which, is of course nice to have, but it’s not essential. But doing this work, I can palpably feel the impact, and that’s extraordinary. It’s so galvanizing for the business because we know these moments are so precious; they are so priceless.
From the beginning we said: no dollar wasted here. Because, what’s the amount of money that it’s worth to save a life for a family, or a network of families? It’s incalculable.
How did you first know you were having an impact?
When we put together our initial field study in California, all our research advisors warned us that it would probably take weeks to enroll patients, and that we needed to set our expectations that this was going to be a long process. So when we initiated our first advertising campaign, I told our team, “Alright guys, be patient.”
And then a member of our team, Rachel, called me about 30 minutes later and said, “Shut it off!’ I was worried something was wrong; I asked her what was going on and she said we were inundated with demand and she couldn’t respond to it all, so we needed to pause the advertisement. So that really told us, wow, there’s a lot of pent up need for this out there.
And then we saw the impact once we enrolled patients. Unfortunately, in addiction treatment for this particular population — for methamphetamine and cocaine — typically something around 85 percent of people fall out of treatment. Recidivism and relapse is extremely high. Before we started, the most reliable numbers we could find showed that a traditional eight week outpatient treatment program for methamphetamine use disorder could retain about 23 percent of patients. Our retention rates at eight weeks were about 50 percent. And this was our early feasibility work, before we had done any sort of optimization or refinements after interviewing this initial patient group.
It was such an eye opening experience. I remember calling one of our advisors, Fred Muench, who works at the Partnership to End Addiction, and sharing our retention numbers, and he whooped, and screamed for joy! It was so wonderful. For people who've worked in this space for a really long time, it's hard not to get ground down by it because it's just so hard to see results. So seeing those numbers, it was such an important indication of what our opportunity was and the impact we could have.
You’ve been CEO of a number of companies, but this is your first time as a founder. What’s been different about this experience?
It’s funny. Because I've been in leadership at a number of startups, people sometimes assume I'm a serial entrepreneur, but I’m not. This is actually the first business I've ever co-founded. From a personality perspective, I’ve always felt like I’m an operator and not an entrepreneur. My risk profile is not the typical sort of entrepreneur profile— where someone comes in with an 18-wheeler of magic fairy dust and dumps it on the board room table. I'm not that person. I'm very pragmatic; I'm much more of an operator. And so most of my career, and all of my prior CEO and President positions, have been kind of Rescue Ranger positions where I came in where there was a need to turn things around, make operational improvements, build and grow things and prepare them for sale.
This has been a new experience for me and one of the opportunities it provided was that I didn't have to inherit a culture. We were able to create it from the outset, and to be really intentional about creating it, as opposed to just falling into habits from prior workplaces.
For example, I think everyone pretty much uniformly hates performance management, and thinks it's the biggest waste of time ever. Like “evals are dumb, no one gets anything out of them.” If you're a good manager, you should be constantly communicating with your staff about how they're doing, and everyone should know what their goals are. So if you've got the right culture in place it's, to a certain extent, superfluous. If you don't, and things are coming up for the first time during this process, then performance reviews are just a bandaid over a deeper problem.
But what everyone does, typically, as they build businesses, they put in an evaluation and performance management process first, but they wait to do leadership training only after they've had some issues. It’s only after things are off track that you hear, “You know, we recognize that all of our leaders don't know how to do interviews or retain staff or conduct performance reviews, so we should do leadership training.” But that's kind of backwards. Shouldn't we do those in the reverse order? Shouldn't we actually cultivate our leaders as we build our company? I mean, early on we’re mostly leaders anyways, so shouldn't we do leadership training first? And build really capable leaders and managers, and then let performance management be a secondary outcome of that, as opposed to the thing that we do initially?
And so it's those areas where we're trying to stop and think about why we do things the way we do them and how we can do them better. And that's been a fun process – to have that level of intentionality about culture design.
You’ve run a number of technology companies, in a number of industries. What lessons remain true across these experiences?
There are a couple things I’ve learned having done this a number of times. I think first and foremost, if your business requires perfect execution, you should probably find a different business. If you find yourself saying “Well, if we have perfect sales execution, and we close everything we touch, then we’ll hit our numbers,” then you haven’t got it. You’ll know when you have it.
There’s a dramatic difference between excellent product/market fit and not. You might come up with a nice idea and get a vague signal of demand, and think you can build a business from there, but there’s really not enough.
But if you have product/market fit, then there is room for the sort of messiness that often comes with a high-growth startup, and which is in many ways necessary for growth. If at the core you have a solid product that serves users well, then you have room to iterate and optimize. If your company’s survival depends on perfect execution from the start, then it’s only a matter of time before something small going wrong that sends the whole house of cards tumbling.
That is one of the reasons Kevin is amazing as an investor, because he’s been an operator. He is laser focused on getting the product right because he realizes that if you have product/market fit, then everything else will follow. And I couldn’t agree more.