India is a unique marketplace in many methods, however one of the defining characteristics of the financial system on a macro stage is the dichotomy among city and rural India. But with Tier 2 cities growing up as startup and innovation hubs thanks to the penetration of the internet, the client mindset in the direction of tech in smaller cities and semi-urban towns is likewise changing appreciably.
The internet has come as superb leveller in the context of urban-rural divide and a number of the sectors where this is most obvious are ecommerce, training, healthcare and client services. The net and cellular information has led to a democratisation of offerings. Arguably, the maximum significant problem that net and era is solving in rural and semi-urban India is get entry to to healthcare.
Despite the world’s dazzling growth in latest years, in component due to increased investment in tech startups which can be fixing get right of entry to to nice healthcare, there’s a skewness between Tier 1 and a pair of and beneath cities in India. As in line with a file by using KPMG and the Organisation of Pharmaceutical Producers of India (OPPI), more than 75% of the u . S .’s pharmacies, round 60% of hospitals and eighty% of medical doctors are currently placed in city areas.
But India’s rising income, increasing fitness awareness and less difficult access to finance and coverage are changing the reality in India outside the cities. The IBEF has anticipated the Indian healthcare market to be worth $372 Bn by 2022, and lots of investments have come through within the past 5 years into the healthcare sector — in particular startups which might be looking to bridge the space between urban and rural India, in addition to those which are casting off the smaller ache points in Tier 2, 3 and 4 cities.
Epharmacies Ride On Ecommerce Wave
In precise, the epharmacy area has flourished despite regulatory demanding situations thanks to the identical market situations that propped up ecommerce, grocery delivery and meals transport startups. The shared logistics, shipping and supply chain infrastructure for lots of those sectors culminated in a tech surroundings possibility, which online pharmacies or epharmacies additionally latched onto.
“We knew the infrastructure turned into there. So we checked out it from a product point of view. And a whole lot of it is driven by means of basically understanding what users needs, and how they find out the wishes, answering their healthcare questions. So that’s how we acquired users,” 1mg cofounder and CTO Gaurav Agarwal told CFT.
The ecommerce increase intended that 1mg may want to consciousness merely on building the right product, choice, pricing mechanisms, Agarwal said. And it also helped the agency build the proper operational structures after isolating the identification from parent enterprise Healthkart in 2015. “We desired to make sure that the stuff that we promised gets delivered to users on time. All of these things contributed a bit ways in getting us in.”
Online pharmacy startups such as 1mg, Pharmeasy, Netmeds and Medlife made drug treatments greater easily to be had in a much wider distribution place. On the opposite end, Practo, Lybrate, Portea, mfine, and DocsApp sprouted up inside the telemedicine and diagnostics area to make get right of entry to to docs less difficult. And step by step, healthtech startups have changed the face of Indian healthcare over the last 5 years.
As consistent with DataLabs through CFT estimates, the total capital invested in startups working inside the epharma area among 2015 to H1 2019 is $361 Mn. The overall capital influx in the on line pharmacy startups combined makes up round 20% of the entire capital invested within the healthtech startup area of India ($1.77 Bn) inside the same time period.
1mg: Changing Healthcare In Tier 2 India
Even even though 1mg came directly to the scene in April 2015, it were round in an earlier avatar under health and well being marketplace Healthkart. It changed into spun off as a generic drug seek business and rebranded from HealthkartPlus to 1mg.
Founded by Prashant Tandon, Agarwal, and Vikas Chauhan, 1mg has 3 business verticals — pharmaceuticals, labs and doctors. Speaking to CFT, Agarwal said that extra than 70 Mn precise sufferers from across India accessed its platform last yr for those three offerings, with over 2.5 Bn annual pageviews for the healthcare content material, which is a critical element of on line pharmacies.
In FY 2018, 1mg Technologies reported sales of INR 39.Eight Cr ($five.Four Mn), a 223% bounce from the last monetary 12 months. Of the overall sales, the epharmacy contributed INR 23.2 Cr ($3.1 Mn) even as the diagnostics share turned into INR eight.8 Cr ($1.1 Mn) in FY18, an increase of 268% and 214% respectively from FY2017. The employer had in addition pronounced a net loss of INR 88 Cr ($11.Nine Mn) in FY2018, which is ready a 50% boom from the closing monetary yr.
In June this 12 months, 1mg closed a $70 Mn Series D spherical from Corisol Holdings and IFC. With different investors inclusive of Sequoia Capital, HBM, Omidyar Network and Kae Capital, 1mg has the momentum in wishes to enlarge the reach of its diagnostic labs to 100 towns in India, and make epharmacy offerings to be had in Tier 3 cities in addition to villages.
