James Whittaker spent 16 years in the hearing and audiology sector before he founded Resonate Health to disrupt an industry that many ageing New Zealanders need.
His claim is to democratise hearing health by embracing the subscription model rather than sales.
Resonate customers subscribe to hearing aids for $90 a month, against the $10,000 upfront it can cost to buy a pair from his company's competitors.
Whittaker is shortlisted in the startup category of the inaugural BusinessDesk CEO Index. In three years, he has opened 29 Resonate clinics and has thousands of subscribers. He believes audiology is about overall health, not only hearing.
“It’s not called Resonate Hearing, it’s Resonate Health, very deliberately, so that it gives us the opportunity to think more broadly,” he says.
BusinessDesk asked him for his experience in dealing with the five criteria in the CEO Index: resilience, vision, impact, innovation, and influence.
Resilience: In the first six months after Resonate's launch, Whittaker decided to introduce an ear-cleaning system from the US to encourage more customers through the door.
For clients who were regularly having ear cleaning, the system worked fine, but for people who had neglected their ears for years, it didn’t work so well.
“The machines were breaking down quickly and we were really starting to struggle with customer service,” says Whittaker. “I had a real problem, because I had to sit down with the board and explain I had spent a lot of their money – about $100,000 – on a system that wasn’t going to work.”
From the outset, the CEO has had funding from private equity group Tahua, which also backs Starbucks, Burger King and No.1 Shoes. The British-born entrepreneur knew he was putting their relationship to the test with this challenge.
He found a new system, TympaHealth, in the UK, developed by an ear, nose and throat (ENT) surgeon. It is a fail-safe system for ear cleaning which Whittaker says has been brilliantly consistent.
“It became this wonderful success story out of what was a horrible six months in the startup phase. That was probably the biggest thing that we have faced.”
Vision: From the outset, Whittaker used his experience in audiology to focus on a clear vision for customers and for people who work at Resonate.
“The vision is actually to be a healthy ageing company, not a hearing aid company, and so it completely changes the way we think.”
In time, the founder expects to go into other areas for an ageing population – skin analysis, for instance – but he says there is more to be done with Resonate
Impact: Whittaker is determined to create a world-class service. On the globally recognised Net Promoter Score system, Resonate already scores 85 out of 100, he says. The business also tracks impact through referrals that customers make to friends and family.
Whittaker says he has to explain his impact to the board each time he wants to open a new Resonate clinic. “Every time I want to build a new one, I have to go back to the board for approval, so they are measuring what I have told them I would do, and largely we’ve delivered all the things I said we would do.”
Innovation: The key innovation at Resonate is the disruptive subscription model. While other newcomers could copy him, the global hearing aid manufacturers won’t. They prefer the up-front cash from people buying a new pair of aids.
Whittaker knows that, because he trialled the system when he was CEO of the NZ arm of globally owned Triton Hearing and its head office in Switzerland closed the scheme down rather than deploy it more widely because of the way it deferred cash flow.
Whittaker also argues that Resonate's structure is itself innovative. With 75 employees – 37 of them audiologists – there is no hierarchy: “We facilitate huge amounts of accountability, responsibility and autonomy for all of our studio teams out in New Zealand because they’re the ones meeting our customers on a daily basis. We give them a framework, but they tailor what they do.”
Communication is key, he adds. Every morning, the whole company jumps on a Microsoft Teams call, an open forum for new ideas and issues.
Influence: Whittaker says he wants his customers to influence him and the direction of the company. He says 1550 of them so far have given Resonate a five-star review.
He reckons he is recognised by competitors and others in healthcare as a challenger. “I would say in the audiology industry itself, the other players in the industry, I don’t get any Christmas cards from them because I am a positive disruptor.
“We’re so accessible, affordable and transparent, and nobody knows how to compete with us,” he says.
Newspaper publishers have no complaints. Along with retirement homes, hearing aids have become a mainstay source of advertising revenue in traditional print media, still beloved by increasingly deaf Boomers.
If that sounds cynical, Whittaker argues that being able to hear is fundamental to remaining connected to the world. For the elderly, social isolation can accelerate mental and cognitive decline. Being able to hear is good for your health.
A good book: Winning on Purpose: The Unbeatable Strategy of Loving Customers by Fred Reichheld. “He says if you love your customers, they will love you in return, and he is absolutely right. It’s exactly what happened to us at Resonate,” says Whittaker.
Sliding doors: If he wasn’t doing what he’s doing, the Resonate founder – who once worked at British Airways – says he would like to be the head of HR at Air New Zealand. How interesting it would be to be head of all that human resource, he says, "but also understanding how a business works in all the different facets, too".
(A reference to subscriber numbers has been amended in this article.)
James Whittaker is a finalist in the startup category of the inaugural BusinessDesk CEO Index. The category winner will be announced on Nov 18. BusinessDesk will publish a report on the overall winner on Nov 19.
Read more of the BusinessDesk CEO Index here.
