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- 07/26/18--11:25: _An entrepreneur won...
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- 07/30/18--07:22: _This startup wants ...
- 08/01/18--05:49: _The homeless man wh...
- 08/02/18--15:46: _11 painful moments ...
- 08/03/18--09:57: _13 styles from Ever...
- 08/03/18--10:44: _There's a big probl...
- 08/03/18--12:47: _The cofounder of a ...
- 08/06/18--05:47: _The CEO of a $60 mi...
- 08/06/18--07:03: _The 'Shark Tank' fo...
- 08/06/18--07:36: _I found high-qualit...
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- Student Loan Hero, a personal finance site, was acquired for $60 million this week.
- That milestone never would have happened if CEO Andy Josuweit stuck with his original idea for a company.
- Josuweit says learning from failure is key to finding success as an entrepreneur.
- The husband-and-wife team behind Lollacup (now Lollaland) earned an investment deal on "Shark Tank" in 2012.
- But Hanna and Mark Lim only applied to "Shark Tank" on a whim.
- Once they were accepted, they practiced every single day and sought constructive criticism on their pitch.
- In the wake of Theranos — the buzzy blood-testing unicorn that's fallen from grace and whose founder faces criminal charges— startups are still working to make blood-testing faster and cheaper.
- One new startup called Essenlix uses an iPhone and an attached device to run tests like a complete blood count, used to measure red and white blood cells in the body.
- The device, not yet approved, could bring blood-testing technology to more people who might not have access to a full lab.
- The lines around healthcare are being redrawn, and Walgreens just laid out its plan to go beyond the pharmacy counter
- We spoke to the CEO of Roche Pharmaceuticals about how the pharma giant became a deal machine in 2018
- Entrepreneur David Casarez quit his job as a web developer at General Motors to launch his own tech startup.
- However, he ran out of money and was already living out of his van.
- So Casarez stood on the highway and handed out copies of his résumé. A driver passing by tweeted a photo and Casarez's story went viral. He's received job offers from Google and other tech giants.
- Casarez said he wants to try his hand at entrepreneurship again, at some point in the future.
- JetBlue, SparkNotes, Virgin Atlantic Airlines, and other successful businesses have had rough patches in the past.
- There have been moments when their founders and CEOs didn't know if the company would make it.
- We take a look at 11 of those moments below, along with how the companies' leadership managed to recover.
- Former Twitter vice president and longtime Silicon Valley investor Elad Gil has recently written a book about late-growth companies called High Growth Handbook.
- Gil suggests company founders should approach high company valuations with caution, and says Wall Street thinks about value very differently from venture capitalists.
- A former female employee at the $23 million artificial intelligence startup Pilot AI filed a lawsuit against the company this week alleging sexual harassment from the company's cofounders.
- Rachel Moore, who was dismissed from her role around April 30, alleges that cofounder Elliot English took off his pants in front of her, and discussed sexual topics including an anal sex workshop he took at Burning Man, hosted by a famous porn star, according to the complaint.
- Moore also alleges that CEO and cofounder Jonathan Su ignored her complaints against English, and that the company's investor, New Enterprise Associates, covered up her allegations.
- Student Loan Hero, a financial planning company, was acquired by LendingTree last week for $60 million.
- CEO Andy Josuweit managed to turn his startup into a success despite not having an MBA or experience in the corporate world.
- Josuweit managed to both get his startup off the ground and pay off more than $100,000 in student-loan debt by putting in long hours and making personal sacrifices.
- The founders of sock company Bombas appeared on "Shark Tank" in 2014.
- They landed a deal with Daymond John and, in 2017, Bombas brought in nearly $50 million in revenue.
- The founders said they didn't take the investors' insults personally because they knew it was all in the name of good TV.
- When you're making sauces, gravies, and other thick foods, using a saucier is preferable to a saucepan because it lets you stir, whisk, and reduce ingredients more efficiently.
- Kitchen cookware startup Made In's saucier ($99) is even more rounded in shape than a typical saucier and is perfect for serious home cooks looking to improve their sauce-making.
- Though the saucier used to be more of a professional kitchen mainstay, Made In's well-designed, durable, and accessibly priced saucier deserves a space in your own kitchen.
- Bryan Johnson, who sold his company Braintree to PayPal for $800 million in 2013, created OS Fund to invest in "deep tech" companies centered on science and technology.
- Of the 28 companies OS Fund has invested in since 2013, 26 have seen an increase in their valuation, two were acquired, and four are now valued at $1 billion or more, Johnson said.
- Johnson is now raising a second fund, OS Fund II, to further more science-backed pursuits.
- Silicon Valley is flush with cash, with nearly $58 billion invested in US venture-backed startups so far in 2018.
- With so much money in venture capital, small-time investors are struggling to compete for hot deals.
- Some investors are standing out by specializing. They may target a specific tech sector, which differentiates them by domain expertise and the quality of their relationships.
- Business Insider spoke with three venture capital investors in Silicon Valley to find out why they went niche.
- One of the first investors in Uber and Salesforce shares how his blue-collar upbringing shaped how he invests his millions
- A former Facebook executive explains why she's all done investing piles of cash, and giving startups something more valuable — social influence
- A VC who just raised $22 million to invest in startups reveals one thing you should never say to a female investor
- Heidi Roizen, a partner at Silicon Valley venture-capital firm DFJ, had to stop a board meeting with cultured-meat startup Memphis Meats when the founder showed a slide of five recent hires, all of whom were women.
- That kind of commitment to inclusion is rare in Silicon Valley.
- At Memphis Meats, more than half of the company's team identify as women; 40% of them are in leadership roles.
- This article is part of Business Insider's ongoing series on Better Capitalism.
- New York-based venture firm Female Founders Fund (F3) has founded a new program to mentor and advise female entrepreneurs in cities throughout the US.
- Among the entrepreneurs participating is Zola co-founder Shan-Lyn Ma, who says that her wedding company at first struggled to spark interest among the predominantly male investment scene.
- Filippo Loreti is a Kickstarter-alumn that has set multiple world records for its crowdfunding.
- The company makes luxury watches that would normally sell for $1,000+ and offers them at an accessible price (from $219) by operating direct-to-consumer.
- Filippo Loreti takes design inspiration from three of Italy's iconic cities: Venice, Rome, and Milan.
- The women on our team tested the $249 Rome collection, defined by its Piazza del Campidoglio-inspired watchface, and loved the price, elegance, versatility, and thoughtful design.
- We've also reviewed the brand's men's offerings.
- Birth-control app Natural Cycles has been approved by the US Food and Drug Administration — the first app to be approved for contraception in North America.
- The app uses an algorithm to tell women when they have the highest and lowest chances of getting pregnant, but it ultimately relies on men and women changing their behavior.
- The app recently came under fire in Sweden when 37 women reported getting pregnant while using it.
- Phil Libin, a longtime entrepreneur and the founder of Evernote, thinks the technology industry isn't doing a good job of promoting innovation.
- He's particularly critical of the startup model, because its focus on building companies leaves out worthy ideas and talented technologists.
- Libin new startup, called All Turtles, is hoping to disrupt that model by funding the development of ideas and turning them into products before their developers teams have to worry about building companies around them.
- All Turtles is intended to promote innovation globally; it already has offices in three countries, with more planned.
- Some of the first ideas it's fostered will effectively graduate from its process this fall.
- Meet Dr. Consulta, a Brazil-based healthcare company that provides set prices for healthcare services like check-ups and MRIs.
- Founded in 2011, the company has already seen 1 million patients through its clinics and has raised $100 million with plans to raise even more.
- The company could be a model for healthcare in the US, which has been putting pressure on patients through higher out-of-pocket costs for doctor's visits and prescription drugs.
Part of being a successful entrepreneur is knowing when to give up on a bad idea.
Andy Josuweit learned that on the fly when he founded Student Loan Hero, a personal finance site dedicated to helping people manage their student loan debt.
This week, Student Loan Hero was acquired by LendingTree for $60 million. But that milestone never would have taken place if Josuweit stuck to his original idea for the company.
In 2012, Josuweit and his business partners won a $40,000 grant from the incubator Startup Chile for their idea for a service called Toolbox. As Josuweit told Business Insider, Toolbox was to be an online space where professionals could build profiles around the products and equipment they use for their jobs. Users would be able to compare the products recommended by people they follow, and they would earn commission from purchases made through their profiles.
But Toolbox never came to fruition. A few weeks into the incubator program, Josuweit realized he had an even better idea, one that addressed an issue that hit close to home.
"We were playing with that idea and we saw some fundamental issues with it. We wrote down all our problems on a piece of paper in a spreadsheet and talked to advisers," Josuweit told Business Insider.
"At that point, my student loans were growing from $74,000 to a little over $100,000," he said. "I thought, 'Hey, this is my cancer, I'm bleeding right now. I need to solve this problem. And there are a lot of people like me out there.'"
Josuweit and his partners put Toolbox on hold and came up with an idea that eventually would become Student Loan Hero. The service provides financial comparison tools for student-loan holders and gives users personalized advice on paying off their debt.
Launching Student Loan Hero wasn't quite so simple — it took a week for Josuweit and his partners to convince their Startup Chile advisers to allow him to go forward with the new idea, he said.
But once it was approved, the new project quickly became personal for Josuweit. He said that as his student loans mounted, he began to feel pressure from his family to succeed. His parents had cosigned on some of his loans, and his failure to pay off the loans was starting to affect their credit.
"It created a lot of stress and pressure in my family," he told Business Insider. "There was almost a year where I didn't talk to my dad, and it was pretty traumatic."
He continued: "That's what created pressure, like, 'Hey, we have to make this work. We don't have a choice.' When you have a gun to your head, your have to push and you have to fight."
LendingTree's acquisition of Student Loan Hero not only validates the early financial struggles for Josuweit, it reaffirms his decision in 2012 to completely change courses after finding a new idea.
"You're going to fall on your face a few times, you're going to screw up and fail. You're going to learn from the failures. It takes time," he said. "But if you are willing, have the determination, have the grit, ultimately it's inevitable you will succeed."
