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Sunday, April 24, 2016

My experiments with entrepreneurship

Some friends have asked how my startup ventures are going, why things happened the way they did, what did I learn so far and so on. This is a chronicle of my experiences/experiments so far in that space:

Background and seed for the idea

I am an engineer by education and have been working in the software services and digital media industry for close to 2 decades. On the other side, I come from a family of doctors and, we also had to deal with a number of complicated chronic medical issues. Especially, when my mother was going through her health issues, I remember being part of that roller coaster ride and also remember how we often got a second opinion by making a quick phone call or by reaching out to someone across the town. Most of the time these second opinions helped us feel reassured about the path she was in. There were also times when these advises helped us make some critical course corrections. All along, I realized that we were the lucky few who had such proximity and access to qualified medical professionals and often wondered how the common people dealt with such situations. Subsequently, around the time we moved back to India in late 2010, I observed how internet usage and social media usage was picking up steam in India. India has the second largest internet usage in the world. (39% of rural and 72% of urban Indians use the Internet for health information). I found that the majority of the health information that was available on the internet broadly fell into 2 categories – a) Generic content portals like WebMD and b) some support networks/forums (not very popular in India). I conducted quick surveys on social media to understand how people felt about quality of healthcare in India and what the pain points were. The survey results (about 100 responses) confirmed my intuition that while we have made great strides in medical facilities; the process to seek a credible medical opinion in a timely fashion is still very unorganized and unpredictable. In India especially, access to internet is more wide-spread than the access to a qualified medical specialist. In fact, most educated families still rely only on their personal networks and casual conversations to seek medical opinions.
This is when I got the idea that using internet as an effective medium we could build a platform that facilitates credible and timely medical second opinions –XpertNation

Idea to Reality


After I documented the idea and even developed a quick prototype to demonstrate, I approached some highly respected physicians who liked the idea and thought this was a service that the medical industry could benefit from and also agreed to be on our board of advisers. We agreed that for such a platform to truly serve its purpose it should be based on a strong set of values and the medical experts on our panel should truly be top-notch and imbibe our core values. We wanted to make sure that whatever we built addressed the problem holistically using evidence based medical practice. After several months of studying clinical medicine textbooks, working closely with the physicians and developers, our platform launched on Dec 18th of 2013.

The Harsh Reality

The launch event itself attracted unexpected media coverage and lot of interested customers. I was very encouraged and immediately expanded the team to include 2 customer care specialists just to answer the incoming calls and queries. We started receiving lot of inquiries from the website and phone. However, from the initial 250 inquiries, only about 5 converged as sales. After quick analysis of where the cycle broke down, we realized that most of them were not sure of the value we provided and so hesitated to pay the Rs. 1000 for it. To understand if price was the barrier, we launched several coupons (free, 50%off, second opinion free). We continued in this mode for another 6 months and received an average of about 75-100 inquiries per month of which only about 10-15 converted to actual sales. I handled most the cases myself to make sure I understand the customers’ needs and also to set the standard for customer service. Having studied each of the cases closely, I understood the recurring themes that we were seeing: The inquiries that came in broadly fell into 3 categories:
  1. Those looking for guidance on which specialist to consult and where to go.
  2. Those with serious/chronic diagnosis that truly needed a second opinion before deciding on a treatment path. E.g., cancer staging, heart issues (bypass or angioplasty, open heart or minimally invasive), etc.
  3. Those who were looking for faster appointments and/or cheaper treatment options
1 and 2 were serviced by us using the different service offerings (free Xpertquery and the paid Xpertconsult) and we politely refused 3.
Among those who were seeking second opinions, the feedback was mixed. A small percentage of customers truly understood the value we provided and knew exactly how to use the opinion they received from our panelist. Majority of the others fell into the following 2 categories
  1. In cases where the first opinion and second opinion that our panelist provided differs, we were expected to do lot more counselling on what the patient should do next. This was something I was not comfortable doing nor was I qualified to do.
  2. There is no set standard/protocol for medical practices in India which makes it very hard for any 2 doctors to concur especially when it came to invasive procedures or end of life issues. Corporate hospitals rarely opt for conservative treatments or palliative/hospice care since families and societal norms don't really like to accept/discuss the inevitable and often expect the doctors to not give up until the last breath or last penny (whichever came first) Unfortunately, this made decision making very frustrating and hard even for the most educated and informed families.
While the above two made it challenging for us to handle patients who received conflicting opinions, I was still convinced that the platform would be of tremendous value to those patients that didn’t even have access to first specialist opinion. So, we decided to focus on a different market segment - tier-2/3 cities and villages which didn’t have credible specialists and only relied on the local general physicians to refer them elsewhere. We came up with a plan to partner with channel partners in those smaller towns and villages who can offer our service to local patients so they can get their specialist opinion before spending time and energy on traveling to the nearest multi-specialty hospital. We zeroed in to launch with 3 channel partners in one district of AP to assess the response and then fine tune the model before spreading out. As I started interviewing and discussing with several potential partners, I realized how the whole medical industry is setup with deep penetrating kickbacks system. Every diagnostic centre, general physician, RMP doctor is tied up with a multi-specialty hospital(s)/specialist in the nearby city. For these centers to instead offer our service, our commission structure both per case and volumes should at least match that of established hospitals.

To Go or No-Go

At this stage, I was disillusioned and went back to the drawing board to figure out how to offer the service without diluting its value and without compromising on any of the core values – quality, honesty and timeliness. This exercise showed me clearly that the second opinions service alone is not a very scalable business model; it is limited by the bandwidth of the expert panel. To make this a viable business proposition, we would have to offer other auxiliary services or diversify to generate a regular revenue stream. I also approached a VC that had earlier funded a similar venture – Mediangels to seek advice. While they were impressed by our roster of panelists and by our thorough workflow, they advised me to diversify and go slow on the second opinions platform until the revenue stream solidifies. They also were very blunt that being a single founder (other co-founder was not on the ground) company, my chances of getting funded was very low since VCs look for a strong team along with the idea itself. So, at this point, I was left with 2 choices – a) Invest more money and energy to plough ahead with Xpertnation and in parallel diversify into other revenue generating opportunities or b) Just keep Xpertnation alive with minimal resources, keeping the risk minimal. Given the situation with my partner who couldn’t participate on the ground at this stage, for option (a) to work, I had to actively look for another partner to share the load, investment and risks associated. Also, for Xpertnation to establish as a trustworthy brand, I would have to focus a lot on the operations and would be left with very limited bandwidth to focus on anything else. This meant I would have to partner with someone who can bring in the other revenue generating opportunities and also run that unit. All of this seemed possible on paper, but I sensed a huge red flag and was not convinced enough to take the financial risk this aggressive approach would entail. I decided to go with the second option and continued to keep Xpertnation alive with just my personal effort and limited investment and let it take a slower trajectory through word of mouth and social media awareness building campaigns. Looking back I still think this was the right decision for everyone involved and this journey has taught me many valuable lessons about being an entrepreneur.

I still truly believe in the value that a service like Xpertnation offers but, I think it is slightly ahead of its time and it is an idea whose time has perhaps not yet come in India.

3 comments:

KOOL KATY LADIES COLONY said...

Vasantha, It is wonderful to see that you are able to see and evaluate all the phases of the project dispassionately. It is especially hard to do with our own brain child. I personally know the energy and enthusiasm (having experimented myself) with which we nurture our ideas and pour our heart and soul into it. I am sure it is a great learning experience and you a far mature individual from when you have started. -Hyma

Virgogreen said...

Hi,

Thanks for sharing this post.



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