Redpoint Founder Series: Andrew Dudum, hims

Redpoint Ventures
Oct 17, 2019 · 21 min read

Sitting down with Andrew Dudum, Founder and CEO at Hims

One of the defining startups of the past few years has been hims, which has ushered in a new revolution in direct-to-consumer businesses while also bringing much-needed innovation to healthcare and the patient experience. Redpoint invested in hims in 2017 and over the past several years, we’ve had a front-row seat to the wild ride at hims — from doing a million in sales in the first week and having everything break in the process to building out an exceptional team, envisioning the future, and staying zen.

Alex Bard sat down with Andrew Dudum, Founder and CEO of hims & hers and an incredible entrepreneur, to share some insights from the past few years.

The interview was lightly edited for clarity

Alex: Before we get into hims specifically, I’ve got some more sort of meta questions for you. First, what are some of the most important lessons that you think you learned during your childhood, that you’ve carried over into how you run your company today?

Andrew: That’s a great question. So my dad and grandfather both live within 10 to 15 minutes of my current house. So I’m still living my childhood in a lot of ways.

Alex: You’re lucky.

Andrew: I’m very very lucky, very blessed. But the lessons I learned at a young age, I still get reinforced today, every couple of weeks, over dinner. Most of the people in my family were entrepreneurs, so they didn’t have bosses. Mostly because I don’t think they could have had bosses. They had this irreverent lack of willingness to have any authority tell them and dictate to them what to do. But because of that, I was taught from a very, very young age to essentially question everything.

Andrew: And so question the rules, question your friends who say something is this way because, question beliefs, question your own thoughts, just question it all. And so I think that’s just exceptionally ingrained in me. I think you’ve probably seen me do that throughout.

Andrew: I probably drive my team crazy because I ask the question “why” maybe two or three hundred times a day. But, for me, just understanding how things are functioning and, at a deep level, coming to alignment, internally, with the confidence that that outcome or that belief is right and comes from a place that I understand is really, really critical. It’s pushing yourself to be curious, an intentional curiosity, and questioning everything, in an elegant way, in a respectful way, not in a disrespectful way.

But in a way that really helps you better understand. And so I think that’s just a huge part of who I am today. It’s a huge part of how I run the business. It’s a huge part of how I interact with family and my own beliefs. And it’s definitely stemmed from the men in my family who are incapable of having bosses and-

Alex: I think they call that unemployable.

Andrew: Unemployable. Completely unemployable entrepreneurs.

Alex: That’s great. And it does make a lot of sense. It is one of those qualities that I very much appreciate about you.

As you look over the landscape of companies that you’ve sort of seen, again, from early childhood days to today, what are some companies that you’re inspired by?

Andrew: My favorite company is Pixar. There’s an amazing book called Creativity Inc. which is about how Pixar intentionally structures itself in order to consistently create amazing product, amazing outcomes. When you think about some of the best movies in history, they really do consistently create greatness over and over and over again. And they’ve been able to do that through a very, very long period of time, which is not something that most companies can endure and can do.

Their success stems from dedicating small teams with high ownership, with the ability to be creative, to fail really fast, to actually encourage failure, to acknowledge it, to celebrate it, to talk about it. And then use that failure as better pattern recognition the next time.

And so it’s just a company that flips the normal mentality of how you should approach something at scale completely differently. And it’s proven to work. And so it’s a model that I love. It’s a company I respect. I think their product is amazing. I also love their movies.

It’s just fun. But how they do it is actually really special, so I have a lot of respect for them.

Alex: You’ve used the word “intentional” or “intentionality” a couple of times. How do you think about values and culture, applying that sort of intentionality behind it?

Andrew: We went zero to over 100 people in the first year and a half. And I remember the early days, I told you that there’s only going to be 15 of us for the first few years. And you looked at me and laughed. I was like, ‘No, I promise. Just 15. But we’ll probably be at 200 or 300 people the next year or two.’

