SaaS Interviews with CEOs, Startups, Founders
1726 HealthTech Company Expects To Hit $1m in ARR As Critical Tech During COVID
15 Apr 2020
Chapter 1: What changes have been made to the podcast release schedule?
Hey guys, I'm recording this here on April 5th. It's Sunday. Everyone's trying to survive the crisis. Quick note to you guys, we are moving, you know, we used to delay these episodes by, you know, four to eight months after we recorded them in terms of releasing them on the podcast. We've changed that.
A lot of these interviews you're gonna hear over the next many months are gonna be ones we recorded only
days prior we think that's a smarter way to run the show i've made the change so expect more urgent information coming out secondly i am getting destroyed on itunes reviews by these people that say nathan's rude he's hard-hitting blah blah blah which by the way i am it's part of my style it's what works the problem is people that love that style never take the time to go leave a five-star review
So I only get one or five star reviews on iTunes. And right now there's a streak of one star reviews that is driving me crazy. It would mean the world to me, guys. If you're loving the show, you love how direct I am. You like the style. If you go leave a review on iTunes now, if you do that and tweet it to me, text it to me, email it to me, whatever you want.
I'm going to reply with a very special surprise. I think a lot of you guys will really like it is heavy, heavy data oriented. All right. So I appreciate that. Thanks, guys. Enjoy the show.
company med stack playing in the med and health tech space trying to make sure that information sent from patients back to the health care providers is safe and secure and the document and the data access is well documented they've grown their company from caught 300 grand in ar up to 600 700 grand in ar today hoping across that million dollar mark here in the next year or so they've raised 2.3 million dollars to do it looking for a 500 000 extension right now as they continue to scale out onto their product maybe bring on two or three more people seven on the team right now three engineers one salesperson burning about a hundred thousand
per month. Hello, everyone. My guest today is Balaji Gopalan. He is the CEO and founder of a company called MedStack. He is an educator and thought leader in the platform and software product strategy and is passionately driven by the role of technology in addressing societal problems.
MedStack supports many digital health companies in protecting the patient and has been awarded accolades in the Canadian Advanced Technology Alliance and TechCrunch. All right, Balaji, you ready to take us to the top?
I am indeed.
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Chapter 2: How does MedStack ensure data security for healthcare providers?
So if a hack does happen, it's clearly documented.
Yeah.
Well, it's more than just documentation. We have a system that monitors the infrastructure so that it knows automatically and provides us an alert if there is an untoward event.
Interesting. Okay, very good. So last time it came on was back in July of 2018. You said you were serving out 45 customers at that point. How many customers are you serving today?
Close to 70. Okay, close to 70. Yeah, yeah, probably 70 by now. Obviously, the last couple of months have been, or last month, last few weeks have been Pretty interesting for us from a dynamics perspective. And we've had a lot of not only new customers come on board, but a lot of growth with our existing customers.
And I think the big things that have happened since we last spoke, there's been a number of pretty important changes. The first one, obviously, we raised some financing at the end of that year. And that was used to completely, from the ground up, rebuild our product.
So how much raised to date?
Uh, total race to date is, uh, 1.8 million.
Okay. So you raised about 1.3 million after our interview.
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Chapter 3: What role does MedStack play in the digital health ecosystem?
All the security stuff we were handling, but their ability to iterate was limited because it was a concierge service through us. MedStack Control is a completely self-service machine-driven system. So they have a console, they can log in, they can add and delete administrative users. and change and grow and shrink the infrastructure as they need. So we launched that the third quarter of 2019.
It's the only thing we're selling now. It's completely changed our kind of sales cycle. And then we've also introduced a new business model that's more in tune with our value proposition. This is actually a very recent development, but it's worked very, very well for us. So now we're saying,
What you're paying for is MedStacks assurances, all of the policies, all of the support for the questionnaires. We actually have a little bit of a natural language processing element that helps us answer those questions as well. That's our SaaS fee.
On top of that, we simply pass through the underlying cloud infrastructure costs that you actually use with a very small markup on top for the security technology to be out on top.
Customers are still, average ARPU is still about $700 a month.
It's grown a little bit because of the new business model, but that's very, very recent. So we're probably close to a little bit over eight now, maybe 850.
Okay. 800 ish. I mean, so can I take 800 ish per month on average times those 70 employees? I mean, you're doing like 50, 60 grand a month right now in revenue. Yes, we are. Okay. And that's up from like 20, 30 grand a month, about 18 months ago. Yeah. So healthy growth now to drive that growth. Did you burn through that full 1.8 million or do you still have some of that cash in the bank?
We are doing a seed extension right now. A lot of that was put towards the building of MedStack Control and some marketing experience we did. We've done a recent shift to a more inbound focused strategy, which is actually working well for us. And we've done a lot of sort of cleanup of our operational costs and infrastructure efficiency.
How much is the extension for?
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Chapter 4: How has the COVID-19 pandemic impacted MedStack's business?
So they don't mind if you have 1,000 customers paying $1 or one customer paying 1,000. What they care about is that not one customer makes more than 30% of your monthly revenue. Which you don't have.
We don't have that.
Yeah.
So we have had a number of conversations with some debt providers and some of those are ongoing as well.
Yeah. Interesting. All right. Let's wrap up here with the famous five. Number one, favorite business book.
Favorite business book right now. Hard thing about hard things.
Number two, is there a CEO you're following or studying?
Uh, as the CEO of falling, I'm sitting, uh, probably the same as I gave you last time, uh, the CEO of Shopify. And I think some of the things he's doing in the current environment are pretty admirable.
Number Toby, uh, number three, what's your favorite online tool for building the company?
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