Shashank ND, Founder & CEO, Practo in an interaction with Raelene Kambli shares Practo’s success mantra and provides tips for start-ups in India to sustain their business
What was Practo’s business plan at the initial stage and how did you develop it further? Explain to us your business model and what competitive edge do you have over your competitors?
Practo is in a unique position of having a globally respected strong B2B software product (Practo Ray) that is tightly integrated with its much loved consumer offering (Practo Search) – creating the world’s first and only healthcare hyper loop that is connecting the entire healthcare ecosystem and is helping millions of consumers make better healthcare decisions.
When we launched Practo Ray, we made sure that we eliminated all the pain points that doctors faced on a daily basis. We chose to keep the software cloud-based so that doctors didn’t have to worry about software updates, hardware requirements, data security and data backups. This enabled doctors to focus on patients rather than having to focus on running a clinic.
To enable consumers to find the right healthcare practitioner, we have Practo Search – our healthcare discovery platform that allows consumers to find the right doctors and book instant appointments. We’ve taken the route of listing all doctors for free (post verification of-course), we also don’t charge patients to book appointments or for doctors to receive these appointments. The entire process is completely free – because this ensures that patients have the widest possible choice.
With a few clicks, patients can book an appointment with a doctor without waiting in long queues. They can also do diagnostic search by the test name instead of lab name to see the list of labs near them that offer the needed test. They can check the quality of the lab by reading through the accreditation information, see real high quality photographs and filter results by proximity, home pickup facility as well as price. All this can be done in a matter of seconds.
We recently launched Practo Ray for specialities, which will provide better tools to doctors and significantly improve patient care for some of the biggest healthcare issues plaguing our country, including controlling lifestyle diseases and ensuring immunisations for infants and children.
Tell us about your recent acquisitions?
We believe acquisitions are a fantastic way to add world class, like-minded talent to our team. It gives us a fast way to scale and the ability to further accelerate our roadmap. We have recently acquired four companies in the past six months.
Fitho will help expand our offerings and move into the preventive healthcare space.
Genii aims at strengthening the tech team at Practo and help accelerate time to market across enterprise segment
Insta Health will enable Practo to transform the hospital industry globally
Qikwell’s acquisition was a move to penetrate deeper into the enterprise segment, especially hospitals, clinics and diagnostic centres, after extending our stranglehold over individual doctors. The Qikwell product recently reduced waiting time for patients from 30 minutes to eight minutes. We are bringing systemic efficiencies into the hospitals, in the way they are run.
Practo now has four offline revenue models, hence we do not need to generate e- commerce revenues or charge our online clientele — patients and doctors. Practo Ray is one revenue stream that brings in cash from the doctors and clinics. Practo Reach is a premium listing and subscription-based service for doctors. Qikwell has its own revenues from hospitals that use its products as does Insta Health.
In August this year you have raised your series-C funding of around $90 million, how are you utilising these funds for expansion? What is your expansion strategy?
We received our third round of funding of $90 million in September, 2015 from Tencent, Sofina, Sequoia India, Google Capital, Altimeter Capital, Matrix Partners, Sequoia Capital Global Equities and Yuri Milner.
The biggest part of the investment will go into building the best products that will transform healthcare for consumers around the world, this includes new products and building on the existing products that we have. We plan to add more features and several more categories including hospitals, more diagnostic centres as well as spas, salons, wellness and fitness centres as well. We also continue to add top-notch talent to its world class team of over 2000 Practeons. We aim to add over 1000 Practeons to this number by next year. We will be recruiting a lot of engineers, growing our technology and product teams and adding many more Practeons who can help us bring groundbreaking products for a global audience.
The next is to scale up the geographical expansion, the footprint will expand from the current 50+ cities and 15 countries to over 100 Indian cities and more countries across South East Asia, Latin America, Middle East and Eastern Europe.
The third one is to acquire more companies with whom we can work together to solve the healthcare needs for billions of people across the globe. We have been active on the acquisition front. We believe acquisitions are a fantastic way to add world class like-minded talent to our team. It gives us a fast way to scale and the ability to further accelerate our roadmap.
At Practo, we envision a world where technology will help consumers find the best doctors with a few clicks. Generating, accessing and storing health records would be entirely digital. Patients will have a single health account linked to their families that will store their health information securely, and provides helpful information (prescription reminders for example) in a timely manner (prescription reminders to take medicines for example) to help people live healthier, longer lives.
Apparently, a large number of start-ups fail within their first five years, but Practo has survived and even thrived. So, what is your strategy for sustainability?
One of the most important things I’ve learnt in this journey is something we’ve put as one of the core values at Practo – we call it ‘First Principle Thinking’ – what this essentially means is that you must think deeply about whatever it is you’re trying to do – a product you’re making, the problem you’re solving and if you think deep enough, you will uncover the real insights and make sound decisions.
