Scale v/s Sustainability: What will you choose?
The last few years have seen the rise of many tech start-ups within the healthcare space. These start-ups mainly connect doctors to patients, doctors to other medical experts, patients to pharmacists, patients to healthcare providers, help people maintain their daily vitals through mobile apps, so on and so forth. All, of them established with one intention, to create a niche business segment for themselves within the healthcare space.
Initially, when these concepts emerged they were very well received both by the target audience and by investors. Industry analysts were of the opinion that these start-ups have the potential to disrupt the existing models of healthcare delivery. This set a momentum for this trend and these young and technologically – driven start-ups started riding the wave. More and more tech start-ups began to sprout which cater to newer and more niche areas of healthcare. Today, even as the rest of the tech start-ups in India are struggling to secure funds due to dipping valuations, these digital health companies have continued to beckon investors. The only cause of concern is the viability of these business models in the long run. Here is where the question of sustainability and scale comes to the fore.
While interacting with healthcare start-ups, investments bankers and analysts, we often have sustainability and scale as an important point of discussion. Sustainability and scale both in their own right are the lifeline of any successful business. While sustainability of a business depends on the ability of the organisation to maintain commercial success, be future ready and to be part of a sustainable society.
Scalability can have different meaning depending on the type of the business model . For instance, scalablity for one business can mean allocating and optimising resources to drive the greatest results and volume across market segments, but for another business it could mean increasing the size of the company or it could simply mean revenue growth. This offcourse, is a decision taken depending upon the organisation’s strategy for growth and overall vision it undertakes.
Nevertheless, this decision also to a certain extent plays a pivotal role in determining the fate of a business organisation eventually.
To delve futher into understanding the perspective of these young business enterprises on sustainability and scale, Express Healthcare quizzes co-founders and CEOs of some forward looking start-ups within the healthcare space. As a word of advice to these promising entrepreneurs, we also bring to you a viewpoint of few experts By Raelene Kambli
HealthAssure is an aggregator of 2000 primary care centres across 800 cities.
We believe there is a large need and gap for preventative care and day-to-day health, be it for general physician, diagnostic, pathology, dentist, specialist doctor, etc., for a family, individual or corporate.
We use a strong IT platform to provide our customers access to our wide spread and high quality primary care network at discounted rates and thereby getting health ‘closer to them and helping them lead healthier lives.
Scale v/s sustainability
At HealthAssure, we did not make a choice between scale or sustainability. We have focused on both from the very beginning to ensure we build a strong base of high quality and complex healthcare ecosystem and a scalable IT and operations platform. This has allowed us to double each year while maintaining our service standards.
Healthcare is a very complex industry and this strategy has helped us build on our goodwill and brand.
It has also helped us remain focussed, innovate and evolve on our strategy each year.
We have to keep challenging existing ideas within and outside our company. That requires a management culture which has a continuing and clear objective of external customer.
– Varun Gera, CEO, HealthAssure
This start-up uses a combination of cloud-powered software (smartphone application), hardware (wearable pedometers) and human assistance (nutritionists, trainers and yoga instructors) to help people reach their fitness goals. HealthifyMe features the world’s largest Indian calorie counter available for free on Android and iOS phones. HealthifyMe’s premium customers can connect with dedicated experts (diet, fitness, yoga) using in-app messaging interface and via skype. Experts understand the client’s lifestyle and help make changes within their lifestyle providing a plan (diet/ exercise chart) and following up on the plan. Experts also connect customers in groups and use social motivation to drive long-lasting results that are empirically proven to be better than offline technologies/ services at a fraction of the cost.
Scale v/s sustainability
We have taken a balanced approach from the start. Our premium model allows for both. We are able to drive string scale from our free app and monetise our premium services for those who want it. As a result, we have strong unit economics and yet have registered 500,000 users already making us the largest digital wellness product in not just India but South/ Southeast Asia as well.
Our revenues have increased 10X in the last 12 months and we expect to deliver another 6X in next 12. Simultaneously, we intend to target two million users in the next 12 months as well.
We believe that exploring new possibilities with the product is always beneficial. Our partnerships have helped us alot in gaining traction in the market and has served as a major factor in our achievement. The corporate tie ups with Manipal hospitals and Medanta among others have enabled us to reachout to a large number of consumers and has positioned us at the forefront of healthcare technology in the market.
