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  • February 2015 (Revised June 2017)
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Intrapreneurship at DaVita HealthCare Partners

By: Joseph B. Fuller, David J. Collis and Matthew G. Preble
  • Format:Print
  • | Language:English
  • | Pages:28
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Abstract

Josh Golomb, president and general manager of DaVita Rx (Rx), was about to meet with Kent Thiry, CEO of Rx's corporate parent, DaVita Healthcare Partners Inc. (DaVita), in August 2013. The two would discuss whether Golomb should lead a new DaVita venture, Paladina Health (Paladina), which operated a network of primary care clinics.
DaVita had launched Paladina in early 2011, and the startup was struggling to gain traction: Paladina had already used a significant amount of the $40 million in funding committed by DaVita; the company's primary care clinics had not yet reached the number of patients necessary to sustain a profitable business; and it was in the midst of trying to integrate with another primary care clinic operator that it had acquired years earlier but was just now merging into Paladina.
Although the startup was young and still finding its way in an emerging industry, Thiry believed that Paladina would benefit from Golomb's experiences at Rx, which had also struggled in its early years. The situation at Rx became so precarious at one point that many of DaVita's senior leaders wanted to shut it down entirely. Rx made it through those challenging early years though, and was expected to exceed $600 million in revenues for 2013.
However, Golomb wondered how relevant his Rx experience was to Paladina. Rx was closely tied to its parent company—DaVita provided dialysis services to patients with end-stage renal disease (ESRD) and Rx supplied medications to ESRD patients—while Paladina's connection to DaVita was less obvious. If Golomb took the job, what could he do to make Paladina's clinics as efficient as possible in terms of service and its economics, without compromising on its value proposition? Was Paladina just too different of a business to be part of the DaVita family?
This case offers an example of "intrapreneurship"—i.e. entrepreneurial ventures launched within large companies—at a Fortune 500 company. DaVita has already had a successful experience launching Rx (after some difficult early years), and the company is now even serving patients from some of DaVita's leading competitors. However, Paladina is the company's first intrapreneurial venture outside of its core focus of serving end-stage renal disease (ESRD) patients—DaVita's main function is to provide dialysis services to ESRD patients and Rx provides medication to ESRD patients. Can Paladina succeed simply by following Rx's example, or will it face different challenges?

Keywords

Intrapreneurship; Entrepreneurial Organizations; Startup Management; Startup; Strategic Positioning; Corporate Entrepreneurship; Corporate Strategy; Business Startups; Strategic Planning; Competitive Strategy; Health Industry; United States

Citation

Fuller, Joseph B., David J. Collis, and Matthew G. Preble. "Intrapreneurship at DaVita HealthCare Partners." Harvard Business School Case 315-046, February 2015. (Revised June 2017.)
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About The Authors

Joseph B. Fuller

Entrepreneurial Management
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David J. Collis

Strategy
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Related Work

    • August 2016 (Revised August 2016)
    • Faculty Research

    Intrapreneurship at DaVita Healthcare Partners

    By: Joseph B. Fuller and Matthew Preble
    • January 2017
    • Faculty Research

    Intrapreneurship at DaVita HealthCare Partners: Cash Flow Tool

    By: Joseph B. Fuller and Christopher Payton
    • February 2015 (Revised June 2017)
    • Faculty Research

    Intrapreneurship at DaVita HealthCare Partners

    By: Joseph B. Fuller, David J. Collis and Matthew G. Preble
Related Work
  • Intrapreneurship at DaVita Healthcare Partners By: Joseph B. Fuller and Matthew Preble
  • Intrapreneurship at DaVita HealthCare Partners: Cash Flow Tool By: Joseph B. Fuller and Christopher Payton
  • Intrapreneurship at DaVita HealthCare Partners By: Joseph B. Fuller, David J. Collis and Matthew G. Preble
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