PillPack Gets an Infusion of Capital to Continue Simplifying Pharmacies
Last year, when CVS was lauded for their decision to remove cigarettes from their stores, it served as a prime example of how broken traditional pharmacies are. In a country facing a diabesity epidemic, retail pharmacies devote huge amounts of floor space to selling sugary snacks. Aisles are filled with get-well cards, but there are too few resources to help patients actually…get well.
PillPack is changing that.
We have long believed in their mission to simplify pharmacy and were lucky enough to provide 60% of their original funding in 2013. We’re obviously pleased with the announcement today that they’ve added $50 million dollars in capital from CRV to expand the scope of their efforts.
But as Fred Wilson recently wrote, valuations are fleeting and imprecise measures of success. As exciting as a new round of funding is, I want to take a little time to share some of the concrete successes co-founders TJ Parker and Elliot Cohen can claim which might be of use to other entrepreneurs.
The Thrill of Watching a Startup Become an Organization
PillPack is an amazing product, has been recognized with design awards, and was named one of Time Magazine’s Top Inventions of 2014. But it’s also rapidly becoming an organization that can compete with the giants that dominate the pharmacy business.
From the start, the founders knew they had a creative solution to a real problem, in the form of their packaging. But one of the things that set them apart was the maturity to know it could be much better. They sought out legendary design firm IDEO to bring it to the next level and didn’t just hire them, they physically moved the full team into the IDEO office to transform the project. This was an early demonstration that TJ and Elliot knew how to get massive leverage from each unit of their time.
This continues today. TJ’s credibility as a pharmacist is what got the company funded, but it’s his vision that will allow it to grow. So he hired someone way more experienced to lead all pharmacy activities. Elliot knew how to set up a Facebook ad campaign, but recruited world-class talent to build their acquisition engine.
As simple as it seems, many startup founders fumble when they try to grow. They hold on to their areas of expertise for too long. They hire employees, but fail to build a team. TJ and Elliot have a vision. Much more importantly, they have the self-confidence to literally replace themselves as quickly as they can in each function. Hiring contributors who can outdo founders is exceptionally rare but it’s the only way I have ever seen enduring companies formed.
Demonstrating How “Full-Stack” Can be “Lean”
Much has been made about the increasing speed at which software can be developed thanks to widespread code libraries, frameworks, and tools like Github. But PillPack shows that it is possible to bring this approach to a “full stack” business like pharmacy.
In the same way that a software engineer can leverage a toolbox of applications like Firebase and the Ionic framework to rapidly deploy real-time mobile apps, TJ and Elliot have used off-the-shelf components to build a factory filled with drug-dealing robots.
Not having to fill individual amber bottles allows PillPack’s team of pharmacists to spend time actually speaking with patients. Imagine that. Answering their questions. Spotting potential drug interaction issues. Doing the job we always want our health care providers to do.
As they learned, they updated their service.
Showing How Empathy Can Be a Differentiator in Healthcare
In an age where entrepreneurs hope simple apps will become tickets to million-dollar exits, PillPack embraces the very hard steps required to create a seamless experience for their customers. From the clearly-labeled sachets that protect their pills to the hand written notes that accompany packages, PillPack is built around sympathy for the challenges in managing care.
A focus on customer service alone doesn’t guarantee success. It has to be paired with a willingness to prioritize it. To design an organization that can deliver it on a consistent basis TJ had to go state by state to obtain registration for PillPack. This meant rental car trips and red-eye flights to physically stand before state boards of pharmacy. It was a hassle, but it made it possible for people in 47 states (and counting) to make use of their services and for children of senior parents to easily coordinate care remotely.
Proving We Can Design The Healthcare System We Want
Healthcare companies spend billions every year on marketing and new product development, but the companies are fundamentally built around relationships with doctors and insurance providers. PillPack is built first and foremost for you, your kids and your grandparents. It is unequivocally and unashamedly consumer first.
There is no shortage of mail order pharmacy options. There is precisely one that appeals to people on an empathic and aesthetic level. Spend any time as a PillPack customer and you’ll see the company is driven as much by Mies Van Der Rohe’s design philosophy as the Medicare reimbursement codes.
Plenty of pharma companies have hired design firms to improve their wares, but it rarely goes beyond a logo, single product or brand polish. Design is an intrinsic part of TJ’s personality. Follow him on Twitter and you’ll see a founder who passionately discusses mid-century architecture while also pointing out the shortcomings of his chosen profession. Like Airbnb before them, PillPack is a company that gets design in their gut and this passion manifests itself in every layer of the service.
PillPack’s recent funding is gratifying but fleeting. There is so much more work to be done to justify CRV’s belief in our future. Hopefully less transient is the real beginnings of an organization that reliably and scalably delivers life-changing health care convenience to an increasingly large number of customers.
Reviewing the road TJ and Elliot have travelled to get here is a worthwhile exercise for all aspiring entrepreneurs.