– Tushar Vashisht, CEO, HealthifyMe
One simple reason behind ‘Pulsewell’ is that healthcare in the current scenario is neither sustainable nor scalable; reasons being asymmetry around information, economics, access and transparency. We are building technology to make sure quality and transparent care is affordable too and is within the reach of each one regardless of your socioeconomic level.
Scale v/s sustainability
Being a new concept, which is working well so far, we have chosen sustainability as a way before scale of operations. There are multiple reasons to it — finance availability, team bandwidth, ease of operations, technology, quality and iterations in offering which happen on a time to time basis.
So far, we have been able to keep our head above the water and make sure we can accommodate changes at a rapid pace. It has also helped us attracting top class talent and business alliances.
Make sure you keep your head floating above the water no matter what, try not to have multiple part time people working, go out and talk to as many people as you can about your idea/ product regardless whether they belong to relevant industry or not, you never know where gold is hidden. No idea which can be stolen is worth your time and efforts.
– Dr Ashwin Bonde, Co-founder, Pulsewell
Curofy is developed with an objective of providing non-intruding, spam free and organised network for doctors. Currently, the company’s focus is on building a high quality engaging network of doctors. With a community of highly engaged doctors, Curofy claims to be a medium for stakeholders to engage their potential users and get the word out. From surveys to product launches to even finding brand evangelist, Curofy is a huge opportunity waiting for the entire healthcare industry. Curofy is currently doing pilot project with select players, where the app provides them with a chance to make their content available on this highly engaged network of doctors. For example, various hospitals (including St John’s, Cygnus, Columbia Asia, Rockland, Fortis and Apollo) have been pushing jobs on the platform and are getting candidates through Curofy. Similarly, some medical devices and pharmaceutical players are benefiting by reaching out directly to interested doctors.
Scale v/s sustainability
We have always tried to scale sustainably. We have tried to build a community at first and so decided to scale first. User generated content was less initially, so we focussed on providing relevant news, which is a single user value proposition. It was very popular among the doctors that time. We kept on adding doctors on foot selling them the vision and engaging them on news. As the user increased, content created by them increased and we started focusing on providing them an easy to use user-friendly and intuitive product to engage on case discussions. Now user generated content (discussions) brings most of our engagement as compared to news. With time, sustainability has been our primary focus and we are increasing basket of our services by working with various stakeholders of the healthcare industry to provide resources to the doctors on a single touch of a button.
Single value used case in early days helped us retain our user base. With increase in user base, as content creation increased doctors got more addicted to the platform. Daily Active Users and Weekly Active Users have also been increasing continuously. It has also allowed us test new things and discover the needs of the doctors.
Healthcare is a high margin industry but it’s a tough nut to crack. There are a lot of grey areas in the regulations and hence understanding the functioning of the stakeholders is a must. Also, the industry still dwells in the non-Internet era and there is huge aversion from technology. However, once this inertia is overcome, the potential dividends are huge. Hence if you persevere and put your daily learnings to use, you will do great. The industry is due for its digital makeover. Be there when it happens. Each day of our journey has been exciting. It feels really great to see the impact that we are creating in doctors’ lives and in the digital healthcare industry. Changing behaviour of an industry is very difficult and we have made some serious progress in this direction.
– Nipun Goyal, Co-founder, Curofy
Buzz4health is a customised professional platform for doctors and medical students, which lets them collaborate through real medical cases and other continuous medical education content. The platform has been incepted with the idea that a doctor’s education never ends with a degree; a medical practitioner needs to stay updated with the latest information on new drugs, research, approaches and emerging evidence-based treatment protocols. Buzz4Health gives access to real-world medicine and helps physicians to share and gain knowledge from multiple specialists with relevant work experience. The customised professional platform helps verified doctors post their medical cases in a click and seek opinion of 100,000+ registered doctors on the platform. To attract more users to its network and make the platform more interesting, Buzz4Health has also adopted a social currency, where doctors can earn credit points if their answers are backed by votes.
Buzz4health is in its early revenue stage where it has partnered with several key opinion leaders across different medical specialisations to run paid accredited (CMEs and others) programmes. Buzz4health aims to disrupt the traditional model of continuous medical education, and envisions a world where physical limitations of space and time don’t hamper the potential opportunities for a healthcare professional to grow.
