Kyle Braatz says Fullscript went from a failed US launch to a healthcare company after realizing practitioners spent 30 to 40 minutes building treatment plans by hand.
Fullscript made its platform free for practitioners and added e-prescribing of supplements to patients' phones, which Braatz says lifted conversion from about 17% to over 50%.
Braatz says Fullscript raised under $200,000 from angels and later almost $2m, its only outside funding, because VCs did not see the opportunity.
A failed US launch led Fullscript to $900m
Fullscript grew from a Canadian supplement-dispensing tool into a platform for whole person medicine after its first US launch failed. That failure showed the problem was healthcare, so the company built treatment-plan delivery that practitioners get free and patients actually follow. Funded by angels and a service business rather than VCs, it now serves over 100,000 practitioners and expects about $900m in revenue this year.
Takeaways
The US failure reframed the problem as healthcare. The first US launch drew signups, but practitioners used it differently than expected. Wholesale distributors let them buy from one source instead of 15 brands, and URLs, payment processors and SaaS fees added friction. Kyle says this showed the problem was healthcare, not e-commerce.
E-prescribing supplements lifted conversion past 50%. Practitioners spent 30 to 40 minutes hand-building treatment plans, and patients struggled to follow them. One cancer patient called her plan a part-time job. Sending plans to the patient's phone lifted conversion from about 17% to over 50%.
A free, record-integrated product put practitioners first. Fullscript made the platform free for practitioners and built it into their electronic health records. After a rebuild and US relaunch, revenue reached about $25m in 2016 and over $40m by end of 2017. Kyle's B2B2C principle puts the practitioner first.
Canada's naturopathic niche gave an uncontested start. Brad's wife, a naturopathic doctor, needed to dispense supplements without running a retail store. Fullscript offered a Shopify-style store with built-in distribution and a SaaS fee, with no competition in Canada. Email drips using Brad's practitioner database reached about 1,500 practitioners.
VCs passed, so angels and earnings funded growth. Simple Stories earnings funded the start, then under about $200,000 from two angels and almost $2m from California angels, the only outside money. Kyle says VCs missed the market size, he may not have been persuasive, and he needed little money.
Shopify peers made large-scale growth feel achievable. Kyle and Brad ran Simple Stories, an animated video business for companies, and wanted more impact and scale. Friends such as Harley Finkelstein and Toby Shannan, and the example of Shopify, made building something large feel within reach.
Kyle's advice on building teams
Stay lean. Constraints breed creativity and keep founders connected to what they need to accomplish.
Experience every part of the business before hiring for it, such as doing customer support for three months to feel customers' pain.
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On this episode 2
Show 1
Make people decisions faster.
Hire executives who are one or two steps ahead of the company. At 10 people, do not hire a VP of sales from a big company.