00:00Today on Forbes, how Epic's 81-year-old billionaire founder plans to keep her health data empire
00:07private forever.
00:10Judy Faulkner takes the stage at Epic Systems' annual customer meeting, where 7,000 healthcare
00:15industry executives have gathered.
00:18Faulkner is the founder and CEO of Epic, a company with $4.9 billion in annual revenue,
00:24whose medical records software is used for 325 million patients worldwide.
00:30Her audience has made the annual pilgrimage to Epic's quirky, book-themed 1,670-acre
00:36headquarters in rural Verona, Wisconsin, to hear the latest news about the tech that many
00:42rank-and-file doctors love to hate.
00:44Faulkner, a computer programmer who founded Epic in a basement in 1979, has bucked convention
00:51from day one, starting with the company dress code, which is, quote,
00:56When there are visitors, you must wear clothes.
01:00While competitors like Cerner, now Oracle Health, Allscripts, now Veridime, and Athena
01:05Health grew by taking venture capital money, executing mergers and acquisitions, going
01:11public and then private again, Faulkner has eschewed any outside interference.
01:17This mentality is enshrined in the first two of Epic's Ten Commandments, which hang
01:22on the wall in a campus bathroom, quote,
01:24Number one, do not go public.
01:28Number two, do not be acquired.
01:32And she intends to keep it that way.
01:34At 81 years old, Faulkner is the same age as President Joe Biden, whose disastrous debate
01:39performance ignited concerns about his age, health, and fitness for office and led him
01:44to withdraw his bid for a second term.
01:47Faulkner, whose keynote lasted one hour and 24 minutes, tells Forbes she has no plans
01:52to retire.
01:54She says, quote,
01:55If you retire, you don't have a purpose in living much anymore.
01:58Working keeps you alive and going.
02:00It's really good when what you do is bigger than yourself.
02:05Over the past 45 years, Faulkner has become one of the most influential people in the
02:09$4.5 trillion U.S. healthcare system.
02:13Epic's software is used for patients in more than half of the 890,000 or so hospital beds
02:18in the U.S., according to estimates from the health IT research firm, Class.
02:24The big unknown is whether Epic's dominance will persist after its exacting visionary
02:29leader is no longer at the helm.
02:31Plus, the hospital market is saturated.
02:35Epic's next stage of growth will have to come from inroads with new customer groups, like
02:39health insurers, medical devices, and laboratories.
02:43One such move recently prompted an antitrust lawsuit alleging Epic holds a monopoly on
02:48electronic health records.
02:50Charges of the company dismissed as quote, baseless.
02:53Forbes interviewed Faulkner prior to the lawsuit.
02:56Faulkner says she has already set a plan in motion to ensure that Epic remains private,
03:01independent, and employee-owned in perpetuity.
03:05She currently owns nearly half, or quote, high 40s, percent of Epic, and Forbes estimates
03:11her net worth to be around $7.7 billion.
03:15Faulkner ranks No. 154 on the 2024 Forbes 400 list, which we just released on Tuesday.
03:23The rest of the company is owned by employees and a handful of Faulkner's family members.
03:29Faulkner has retained all of Epic's voting shares, which, upon her death, control will
03:34be shifted to a trust governed by four of her family members, her husband Gordon, who's
03:3980 years old, and three children, and five longtime senior manager employees at Epic.
03:45In line with Epic's Ten Commandments, she says the trust rules prohibit an IPO, sale,
03:51or acquisition, and stipulate that the next CEO, quote, has always got to be a long-term
03:56Epic employee and a software developer.
04:00Faulkner has started selling portions of her non-voting shares back to Epic, with the
04:04proceeds going to her family foundation Roots and Wings, which was established in 2020.
04:10Her philanthropic efforts are focused on early childhood development, including health, education,
04:16safety, and basic needs for kids and families.
04:19Once sold, Faulkner's non-voting shares are offered to Epic employees.
04:24She says, quote, eventually it's going to be pretty much all owned by employees and
04:29my family.
04:31For full coverage, check out Katie Jennings' piece on Forbes.com.
04:36This is Kieran Meadows from Forbes.
04:39Thanks for tuning in.
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