But as you grow like that, and as you make decisions, being intentional is pretty much the only thing that matters. And all that means is just making sure you’re thinking about your actions. So, from a culture and value standpoint, it’s probably the easiest way to be intentional in a way that everybody in the organization knows what’s important and why. So for us, there’s an intentionality around a mission to help people feel better, and empower them to be well, and empower them to have choice.

There’s pillars that we really value, like sparking conversation, which you’ll see when you walk down the subway, and you see one of our advertisements. And it’s really provocative. It’s very intentional, which is to encourage people to have these debates, and have these conversations about health that you normally wouldn’t, so that it then becomes normalized. So there’s intentionality with the marketing.

But I think how you structure your values and your principles is the quickest, most effective way to get everybody in the company actually thinking about their decisions, through the same lens. So it’s a great tool, a critical foundation to a company. And it’s something that we spend a lot of time on.

Alex: How do you think about getting those into the water supply, so to speak? Because you’re scaling so quickly, new people are coming on board. How do you make sure that they’re sort of aware of what those guiding principles are?

Andrew: You just bother them by saying it over and over and over again. We had an all-hands meeting, actually yesterday, and I made the joke, which was you’re going to get so sick of me saying the same thing for the next two years. So I just apologize in advance. Because we’re going to have it on the walls. We’re going to have it in the weekly emails that go around. You’re going to hear it every time I talk. I’m going to say the same things. And it’s, again, intentional because just like all humans, we’re getting a lot of stimuli coming in, and in order to really have something digest and be a part of you and build a habit, you need to do it over and over and over again. You need to hear it over and over and over again. It’s as simple as being very consistent with what you’re saying to the team and how you say it.

Alex: Agreed. So let’s double click on hims now, for a minute. If we go back to the beginning, I know that you had been testing this opportunity for about a year before you even launched anything. Tell us a little bit about that. What got you excited about pursuing this mission? Why do you think it’s important?

Andrew: So hims was interesting because it had a few different exciting aspects to it. First, from a very human level, it’s a brand that I was really passionate to build. I grew up with sisters who are very cool and very trendy; they’re much cooler than I am.

Alex: They always are.

Andrew: They always are, and they’ll let you know that. And for years they would push me to be my best self. They would say, “Hey, you’re looking really ashy. Why are you so ashy? You look dry.”

Alex: I’m not sure I know what that means.

Andrew: I didn’t really know either. And so they’d say, “Here’s a moisturizer, use it every day, you’ll look a lot better. You’re looking really tired. Why aren’t you sleeping?” They love me, so they push me to be my best self. And when I look around within my friend group, and when I look around within the city, you’ve got groups of people that need that encouragement and that push. And so there was a desire to build a brand that pushed people to be their best self and to give them the opportunities to actually get products that were affordable and respectful, and medicine that works to do that. So I think that was just one of the first core parts of it to me.

The second was, I’m always looking as an operator and as an entrepreneur, for opportunities that don’t come around that often — the why now. Why is the timing right? Often it’s that something, structurally, has changed. And with this industry, something, in fact, did structurally change, which was that, from a regulatory standpoint, you can now talk to a physician via your phone. You can text, you can email, you can jump on a video chat, you can jump on an audio call — and it’s actually allowed, whereas, two years ago, it wasn’t.

You look at other huge industries, and they’ve all been digitized — real estate, transportation, ecommerce. Health care, on the other hand, was completely untouched by digitization. In the system that we all interact with today, when you make an appointment, you wait, on average, 23 days. You then wait in a waiting room for two hours to have a two-minute conversation with a doctor. And then you go to a pharmacy and pick up medicine every single month. 50 percent of people forget to even pick it up. So they never even have the chance to be better.

The ability to now rebuild that process — which was 40 or 50 years old, and hadn’t really been touched by this era of innovation — that was exciting. And I thought it was something where we could apply the best and the greatest minds to in this area, and actually make a difference, now that you could legally go after it.