It was just before midnight in spring 2012. The kids were asleep, and Hanna and Mark Lim were assembling sippy cups in their living room.
In the background, the TV was tuned to an early season of "Shark Tank."
"We were watching and having such a great time commenting on what we would have done," Mark Lim told me. "We said, 'You know, I bet if we went on that show, we would do great.' We were like, 'Yeah, honey, you would do great. We were kind of pumping each other up.'"
They were only joking though. Their business, Lollacup, was still in its infancy.
On his way back from the kitchen, Mark decided, just for kicks, to look up the date of the next "Shark Tank" casting call, in Los Angeles.
"Lo and behold, it was the next morning," he told me. "We said, 'You know what? What do we lose? We'll be a little tired, but let's just wake up super early, drop the kids off at our parents, and we'll see what happens." Still giggling, they filled out an application.
The next morning, they waited seven hours in line for their turn to audition. When they were called back a few months later, things started to feel real — a little too real.
"We asked, 'Is there any way we could delay this for a year, for next season, so that we can have some more traction and figure out our overall strategy?" Mark remembered.
The team's answer? "Absolutely not. It's now or never."
"So we went through with it," Mark said. They were scheduled to pitch the sharks in late summer, and in the months leading up, "we proceeded to watch every episode, write down each question, and then have a typed-out answer, like how we would answer."
Mark went on: "We got in front of people who were not afraid to criticize us." He and Hanna practiced every single day, he said, "until we were tired of the word 'Shark Tank.'"
The Lims' appearance on 'Shark Tank' was dramatic
The Lims appeared on season three, episode 12 of "Shark Tank," requesting $100,000 for a 15% stake in Lollacup. They explained that the cup was a better alternative to traditional sippy cups with straws, which can damage kids' teeth. To ensure safety, the cups were made in the US instead of overseas.
Kevin O'Leary made the first offer, $100,000 for 50%, but he wanted to produce the cups offshore. Daymond John matched O'Leary's offer, but wanted the Lims to get out of a deal they'd recently made with a sales agent.
Other sharks took the bait, and things got tense.
Robert Herjavec asked the Lims if they had a counteroffer, and Mark came back with $100,000 for 40%. Mark Cuban jumped out of his chair — "Yes! I'm in!"— but Mark first wanted to see if Herjavec would accept his counteroffer.
John tweaked his offer to $100,000 for 30%, but when Hanna said they'd rather partner with Cuban and Herjavec, John went back out.
Ultimately, the Lims struck a deal with Mark Cuban and Robert Herjavec: $100,000 for 40% of the company.
"That's the classic thing with business and entrepreneurship," Hanna told me. "When the opportunity arises, you have to seize it."
That's how they approached their appearance on Shark Tank. Hanna added, "We haven't really looked back."
SEE ALSO: When the founders of dating app Coffee Meets Bagel turned down Mark Cuban's $30 million offer on 'Shark Tank' 3 years ago, they got dozens of emails calling them 'crazy,' 'greedy,' and 'stupid' — but they still aren't sorry
The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.
Recently, I've been seeing a luxury handbag company called Senreve all over my social media feeds.
Each time I saw it, I found myself drawn to the crisp lines of the bag and the way it seemed to instantly cinch the wearer's outfit together, whether she was wearing a flowy weekend dress or stylish business casual.
Intrigued by what seemed to be the it bag of stylish women everywhere, I decided to learn more about the company that believes (rightly so) that women can have it all, down to the handbag they choose to carry.
The first thing that's clear is Senreve was made for the modern woman who demands more from everything in her life, professional and personal, and needs accessories that can keep up. Designed for busy multitaskers who breeze from breakfast meetings to cocktail networking events, Senreve handbags are just the solution.
Whether in food, furniture, or fashion, you can't fake craftsmanship. All you have to do is feel any of Senreve's bags to find luxury quality and sturdy construction that just isn't there with brands of similar price points. Made in Italy by craftsman who have been working with top luxury brands for over 50 years, the bags feature an Italian water-resistant genuine leather exterior and a supple, stain-resistant micro-suede interior. The pebbled leather is soft and smooth, yet scratch-resistant and clearly durable.
Though some styles have more color options than others, they're all undoubtedly gorgeous. You can choose from deep and moody colors like forest, merlot, marine, and noir, or opt for soft and neutral tones like cream, blush, and sand.
Senreve's sharp style, quality leather, and beautiful color options have earned the adoration of celebrities including Selma Blair, Priyanka Chopra, Jenna Dewan Tatum, and Jessica Alba, as well as popular bloggers Chriselle Lim and Rocky Barnes. Its a lineup of supporters as versatile as the bags themselves.
The bags and totes range from $125 to $995, so it's not likely to be a quick buck you just drop on a whim. But if you're seriously considering a handbag investment for you or a special someone in your life, a Senreve bag will not disappoint. You can see the best styles from the site below.
Having trouble figuring out what to get people for the holidays? You can check out all of Insider Picks' 2017 gift guides here.
This distinctively boxy bag looks cool no matter how you wear it: as a backpack, a crossbody, over the shoulder, or on the arm.
A mini version of the Maestra, this bag is great for daytime outings. It has seven interior compartments and the central one can fit an iPad.
The newest addition to the popular Maestra family is this mid-sized beauty. While it can't fit a laptop, it can fit an iPad Pro and has one more compartment than the regular and Mini Maestras.
See the rest of the story at Business Insider
The story might sound familiar: An entrepreneur out of a prestigious US university has developed a new blood-testing technology that can be run using only a small sample of blood.
While that might leave visions of black turtlenecks, and Silicon Valley-level valuations in your head, Stephen Chou, a professor of electrical engineering at Princeton University, is trying to make sure his startup, Essenlix, doesn't meet the same fate as Theranos.
The New Jersey-based company is developing a a system that uses an iPhone and an attachment to run lab samples on-the-go.
"You basically have a mobile chemical biological lab in your hand," Chou said.
To start, Chou developed a test for a complete blood count (or CBC), which measures the number of white and red blood cells in the body as well as hemoglobin, a protein responsible for transporting oxygen.
While the test is used to monitor overall health, it's also frequently used in blood cancer practices to check a person's blood count before chemotherapy. The company's raised about $20 million from investors including Quadrant Management, Carret Private Investments, and other high net worth individuals.
Here's how it works
Essenlix's system, dubbed the iMOST (short for "Instant Mobile Self-Test"), consists of a few different components: there's an app, an attachment, a cartridge for the sample, and of course the iPhone itself. The attachment sits over the iPhone's camera and flash.
The test starts with a finger-prick. The first drop of blood gets wiped away, but the second gets put on a thin plastic cartridge.
Once that's done, the cartridge is loaded into the green attachment, and the test is run in a matter of seconds, leveraging the insides of the iPhone including the flash and camera.
Typically, complete blood count tests are done on machines found in the labs at doctor's offices. To vet Essenlix's system, the team ran clinical trials comparing the new technology to traditional devices.
In two trials of 92 patients total run at Hunterdon Hematology Oncology in New Jersey, Essenlix tested patients with both the standard machine and its blood test. In the end, there was on average a 6% difference between Essenlix's white and red blood cell counts and what traditional machines found, and a 3% difference in hemoglobin measurements, all within the FDA requirements for allowable total error.
"Our error is clearly smaller than the FDA’s requirement so the data is very, very good," Chou said.
With that data, Chou said the company is working with the FDA to move toward a potential approval, and ideally hopes to publish the clinical trial results in a publication.
Proliferating lab testing
While doctors who already have access in their offices to a lab that runs blood count tests might not need an iPhone-based version, the implications of a mobile testing platform could be significant in rural areas that may not have access to traditional, expensive equipment. And ultimately, because the test can be run rather simply, it might lead to lower lab costs.
There are others companies trying to make the blood testing process easier and cheaper. In July, a company building a tabletop machine got the European OK for its CBC tests.
The lab-testing community is optimistic for a day when tests like a CBC can be run on smaller, more portable machines, which will inevitably improve access to the technology.
"This is necessary," Dennis Dietzen, a medical director at St. Louis Children's Hospital and professor of pediatrics and pathology and immunology at Washington University School of Medicine and president of the American Association for Clinical Chemistry told Business Insider. But miniaturizing the technology needed to run these kinds of tests, Dietzen said, isn't easy. Dietzen said he's still waiting to see clinical data published in an academic journal that compares Essenlix's technology to the standard way blood tests are run.
The dearth of clinical data and published articles about its technology was a common refrain for criticism to Theranos. For a long time, the company didn't publicly share its data, saying it'd rather go through the FDA approval process.
In the future, the hope is to use Essenlix's iMOST technology for other blood tests to detect viruses or bacterial infections, and ideally one day on other types of body fluids beyond blood.
David Casarez quit his job as a web developer at General Motors just months shy of his 26th birthday.
Years earlier, he'd made a pact with himself, that by the time he turned 26, he'd start his own business.
So Casarez cashed out his 401(k) and packed his bags for the San Francisco Bay Area, where he planned to launch a tech startup. He described it to me as a multi-sided platform covering the food industry, picking up where services like Blue Apron had left off.
Casarez's family thought he was crazy to leave a stable gig, especially since he wouldn't have money to cover the cost of rent in California and would have to live out of his van.
Today I saw this young homeless man asking for people to take a resume rather than asking for money. If anyone in the Silicon Valley could help him out, that would be amazing. Please RT so we can help David out! pic.twitter.com/ewoE3PKFx7— FullMakeup Alchemist (@jaysc0) July 27, 2018
Casarez had run out of money for his startup and was homeless. Now he's received hundreds of job offers, including one from Google, he told The New York Post.
I spoke with Casarez by phone and he told me that he'd like to return to the corporate or startup world for now, but he "absolutely" plans to try entrepreneurship again. "I don't think I'll ever give up on pursuing that dream," he said. "It is a dream of mine to be able to build something that's going to help society."
At one point after he ran out of money, his vehicle was repossessed. "I just felt down in the gutter," Casarez said. "I just completely went off the grid for a bit. It was a very depressing period. But I wasn't going to let that hold me down."
