How Epic’s 81-Year-Old Billionaire Founder Plans To Keep Her Health Data Empire Private Forever

Forbes

As CEO of the $4.9 billion revenue electronic medical records giant, Judy Faulkner is one of the most powerful people in healthcare. With no plans to retire, she tells Forbes about her arrangement to ensure Epic remains independent and employee-owned in perpetuity.  Read the full story on Forbes: https://www.forbes.com/sites/katiejennings/2024/09/30/epic-systems-billionaire-judy-faulkner-private-independent-never-ipo/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

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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