So I think that those were at the core of why I decided to dive in and try to build the company.

Alex: I’ll tell you, as you know, we shared your excitement and enthusiasm because I think it was the fastest term sheet that we’ve ever issued that I’m aware of. We got the update from you. And then the very next day came back and issued you the term sheet.

Andrew: Yeah. It was the fastest one I’ve ever received, for sure.

Alex: Speed is a feature, it turns out.

Andrew: That’s right. Absolutely.

Alex: So, you launched. And in that first week, I think you did something like a million dollars of annualized revenue. How did that compare to what you expected? And, since then, what have you done in foundation-building to set the company up for the incredible scale you’ve seen?

Andrew: As you know, we launched, and everything broke. We were expecting about 50 orders a day. And we had built a whole system of physicians and customer support and a pharmacy that could fulfill 50 orders a day. And that meant one customer support agent, and one doctor, and a small little pharmacy to do that. And I think we did three or four hundred orders the first day. And so everything actually broke.

And so, in the first six months, we went through this amazingly fun, but crazy and terrifying experience, of trying to rebuild the entire company right after we had launched. That was really the first half of the evolution. Since then, thank God, we’ve kind of been able to get things stable. And now get actually proactive with building structure, and an actual foundation that can then take it to the next level.

So as you said, in the first week we did a million in sales. It was the smallest week we’ve had to date. And it will likely be our smallest week forever. We are now seeing two to three thousand patients come through the system, across hims & hers, from dermatology, emergency contraception, birth control, skincare, hair, vitamins, every single day. Thousands of people a day are seeking real medical treatment and actually interacting with a physician through our platform.

‘In the first week we did a million in sales. It was the smallest week we’ve had to date. And it will likely be our smallest week forever. We are now seeing two to three thousand patients come through the system, across hims & hers, from dermatology, emergency contraception, birth control, skincare, hair, vitamins, every single day.’

The structure and the processes that we need to be able to build in order to deliver very, very high-quality guidelines-based medicine at scale, over the internet, is huge. So that’s really where most of our focus is.

Alex: It’s almost two years since that point. What do you wish you knew then that you know now?

Andrew: There are so many things I wish I knew. I think, in the early years of starting a company, you don’t quite appreciate the fact that what really drives success and the outcome of success is a lot of really, really tiny decisions, compounding over many years.

I think a lot of entrepreneurs, including myself, believe in this idea of launching something and it either working or it not working. I think a lot of people look at our company and say, “Hey, we launched, and it worked.” And it did work — when we launched a year and a half ago. But we had been working on it for a year to two before that.

I think what I would like to have told myself back then is that, fast forward even two years, you’re still going to be optimizing little decisions that, hopefully, compound in such a way that two years in front of you, you’re reaping the rewards of that. It’s the mentality of, hey, this is a marathon, first of all. But, also, nothing is binary. It’s entirely a scale. And it’s all about you being, again, intentional and thoughtful about what are you working on today that could make tomorrow better, that then makes next week better, and instilling that, as much as you can, in the company.

Alex: Absolutely. Now, we’ve seen a lot of D2C brands launching. So can you talk a bit about what it takes to be successful in D2C? And then, separately, because we have the added opportunity and complexity of hims being a healthcare company, what does it mean to be a healthcare company, as well?

Andrew: So direct-to-consumer is amazing. All of a sudden, a customer on Instagram has 27 pairs of shoes they can buy with one click.

Alex: I’ve bought them all.

Andrew: Which is awesome. It’s an amazing opportunity for customers. It’s an amazing opportunity for companies. At the same time, it’s a very, very tough environment because it is now so prevalent.