When he came up with the idea of passing out résumés on the highway, he thought, "Let me give this one last shot."
Casarez isn't discouraged by his failure to launch his tech startup
Casarez isn't especially disappointed at the way things turned out with his startup. "Sometimes you have a lot of failures before you have success," he said.
I asked Casarez if he was at all influenced by "entrepreneurship porn," a term coined by Morra Aarons-Mele to describe stories about the supposedly glamorous lifestyle of company founders.
"I did my research," he said. That's why he practiced living out of a van even when he was in Austin, Texas, working for GM.
Despite the notoriously poor odds of startup success, "I told myself, would I rather be on my deathbed knowing I didn't take the risk or knowing that I did? That's what really pushed me to leave the comfort of working at GM," Casarez said.
His advice for other people who want to strike out on their own? "Never give up. If you have a dream, pursue it. Take a risk, because you never know what the end result will be." As for the tumultuous past year of his life, Casarez said, "All I feel is it's a bump in the road."
If you take a look at the history of many successful companies, you'll inevitably find moments where the founder or CEO didn't know if the organization would make it.
Maybe they'd run out of money, or maybe they'd stumbled into a PR disaster. Either way, the future looked bleak.
Below, we've listed 11 such moments — and how the company leadership managed to forge ahead.
VIPKID CEO and founder Cindy Mi couldn't handle unprecedented customer demand
VIPKID is a Chinese education startup that connects native English-speaking teachers with young Chinese students for virtual English lessons.
As Business Insider's Harrison Jacobs reported, while the company was in its pilot stage in 2014, Mi's friend tried out the service and posted about it on Weibo (China's version of Twitter).
Within a day, the company was receiving calls and messages from people who wanted to try the service for themselves. People started to get angry because the company wasn't able to respond to all their requests.
Mi's team ultimately resolved the problem by putting out a statement that read: "Give us a couple of months and, when we're ready, we'll come back to you."
Mi told Jacobs that the message conveyed to customers that the company was professional instead of sleazy and wasn't simply trying to get money out of them before the product was ready.
SparkNotes cofounder Sam Yagan wasn't churning out content fast enough
Yagan was a Harvard undergrad when he cofounded SparkNotes along with his roommate; the site went live the spring of their senior year.
As Yagan told Business Insider's Richard Feloni on an episode of the podcast "This is Success," the immediate response was that "people were pissed,"sending angry emails. Specifically, because the site didn't have the book they needed yet.
"That's the best kind of hate mail to get, is we need more product," Yagan said. That summer, they hired some editors to put up more SparkNotes, "and the rest is history."
GOAT cofounder Eddy Lu wasn't prepared for the company to explode in popularity
GOAT is now the world's largest resale marketplace for high-end sneakers.
On Black Friday 2015, GOAT blew up and couldn't keep up with customer demand; thousands of orders were left unfilled.
As Lu told Feloni on another episode of "This is Success,""We responded to every single customer-service message. I think there were about 4,500 that day. But at that point it was better to be hated than unknown."
See the rest of the story at Business Insider
The Insider Picks team writes about stuff we think you'll like. Business Insider has affiliate partnerships, so we get a share of the revenue from your purchase.
Cult-favorite basics brand Everlane has steadily been taking over as our number one shopping destination for all things sleek, pragmatic, and minimal.
The brand excels at creating timeless styles with a touch of modern flair, and always keeps practicality top of mind when putting out new designs. There's a reason we write about them so much, and it has everything to do with the fact that their clothing, shoes, backpacks, and travel essentials are truly some of the best out there.
Another major incentive is the value. As a direct-to-consumer company, Everlane is able to produce everything in ethical factories with benefits and living wages for workers, all while keeping their costs down and passing on savings to the rest of us.
So whether you're already a die-hard fan who wants to know what other loyal shoppers are buying or you're relatively new to the brand and want a few recommendations, we've put together a list of Everlane picks that our team loves and wears in their daily lives.
Check out all the men's and women's Everlane pieces we swear by below:
The Modern Loafer Mule (women's)
I have two pairs of these mules — one in white and one in black (though they come in tons of colors, including new suede options). They serve the same purpose and have a similar aesthetic as their traditional loafers, but with no blistering on the heel — which is a major consideration for someone who walks as much as I do. These took a little bit of time to break in before they felt truly comfortable and walkable, but at this point they are probably my most-worn shoes. I pair them with everything from denim and a T-shirt to silky slip dresses to plaid pants and oversized button-downs. They're super versatile, sleek, and cute! — Sally Kaplan, Insider Picks editor
The Cashmere Crew (women's)
I tried to avoid buying this sweater even though I knew I'd love it because I don't typically spend $100 on anything, but the price is just too good. I'm glad I took the plunge because I love it. I wish I had it in every color, but the classic black one I chose is definitely the most versatile color choice. It's soft, luxurious, and warm for cold winter days. — Malarie Gokey, Insider Picks guides editor
The Day Market Tote (women's)
Last summer, I got my hands on the cognac tote popularized by bride-of-the-moment Meghan Markle and it has rarely left my side since. You can tell, too. While it was stiffer when I first got it, the leather has weathered beautifully into a soft material that has obviously received a lot of love through multiple uses. The handle length is just right and the bag is surprisingly sturdy. In addition to essentials like my wallet, sunglasses, and a light cardigan, I lug around a large 40-oz. water bottle in it and it doesn't break a sweat.
The simple, elegant design makes it a versatile and polished choice, whether you're going to work or heading out for drinks. I'm personally a big fan of the rosy, warm color options, like Blush and Light Taupe. — Connie Chen, Insider Picks reporter
See the rest of the story at Business Insider
Former Twitter vice president and longtime Silicon Valley investor Elad Gil has spent a lot of time considering what drives a company's value. He's recently written a book dedicated to the subject of company growth, called "High Growth Handbook," which details how a growing company can retain great leaders, manage its resources effectively, and maintain its value longterm.
One of his key pieces of advice deals with how leaders of growing companies think about their business's value.
According to Gil, it's typically not in a company's best interest to over-optimize value.
He writes, "When a founder has a multi-billion-dollar valuation two challenges arise: 1) the founder may push unsustainable growth at all costs to hit the valuation and 2) a lot of distractions arise that may not help the business (e.g., press, speaking opportunities, investments, etc.)."
Silicon Valley's up-and-coming CEOs might be too distracted seeking coveted unicorn status to realize that a billion-dollar valuation presents a mire of potential pitfalls.
In an interview with Business Insider, Gil suggested there's an inherent disconnect with the way Silicon Valley considers worth.
"Fundamentally, when all is said and done, the way that businesses work best in the long run, is in the cashflow they bring in," Gil said. "In the really early days, it's about the startup, the team, and the potential. As you grow the company, you start hitting different milestones, in terms of revenue."
With more and more companies achieving unicorn status all the time (already in 2018, more than 15 growing companies are estimated to be worth $1 billion or more), Gil says they should consider the way traditional financial institutions define worth.
"Look at the way Wall Street looks at a company," said Gil. "They should think about cashflow and leave it at that."
Of the companies that have achieved billion-dollar status in recent months, Gil suggests their 7-figure estimations might not be entirely accurate.
"Maybe only half should be valued that high," said Gil. "Not all are over-valued, though. The most valuable companies might look overvalued at the time, but sometimes they look cheap in hindsight."
"Some people say that running a startup is like going to war. It's hard to see what the future really holds if you have a smart investor telling you that your company is worth a lot. You might think that it's a good idea to raise at a high valuation."
When considering company value, however, Gil says that it's best to back it up with hard numbers.
"Public investors approach value very differently," he said. "They’ll assess you on different metrics. Your valuation might be true until there's public scrutiny, and you don't know what you'll be valued in a public market."
A former employee at the artificial intelligence startup Pilot AI filed a lawsuit against its cofounders and one of its investors in the San Francisco County Superior Court on August 1, alleging sexual harassment and gender discrimination in her time at the company.
Rachel Moore, a 24-year-old Stanford grad, claims she was discharged from her role at Pilot AI around April 30 after months of alleged sexual harassment and gender discrimination at the company, according to the suit.
Pilot AI is a Palo Alto-based artificial intelligence startup, founded in 2015 by Stanford PhD grads Elliot English and Jonathan Su. A 2016 series A funding round, led by New Enterprise Associates, valued the company at $23 million, according to PitchBook.
Pilot AI, English, Su, and NEA are all named in the complaint, as well as Pilot AI's human resources provider TriNet.
Burning Man, pants dropping, and "fuck me boots"
The culture at Pilot AI, Moore alleges, required employees to participate in "sexual and risqué banter." She was told men watch pornography in the office and use the server room to masturbate, according to the suit.
In particular, Moore alleges sexually charged comments from English, the chief technology officer, including one instance in which he allegedly told Moore about participating in "an anal sex workshop at Burning Man led by a famous porn star."
In another instance, English allegedly asked Moore whether the boots she was wearing were "fuck me boots." Moore also alleges that English called her into his office, closed the door and changed his pants in front of her, which she took to be a sexual advance.
In addition to specific instances of sexual harassment, Moore alleges Su, the CEO, tried to dissuade her from filing a complaint, and failed to document her complaint when she filed it, even as she faced what she believed to be retaliation for rejecting English's alleged sexual advances.
Moore also alleges that the VC firm NEA and its partner Rick Yang led an "utter sham and a cover up" in lieu of a formal investigation into her complaints.
Representatives for NEA, Pilot AI and Yang did not respond to a request for comment. TriNet declined to comment.
