Sramana Mitra: What is the business model for you? Are you on a marketplace commission business model?
Talha Sattar: We have a few different revenue streams. One is, we charge service fees or convenience fees. The average consumer might pay somewhere between $2 and $5 per transaction. That’s one revenue model we have.
The second one is where we can help increase a pharmacy’s business. The third one is where we enable other brands to get more visibility on our platform. There’s a new probiotic out. Can that get more visibility on our platform?
Sramana Mitra: That’s more an advertising kind of business model.
Talha Sattar: It’s much more of the sponsored model that you see today on Amazon. It’s pretty early for us.
Sramana Mitra: What are your observations by being in this business? What are worth discussing?
Talha Sattar: It’s very interesting to always see how existing offline transforms. They don’t do a great job of building an online solution. Some take it quite seriously. As people are looking at industries that they want to enter, it’s easy to dismiss big offline competitors. It usually ends up in the middle.
Some are quite responsive and thoughtful about the product they build. The others are just ignoring it and saying, “Online doesn’t matter.” That’s a big macro point that’s true in most large industries. You end up with entrenched competition that half ignores you and the other does something good.
The other thing is my view now is that people want both an online solution and an offline solution. Sometimes they want to go in and pick up the prescription. People want both solutions. Those are my two observations.
When I first started the company, my view was, “If you can have it delivered, why would you ever go to the store?” Now I understand that people want to do both.
Sramana Mitra: Where do you see open problems that you could steer new entrepreneurs towards?
Talha Sattar: There’s still lots of opportunities in pharmacy. It’s the second biggest category in America. There are large pockets that are underserved. Nobody is really managing medications just for diabetics. Diabetics have pretty unique and complex needs.
I have not yet seen a pharmacy that said, “We are the pharmacy for diabetics.” It’s a big opportunity both from an impact perspective and also from an economic perspective. I haven’t seen anybody do it. It’s hard to do, but it’s big.
Sramana Mitra: What you’re saying is interesting. You’re talking about diabetes as a category. If you list that one level higher, disease-specific pharmacy is not something we have seen.
Talha Sattar: I’d say you do see some of that in cancer for example. They tend to exist because the drug is pretty complicated to administer. It’s not as easy as taking a pill. You see it in really complicated situations or you see it in simple situations like birth control.
Birth control is not that attractive a market. It doesn’t have very high margins. Cancer is high margin, but that tends to be owned by insurance companies. Most diabetics are served by corner store pharmacies.
Sramana Mitra: It’s very personalized. There’s quite a bit of education in managing diabetes.
Talha Sattar: It’s a big opportunity. Other opportunities would be related to how to get people off medication. Everybody I know who’s on medication wants to get off them. Nobody gets up in the morning looking forward to taking three pills. That’s going to be a big opportunity. How do you solve the underlying issues?
There are a lot of things you can control by diet and lifestyle. You will see people build companies that are really about getting you off your blood pressure medication.
Sramana Mitra: Interesting. Very good insights. Thank you for your time.
This segment is part 2 in the series : Thought Leaders in E-Commerce: Talha Sattar, CEO of NimbleRx