One of the things that I think about is that it’s never been easier to start a company. It’s never been harder to build a brand. And I think in D2C world, that really applies. And so the types of companies that I look at, and I say, “Hey, that’s really interesting, relative to the rest,” are ones that: a) have a product that’s truly differentiated, in some capacity. And maybe it’s the actual product, maybe it’s how they deliver the product, maybe it’s the speed, maybe it’s the quality, maybe it’s the price, but it’s something truly unique. And I think it’s something that has the ability to transform into a platform.

So with hims, we intentionally started with really stigmatized issues. Erectile dysfunction and hair loss. But we named the company hims and hers, right? Very intentionally, because we knew three and six months later, we could roll out other things like vitamins and sleep and emergency contraception and dermatology. I think D2C companies that have that type of progression in mind and are building the opportunities to move in those directions from day zero, that’s really interesting to me.

Andrew: And then — and this is something we spent a ton of time on, as you know — a business that has some type of interesting approach to distribution and has a unique growth engine, I think is really critical.

It could be how they communicate their story, the channels that they’re using. But a very creative approach that gives them, what I like to call, some type of proprietary distribution channel. Because at the end of the day, it’s so easy to jump on Facebook, create some ads, get some shoes, sell them. Anyone can. But because everybody else can, really nobody can. Right? Nobody can win, uniquely. And so that’s kind of what gets me excited about the D2C space today.

Alex: You talked again about intentionality with hims. You started in a few categories but then meaningfully expanded the product portfolio. Hers was always something that was going to be coming on the horizon because this is about touching as many lives as possible. What does the future look like for hims and hers? And how do you think about building a moat?

Andrew: The opportunity for our brand is stressfully large, to be honest. It’s exceptionally overwhelming; you’ve got a healthcare industry which is an eight trillion-dollar industry. It’s the largest untouched industry. It’s the topic of all conversations when you turn in the news.

Andrew: And that’s because it’s broken. It’s expensive. It’s unaffordable, it’s hard to access, it’s confusing. The customer doesn’t have choice.

I’m a decently educated person. I have no idea how my insurance works. I don’t know what is covered and is not. And I think that’s pretty common for most people. And so the opportunity is really to build a new front door to the healthcare system, a system that people love using, that they trust, that they respect, that’s efficient, that’s respectful of their time, that gives them options and transparency, and access to experts, but in a completely different modality and a different form factor than whatever was built in the past.

And so I think the opportunity set is very, very large. Many, if not most, of the reasons people go to the hospital, you can be doing via digital health. I think five years from now, the majority of access will be accessible from your phone or from your computer. And I think we’re just kind of on the first-yard line of charging forward on that vision.

Alex: I think one of the things I was always most excited about, as it relates to this company, is that you’ve brought people into the healthcare system that were not part of it initially. And so it’s sort of expanding the opportunity and touching more lives, versus just changing the behavior of somebody who’s already participating, and doing that through destigmatizing some of these things, and education. Doing that through meaningfully reducing the cost to participate. And then just creating a great end-to-end experience. I think that’s a big part of what you do. And that is special.

Andrew: Absolutely.

Alex: In the incredible scale that you’ve seen over the last two years, do you have any management constructs or frameworks that you use to help you run the business, day-to-day?

Andrew: I try to. I left business school after two years, so my frameworks are not as good as others.

Alex: Yeah, that’s right. They teach it in the third year.

Andrew: Yeah, exactly. So I’ve got like half the framework. I think some guiding principles that I like to use.

One, hire people smarter than yourself. Always. Try your best to be the dumbest person in the room, as much as possible.

Alex: I’m very good at that.

Andrew: I am too. I consistently try to make that happen. As a leader, as an entrepreneur, one of your greatest assets is your ability to bring people into the fold who can help you be better than yourself. Because otherwise the opportunity of the company is capped at your education and your knowledge base. And in no way do you ever want that to happen. So I think that’s a first principle. Make sure you bring in the best people.

The second is let them do their job. Be aware of their expertise and yours, and give them room and freedom and flexibility, as a manager and as a leader, to do what they’re excellent at.