As Andy Josuweit learned, it takes the same three qualities to get a startup off the ground. Josuweit sold his company, the financial-advice site Student Loan Hero, to LendingTree for $60 million last week, two years after he paid off the last of his $107,000 in student-loan debt. The CEO recently spoke with Business Insider and explained how he was able to overcome a lack of business experience to find success. "I didn't consider myself the smartest guy in the room. I didn't really do well in school," Josuweit told Business Insider. "But one of my best attributes is I'm willing to work hard and keep showing up day after day, and that's the most important thing to success as an entrepreneur." Josuweit founded Student Loan Hero in 2012 with funds from the incubator program Startup Chile, after dramatically changing the idea for his business after the program had already begun. Under immense pressure to succeed from his parents, who were on the hook for some of his debt, Josuweit made a number of sacrifices: He worked 14-hour days, he biked everywhere instead of owning a car, and he even moved from New York City to Austin, Texas, so he could pay less in taxes and living expenses. Josuweit made his final loan payment in September 2016, and preaches financial education on his site every day. Student Loan Hero offers financial comparison tools and personalized advice on paying off debt, and the company claims it's helped wipe out more than $1 billion in student debt. Josuweit never earned an MBA. He compared his rise in the startup world to his wrestling career in high school, when he went from a "pretty terrible" athlete to a district champion, and even went on to coach the University of Texas wrestling team. "I view business as the same path. You're going to fall on your face a few times, you're going to screw up and fail. You're going to learn from the failures. It takes time," Josuweit told Business Insider. "But if you are willing, have the determination, have the grit, ultimately it's inevitable you will succeed." He added that many entrepreneurs are too eager to give up when they don't see results — even if they might be on the cusp of a breakthrough. "I think a lot of people don't want to put in the time or they don't realize they're that close when you're just about to be successful," he said. "You can't see it, you can't see the future, and a lot of people give up before they take off." "If you really want to do it, run your company and do your own thing, you've got to put in the time."
It takes hard work, patience, and a willingness to make sacrifices to pay off more than $100,000 in student-loan debt.
As Andy Josuweit learned, it takes the same three qualities to get a startup off the ground.
Josuweit sold his company, the financial-advice site Student Loan Hero, to LendingTree for $60 million last week, two years after he paid off the last of his $107,000 in student-loan debt.
The CEO recently spoke with Business Insider and explained how he was able to overcome a lack of business experience to find success.
"I didn't consider myself the smartest guy in the room. I didn't really do well in school," Josuweit told Business Insider. "But one of my best attributes is I'm willing to work hard and keep showing up day after day, and that's the most important thing to success as an entrepreneur."
Josuweit founded Student Loan Hero in 2012 with funds from the incubator program Startup Chile, after dramatically changing the idea for his business after the program had already begun.
Under immense pressure to succeed from his parents, who were on the hook for some of his debt, Josuweit made a number of sacrifices: He worked 14-hour days, he biked everywhere instead of owning a car, and he even moved from New York City to Austin, Texas, so he could pay less in taxes and living expenses.
Josuweit made his final loan payment in September 2016, and preaches financial education on his site every day. Student Loan Hero offers financial comparison tools and personalized advice on paying off debt, and the company claims it's helped wipe out more than $1 billion in student debt.
Josuweit never earned an MBA. He compared his rise in the startup world to his wrestling career in high school, when he went from a "pretty terrible" athlete to a district champion, and even went on to coach the University of Texas wrestling team.
"I view business as the same path. You're going to fall on your face a few times, you're going to screw up and fail. You're going to learn from the failures. It takes time," Josuweit told Business Insider. "But if you are willing, have the determination, have the grit, ultimately it's inevitable you will succeed."
He added that many entrepreneurs are too eager to give up when they don't see results — even if they might be on the cusp of a breakthrough.
"I think a lot of people don't want to put in the time or they don't realize they're that close when you're just about to be successful," he said. "You can't see it, you can't see the future, and a lot of people give up before they take off."
"If you really want to do it, run your company and do your own thing, you've got to put in the time."
"No one would want to sit in and watch one of my regular investor meetings," said David Heath. "They’re pretty cordial. People are asking really thoughtful and soft questions."
Heath is the cofounder, along with Randy Goldberg, of sock company Bombas. In 2014, they appeared on an episode of "Shark Tank," ultimately landing a deal with Daymond John: $200,000 in exchange for 17.5% of their company, plus the financing of the inventory.
Today, Bombas is one of the biggest "Shark Tank" successes: Heath told Business Insider’s Richard Feloni that the company had been profitable since 2016 and brought in "just under $50 million" in revenue in 2017.
John told Feloni that Bombas was his best investment, largely because the company’s social mission — donating socks to homeless shelters — is also good for business.
Like most interactions in the tank, the back-and-forth between Goldberg, Heath, and the sharks back in 2014 was intense — notably more so than your typical investor meeting. But the Bombas founders said they weren’t especially fazed.
"What we told ourselves prior to walking in," Heath said, "is that at the end of the day, you have to remind yourself that it’s a television show."
The founders' real reactions to the investors' insults weren't shown on TV
At one point after Bombas’ pitch, Kevin O’Leary (a.k.a. "Mr. Wonderful") told the founders: "Guys, a $4 million valuation [Bombas had valued their company at $4 million at the beginning of the episode] in a total commodity of socks is ludicrous. And I think reality will strike because you guys are still sock cockroaches."
O’Leary added that Bombas had no market share or retail exposure yet.
Goldberg and Heath said they couldn’t help but laugh when O’Leary likened them to insects. "We thought it was really funny, that it was a really funny comment, rather than being like, 'Oh, we’re so offended that you called us a 'sock cockroach,’" Heath said.
That’s not what appears on TV. Instead, the founders are straight-faced and Heath says, "You could have said that to the guy who started Under Armour, too."
The Bombas founders were similarly tickled when the TV promotion for that episode of "Shark Tank" came out. There’s a clip of Goldberg dabbing perspiration from his face with a napkin — it looks like he’s cracking under pressure.
But Goldberg told me that moment really happened before the Bombas founders delivered their pitch, when they had to stand under the hot lights for 30 seconds.
"We thought it was pretty clever," Goldberg said of the producers’ decision to show him sweating. "We don’t really take ourselves too seriously."
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In every home cook's kitchen you're likely to find a saucepan, the small round cooking pot with tall sides that's used for making sauces and gravies or warming up liquids.
You're less likely to find a saucier, a similar type of pot that has a rounded bottom and slightly flared top. If you don't frequently make sauces, risottos, custards, and other types of foods that require frequent stirring or whisking, a saucier will just be another extraneous piece of cookware taking up space in your cabinet.
However, if you are a sauce enthusiast and are frustrated with the flaws of a traditional saucepan, you should consider investing in a saucier.
I recently tested Made In's saucier, the shape and design of which made me question why I've put up with making sauces in a traditional saucepan for so long.
Its three-quart saucier, in particular, was designed based off customers' feedback, and because Made In can control all of its production processes, it was able to make a more "curated" saucier that specifically addresses these customer needs.
Made In's saucier is more rounded in shape than a traditional saucier, making it even easier to stir ingredients around. It's also more flared in shape at the top to encourage better evaporation when you're reducing sauces and gravies.
I made a variety of sauces, including a chunky tomato sauce filled with vegetables and a creamy alfredo sauce, in the saucier and the processes were so much smoother thanks to the design of the pot.
Because it doesn't have hard edges like a saucepan, ingredients didn't get stuck in tricky-to-reach places and I could stir everything in smooth, continuous motions. The handle is sturdy and made me feel supported as I turned the pot and also stayed cool throughout the cooking process.
Reducing sauces and gravies makes more sense in a saucier instead of a saucepan with tall sides because there's more surface area to let the liquid reduce and condense faster. As a busy person who likes cooking but has many other tasks to get through during the night, I liked that the saucier made cooking more efficient.
As with the nonstick frying pan, what especially impressed me was the value I was getting from this well-made cookware.
The saucier has a five-ply stainless steel and aluminum construction (the extra layers make it more durable), is induction compatible, and is dishwasher- and oven-safe. A three-quart All-Clad saucier has nearly all the same specifications — it's actually only three-ply — and is sold for double the price. With a lid, Made In's saucer is $99, while All-Clad's is $163 on Amazon and $195 at other major retailers like Bed Bath & Beyond.
Savings like this combined with a product that was carefully designed for the actual cooking task in mind only further convinced me that Made In is a kitchen company you should be watching.
"If you go to someone with money, and say, 'Hey, why don't you invest in science stuff?' they'll probably say no," said Bryan Johnson. "They'll say that it takes longer, that it's harder to assess risks, and that it isn't worth it."
Johnson is a cofounder of OS Fund, a venture fund that specializes in what Johnson calls "deep tech," technologies at the crossroad of science and tech.
Often, these deep-tech companies — or any early-stage company dealing with science, medicine, or biotech — pose as risky bets to prospective investors. Biotech companies typically take longer to yield returns than their consumer-facing counterparts, and regulatory approvals and research studies can prolong the time before products are ready to go to market, making many investors less eager to fund science-backed startups.
But Johnson says deep-tech companies are not only worthwhile investments, but highly profitable.
So far, Johnson's foray into investing has yielded overwhelmingly high returns. Of the 28 companies that Johnson and his cofounder, Jeff Klunzinger, have funded since 2013, 26 have seen an increase in their valuation, two were acquired, and four are now valued at $1 billion or more, Johnson said.
Now, Johnson and Klunzinger are raising a second fund, called OS Fund II, to invest in entrepreneurs who aim to solve global problems like world hunger, nuclear waste, and environmental hazards caused by food production.
While these issues might seem like daunting investments, Johnson insists that solving these problems shouldn't be left to nonprofits or nongovernmental organizations.
"We're not simply do-gooders," Johnson said of himself and Klunzinger. "We're competing with all the best funds in the world. We're interested in seeing returns on our investments and doing this successfully."
Johnson credits much of his fund's early success to his outsider sensibility. He's the former CEO and founder of the payments company Braintree. After he sold Braintree to PayPal in 2013 for $800 million, Johnson used some of his money to fund science-based companies.
"I have no formal scientific training," Johnson said. "Early on, I was personally betting $100 million on this project. I come from a very naïve perspective, and I've spent a lot of time doing research and working with the founders."
Johnson says his early experience as an entrepreneur has provided him the ability to guide early-stage companies in the right direction. While many science-based companies are clouded by an academic perspective, approaching them with purely entrepreneurial insight can reap huge dividends, Johnson said.
