In this series, we’ll be asking local entrepreneurs and other thought leaders in the Rhode Island tech ecosystem a few simple questions about their work and the ideologies and inspirations that drive it. For this week’s post, we spoke with Joe Nagle of Delta Dental.

Delta Dental of RI President and CEO Joe Nagle may technically work in insurance, but he has been an innovator and a leader in the innovation economy in Rhode Island for years, not only at Dental Dental, but as an overarching driver of entrepreneurship in the Ocean State.

Starting in 1985, Nagle became CFO at Ocean State Physicians Health Plan, which is now United HealthCare of New England. In its early days, he helped transform the startup HMO into a company with $140 million in annual revenues.

Nagle has previously served as vice president of Strategic Planning for Blue Cross Blue Shield of Rhode Island and in 1990, co-founded a healthcare consulting company called The Capstone Group. Then, in 1992, Nagle joined Delta Dental of Rhode Island and for the last 25 years has been solving a problem that only comes with success: How to keep growing in a market when you are already dominating that space.

Additionally, Nagle played a key role in getting MassChallenge to expand to Rhode Island this year.

MassChallenge Expands Program to Rhode Island

Rhode Island Inno caught up with Nagle to discuss his career as an innovator and what’s happening in the state’s startup and innovation economy.

Rhode Island Inno: How did you get involved in the entrepreneurship ecosystem in R.I.?  Insurance can often be seen as a stale business. But you have clearly found ways to be innovative at Delta Dental. How do you find the inspiration to innovate in a business not known as super entrepreneurial?
Nagle: My appetite for entrepreneurship was fueled in part by my personality and also due to Delta Dental’s strategic challenges. In some ways, Delta Dental has become a ‘victim’ of its success. With more than 600,000 Delta Dental members and a more than 20-year unbroken record of profitability, it has become increasingly difficult to grow our membership. As a member of the Delta Dental Plans Association, we are precluded from marketing to companies not headquartered in Rhode Island. With such geographic constraints, and the fact that Delta Dental of Rhode Island is already nearly eight times the size of our next largest competitor, continued significant growth prospects are severely limited.

Joe Nagle. Courtesy photo.

To feed our need for continued growth, we started Altus Dental Insurance Company in Massachusetts, adding more dental memberships beyond our Delta Dental line of business to leverage our technology investments and operational strengths. We recruited a robust network of dentists in Massachusetts and created the new Altus Dental brand. Spreading more membership over relatively fixed costs also enabled us to keep operating expenses low for our Delta Dental members. In fact, today, our operating expenses per member are actually lower than they were 25 years ago when I joined Delta Dental. Altus Dental has been an unqualified success, the most successful PPO in Massachusetts, and today insures approximately 170,000 people, all jobs located right here in Rhode Island.

We have started other successful companies as well. We have formed a health care consulting firm known as Park Row Associates, which assisted our clients in managing health insurance. Later, we formed Altus Benefit Administrators, which provided third-party administrative services such as COBRA and flexible spending account administration for Rhode Island employers. Eventually, we sold both companies after determining they were no longer strategically relevant, and that neither enterprise would ultimately be scalable to the extent we deemed necessary.

But yet every company must grow or eventually wither, so three years ago we we formed Altus Ventures, a boutique venture capital firm, and I recruited Blaine Carroll to run the operation.  Altus Venture’s vision is very complex. Our research and analysis was magnified to identify attractive investments in the start-up community that we could realistically infuse our managerial expertise in addition to our funding.

Rhode Island Inno: What role did you play in expanding MassChallenge to R.I.?  How big is this for the R.I. start-up scene? Do you expect to see R.I. and Providence become a destination for innovation and entrepreneurship in future years?
We have been a big fan of MassChallenge for several years and began our support in Massachusetts. The sheer number and quality of opportunities is quite impressive. But as a Rhode Island company, we were eager to see a more robust presence and support for the startup community nearby. The quality of our academic institutions and the presence of so many successful companies could easily support more activity. So we were excited about the opportunity, along with our friends at FM Global, to make the investments needed to spur MassChallenge to create a satellite location in Providence.  

MassChallenge is actively scouting opportunities that might make sense for Delta Dental to pursue, so it is a great partnership. And Delta Dental, like so many Rhode Island employers, can serve as a critical source of funding for startups here. It’s a different model than the one that relies predominantly on venture funds, but is has distinct advantages as well. So, yes, Rhode Island and Providence can certainly become a destination for innovation. All it will take is a more active role by many of the companies that are already here. If Delta Dental can serve as an example of how this can work, we are happy to do so.

Editor’s Note: Joe Nagle is a 2018 Rhode Island Inno 50 on Fire finalist. Read the whole story on the awards event here