The third guiding principle is know when you actually need to help them do their job. As an operator and as a founder, you also have this weird balance of, hey, they’re an expert, but at the same time, you have a lot of context. You started this thing a long time ago, and you’ve seen a lot, and you felt a lot of things, and you think about it all night long. So know when you actually need to go in there and give them some help and some support or some guidance. But it’s always that balance.

And then I think the last thing, as a manager and a philosophy, is just make sure people are on the same page about what success means. People say make sure they know the game they’re playing and how to keep score. Make sure that the hundreds of people on your team, every single day, as they’re making dozens of decisions, can think about how those decisions are going to impact the number that they’re going after or the new product they’re trying to get out, and why something is important to the business. Ensure there’s that cohesive tie for everybody, from what they’re doing to the business outcome and why that matters to the company.

Alex: Yeah. I remember this post that I read from Fred Wilson that’s now almost probably 10 years old. It talked about the job of a CEO being, fundamentally, three things. You touched upon two of the three things — the first is setting the vision and mission and making sure everybody is aligned to it, which you’ve done an amazing job at. The second is hire extraordinary people, effectively, be the dumbest person in the room. And support them such that they can help build a great company.

The third is make sure you don’t run out of money. Can you talk a little bit about that, and specifically, any advice to people as they think about fundraising and financing, and how to consider those decisions? You’ve had a lot of options. How have you thought through that?

Andrew: I have so many opinions on this. As a CEO, your number one goal, make sure you don’t run out of money. If you are an operator or an entrepreneur who has already raised money, one of the pieces of feedback that I always encourage founders on is to be proactive about raising money far before you need money. One of the worst things in the world is raising money when you really need money. And I know because I’ve done it before over the last 12 years.

And so a lot of founders put this mark of, “When we get to six months of cash left in the bank, that’s when I’m going to go out and start having conversations.” And I’m like, if I’m at month 12 of runway, and we don’t have new cash coming in the bank, that’s my only thing that matters.

I think being a little bit more conservative with cash management is important for fundraising. The other thing I would encourage entrepreneurs and founders to know is the model of their business. Don’t outsource that to a CFO or a finance manager. They should be able to adjust the variables in their model and understand the impact it has to cash runway. And that just will create a tighter connection between the understanding of the business levers and the cash that they need and when and why.

From a first-time funding standpoint and fundraising standpoint, as you said, we were really blessed, we had a lot of options and a lot of really great people that we could bring into the company. I think one of the pieces of advice that I think is worth talking about is understanding that there is a lot of money, actually, in the market. There are a lot of people, there’s a lot of VCs, there’s a lot of ways to get a $100,000 check.

What I’ve seen time in and time again, is that the person you bring in, or the people you bring in, actually fundamentally matters. Because I can absolutely guarantee you that at some point, things are going to be very ugly. It’s going to be brutal. And you, as a founder or as an entrepreneur, actually are going to need to rely on your investors for guidance or, in a lot of situations, just encouragement. You’re going to need to be energized by them because things are going to be tough. Or you’re going to lose a co-founder. Or you’re going to lose a CTO. Or you’re going to have to fire somebody. Or a product launch is going to completely fail, even though you spent six months on it. It happens in every company. It’s happened to us.

Alex: You mean it’s not perfectly up and to the right?

Andrew: It is not perfectly up and to the right. So one of the best things that I ever did, and I don’t know if I did this intentionally or if I was just very lucky, to be honest, was bring good people in, including yourself, whom I could actually trust, and could actually have conversations with. And so I would just really encourage people to understand they’re building their support group. That is what you’re doing when you’re taking investment is you’re choosing people to surround yourself with when the company is both good and not good.

Andrew: And so you want to think about that very thoughtfully. You want to get to know these people very thoughtfully. The price that they’re giving you for your company very rarely matters.