"A lot of scientists have built up the wrong intuitions," he said. "The academic game incentivizes you to pursue fields that are sexy, rather than the best markets. Sometimes you have to look for markets that aren't sexy or have been neglected."
Johnson compared investments in biotech today to the early enterprise landscape of the late '70s.
"In 1978, there were a few new companies like Microsoft and Intel and Oracle that were building up a new ecosystem of opportunity," he said. "Now we're in the age of biology and genomics and protein design and automatic manufacturing. It's an emergent field that's bigger than computing. It's a new era for investing."
There was a time in San Francisco when pretty much any wealthy individual could write a check and own a piece of a company or a portfolio of companies through partnering with a venture firm.
But being rich doesn't get you as far in today's tech landscape.
More and more venture firms, from Palo Alto to Tokyo, are pouring billions of dollars into mammoth, global growth funds known as "mega-funds" that have invested in startups building the future of work,cars,computing, and even dog-walking. Sequoia Capital told limited partners they would have to make a minimum investment of $250 million to procure a spot in its growth fund.
The rush of capital has produced a number of effects, including inflated startup valuations and increases in the amount of capital competing for access to the buzziest startups in Silicon Valley.
"In the early days of venture, one could have made the argument that because venture capitalists had money and entrepreneurs didn't, and there were limited choices [with fewer funds], having money itself was competitive advantage," Ron Bouganim, founder and managing partner of boutique venture firm Govtech Fund, told Business Insider.
"With the oversupply of capital, having money alone is not an advantage. There's so much money chasing every investment opportunity," Bouganim said. "How do you differentiate yourself from another investor? Some form of specialization is necessary."
SC Moatti, a former Facebook executive who raised $13 million for her firm Mighty Capital's debut fund, put it this way: "Money is money. It's nothing specific. It's really hard to say, 'You should take my money because it's more green that somebody else's.'"
The situation has created a shift in venture capital, where small-time investors are rewriting the playbook on how to land deals. Those who don't have the reputation or financial backing of the most established venture firms on Sand Hill Road are getting smarter, not richer, to compete with the fat funds sprouting up.
Some investors look to specialize by targeting a specific tech sector, which gives them a robust network of connections, domain expertise, and higher quality deal flow, because founders start to seek out those firms that aim to deliver more value for their buck.
Knowledge is more valuable than money
The first half of 2018 saw nearly $58 billion invested into venture-backed startups in the US, which is more than VCs deployed for the full year over six of the past 10 years, according to the National Venture Capital Association. An estimated 300 new funds will close in 2018, which only adds to the opportunities for founders to raise.
In order to compete for spots in hot investment deals, investors are asking themselves why a founder should take their money over someone else's pile of cash. For some, it's about who they know.
For others, it's about their expertise.
Clara Brenner and Julie Lein just raised $22 million for their debut fund to invest in startups solving important challenges for cities. Those companies are a tough sell for venture capitalists, because their products often require a lot of money to launch and they face regulatory hurdles from local authorities who prefer the status quo.
"We gravitate towards businesses operating in highly-regulated or politicized spaces. And we offer our companies a lot of hands-on support around these issues, which they'd be hard-pressed to find elsewhere," Brenner told Business Insider.
The investors met as graduate students at MIT Sloan School of Management, where they studied the intersection of cities and entrepreneurship. They applied their knowledge of urban innovation as cofounders of an accelerator called Tumml, which made early investments in companies such as Chariot, a private shuttle service that carries commuters where they need to go, and Neighborly, an online investment platform for civic projects.
Brenner and Lein helped shape some key policies inside Chariot, including the decision to hire locally and deploy shuttle buses in neighborhoods that are underserved by public transportation, in order to build goodwill in the community. In 2016, Ford bought Chariot for $65 million, creating a nice payout for Brenner and Lein, as well as investors, or LPs, in their urban innovation accelerator.
The investors are betting that their new firm, Urban Innovation Fund, will attract social-impact companies because of their domain expertise. They already have a track record for success: Chariot is thriving, while its Andreessen Horowitz-backed rival shut down.
The decision to specialize was a no-brainer, according to Brenner.
"Specializing helps you stand out. For an entrepreneur, you are demonstrating passion and expertise for their business, which can make you a real value-add," Brenner said. "For an LP, you are offering them a portfolio that doesn't look like anyone else's, which can help them diversify. And, of course, building a well-considered thesis can make you a stronger, more discerning investor."
A laser-focused venture firm rises
Many years ago, Ron Bouganim made a similar observation.
As the Canadian entrepreneur crawled through the process of becoming a US citizen, he saw that the government was ripe for innovation. In 2014, he launched a venture capital firm called Govtech Fund to deploy capital into startups that aim to help governments be more responsive, efficient, and better able to serve society.
The firm only makes about four investments a year and is laser-focused on technology that modernizes the internal operations of government. This is not to be confused with civic technology, which supports the public's interaction with government, and is likely a better fit for Brenner and Lein's Urban Innovation Fund.
Govtech Fund companies build software tools for government employees that improve how they deliver everything from foster care to law enforcement to food safety. The portfolio ranges from Glimpse, which identifies and evaluates a school district's "eROI" (education return on investment) for every product, program, or strategy implemented in a classroom, to Sema, which transforms legacy software code maintenance for government software systems.
Matt Van Itallie, CEO of Sema, said he considered many venture capitalists when fundraising for his company.
"Our goal was to partner with a fund that truly understood the govtech market," Van Itallie said in a press release announcing Govtech's second fund."We're not just backed by the Govtech Fund's capital, but with the govtech ecosystem they have built."
Companies that have taken venture dollars from Govtech Fund have relationships with over 20,000 government agencies, and according to Bouganim, the ecosystem adds 10 new agencies every day.
It's not uncommon for those startups to pitch their government partners on services provided by other companies in Govtech Fund's portfolio. They share learnings with each other in the firm's Slack channel and on company offsites. Some entrepreneurs even come to work at Govtech HQ, a 4,000-square-foot office space in San Francisco that was designed for hosting speakers, lunch-and-learn programs, and salons with visiting government workers.
Bouganim said while he doesn't have the resources of a large, private equity fund with "a hundred staff members that are doing research" as if it had an "in-house consulting shop," he adds value in other ways with a close-knit portfolio of 19 companies.
"I don't think venture capital is different from any other business," Bouganim said, adding that when he advises his startups, he tells them, "'You need to have a large market opportunity, you need to have a differentiated product, and as you scale that product, you need to have competitive moat. If you don't build competitive moat, someone else will come along and probably displace you.'"
He went on, "So, when you just look at the basic principles of running a startup, why would that apply any differently in the world of venture capital?"
Investors are more involved than ever
Most venture firms specialize to some extent in order to attract a certain type of company. Investors might choose to focus on a venture stage from pre-seed to growth, a geography, or a sector.
With so much money in venture, some investors say they have to do more than specialize in order to attract tier one startups.
"That's not how you stand out," said SC Moatti, the former Facebook executive who launched her own venture firm. "You stand out by the value you bring, not by saying, 'I do this and not that.' You stand out by saying, 'You should take my money because it really has a different color, because we give you access to Products That Count.'"
Mighty Capital invests almost exclusively in product-driven startups and differentiates itself from other growth-stage funds by giving its portfolio companies access to Products That Count, one of the world's largest networks of product managers. It's helpful if a founder wants to hire product managers, sell to product managers, or get advice from insiders on building their companies at scale.
Moatti has figured out that social influence is what she brings to the table, beyond writing checks for between $500,000 and $1 million.
Mighty Capital makes mostly growth-stage investments, because Moatti said that's when the firm adds the most value for companies. The job of a product manager is to match a customer's problem with a solution in the form of a product. This is known as product-market fit, and it's an essential goal of growth-stage companies.
Some venture firms are building out programming and services to support the portfolio companies after they've invested.
Structure Capital, a young venture firm in San Francisco, invests almost exclusively in sharing economy companies whose goal is to reduce waste. (The firm's founder, Mike Walsh, seeded the fund with $300,000 worth of Uber stock before the company blew up.)
According to Walsh, the firm's "special sauce" is a two-day bootcamp for portfolio companies that Structure Capital offers. Entrepreneurs meet with advertising executives and brand strategists to craft their brand, through developing logos, idea videos, taglines, mission statements, and their overall brand strategy. This is especially important for sharing economy companies (think Airbnb and Uber) that rely on customers loving the brand to grow their businesses.
In Silicon Valley, it's the investors who are trying to impress.
"Almost always, we are the most hands-on investor our portfolio companies have," said Brenner of her new firm, Urban Innovation Fund. "As a team, we pride ourselves on being useful — with deck prep, fundraising support, or policy-related strategic planning. We take their calls and texts late at night, and we are always repping them to other investors."
According to Moatti, founders should expect nothing less when there's so much capital competing for investments.
"Most venture capital firms offer money and a network," Moatti said. "Well, if you've been in the Bay Area for long enough, we all have a little bit of money and a network."
"The fact that we give access to basically hundreds of thousands of potential hires, or hundreds of thousands of potential customers, that's really differentiated," she said.
The moment Heidi Roizen knew she'd backed the right startup happened in the middle of a board-room meeting. After 20 years working as a venture capitalist, she'd never seen a slide like the one presented to her by Uma Valeti, the founder of cultured-meat startup Memphis Meats.
Before her were photos of five of the company's most recent hires — all of whom were scientists or managers by training, and all of whom also happened to be women.
"I stopped him right at that moment to tell him I'd never seen a slide like that in my career," Roizen told Business Insider. "And he looked at me like something was wrong, which partially explains why Memphis Meats is such a leader when it comes to diversity."
Based in Silicon Valley, Memphis Meats kicked off with funding from leading biotech hub IndieBio in 2015. Today, it's backed by investors such as Bill Gates, Richard Branson, Twitch cofounder Kyle Vogt, and Kimbal Musk (Elon Musk's brother). Two food giants — Tyson Foods and Cargill — are other notable investors.