Scale v/s sustainability
Buzz4health focused on scalability in the first 12 months of its online platform, where the goal was to reach out to a maximum number of verified doctors. After acquiring 1,00,000+ doctors, the strategy has been to launch monetisation programmes on the platform to engage the existing users on the platform and provide them options with paid premium content (accredited by state medical council).
We believe that we chose scale first to make sense of the long- term vision and the first 1,00,000+ doctors on our platform will help us drive both scale and sustainability from here on.
Less is more. Sometimes, it is overwhelming to try and build too many things that seem potentially groundbreaking. It almost seems against conventional wisdom to not build more. This is particularly true of Internet and mobile businesses, where the user has to go through a learning curve. It is almost always good to focus on one thing and build a brand before aggregating a variety of features.
– Hitesh Ganjoo, CEO and Founder, Buzz4Health
Doctor Insta has three models to cater to different customers.
- B2C (For retail customers) – User pays a standard fee per consultation with a specialist doctor. 70 per cent goes to caregiver/doctor and 30 per cent comes to our platform.
- B2B2C – Hybrid model for employers for their employees, wherein the employer pays a PMPM (Per Member Per Month) fee and the employees can consult a caregiver at a discounted price
- DII (Doctor Insta Inclusion) – For the rural areas of India in collaboration with companies running e-Kiosks. User pays a standard fee per consultation with MBBS doctors.
Scale v/s sustainability
Both scalability and sustainability go hand-in-hand. It is not ‘either-or’ but is ‘both-and.’ To give you an analogy- human body cannot survive with just either heart or brain and it needs both the parts to work efficiently. Similarly, a business can only survive when it is both scalable and sustainable. So, we at Doctor Insta chose ‘scalable sustainability’ approach.
We are early in our journey and so far it has been very encouraging and rewarding. This strategy of managing a tight ship has helped us in keeping our customer acquisition cost very low through joint ventures and alliances. It also helped us in getting large volume of users through B2B2C model. We are now providing online consultations to some of the major companies in the country like American Express, PayU, Tech Mahindra, Punj Lloyd etc. We have all the right ingredients to become the next unicorn. The key is to stay passionate and persistent- not to lose focus and stay one step ahead of the competition.
It is good to try and fail rather than fail to try. Always believe in yourself. Failures should motivate you to try harder and use them as a learning experience. There are a number of ways we can actually learn from the failure, but in order to do so, we need to look at the failure objectively, like an outsider looking in. Initially, when we launched Doctor Insta, our focus was primarily on ‘Video Consults’ but with more than 80 per cent of India still not having proper Internet connectivity. We quickly added ‘Phone Consult’ functionality to increase the size of target market. Similarly, in our earlier version of the product, we didn’t have follow up consults free and patients would tell us that their current doctors don’t ask them for consultation fee within two to three days of getting first consult for the same problem. So, we listened and learnt from our patients’ feedback and quickly offered a superior and compelling service offering by giving a free follow up consult within seven days of a patient getting his/ her first consult.
– Amit Munjal, Co-founder & CEO, Doctor Insta
HealthSaverz is India’s first pharmacy focused on chronic patients and senior citizens. We have built a model that ensures chronic patients are dealt with by our team of qualified pharmacists. Original prescriptions are picked up and digitised and orders are taken by pharmacists over the phone. Patients are reminded to refill their prescriptions and we have a mobile app and SMS-based reminder mechanism to ensure patients are reminded to take their medicines daily. We also have a policy of taking back returns of your medicines when the doctor changes your prescription.
We are highly compliant and dispense against valid prescriptions only and consider ourselves to be India’s most compliant pharmacy.
Scale v/s sustainability
We have clearly chosen sustainability over scale. When we started the company, we had the option to be a marketplace, a pure tech company connecting patients impersonally with pharmacies, taking advantage of the lack of enforcement of regulations, working with scanned copies of prescriptions etc. This is clearly a model that’s far easier to scale. However, we have always been clear that marketplaces are not a valid online healthcare model anywhere in the world. Given the liability around medicines, it is important to ensure an e-pharmacy model instead where the pharmacy is responsible end-to-end from prescription acquisition to dispensing to delivery.
So, we grew the hard way actually picking up prescriptions from customers and educating them.
