Ro Will Be The Shopify of Healthcare

At the Last Futurist, we’re always evaluating the trajectory of tech startups. During the pandemic one company has really risen to the surface. We predict that in the 2020s it will become the Shopify of healthcare. It’s Ro, the patient company.

Ro started out in men’s health three years ago. It is now generating over $250 million in annual revenue. And its brand is becoming one of the unlikely winners in a time when our lives are full of uncertainty and health concerns. Asymptomatic Covid-19 cases can lead to future heart problems or even brain damage.

With Covid-19 cases flourishing and a declining life expectancy, health tech companies will mature in the 2020s into some of the most powerful companies of the 2030s. This is also occurring due to the rise of AI in healthcare which will be pioneered by Google, Amazon, Apple and others.

As of late July 2020, Ro is valued at $1.5 billion after raising another $200 million in financing. Ro is our pick to become one of the main winners of the pandemic.

Ro will personalize the patient experience and change the future of healthcare in the U.S. This story will evolve quickly. As trends like WFH thrive so do new ways of exploring medical care options. Essentially, more people than ever are flocking to get medical treatment online amid the coronavirus pandemic.

Ro is moving into the broader pharmacy space and has hired industry veteran Stephen Buck to help build out its subscription business.

Ro will change how medical insurance works. The company served 5 million doctor-patient interactions last year. But this is just the tip of the iceberg for this company. A start-up that says its product suite spans “diagnosis to delivery,” Ro has reached record revenue for four straight months through May 2020. The company is also an Amazon acquisition candidate.

Ro Will Democratize Telemedicine and Software Apps for Healthcare Accessibility

The company started out by selling hair loss supplements and erectile dysfunction medication to men. It has built a range of health apps and is on a very lucrative trajectory now. 2021 will be the true breakthrough year for telemedicine. Its main rival is currently Hims.

Ro however will become much more than that. When it launched in 2017, the company’s flagship service, Roman, focused on conditions where men might feel stigma or shame talking to a doctor in person. From that unique value proposition Ro will become the Shopify of Healthcare and the patient experience. It will change the way we do healthcare. I’m saying this in mid 2020.

The company now has a medication delivery service called Ro Pharmacy, which delivers more than 500 generic medications at a flat fee of $5 each. To market itself to new patients, it built out a health content offering called Health Guides. The way Ro scales in the 2020-2023 period will be quite amazing and a lot of hype will come of it.

Ro Has Multiple Paths to Profitability and Scale

Ro is taking on Amazon’s PillPack. It’s competing with Walmart. Backed by more than $176 million in venture capital, it also has to take on traditional retail pharmacies where most consumers still shop for their drugs. As soon as this stock goes IPO, it’s an immediate buy.

If Amazon started with books, and became something else, so will Ro. It starts off and onboards with those really interesting niche verticals. Take for instance Rory. It targets menopausal women, offering six products which are available for purchase and direct-to-consumer delivery.

These include prescription medication and supplements for hot flashes, over the counter treatments for insomnia, prescription vaginal estrogen cream, an all natural water-based lubricant for vaginal dryness and also Latisse, which helps grow eyelashes.

Ro is worth just $1.5 billion today, so how does it become the Shopify for healthcare? It has built a big business by asking consumers to pay cash to help alleviate many of the most common medical complaints without having to visit a doctor in person.

Ro disrupts the patient experience and in 2020, few things are as lucrative. Think about it. The average Ro customer is in their mid-40s and orders pills for high cholesterol, hypertension, birth control or diabetes. Ro is trying to make the experience similar to the way consumers buy other things. In five years, we won’t be accessing healthcare products in the same way as we do today.

In a subscription of everything world, Ro is one of the big winners of the coronavirus scare of the early 2020s. The modern consumer is mobile everything. Ro’s pitch is that it offers affordable prices and a simple user experience which includes access to pharmacists by text message.

How Ro Will Disrupt the Patient Experience

By working directly with drug makers, Ro is navigating around pharmacy benefits managers who manage prescription drug benefits on behalf of health insurers. While PillPack and CareZone (Walmart) have had to battle with pharmacy benefits managers in the past, Ro works with them.

The company was started in 2017 by a trio of entrepreneurs: Rob Schutz, Saman Rahmanian and chief executive officer Zachariah Reitano. Their spin-out apps and in-house brands mean they can cater to a new patient experience that Covid-19 made possible, vastly accelerating how we seek care and health products.

Ro eventually becomes a software healthcare company on the scale of what Shopify is today for E-commerce merchants. This means they get into biotech too.

This is the patient company because of how they optimize software to benefit the patient experience. Every time they have done the extra work to build more software to improve the patient experience they set a new and higher standard for the entire industry. That’s why Ro is one of the telehealth winners of the future. The patient experience really matters.

The company is generating $250 million in annual revenue — without taking insurance. Its investors include Initialized Capital, Box Group and Slow Ventures, as well as angels like Y Combinator partner Aaron Harris, Benchmark’s Scott Belsky and the chief executives of Casper, Code Academy and Pill Pack. It has 18 investors.

Ro will be the company that does the most to disrupt the laggard patient experience in America. It placed #2 in Wellness in Fast Company’s World’s Most Innovative Companies in 2019. Ro’s genius in a nutshell is summed up pretty easily today.

Unlike many telemedicine companies in the space, it focuses on areas of healthcare where patients are likely to have a repeat need and may need ongoing support, rather than the one-off sinus or urinary tract infection. That includes chronic medical conditions, like diabetes and heart disease, which currently afflict nearly half of all Americans.

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