For example, when we built Practo Ray, our SaaS product, the entire world told us that building software for doctors won’t work and no one would buy it – we looked at the problem and found that in fact, the reason why doctors hadn’t adopted the technology was because no one had ever built a product specific to their unique workflows – up until Ray, it was a technology that had failed doctors – so we fixed it and sat with doctors in their clinics for hours to understand the problems and build our product to solve them. When we were building Practo Ray, we already had the vision of building a global company, so we made sure that we built a product that was scalable and replicable in multiple countries across the globe. The same software that is used by a doctor in Shivajinagar in Bengaluru is used by doctors in Singapore, Malaysia, Indonesia and Philippines (with a few language tweaks)
Second, when we were looking at a sales model, again the whole world told us that no one has ever made a successful feet on street sales mode for a SaaS product, our first principle thinking told us that if doctors aren’t online, it made no sense to stick to online sales. We still went ahead and launched Practo Ray – the world’s first SaaS based platform in healthcare. The first version of Practo Ray was created from scratch, based on the feedback we got from doctors. Over the next few months, at some point or another we got validated. The first validation came from the users. In Bengaluru, there were 10-15 doctors we sold the software to at first. Changing the system is done best with a bottom-up approach. For two years we ran it on our own, without any money. Then it just took off. We did what was right. We kept our ego aside and ran the business. Validation came every two to three months and accordingly we made changes to the product based on direct feedback from the doctors. Today we have over 40 million appointments booked on Practo.
What kills startups? And are these risk factors applicable to healthcare startups as well?
The foundation of every start up should be the vision to solve an existing problem in a specific industry. When founders lose focus of that vision that is when the problem arises. Along with solving a meaningful problem, companies should put in all their efforts towards building a great product. In order to do this, you must hire ‘A’ players. Fund raising is something that will follow if the product is good and the customer base is loyal and content with the product offerings. The aim of every start up, irrespective of it being a healthcare start up or any other should never be to make money, but to solve problems, build great products and follow a remarkable culture within the organisation.
What needs to be done by the management to sustain a startup business and scale up?
One of the most important things I have learnt is to build a very strong culture in the company. Every Practeon is aligned with the culture at Practo. Culture is a key difference between good and great companies. At Practo we’ve always had a ‘do- great’ culture which means a person wants to be the best at whatever they do not for want of reward or recognition (which they get) but because it is what they expect of themselves. I believe in a passionate, super-flat, meritocratic organisation. I don’t believe in average or good, I believe in great. At Practo, we look for people who want to solve humanity’s biggest problems — who have a purpose — those who want to leave the world better than they found it. I think meaning and impact are the things that keep people going. I think this is what makes people want to come to work everyday.
At Practo we only hire A players, people who can do that specific task better than me. We trust, empower and instill a sense of responsible autonomy so that every team can take real ownership and drive things extremely fast – while being aligned to the vision of the company. To help us scale faster and take the best management decisions, we have a simple VUPIM hierarchy, You have to optimise the Vision first, then the Users, then Practeons, then Investors and then Me ( the individual being).
This has helped Practo become the world’s largest appointment booking platform. As a company, one of the most important things we’ve done is create the world’s first healthcare hyper-loop, a seamless integration between our consumer and B2B product that enables millions of consumers to find the right healthcare practitioners besides helping practitioners to treat their patients better and more efficiently.
We recently received a 100 per cent rating on Glassdoor, I think it is a reflection of the strong leadership at Practo. Every day, I am inspired and excited how Practeons helped to make a positive difference in the lives of billions around the world. I have always believed in motivating them to push their boundaries, work on something better, on something that can change lives and on something global.
What are the three must do things for a healthcare start up to survive in India?
For any start up to survive, it is vital to do the following things:
Firstly, always optimise for the vision. Articulate the Vision continuously and ensure each step you take is towards this. Vision helps align the entire team behind a common purpose. Secondly, solve hard problems. At the start, try picking the tough problems to solve. These are usually the ones no one else would have tried solving. Ask yourself, ‘Why hasn’t anyone done this before?’ Logically, due to technology advancements, problems that were harder to solve so far, would become easier now.
Third, hire A players only. That should be one of your top priorities. Only get the best of the best. They can give you exponential growth. Ensure they buy into the vision of the company and focus equally hard on retaining them. One of the keys to retention is to build a great culture from day one. It will remain through the life of the company.
And finally, have fun. You will spend long hours doing this so make sure you love doing it and are excited by it. There is no room for half heartedness.
We are seeing that a lot of investors are betting on promising Indian start-ups. What is your opinion on the same?
I have been on both sides of the start up sector, three years before the investment boom and four years post the influx of funds. I have seen how dramatically things have changed. One of the major drivers is the number of internet users that India has witnessed. Entrepreneurs have existed for the past twenty years, but around 2011 because of the mobile phone and internet boom, the number of internet users shot up. Today, we are sitting at around 300-400M internet users, which is larger than the population of the US. There is no other phenomenon that has witnessed a 10X change in the three years. The advent of mobile phones and internet users has been the backbone of this huge surge in start ups in India.
India is slowly becoming the start up capital of Asia. Entrepreneurship is a lot harder than building a business but it’s definitely getting easier now. Building a business and building a start up are two different things. Building a startup is like building a business on steroids. You have to scale up and move fast. India has a lot of fundamental problems, but India also has a lot of hard working and smart people who can solve these tough problems. They need some capital and some support. Luckily we have the right society fabric as well as the right governance model that gives us the freedom as individuals to go solve those problems. India is also a large country, one ground breaking idea can become very large.
India is self-sustaining in that matter. Additionally, India is also an English-speaking country, which is a huge benefit. I think the current environment is great to support a vibrant start up ecosystem for the next 10-20 years.