Like a handful of other enterprising startups in the meat-alternative space, Memphis Meats' mission is to grow real meat from animal cells to minimize the environmental waste and ethical problems linked with factory farming.
But unlike the majority of the startup world, more than half of the company's team identify as women; 40% of them are in leadership roles.
The reason that's significant isn't merely because it's novel. It's also a key indicator of the company's core values, Roizen said.
'Great resumes are the price of admission, not the focus of our hiring process'
Memphis Meats is committed to hiring a diverse team of people who hail from a variety of backgrounds, Megan Pittman, Memphis Meats' director of people operations, told Roizen in an interview for a blog post she wrote about the experience.
To do that, they look beyond traditional hiring practices that focus exclusively on things like résumés, which can be biased toward white men because of institutional racism and sexism. For decades, policies like redlining (the process by which banks refuse loans or insurance to people of color because an area is determined to be too financially risky) and immigration practices favoring European countries have limited the resources available to women and people of color.
Those policies and behaviors also contribute to limiting the amount of money that goes to women and people of color. Last year, all-female startup teams got just 2% of all venture-capital investment dollars. Fewer than 1% of American venture capital-backed founders are black.
Instead of sitting down to a traditional interview, hiring managers at Memphis Meats ask all job candidates to begin by giving a 30-minute talk focused on an accomplishment or a topic they're familiar with.
Hiring managers at Memphis do other things that help to make diversity an entrenched part of the process. They all ask one question, for example, when looking for a new hire: "What do we need our next person to bring that our team doesn’t already have?” Pittman said.
Roizen said it's critical that more startups prioritize inclusion like Memphis Meats did — from the beginning — because not doing so can trap a company in a vicious cycle.
“If you suddenly wake up one day and you look around the room and it’s all guys, it’s much harder to back things in than to build that gender diversity from the beginning," Roizen said.
Memphis Meats' question about bringing in someone who can speak to a skill or attribute that the company doesn't already have hits this nail on the head. It emphasizes that what the company needs is not more of the same, but instead a variety of perspectives from a variety of backgrounds. The practice has paid off, Pittman said.
"We’ve seen plenty of data showing that companies that hire based on résumés and checkboxes end up with homogeneous workforces," Pittman said. "Don’t get me wrong — great résumés and hard skills are requirements at Memphis Meats, but they’re the price of admission and not the focus of our hiring process."
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When Zola co-founder Shan-Lyn Ma first began pitching her idea for a one-stop wedding site to investors, she says they were mostly unimpressed.
"One of the things I remember very vividly from the first few years starting out was a meeting in which I was pitching a group of all male investors," said Ma. "One investor looked me right in the eyes and said, very seriously, 'When I got married 20 years ago, my wife seemed to be fine with the wedding registry we used then. Are you sure that women today will want anything different?'"
Ma said she was amazed by his response: "It struck me as a little crazy. You would never say that of any other tech service from 20 years ago. It seemed so obvious that people today would want to benefit from great design in weddings as they do in every aspect of life," she said.
For Ma, securing funding early on was an uphill battle. Many investors didn't seem to see the point of an efficient, customizable wedding registry, she says. It's understandable, said Ma, that her company may not have initially resonated with the average venture capitalist.
"Our average customer is a 26 to 34-year-old woman," she said. "That demographic is not hugely represented in the VC industry. It's been a long time since many investors were married themselves, and it was tougher sell than, say, a photo sharing app."
Looking back, Ma estimates that three out of every four investors she pitched turned Zola down. Five years later, however, some of those same investors might be experiencing regret.
Today, Zola is one of the top websites used by millennial couples to plan their weddings . It's also among the fastest-growing wedding companies in the US, and has plans to take on the $72 billion wedding market. In their latest funding round the company raised $100 million from investors including Lightspeed, Goldman Sachs, and Thrive Capital.
On this particular round the tables were turned: "It's a very different ratio now," said Ma of the investors interested in funding Zola.
Now, Ma is hoping to impart some of the lessons she learned from her early days pitching her company to other female founders.
Ma is just one among a group of high-profile female entrepreneurs gathered together by New York-based venture firm Female Founders Fund (F3) for its new Venture Partner Program. The program's aim is to bring together a network of business-savvy women to take on the disproportionately male entrepreneurial landscape.
F3 partner Sutian Dong says that the program's aim is to create increased exposure for female founders and provide access to a network of of investors, advisors, and mentors. The program has headed up several female entrepreneurial communities in Boston, L.A., San Francisco, and New York, with mentors including Stich Fix founder Katrina Lake, Care.com founder Sheila Lirio Marcelo, Gixo co-founder Selina Tobaccowala, and Tala founder Shivani Siroya.
In an interview with Business Insider, Sutian Dong described the program as the formalization of a process that F3 has engaged in ever since Dong and F3 founder Anu Duggal kicked the fund off: "We’re constantly thinking about ways to leverage what we’ve built thus far," said Dong. "We're taking the same thing we were doing informally and putting it into a formalized process."
Or, as Ma puts it: "We're hoping to break up the old boys network of the past. These types of networks have been built for generations, but primarily men. As a female founder myself, I've seen that for female founders it can be harder. This is about building an operable network for women."
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Luxury watches often come with the sort of price tag that prohibits most of us from owning one — an inaccessibility that has, in the past, been a central part of what made something luxurious a luxury.
But thanks to new companies approaching the industry with more robust business models, things are changing, and luxury is becoming increasingly affordable.
Now, if you find the right online company, you can own a watch that should theoretically cost 10 to 40 times what it takes to produce for much less.
And if you're looking for that, you should know about Filippo Loreti.
Filippo Loreti is a watch company that was founded by 20-something Lithuanian brothers Danielius and Matas Jakutis in 2015. Aside from its watches, it’s best-known for its record-breaking 2015 Kickstarter in which the company outstripped its $20,000 goal by raising close to a million dollars in a month’s time. The company’s mission was and is simple: make $1,000+ luxury watches affordable and relatively accessible.
In short, the Jakutis brothers wanted to democratize the luxury timepiece industry.
By creating the company online and reducing how many external pieces they have to include (middlemen and retailers) the company is able to keep its costs low and pass those savings on to its customers. As a result, you pay from $219 for a minimalist watch to $609 for an artisanal automatic, all well under what luxury watches typically go for.
Filippo Loreti’s 2015 Kickstarter campaign made it the most crowdfunded watch company in history, and, in 2016, the company broke its own record by raising over 5.5 million in 30 days from more than 18,000 backers. In total, the company has launched three record-breaking crowdfunding campaigns, raised more than $10,000,000 tot and is one of Kickstarter’s 20 most successful initiatives across all categories.
Aside from affordable luxury, Filippo Loreti likely draws customers for its ongoing spirit of crowdsourcing. The company maintains the “old ways” that set great watches apart from the rest, but its watches are co-developed with the brand’s community — resulting in a luxury watch that still feels aspirational, but with the sort of thoughtful design that brings it decisively into the ‘now’.
Initially, the company’s messaging — like most watch brands — was catered towards men. However, one facet of the elegance and elastic utilitarianism of watches is that they aren’t necessarily gendered. While Filippo Loreti’s site offers two sections — men’s watches and women’s watches— the differences are minimal, and the prices identical.
Anyone of any gender could comfortably wear the designs.
The watches are inspired by three iconic Italian cities — Venice, Rome, and Milan — as well as, less overtly, the long history of Italian luxury and finesse in general — emulating the same meticulous and vocational craftsmanship of industry landmarks like Ferrari, Fendi, Versace, Prada, Armani, and Dolce & Gabbana.
For the last few weeks, the women on our team have been wearing watches from the $249 Rome collection to see how they stack up. As a whole, the line is minimalist, versatile, and elegant. Of the four options, the major distinctions are in color of leather and metal: Matte Black, Rose Gold, Gold, or Silver.
Filippo Loreti’s interpretation of Rome takes its main inspiration from the famous Piazza del Campidoglio, a “masterwork of urban planning” with a mesmerizing, elliptical design by Michelangelo as its centerpiece. The series’ dials are executed in a reminiscent style, using a “guilloche” pattern most notably used by high-end watchmakers. The collection falls in line with the iconic Italian architectural monuments best defined by their sloping lines and carefully crafted details. At the back of the watch face, you’ll find a 3D embossed recreation of the Piazza del Campidoglio — an unusually beautiful addition that adds artisan value without interfering with its simplicity.
You can swap out leather bands if you value versatility, and you can shop for an automatic ($585 - $609) or quartz ($249) form the series. Though, in a rare distinction for the brand, the Rome automatic watches are only found in the men’s section.
Financially, it makes sense to get a luxury watch here rather than pay a 4,000% markup — at least until that markup is justified by the sort of iconic name that warrants a lopsided price. Plus, the company offers free shipping worldwide, 90-day returns, and a 10-year international warranty.
But, all in all, the watches are really nice — even regardless of price point. Part of the draw to Italian staples like Fendi, Ferrari, and Versace is the knowledge that these items were, in some way, costly either in price, effort, or ingenuity to produce. Filippo Loreti watches are affordable, but they still feel luxurious and aspirational in the sense that they feel distinctly thoughtful and labored-over. The Rome collection is simple enough to be timeless and versatile, but still ultimately feels customized.
Below are the watches we tried and what we thought:
Connie Chen, Insider Picks reporter:
I’ve always had a strong preference for gold or light-colored watches, but Filippo Loreti’s Rome Matte Black watch might be the first to make me jump ship. Though it’s all black, the various textures — the geometric etchings surrounded by a smooth ring of marble, the soft yet sturdy leather — play against each other so the watch is still visually interesting. The reverse engraving is beautifully detailed, and even though no one else can see it, it’s a reminder of the brand’s elegance, sophistication, and craftsmanship.
