The Story of AppliedVR: Building the Future of Digital Medicine

Entrepreneurial journeys rarely follow a straight line. In a recent Category Visionaries episode, AppliedVR founder Matthew Stoudt shared how his path to revolutionizing pain treatment started with bubble gum and led through gas station advertising before finding its true purpose.

The Entrepreneur’s Journey

“I’ve always been an entrepreneur at heart,” Matthew recalls. “Even when I was a little kid, I was causing havoc at school, creating bubblegum empires where I was selling things to kids that they couldn’t get access to.” This early entrepreneurial spirit would shape his entire career trajectory.

After college, Matthew followed the traditional route through investment banking and private equity. But the entrepreneurial itch remained. His first startup in 1999 was prescient – a virtual hard drive service that predated Dropbox. While that venture ultimately didn’t succeed, it taught him a crucial lesson about staying true to vision rather than chasing trends.

“We morphed and we pivoted and we started to pursue other things that sounded hot and cool at the time,” Matthew explains. “We completely broke away from that original idea of a virtual hard drive… Sometimes you got to come up with an idea that fits with the right time and space and market need.”

Finding the Right Problem

The journey to AppliedVR began with a recognition of a massive, underserved healthcare crisis. “In the US, there are about 100 million sufferers of chronic pain, about 1.5 billion around the world. And in the US, we spend about $650,000,000,000 a year trying to address it,” Matthew notes. Even more striking is his observation that chronic pain is “bigger than the combination of diabetes, cancer and heart disease.”

But the real insight wasn’t just about market size – it was about understanding why existing treatments weren’t working. “We have always viewed chronic pain as if it’s acute pain,” Matthew explains. “We give people NSAIDs, things like Tylenol, Advil, then we give them opioids, and then we give them injections, and then we give them implants, and then we give them surgery, surgery. But we don’t fundamentally treat it for the condition that it is.”

Building the Solution

The technology to address this problem had existed in research labs since the 1990s, but as Matthew notes, “The challenge you had in this case was the technology weighed 50 pounds, cost $50,000, and so it was confined to the laboratory, to the world of isn’t that interesting?”

To bridge this gap between research and real-world application, AppliedVR partnered with Beth Darnall, “probably the top pain psychologist in the world out of Stanford.” Together, they developed an eight-week therapy program that patients could use for just six minutes a day, teaching essential skills for pain management.

The Future Vision

Looking ahead, Matthew sees VR evolving into “a healthcare hub in the home” – though he’s realistic that this is “probably more in the eight to ten year time frame.” The goal isn’t just widespread adoption, but fundamental transformation of healthcare delivery: “This idea that VR immersive therapeutics is now a part of standard of care… where this becomes one of the first things that a doctor prescribes versus one of the last things.”

For Matthew, this vision represents more than just business success – it’s about changing how we think about treatment itself. “We always believe that start from what is the least invasive that you can do,” he explains, “and this is probably the least invasive that you can do that can actually make an impact.”

It’s a vision that brings together his entrepreneurial spirit, his commitment to evidence-based development, and his understanding of what it takes to create not just a product, but an entirely new category of medicine. While the journey from bubble gum entrepreneur to healthcare pioneer might seem unlikely, it’s exactly this diverse experience that has enabled AppliedVR to take a different approach to solving one of healthcare’s biggest challenges.