The other area we chose sustainability over scale was in how we acquired and served our customers. We believe you need sustainability to be able to scale, so while many start-ups focused on acquiring users, we have always been focused on acquiring long-term customers. We have focused on ensuring we deliver substantial value to customers while maintaining positive transaction economics. To do that, we’ve had to educate customers with regard to prescription compliance, communicate reasonable lead times to ensure we are not overstocking inventory and doing expensive express deliveries. We say to customers, “A little planning, a lot of savings!” This has required some customer education but it has delivered for us.
This strategy has helped us grow in a solid way not just by new customer focused sales channels but by customer loyalty and word of mouth. We’ve grown rapidly since our inception in January 2015.
As the title of the book by by Nathan Furr says: Nail it then scale it! That’s been our motto. We’ve got a vibrant scalable business model that wouldn’t have been possible if we’d listened to conventional wisdom or followed ‘Me-too’ strategy. Our recommendation to others would go your own way and have conviction in whatever you do.
– Ryan Albuquerque, Co-founder, HealthSaverz
It is important for tech start-ups in healthcare to tap non-Internet users and thus have sustained growth. Ex. Firstcry, Lenskart follows the same model. The reason being only evolved shopper will opt for services online, rest all will prefer offline services. Moreover, it is imperative for these start-ups to understand their customer needs. For eg for a start-up with online platform for healthcare providers needs to understand that a larger group of doctors generally prefer to practice on their own so the start-up really needs an excellent convincing strategy to get as many doctors on board to sustain in the long run.
– Narayan Shetkar, Director, Singhi Advisors
I don’t think you can choose one or the other. You must build great products which implies that the product and indeed the business model around the product is scalable and sustainable. Of course, you must scale and scale rapidly, but the unit economics must always be sound or you are likely to run into trouble in the medium term.
– Varun Dubey, AVP, Marketing, Practo
We are seeing interesting work being done by start-up companies in the domestic formulation market. The market continues to grow with good profitability and good teams from established pharma and healthcare companies who are getting influenced with the overall start-up culture. In our view, start-ups should focus on sustainability. We have seen a lot of start-ups resorting to quick financing in order to demonstrate scalability, but that is a fallacy. If the business is sustainable, scalability will happen and value will be created.
– Ajay Garg, Managing Director, Equirus Capital
We create and validate protocols for treatment of various life threatening and life style diseases using regenerative medicine and stem cells. We work closely with hospitals and doctors who use our protocols and our cells to treat their patients. We supply cells to the hospitals and get paid for the same. We also get approached directly by patients who we refer to our partner network who use our products and protocols for treatment.
Scale v/s sustainability
My choice would clearly be sustainability first. We need to make sure we are in the market with the right product and protocol and it can’t be achieved unless we have focus and work on a small sample size. In healthcare it requires a lot of data spread across years to be able to declare a product or service gold standard for a disease. Hence, unless we sustain ourselves to relentlessly gather and validate that data, scaling up would be an hard option.
We have been working in creating, validating and revalidating protocols for the past three years and are finally reaching a place where we can now start to spread the message across the world. Our focus on sustainability has given us the chance to be able to refine our protocols and products so they can now be scaled up without any major change to the process or system.
Failures are an integral part of any startup journey, more specifically a healthcare start up. It is a gritty work to find the perfect product/protocol that requires multiple levels and multiple party validation. Since there are so many complex levels involved, failure is bound to happen till the perfect combination is found. We have had our shares of failures where multiple times we have faltered getting high cell viability numbers v/s cell count. We have had failures in keeping viability for a long period of time. However, each time we have gone back to the drawing board , we have found the right balance for our business to sustain.
– Vipul Jain, Founder, Advancells
Latest News & Updates
- Bank of Baroda (BoB) has agreed to sell its Tri...
- Mumbai: France-based Imerys Group, world leader...
Budget 2020: Policy relaxations and incentives will whip up investors’ appetite, help govt fast-track to clock $5 trillion markThere are great expectations that Finance Minis...
- The evolution of the renewable energy sector in...
- Chasing growth sans sustainability has led to t...
- Cyclical problems can be addressed by periodica...
- The Founder and MD of Singhi Advisors shares ho...
- The Insolvency & Bankruptcy Code (IBC) has ...
- Aurangabad-based auto electric component maker ...
- Private Equity (PE) in India is still in its na...