Mara Leighton, Insider Picks reporter:
I've gotten to check out a lot of watches through my time at Insider Picks, and Filippo Loreti is one of my favorites. The quality of the materials and the considered but understated design make them look and feel luxurious without being over the top. The matte black is sleek and the proportions spot on — not so thin that it appears purely ornamental or the watch face unnaturally large like many women’s watches, but also not bulky enough to appear overtly masculine. The contrasting texture and intricate pattering are interesting to look at, and I love the personalization of the 3D embossed Piazza on the back. My favorite aspect, though — aside from price — is that I always think of Michelangelo’s geometric centerpiece when I look down at my wrist. It’s an oddly nice source for a recurring mix of both humility and inspiration — and I like knowing my watch has a bit more of “deep dive” story to it.
Remi Rosmarin, Insider Picks intern:
I rarely wear watches. I have a small wrist, so I find that most watches either dangle uncomfortably or just look absurdly large on my arm. Those issues, plus the high price tags on most watches I actually do like, have deterred me from watch shopping all together. I assumed this watch would be another failure.
After trying the Rome Gold, I was actually pleasantly surprised. The brown leather band and gold face give the watch a classic, timeless look that matches well with my everyday jewelry. At 40 mm, the face of the watch is still pretty large, but I did not find it obtrusive as I typed and did work. I think this can be credited to the settings on the band, which allowed me to make sure the watch was really secure. The design is simple, but the textured pattern on the face definitely adds some intrigue. This watch may not go in my everyday rotation right away, but I definitely will re-wear it. If you’re in the market for a watch, I think Filippo Loreti, with its high quality but reasonably priced options, is worth checking out.
Sally Kaplan, Insider Picks editor:
I am no watch connoisseur, but my partner has a collection of minimalist timepieces that I occasionally steal to wear myself. This time, it seems, I'll have to guard my own watch from her thieving hands.
I got the Rome Silver watch to test out, and I've been amply pleased with it so far. The minimalist silhouette of the watch is what I found myself initially drawn to, but the immense detail is what keeps me wanting to revisit it every day. I'm particularly excited to wear it on my trip to Rome in March of next year, where I absolutely plan compare the etching of the Piazza del Campidoglio to the real thing.
It's worth noting that the watch face is on the larger size for my wrist, which isn't something I mind, but may be a consideration for anyone with tiny wrists or daintier taste.
A birth-control app called Natural Cycles has been approved by the US Food and Drug Administration, marking the first time an app has been approved for contraception in North America.
Designed by physicist couple Elina Berglund and Raoul Scherwitzl, the app doesn't involve a pill and contains no medication. It works by giving heterosexual couples recommendations about when to avoid sex or use protection, based on a woman's daily temperature measurements and the regularity of her period.
“Consumers are increasingly using digital health technologies to inform their everyday health decisions, and this new app can provide an effective method of contraception if it’s used carefully and correctly,” Terri Cornelison, assistant director for women's health at the FDA’s Center for Devices, said in a statement. “But women should know that no form of contraception works perfectly, so an unplanned pregnancy could still result from correct usage of this device.”
Natural Cycles only helps prevent pregnancy if people using it behave in the way it prescribes. The app also recently gained regulatory approval in Europe — the first app to do so there as well — but it came under fire in Sweden several months later when 37 women reported getting pregnant while using it.
Those pregnancies ignited a small controversy about how the app works and what it can — and can't — do. But Scherwitzl told Business Insider in January that he was not surprised women had become pregnant.
"We give red and green days and clear recommendations on which days to abstain and which days we consider the risk of pregnancy to be negligible," he said.
The problem with saying 'as effective as the pill using only math'
Natural Cycles was initially portrayed by multiple news outlets — including Business Insider — as being "as effective as the pill using only math."
When is used properly, Natural Cycles may be comparable in effectiveness to the pill. But that doesn't always happen, as the controversy in Sweden revealed.
"Just like with the pill, you have scenarios where women take the pill everyday" and it's as reliable as possible, Scherwitzl said, and then there are "scenarios where they don't take it every day" and the reliability decreases.
How Natural Cycles compares with simply using a calendar
Natural Cycles' approach puts it in a larger category of birth control known as fertility awareness, which is similar to the calendar-based approach people have used for decades.
The company's founders published a study on the app's effectiveness in the European Journal of Contraception and Reproductive Health Care in 2016. The research involved 4,000 women between the ages of 18 and 45, and the results showed that out of every 100 women who used the app in a "typical" way for a year (meaning certain common slip-ups were accounted for), seven of them got pregnant.
That rate is and significantly lower than the traditional calendar method, which has an average fail rate of 24%, according to the CDC.
The "typical use" scenario for the pill leads to about nine out of 100 women getting pregnant within a year, so the study suggests Natural Cycles is on par with an oral contraceptive. But the app still leads to more pregnancies than would be seen among people using injectable birth control or an IUD. The typical use fail rate for an IUD is 0.2-0.8%, or less than one out of 100 women getting pregnant each year.
Apps can 'provide encouragement,' but still have key limitations
As far as the women who got pregnant while using the Natural Cycles app are concerned, the same European study found that more than half of them had unprotected sex with men on the days when the app advised against it. Those instances are evidence of a longstanding human reality: behavioral control is difficult, especially when it comes to sex, and not a guaranteed way to prevent pregnancy.
"While smartphone apps may provide encouragement, they can't stop [men and women] from ... sex altogether," Susan Walker, a professor of sexual health at Anglia Ruskin University, wrote in an article for The Conversation.
A handful of other factors can also get in the way of the app working correctly, including having multiple sex partners and having a partner who is not equally committed to birth control.
So if you're planning on using the app — or one of the dozens like it that have not been approved as medical devices — experts say you should have a predictable sex schedule, regular periods, be willing to check your temperature every day, and have the ability to abstain from sexual activity on consecutive days every month.
If you can do all that, the app could work for you.
"In the end, what we want to do is add a new method of contraception that women can choose from without side effects," Scherwitzl said. "I think there are many women who this will be great for."
If you ask Phil Libin, the tech industry doesn't do a very good job these days at promoting innovation.
They may seem a strange thing to say, given that the industry has a reputation for being the most innovative in the country, if not the world. But Libin's not just some crank.
He's been in the industry for more than 20 years, founding a succession of successful startups — including note keeping app Evernote, the one he's most known for — and working as a venture capitalist. He's seen how the business works from the inside.
"The structure for making innovative tech products … is old and inefficient and broken in lots of different ways," Libin, All Turtles' founder and CEO, told Business Insider in an interview earlier this month.
Libin's solution is a new kind of company called All Turtles that he's designed specifically to address the problems he sees in tech innovation, particularly in the area of artificial intelligence. If his bet is right, the result could be not just a bunch of new AI-based products and services, but a better way to foster and develop new technologies.
"If this works, you can copy and spread it" widely, said Abhishek Nagaraj, an assistant professor at the Haas School of Business at the University of California, Berkeley, who focuses on entrepreneurship and innovation. He continued: "The potential is tantalizing."
Neither of tech's two innovation models is working well
The way Libin sees things, the tech industry has two basic models for promoting innovation — and each has its own shortcomings.
The first, he says, is through the research efforts of the giant tech companies, including Facebook, Microsoft, Google, and Apple. The problem with that model is those companies tend to be very conservative, focusing on small-bore innovations that won't disrupt their core businesses. When they are more forward thinking — such as Google with its X lab — they tend to be focused on moon shots that, by definition, have will likely have little near-term impact on the real world.
The second model, by his reckoning, is built around startups. While entrepreneurs are often more willing to focus on disruptive technologies than the tech giants, innovation in the startup world is thwarted by the very focus of trying to create new companies. That fixation is fundamentally flawed.
By necessity, that model self-selects for founders who are good at fundraising and managing, rather than those skilled at solving important problems, Libin said. By contrast, technologists with good ideas or product development skills can fail simply because they have no talent for building companies.
What's more, because entrepreneurs and startups are frequently working by themselves, they often don't and can't learn from the mistakes of others. Instead, they end up reinventing the wheel over and over again at the expense of time, money, and often the ideas themselves.
"It's a total s--t show," Libin said. "Like everything's on fire, no one knows what they're doing, you have to scrounge around for resources and everyone makes the same 10,000 mistakes over and over again."
But there are other problems with the startup model, Libin said. Again, because it's so focused around companies, it tends to exclude innovative people and ideas from areas of the world outside of Silicon Valley that don't have the kind of ecosystem found there for funding and supporting startups.
And with the growing size of funding rounds, Silicon Valley has become increasingly focused on ideas that have the potential to be billion dollar companies or larger. That's started to leave out practical innovations that are worthwhile but don't have that promise.
"Not everything has to be a multibillion dollar outcome," he said.
Libin thinks he has a new and better way to jump start innovation
Libin thinks there's a better way. With All Turtles, which he launched last year, he aims to bring together talented technologists working in AI and help direct them to solve particular real-world problems with the technology. All Turtles will fund the technologists, assist them in developing their solutions, and then help them figure out how to go to market with them.
It's already a global effort. In addition to its San Francisco headquarters, All Turtles has offices in Tokyo and Paris to fund projects in those cities. It plans to open a Mexico City office next year. Within five years, Libin would like to have outposts in eight cities, including ones in Eastern Europe and Africa and potentially in India and China.
Libin plans to have each All Turtles office oversee 10 local projects at a time. Each year, the offices would each graduate about three projects and replace them with three new ones. Libin wants to keep the total number of projects per office fairly small to keep things manageable and to maintain quality control.
All Turtles is flexible when it comes to both originating ideas and eventual exits
The projects will come from any of three places.
They could be ideas generated in-house by Libin and the All Turtles team. They could come from outside corporations who are looking for help in developing a specific idea or solving particular problem. Or they could come from individual technologists or teams who are looking for help attacking a particular problem. Libin expects that within each office, new projects will roughly be split evenly among the three different sources.
In most cases, All Turtles will fund the development of projects by itself. In other cases, it will bring in projects that already have some venture or corporate funding. Regardless, the plan is to develop the projects in-house to the point where there's an actual product that's launched and has traction in the market before worrying about where the project will end up.
All Turtles establishes all the projects as separate companies within its corporate structure so it can easily spin them off as standalone startups with their own sources of external funding, as circumstances allow. But All Turtles is intentionally designed to accommodate other possible outcomes for ideas that make it past the development stage.
