Saeju Jeong, Noom, on using behavior change to improve health

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Saeju Jeong, Co-founder and CEO of Noom

In this episode, we interview Saeju Jeong, the Co-Founder and CEO of Noom. Founded in 2008, the company’s mission is to help people everywhere lead healthier lives through behavior change. Although today they are best known for their weight loss app, the company is making a push to extend its behavior change platform further into chronic care, supported by their recent $540 million Series F growth round led by Silver Lake.

During this conversation Saeju and I discussed:

• The journey pivots throughout Noom’s history before it landed its current focus
• How Noom incorporates behavioral psychology into its products
• Why Noom is expanding into into chronic care

Saeju Jeong, Noom, on using behavior change to improve health

Start to 12:00: A brief history on Noom

• A young entrepreneur who loves heavy metal: Realizing that medicine might not be the right career path for him, and taking inspiration from the stories of Korean role models in business, Saeju had a strong itch to found a company from a young age. So, at 19 years old, his first venture was in heavy metal music — definitely not the typical foray into healthcare.
• Seeing his father, a physician, become frustrated with medicine’s focus on sick care instead of preventative medicine is what ultimately inspired Saeju to enter this industry. His father recognized the challenges of building healthy habits that can improve health in the long-term. Saeju, and his co-founder Artem Petakov, were inspired to confront this problem through tech-enabled products initially centered on fitness.
• Some early pivots: First, they created an app that would connect to stationary bikes at gyms to guide and motivate people during their workouts. Later they expanded the concept to other workouts more broadly. Despite all the features of the app, when surveying users the company found that nearly all of them were using it simply to track their steps. After conducting deeper market research they realized that users’ motivation was usually to lose weight and that the opportunity in the diet and nutrition market was bigger than they initially thought.
• The ah-ha moment: In 2010 the founders launched a calorie counting application, but they were not convinced that it would deliver sustained results for all users. So finally, in 2017, the company re-launched with what is the current version of Noom. This one focused on behavior change, often motivated by live health coaches.

12:00 to 18:30: Building a platform for behavioral change

• Noom learns from users: Noom seeks to differentiate itself by incorporating ideas from behavioral psychology. What is most interesting here is Noom’s source of ideas — its users. The company both analyzes users’ activity and collects direct customer feedback to test new strategies for motivating users and keep what works.

“What makes us very different from the other players is that from the beginning we have always believed the end users will provide the answer. They give us the answer on how to build a product. We pay attention to consumer behavior and how they use our service… We iterate all the time to make sure that we follow what has been working for them and improve it.”

• In April, Mashable published a review of Noom where it examined some of these strategies more closely. One of the first things pointed out in this review is the community of coaches and other users:

“From the get-go, Noom makes users feel like part of the ‘Noomologist’ club and identifies members as #NoomNerds. The app encourages a community feel with support from a Noom virtual coach, who is trained in cognitive behavioral therapy and posts direct messages to you in the app.”

• In our interview, Saeju describes how this “community strategy” of connecting members to each other and to coaches was also driven by user research. In 2013, the company realized that logging meals was a key bottleneck to user engagement. When Noom asked users how it can help, many said that they struggled to even start since they did not know which foods were healthy. To support this need, Noom introduced human coaches who could provide guidance — this strategy worked.
• Noom is public about what it learns, sharing publications from user research on a regular basis. Additionally, the company even tries to summarize the key takeaways from these studies and present them directly to users so they can be more informed about the psychology behind their day-to-day decisions in the hopes that they can more actively work on changing unhealthy behaviors.
• Scaling this approach: Noom intends on continuing its investment in human coaches. Saeju says the company now employs more than 3,000 full-time human coaches in the U.S. At the same time, he says that their aim is to “use technology to make it an affordable and scalable platform.” To do this, Saeju highlights the company’s investments in AI to expand the reach of coaches by having a mix of AI-driven and human-driven coaching: “if we provide the right blend of an AI-assisted platform [and human coaching], the human coach can deliver much better results.”

Noom presents tips from behavioral psychology directly to its users in an approachable way (source: Noom)

18:30 to 35:00: Noom’s moves into chronic care

• In late May, Noom closed a $540 million Series F round led by Silver Lake with the intention of using this capital to support the expansion of its behavioral change platform, in terms of both clinical focus and geography.
• The link to chronic care: Noom views weight loss as one measure of overall health, though alone not necessarily as the end goal. Saeju notes that over the years Noom’s members have been sharing stories of not just their weight loss but also the improvement in their chronic conditions, like hypertension or high blood sugar. Through user research, the company also found its members appreciated a curriculum that incorporates behavioral health needs such as stress and anxiety management. Thus, Saeju believes the company already understands many of its users’ needs across a variety of areas and is well-positioned to use its existing platform to further support these needs.
• Saeju thinks a key advantage of Noom within the increasingly competitive chronic care landscape is its historical direct-to-consumer approach, as this has enabled the company to more quickly test and build new features that users might find helpful and meaningful to their health goals.
• Furthermore, Saeju suspects that Noom’s popularity and user-friendliness today supports the already positive impression of its offerings as it seeks to expand within the employer and payer markets and go head-to-head with more established chronic care players.

“We believe that if we can hear from our end users, how they like our products and services, then we have a higher chance of improving [these products and services]…. Will we compete with available services out there? Yes. But the way we want to play in the market is going to be different because we can prove that we shorten the communication cycle between the end user experience and product makers.”

• Finally, Noom expects to enhance its capabilities in chronic care by continuing to invest in partnerships and, as needed, even sponsor medications (e.g., metformin for type-II diabetes). As an example, Saeju pointed to their 2019 partnership with Novo Nordisk (a biopharma company primarily focused on obesity and diabetes). Today, Noom is offered as part of SaxendaCare, a digital-first program to support patients taking Novo’s Saxenda treatment for obesity management.
• Evolving the business model: Noom may ultimately have multiple versions of its product to better meet the needs and economics of its members’ varying health concerns. For both the DTC and employer markets, Saeju envisions maintaining a more affordable consumer version. For those with certain conditions, however, the higher-cost model of learning from those users and creating new product features may require a different pricing strategy.

“We have to alter the way we pay attention to our user base because they are different… that will alter the way we interact with end users, and that will impact our price.”

• The consumer-focused weight-loss program will likely “continue to be our flagship [product]” since the company views this as core to improving overall health for its members. Later this year, however, Saeju expects that Noom will launch new product lines aimed at chronic care management and stress management.

35:30 to End: Final thoughts and advice for MBAs

• Saeju fundamentally attributes Noom’s success to its ability to engage with and learn from its users to understand how to best motivate them to achieve their health goals. He says the degree to which the company focuses on this is one of the things that most surprises new people who join the company, even among those who had already heard of Noom’s emphasis on behavior change.
• Advice for MBAs looking to join Noom: Saeju appreciates MBAs’ ability to learn quickly and work in teams to tackle problems. His biggest advice to MBAs is to keep a flexible mindset — to not lean too much on business cases from class so that they can bring fresh creativity to the problem at hand.

Noom is hiring across a variety of roles, including ones ideal for MBAs! Interested candidates can check out their careers site here.