How do we look at quick medicine delivery and competition in the space?
We believe that as a startup, our fundamental job is to add value to our users’ lives with our product and service. When you talk about competitors in a space, sometimes people think of it as some sort of hatred towards the other company. But it’s just so different and so counter-intuitive in the practical world if you think about it in the long run.
When we started Farmako, we used to think that we would first solve the problem of health records in India. Once we build this, we will launch services like quick medicine delivery, and fast diagnostics. We were looking to build something that makes it easy for anyone to add their health records to Farmako. We had this concept of a Farmako Health ID, which is an email ID like this- <yourPhoneNo>@farmako.me
To add records to Farmako, you, your doctor, or your lab just have to email your health records to your health ID, and on your WhatsApp, you will get the report along with an option to add it to your medical records. Of course, it is not the best way to build a health record system. There should be solid protocols and options to have control over data. We wanted to make it simple, easy, and quick for anyone to be part of the system. Like everyone (whitelisted) can add records to your medical history, you have all your records on your WhatsApp chat, and in the future, you can just talk to our AI Health Assistant to get personalized suggestions. Like how hemoglobin in your body improved, what should be your diet, connecting to a nearby doctor, booking a lab test, or ordering medicines- all in one place.
When the Indian government launched the ABDM program and ABHA (Ayushmaan Bharat Health Account), which is a unique health ID for everyone in India, the first thought in my head was- that is actually a great thing for India and Farmako. I thought it would make our job much easier in the long term. We can work on the more interesting part rather than working on building a temporary protocol to share and keep health records. Since the current Indian government has a very good PR and reach, a lot of people will have ABHA IDs and will get to know how important it is for their health.
Now, we just integrated with ABDM as a PHR (personal health record) partner app. We work the same way as we aim to and we can focus on solving the problems we feel are important to solve this decade. Like a quick medicine delivery service.
We started a pharmacy in Moradabad in July 2021 to experiment with quick medicine delivery even when we were primarily working on health records. Back then, we were working on an EMR App for doctors, a SaaS for diagnostic labs, and a universal health ID for patients. We had around 3M health records added to Farmako from our SaaS. But we also realized that it is super difficult to make money in SaaS in healthcare, and at some point, we would need to launch quick medicine delivery to make the whole model sustainable. Everyone on our team wants to solve this, it is such a good business, as we found out and it adds so much value to our users’ lives. We keep seeing tens of daily reviews shared internally where we saved someone’s life with our quick medicine delivery late at 3 AM in Gurgaon or New Delhi.
So we launched quick medicine delivery in Gurgaon, knowing that we have Apollo, 1mg, Pharmeasy, Netmeds, and others. Apollo has around 6000 pharmacy (franchise) stores in India. 1mg is part of the Tata group and Tata Neu ecosystem. Pharmeasy has raised over a billion dollars and Netmeds is backed by Reliance Group. They can all start their quick medicine delivery service anytime. All of them have thousands of crores in cash to burn on ads, offers, discounts, and beat up the competition.
In 2022 end, we ran an experiment for a few months partnering with some pharmacy stores, Swiggy Genie, and Dunzo in Gurgaon. We might have served a few thousand or tens of thousands of users then, but whoever got the medicines on time, just got stuck with Farmako for all their healthcare needs. Like there’s a level of trust they have with Farmako. Like most people have for doctors from Fortis, Max, Medanta, and AIIMS. It was difficult to explain in words what value we were adding which people can not get from a Dunzo + Apollo or any other retail pharmacy.
Looking at a problem and building a product is such a magical process. Everyone thinks about it in their own way.
The Farmako team is very different. Like if you meet people from any startup and then anyone from our team, you will feel they are different. They think differently than other people, and we have this across all teams. We have a very balanced team in terms of sanity (or insanity). Like you will cover all the aspects around a topic if you talk to the whole team. So when we experimented with quick medicine delivery, everyone on our team naturally picked up on different problems they saw and started solving on their own.
We had this feeling that we could solve quick medicine delivery with better products. It requires an ecosystem of internal products and a good app for the users, which then scales into a personal health assistant in the long run.
When Apollo opened so many retail pharmacy stores, it gave a lot of people access to medicines. Like they can just go to a nearby Apollo store and get the medicines needed. Similarly, so many people use 1mg to check the information on any medicine. Millions of people face these problems, and that’s why they are such big players in the industry. And those were good metrics to solve in the last decade or so.
Time is such a good metric for solving problems in general, especially in healthcare. Affordability is also a good one. People fundamentally prefer to get things fast and more in the case of medicines. We wanted to make the delivery time a metric for the industry. Now, we see 1mg doing auto ads in Gurgaon on their 1-hour delivery, and of course, Apollo Pharmacy has been doing the same for their 2-hour medicine delivery service for a long time.
Last year, I met a lot of people from Apollo, 1mg, and Pharmeasy. One of the things I noticed was that their top management was much more focused on growing the revenue and business. Our philosophy is that we can automate most things with better products, which makes the business grow faster with better margins in the long run. If we process orders faster, we can also process more orders with the same number of people or the same number of pharmacies. And our mindset is also different. When 1mg delivers in an hour or Apollo in 2 hours, it is a win for them. When we deliver in 50 minutes, it's a failure for us.
We have a super small team compared to anyone on our scale. I mean the scale of service, the number of orders we serve, the number of products we have internally and out in the public, and operational complexity. With AI becoming more and more capable of doing human-level tasks, makes it easier for one person to build more (& complex) things easily. A two-person temporary AI team in Farmako just built a super strong AI model for real-time demand forecasting. I believe this would be much more difficult to do in a big company. We would just be missing out if we didn’t think about it consciously and plan things accordingly. The future companies will have fewer people building big-scale companies. The future companies will have more and more software and internal tooling integrated with every part of decision-making. And that naturally makes things faster, talking about the delivery lifecycle and every crucial decision inside Farmako.
AI will also make people start a lot more startups in the pharmacy space, solving different problems. The other day one of my juniors called me asking if he should do something in the generic pharmacy space, and I said he should do that despite having Trumeds, Zeelab, and others. Medicine is just such a big problem a lot of people face that more and more people should work on it.
We believe that in the next 5 years, people will need and prefer quick medicine delivery, fast diagnostics, and faster and cheaper access to a doctor. Our vision is to work on this and build a sustainable business around it in the long term while keeping an eye on other players in the market, learning from what they are doing better, and improving on that.