They could be acquired by outside companies, for example, particularly those that partner with All Turtles to develop the ideas. helped fund them. Or All Turtles could keep them in-house and run them itself, offering their products and services as its own.
"We're indifferent toward companies," Libin said. "If some of these products then become independent companies, fine, that's the best outcome, but they don't have to."
He continued: "We don't have the startup fetish that permeates the industry."
One of its first products is a chatbot designed to combat sexual harassment
The company already has "several" projects that it expects to graduate from its program in the fall and get outside funding, Libin said. One of them, a product called Spot, is a chatbot designed to make it easier for victims of workplace sexual harassment to document and report their experiences. The system relies on natural language processing and an interaction model that's intended to encourage victims to recount their experiences as accurately as possible.
Launched earlier this year, Spot is free for individuals to use. All Turtles charges corporations who want to build it into their human resources processes.
"By the time Spot gets the first penny of external funding, it will have a launched product with thousands of users, with actual, paying large companies, with revenue, with traction, with tons of media exposure," Libin said. "It will be a real thing before we ask anyone for money."
Although All Turtles is designed to fund innovative tech ideas, it's set up as an operating company, not as a venture fund. Ironically, while Libin is trying to pioneer a different model for innovation, All Turtles is itself a venture-funded startup. It's raised $20 million in financing in a series A round, with much of the money coming from Salesforce Ventures.
And while Libin thinks there's a need to fund and develop technology innovations that aren't necessarily going to turn into the next billion dollar companies, he has big ambitions for All Turtles. He's hoping All Turtles itself will eventually become a public company worth billions of dollars.
All Turtles has plenty of company in trying to jump start innovation
Libin isn't the first person, of course, to recognize that the tech industry has a problem in funding and developing new ideas and technologies. In the 1990s, entrepreneur Bill Gross set up Idealab as an incubator to develop ideas for web-based companies, many of which he later spun off or sold.
Later, Y Combinator and 500 Startups were launched to help entrepreneurs establish themselves and get their startups off the ground. More recently, Android founder Andy Rubin launched Playground to help incubate innovative ideas, particularly in technology hardware. Meanwhile, numerous venture funds and organizations have launched with the express purpose of trying to help entrepreneurs — including those in other countries — build companies and develop their ideas.
Neil Cohen has had a front row seat to this movement. In the 1990s, he cofounded Camp 6, an early startup incubator that fizzled out with the dot-com bust. More recently, he's worked with other incubators and accelerators from around the world.
"I can appreciate the process and the thought [Libin's] putting in to be better at it," said Cohen, now an independent marketing consultant. He continued: "Great for him to have this organization that's going to try to create and accelerate these ideas. But I would say that there other places doing great work."
Separating product development from corporate development could prove problematic
What's more, Libin's idea of trying to promote innovation outside of the typical corporate structure could prove troublesome. Products are often shaped by the business model and goals of the companies that develop them, noted Haas' Nagaraj. A company that was looking to compete with Facebook head-to-head would likely design its product very differently than a company that aspired to be acquired by Facebook.
"How successfully you can decouple [product from business model] is a question for me," he said.
For his part, Libin recognizes that there have been other efforts to try to overhaul technology innovation — and that his might not work out. The company's name reflects that realization, he said. It refers to a tower of turtles. Libin's company is building on the efforts of those who came before it, and others will build on his and learn from his mistakes.
"There's a rich history of people trying to change the way innovative products get made and make who gets to make them more inclusive," Libin said. "We're the next level up from that."
Thomaz Srougi comes from a family of doctors — both his parents and his brother are in the medical field.
"I’m the ugly duckling," Srougi, who has a finance background, told Business Insider. But the entrepreneur didn't stray too far when cofounding Dr. Consulta, a Brazilian company that provides doctor's visits and healthcare services for set fees — no insurance needed.
Founded in 2011, the company has already raised $100 million from Sillicon Valley venture firms, family offices, and other global investors, and is in the process of raising another $100 million. Already, Dr. Consulta has seen 1 million patients. To put that into perspective, that's 1 out of 12 people in Sao Paulo, the largest city in Brazil.
Healthcare in Brazil
In many ways, Brazil's health system looks a lot different from the US. In 1988, Brazil wrote universal healthcare into its constitution, saying that public healthcare had to be free to all 200 million Brazilian citizens.
For the majority of Brazilians, the public system covers everything from check-ups to hospital stays. About 26% are covered by private health insurance, usually provided by their employers similar to the system in the US. On both the public and private sides, there can be issues: there are long waits associated with the public system, and private health insurance costs are going up.
Dr. Consulta's plan is to go after the remaining 150 million Brazilians who don't have insurance who might not want to use the public system.
Dr. Consulta got off the ground in 2011 by establishing a healthcare clinic in one of the low-income neighborhoods in Sao Paulo. Srougi and the team spent three years focusing on the model there and have since expanded to more than 50 locations around the city.
Because insurance isn't a part of the picture, Dr. Consulta could build everything on its own.
"We had the courage to do that from scratch," Srougi said.
Here's how it works
All in, the company has built its own booking system, clinics, and an electronic health record to manage patient information.
The company employs 2,000 doctors, mines its data to help pharmaceutical companies find potential candidates for the clinical trials they need to run, and helps with pharmacy discounts. It's currently running seven trials for international pharmaceutical companies spanning issues like high cholesterol, heart disease, diabetes, and chronic kidney disease. More are awaiting regulatory approval to get off the ground, with hopes to grow the clinical trial market in Brazil.
But there are some healthcare elements the company won't touch.
"We're not getting into health insurance, we're not becoming a hospital, we're partnering with them," Srougi said.
At each doctor's office, prices for procedures are listed out. For example, a general practitioner visit costs roughly $30 ($110 Brazilian Real), while an MRI costs roughly $128 ($500 Brazilian Real). It's a big difference from how prices are set in the US, where it's varied and you often don't know how much you're on the hook for until a few months later.
"It's all posted almost like a McDonald's menu," Dr. Marc Garnick, an oncologist at Beth Israel Deaconess Medical Center and a professor at the Harvard School of Medicine, who's been advising Dr. Consulta and is an investor, told Business Insider.
The model — providing a service for a set fee — is one that healthcare companies have been trying to move away from in an attempt to get better healthcare outcomes at lower costs. In the US, fee-for-service systems have often led to doctors over-using resources (prescribing unnecessary tests or procedures) as a way for the health system to make more money. Srougi said that's not the case for Dr. Consulta.
"We twisted the incentives so doctors aren't incentivized to prescribe more than necessary," Srougi said. That involves a series of protocols embedded into Dr. Consulta's software, which flags when doctors are going off-book. Their compensation can be docked if that happens too often.
The hope is to also work with employers in Brazil to offer Dr. Consulta as a benefit, at which point the services would be covered by the employer on a per-member, per-month basis. Srougi said there are currently employers competing to be part of the pilot.
The approach is similar to both urgent care and direct primary care, a small but fast-growing movement in the US of pediatricians, family-medicine physicians, and internists — though those services charge a monthly fee rather than by visit.
The public-private divide
But targeting those who don't have insurance worries some of Brazil's policy experts, who question the impact it'll have on the public health system.
Matthew Harris, a professor at the Imperial College London's School of Public Health who worked for the Brazilian healthcare system as a doctor in the 1990s, told Business Insider that his concern is that people would feel the need to pay for care they'd otherwise get for free, weakening the public system's ability's to get a complete picture of citizens' health.
"When done well, it’s second to none," Harris said about the public health system. That said, he acknowledged, the Brazilian system is under-funded, meaning the system hasn't been able to care for everyone as well and as quickly as it does in theory, even as the government has been contributing more of its budget to healthcare.
Srougi for his part sees the relationship as complementary: where the public system falls short, Dr. Consulta can be there.
"The public system fails to do primary care, and that's exactly what we're good at," Srougi said. "It's beautiful on paper, but in reality it doesn't happen. It's a false promise."
The bigger issue, as Rodrigo Soares, professor of Brazilian public policy and international and public affairs at Columbia University sees it, is that the public system is so separate from the private side that it can be inefficient. Those with insurance are directed to privately operated doctor's practices, while those using the public system are directed to public clinics and hospitals. That can become a problem when a person with private insurance needs a complicated procedure that might be better handled at a university hospital on the public system.
Why US investors are flocking to healthcare in Brazil
To grow Dr. Consulta, Srougi's been coming to the US and meeting with venture capital firms as well as private equity, mutual funds, and hedge funds. The hope is to use those firms' expertise as well as their capital when expanding the company's presence in Sao Paulo as well as an entry into other major Brazilian cities like Rio de Janiero and Belo Horizonte.
"We have a solid base of partners. We don't need money for money," Srougi said. "We're looking for the best product software developers and the best skills and resources within data analysis. Most of those funds are here and in the Valley you have the usual suspects developing software."
But his US investor base isn't alone in its interest in Brazil. In 2012, Minnesota-based UnitedHealth Group bought Amil, the largest healthcare company in Brazil. And in 2014, investment firm Bain Capital acquired Grupo NotreDame Intermedica, taking the company public four years later.
For some of Dr. Consulta's investors, the draw of what the company is achieving in Brazil is in part because of where it succeeds where the US system fails.
"They've solved a lot of problems that we are constantly trying to solve in the US," Garnick, the Harvard School of Medicine professor, said.
And in a lot of ways, the technology components to Dr. Consulta's system, as well as its model, could be applied elsewhere.
"I don’t think of Dr. Consulta as a Brazilian company. It's a very universal vision to how healthcare should be deployed," said Neil Day, vice president of technology at Blue Bottle Coffee and an investor in Dr. Consulta.
Ultimately, the model could be one that the American healthcare system takes cues from as it tries to keep a lid on rising healthcare costs that are putting patients on the hook for high prices that often come as a surprise.
"The solution for the American healthcare system isn't coming from [the US]," Srougi said. "It's coming from other places that for many reasons fostered more possibilities in terms of new types of care models."