Epic Systems

Healthcare IT

Mentions

Podcasts

Episodes

Podcast consensus

Points of consensus

▶Epic Systems is a privately held company, founded and still led by Judy Faulkner, that has grown without external venture capital or private equity funding.May 2026

▶The company operates under an unconventional corporate philosophy that includes not maximizing profit, a strict policy against acquisitions or being acquired, and prioritizing customers above all other stakeholders.May 2026

▶Epic holds a dominant market position in the U.S. electronic health records industry, with over 80% of Americans having a record in its system, a success attributed to its integrated, all-in-one software solution.May 2026

▶A significant portion of annual revenue, typically 30-35%, is reinvested into research and development.May 2026

Points of debate

▶Epic's Legal Standing: The company's claim of never being sued by a customer is contrasted by active lawsuits from a competitor (Particle Health) and a state government (the Attorney General of Texas) alleging anticompetitive behavior.May 2026

▶Nature of Market Dominance: The company's success is attributed to a superior, integrated product, but antitrust allegations suggest its market power may be used to interfere with customer contracts and stifle competition.May 2026

▶Customer Retention vs. Lock-in: Epic boasts near-perfect customer retention, with only one temporary loss in its history. However, legal challenges raise questions as to whether this loyalty is purely due to product satisfaction or influenced by anticompetitive barriers to switching providers.

Key themes

▶Unconventional Corporate Philosophy and GovernanceMay 2026

Epic Systems operates on a set of core principles, including never going public, never acquiring other companies, and not maximizing profit. This philosophy extends to its internal culture, which eschews job titles, and its succession plan, which involves a Purpose Trust legally bound to uphold these tenets.

This rigid, mission-driven approach creates a strong corporate identity and long-term stability but may limit strategic flexibility and growth opportunities in a rapidly evolving tech landscape.

▶Dominant Market Position and Competitive StrategyMay 2026

Epic achieved market leadership in the electronic health records space with an integrated, all-in-one solution that competitors could not match. The company now holds records for over 80% of Americans and maintains a passive international growth strategy, waiting for foreign clients to initiate contact.

Epic's market saturation in the U.S. makes it a target for regulatory scrutiny, while its passive approach to international expansion could represent a significant, untapped growth vector or a vulnerability to more aggressive global competitors.

▶Financial Independence and ReinvestmentMay 2026

The company has been bootstrapped since its founding in 1979, deliberately avoiding private equity or venture capital funding. With a reported annual revenue of $5.8 billion, Epic allocates an unusually high percentage (30-35%) to research and development, prioritizing product improvement over profit extraction.

This financial self-reliance insulates Epic from market pressures and activist investors, allowing it to focus on long-term R&D cycles, which is a key competitive advantage but also places the burden of financing growth entirely on its own operations.

▶Mounting Legal and Antitrust ChallengesMay 2026

Despite a history of high customer satisfaction and a claim of never being sued by a customer, Epic Systems is currently facing significant legal challenges. Lawsuits from Particle Health and the Attorney General of Texas allege anticompetitive use of its market power and interference with contracts, creating a narrative that contrasts with its benevolent self-image.

These legal battles represent the most significant current threat to Epic's business model and reputation, potentially leading to costly settlements, mandated changes in business practices, and increased regulatory oversight.

Source episodes

Timeline

1979

Judy Faulkner founds Epic Systems, beginning a multi-decade journey of bootstrapped growth without external funding.

c. 1979-2024

Over its approximately 50-year history, the company establishes a reputation for extreme customer loyalty, claiming to have never been sued by a customer and only losing one temporarily.

Undisclosed Recent Year

The company's annual revenue was last reported at $5.8 billion, reflecting its significant scale and market penetration.

Current

Epic Systems employs approximately 15,000 people and operates in 16 countries, holding health records for over 80% of Americans.

Current

The company faces significant legal pressure, including lawsuits from Particle Health and the Attorney General of Texas, alleging anticompetitive practices and abuse of market power.

Future

A succession plan is in place where a Purpose Trust, controlled by family and staff, will manage voting stock with a legal mandate to prevent Epic from ever going public or being acquired.

Suggested prompts

How can Epic Systems reconcile its stated customer-first principles with mounting antitrust allegations from competitors and regulators? &nearr;What are the long-term risks and benefits of Epic's strict 'no IPO, no acquisitions' policy in a rapidly consolidating healthcare technology market? &nearr;How will the Purpose Trust succession plan impact Epic's strategic agility and innovation compared to founder-led or publicly-traded competitors? &nearr;Given its passive international strategy, what are the untapped growth opportunities and potential threats for Epic Systems in foreign markets? &nearr;

Key concepts

Corporate Principles & Philosophy 5 ep Financial Strategy & Performance 3 ep Market Position & Competition 3 ep Leadership & Succession Planning 3 ep Legal & Antitrust Challenges 2 ep Customer Relations & Retention 2 ep International Operations 2 ep Research & Development 1 ep Corporate Culture 1 ep

Notable quotes

“Epic Systems typically spends between 30% and 35% of its annual revenue on research and development.”

Judy Faulkner · 672. What Makes Judy Faulkner Run? | Freakonomics Radio

“Epic Systems has only ever lost one customer, who returned to using Epic's software one year later.”

Judy Faulkner · 672. What Makes Judy Faulkner Run? | Freakonomics Radio

“A core principle of Epic Systems, part of its 'Ten Commandments,' is to never go public.”

Judy Faulkner · 672. What Makes Judy Faulkner Run? | Freakonomics Radio

“Epic Systems won the electronic health records market because its integrated, all-in-one solution was superior to competitors' offerings.”

Bob Wachter · 672. What Makes Judy Faulkner Run? | Freakonomics Radio

Report last updated: May 5, 2026

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