When you actually do the math of this price versus that one. Like, ‘Well, this is five percent less or more dilution.’ It actually doesn’t matter. What matters is whether or not the company has a successful long-term outcome. And so I would say, be long-term greedy. Don’t be short-term greedy. And what I mean by that is prioritize a successful long-term vision for your business and bring the right partners on board with you. Don’t prioritize that first-day dilution. Because I can guarantee, it almost always washes out.

Alex: I’ve heard you use that phrase, ‘long-term greedy,’ a lot. I think it makes a lot of sense. Switching gears a bit, to something that I think enough people don’t actually talk about in the Valley, which is, being an entrepreneur is incredibly exciting. But it is also incredibly stressful. How do you manage through that? What do you do to make sure that you’re staying healthy as you’re building this big, important company?

Andrew: I can probably keep doing a better job of it, as you know. But it’s brutal. It’s a brutal role. And anybody that comes to me and says, ‘I want to start a company,’ I usually tell them not to, to be totally honest. I say, ‘I don’t recommend you start this business unless you don’t have a choice but to start this business because you, as a person, are so convinced, are so confident, are so excited, not that it will work, but just that you need to build it. That you need to see if it can happen.’ If that’s not you, I encourage you not to take on the pain because it is brutal.

Alex: It is.

Andrew: I think in order to balance that, you need to have a support team that you surround yourself with. And so I do that from an investor standpoint, and other CEOs and friends that run companies, and other friends that are completely out of the industry. When I go spend time with them, we’re not talking about work, we’re actually just relaxing.

I think identifying your safe space is really critical — that could be a partner, it could be a group of friends. For me, I go to Russian River with my girlfriend. And we have about 20 trees up there. It’s really silly, but I’ll spend five hours on a Saturday just walking up and down the rows of fruit trees, checking on them, cutting them, watering them. And it’s completely meditative to me. And it’s completely different from what I do Monday through Friday. But because of that, it’s hugely valuable for me to decompress.

Staying mentally healthy is really critical. Staying physically healthy is massive. I try to get eight or nine hours of sleep a night, which is a lot of sleep. Most people cannot do that. But I’m very rigid with sleep. I’m a monster if I don’t sleep well. And so I think the importance of eating well, sleeping, become incredibly valuable once you’re in this type of a game.

But, again, you just, you have to realize how overwhelming it is. And because of that intentionally make steps, or put steps in place, to protect yourself. I’ve seen a lot of founders that have not been well in building their companies. And it’s very, very sad to see. And it is something that’s not talked about and needs to be. But I think it’s something that you need to really proactively protect yourself against.

Alex: Next time let’s bring some fruit to the board meeting.

Andrew: Yeah, let’s do it.

Alex: OK, we’re going to go into a rapid-fire questions. You ready?

What’s the first thing you do in the morning, besides waking up?

Andrew: Check Twitter.

Alex: Yoga, meditation, or something else?

Andrew: Yoga and meditation.

Alex: Favorite book?

Andrew: Creativity, Inc.

Alex: First concert you ever went to?

Andrew: Rolling Stones in London.

Alex: One piece of advice, just one, that you have for other founders.

Andrew: Keep it simple.

Alex: What’s one thing that you believe that most others would disagree with you on?

Andrew: Rules are kind of meant to be questioned in most situations.

Alex: Spirit animal.

Andrew: Probably a hummingbird. I like to just zip in, zip out, learn some stuff, check in on people, get out of there, fly away.

Alex: If you could have dinner with any famous person, dead or alive, who and why?

Andrew: Probably my grandfather. He passed away like a decade ago. I think that would be pretty amazing, as an adult, to be able to have that.

Alex: Amazing.

Redpoint Ventures

Since 1999, Redpoint Ventures has partnered with visionary founders to create new markets and redefine existing ones.

Redpoint Ventures

Written by

Redpoint partners with visionary founders to create new markets or redefine existing ones at the seed, early and growth stages.

Redpoint Ventures

Since 1999, Redpoint Ventures has partnered with visionary founders to create new markets and redefine existing ones.

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