The company’s CEO Tandon said the Series D could assist the organization get complete insurance throughout India in phrases of supply chain, logistics and infrastructure, which could help it gain this penetration out of doors the most important metros and Tier 1 towns. And to get there it is also trying to spend money on constructing its data technology team for new products together with a digital doctor and AI-powered fitness bots. To solve get admission to and availability of drugs, 1mg went to the middle of AI fashions to locate the solutions, Agarwal claimed
“AI is a poorly effortlessly understood these days — anyone says they are the use of AI. But we are going past that. We have been clear that this era ought to change healthcare,” Agarwal stated approximately the organisation’s plans to use artificial intelligence models to improve its offerings.
Agarwal and his engineering team needed to understand how AI models work — the mathematics behind it, as he places it. “So these days, despite the fact that our AI and machine gaining knowledge of group is small, we have over 12 tasks stay in our production structures that use AI and ML fashions.” He added that it’s now not just about finding a version from the internet, plugging in the 1mg facts, but basically knowledge the math and how mathematical fashions worried genuinely supply 1mg the advantage and fee it needs.
Scaling Up 1mg For The Big League
“We use AI today in enhancing user conversions; we use AI to streamline delivery times and the logistics of that; We use AI in doctor consults; We use AI in ailment development fashions, so it’s pretty an array of use-cases for us”
Of direction, it had to begin from someplace, and Agarwal acknowledged this adventure saying how a long way the era crew has come and the growing diploma of sophistication on this team’s method as 1mg scaled up.
“You realize, at every level in the scale, the demanding situations are very unique. So for example, when we began 1mg, we had a completely monolithic infrastructure and we rebuilt that whole thing to genuinely work on a microservices structure. That gave us a sure amount of velocity of development, scalability, stability, and many others, that that we have been capable of leverage and undergo a great deal, a lot faster with regards to generation and product services.”
He delivered that even though the group has grown, there’s usually been an attempt to evaluate new technologies that may be used to automate components of the operations or streamline the infrastructure. “We have a small group, that is called the platform team, which continues investigating what new things are coming available on the market, and the way could they be useful for us,” Agarwal brought to emphasize how 1mg scaled up as a platform.
Agarwal slightly paused as he seemed back at the adventure, however there may be one second where he breaks off from the narrative, and pointedly makes a announcement about cloud computing, announcing that all and sundry severe approximately the use of generation and all its various fingers has to leverage cloud from day zero or maybe before beginning. That’s something 1mg didn’t do, however it did start the usage of Amazon Web Services at a fairly early level, he advised us.
“We used to be hosted on a personal facts centre. And there was a spate of DDOS assaults on corporations and due to the fact they were centered, 1mg infrastructure became additionally affected. So we determined overnight to in reality circulate to cloud infrastructure, which was greater sturdy and reliable. And our decision turned into accurate.”
Before AWS, 1mg’s scalability became depending on third birthday party and bargaining. Even even though it became capable of get higher pricing, according to Agarwal, the usage of a private data centre was now not the high-quality in shape in phrases of flexibleness, and the speed at which it wanted to scale up for new offerings. “It changed into manner better with a generation platform like AWS, and it’s now not pretty much scalability. But our uptimes are upwards of ninety nine.Ninety nine%. A lot of this is subsidized with the aid of AWS skills, and you already know their database carrier or the load balancers and the auto scaling guide and see times, which helps hold the unit value low. It allows plenty with commercial enterprise continuity, and the capacity for the business to innovate.”
But Agarwal become quick to add that it’s not just about innovation, but additionally statistics protection. “We are very clear that patient facts, affected person protection and privacy is our pinnacle precedence. We simply have a totally massive medical affairs crew — round forty human beings nowadays.”
A Culture Of Ownership
While it’s a sales-driven commercial enterprise, it’s now not just about the numbers for Agarwal. He confused that the tradition at 1mg blends duty with empathy to get the team equipped for the challenges.
Of course, tales from India’s boom stage startups paint a photo of unachievable objectives and long working hours. How a good deal of that is authentic for 1mg? “We have been clean that 1mg goes to be a five-days-a-week area. I cost my paintings lifestyles as a whole lot as I value my personal existence. We said that we will no longer measure people on what number of hours they've spent in the workplace, but on how a whole lot they supply.”
At the same time, there’s a feel of possession that the enterprise attempts to infuse into its employees. Agarwal went directly to problematic that despite the fact that 1mg works with third-birthday party partners inclusive of pharma companies, it does no longer percentage any consumer records with 0.33-events, however as a substitute gives access to the users to behavior surveys, take comments and so forth, which really informs groups approximately deficiencies in their products or bundle design and extra.
The dedicated medical affairs team is chargeable for all affected person safety, patient protocols, that 1mg operates inside. This consists of dispensation of medicines, content material listing, lab take a look at protocols, which can be defined, audited and reviewed independent of the commercial enterprise. So the team isn't driven by means of the enterprise goals, Agarwal delivered.
This philosophy of ownership of methods is one of the middle values of 1mg. “We determined early on the core values that might power us. Ownership may be very critical as it teaches duty. But on the same time, right here at 1mg, hierarchy does now not be counted, the purposeful businesses don’t matter — due to the fact with possession comes accountability.”