Thrive Archives - Product Management Confabulation

July 28, 2021

Joshua Kushner’s Thrive Capital leads $20M investment in Brazilian healthcare startup Pipo Saude

Pipo Saude, a startup that developed a platform that sells and manages healthcare benefits for Brazilian companies, has raised $20 million in a Series A round of funding.

Joshua Kushner’s Thrive Capital led the round, marking the first time the New York-based venture firm has led an investment in a Brazilian startup. (Although, notably, Thrive has also put money in Nubank and Loft.)

Atlantico participated in the financing as a new investor in addition to all existing backers including Monashees, Kaszek and OneVC. Nubank co-founder and CEO David Velez and Cedar co-founder and CEO Florian Otto (and former CEO of Groupon in Brazil) also joined in the round. Pipo Saude had raised $4.6 million in a seed round in June 2020 that was led by Monashees and Kaszek with the participation of OneVC and Nubank’s Velez.

Pipo Saude raises $4.6 million to bring healthcare benefits management services to Brazil

Manoela Mitchell (CEO), Thiago Torres (COO) and Vinicius Correa (CTO) founded Pipo Saude in July 2019 with the goal of “bringing an unparalleled experience” of buying and managing healthcare benefits for corporations in combination with providing a care navigation platform for employees. More simply, its mission is to “transform” the healthcare experience for companies and their employees.

Pipo Saude started selling its solution six months after its inception. Over the past year, it has grown its ARR by “around 5x,” and the number of lives managed by 7.2x, according to Mitchell. Pipo currently has 100 corporate clients and 15,000 lives under management. Its clients include Brazilian unicorns MadeiraMadeira and Buser, Caelum and Funcional Health Tech, among others. Pipo Saude makes money off of commissions and says that its business model is a hybrid of Nava, Accolade and Rightway, but that Zenefits and Amino are inspirations or benchmarks that it “looks up to.”

When Pipo was first founded in 2019, the company was trying to convince prospective customers that digital healthcare could be an interesting option to reduce cost and improve care, according to Mitchell.

And then when the COVID-19 pandemic hit in March 2020, she added, the whole sector was forced to change and the company saw all stakeholders from doctors to employers to patients “adopting technologies to make their job easier or more accessible to others.”

This trend also helped Pipo grow. In January 2020, it had two corporate clients. By December of the same year, it had around 70.

“COVID has fast-forwarded the digital transformation of the healthcare system everywhere, but even more so in a place like Brazil that was a few years behind the U.S. when it came to technology penetration in the health space,” Mitchell said.

Image Credits: Pipo Saude

Because healthcare is so complex, most companies outsource the benefits capabilities to traditional brokers. Pipo, she said, was created to “disrupt this landscape” with the use of technology and data.

The company claims that enrolling a new member in a healthcare plan can typically take up to 10 business days in Brazil, but that Pipo “can do it in less than 1 hour” given its integrations with HMO/PPOs. It plans to use the new funds to continue investing heavily in technology and data with the goal of launching its first digital product that will be “100% focused” on its members.

Sao Paulo-based Pipo currently has 108 employees distributed across 33 cities and three countries, up from 27 a year ago. During the pandemic, it evolved into being a “remote-first-company.”

The startup also plans to use its new capital to do some hiring, with the goal of doubling the number of its full-time employees by year’s end. Mitchell described the business model as an “asset-light” one that connects healthcare buyers, users and products without having any type of regulatory capital need.

In the medium to long term, Mitchell said the team views Pipo as a local business rather than a global one.

“Going deep into healthcare data and protocols requires a lot of specialization and deep understanding,” she said. Also, the opportunity in Brazil is just so large.

“We are focused on being the local leader in Brazil rather than having a broader but shallower expertise across many markets,” Mitchell said.

Kareem Zaki, a general partner at Thrive, said his firm invested in Pipo Saude because it viewed the company as the first of its kind innovating the channel by which healthcare solutions reach individuals and their families.

“Pipo is using data to deliver value at every step of the customer journey, from informing employers’ purchase decisions and automating manual pieces of benefit management to helping employees navigate the healthcare system to meet their individual needs,” he wrote in an email. “The result is 20% better savings, up to 50 times faster workflows, and a 97% customer satisfaction rate that is unprecedented in the industry.”

Pipo Saude is not the only Brazilian startup tackling the benefits space. Earlier this month, Flash, a startup that has developed a flexible benefits platform for Brazilian companies and employees, announced it had raised $22 million in a Series B round of funding led by Tiger Global Management.

Latin America’s digital transformation is making up for lost time

May 4, 2021

Headway raises $70M at a $750M valuation to help connect therapists with people and insurance schemes

Mental health, and how it is getting addressed, has been one of the major leitmotifs of the past year of pandemic living. Covid-19 not only has led to a lot of people getting ill or worse; it has increased isolation, economic uncertainty, and led to a lot of other kinds of disappointments, and that all has had a knock-on effect on our collective and individual state of mind.

Today a startup called Headway, which has been working on building a better way for people to attend to themselves — by way of a three-sided marketplace of sorts, by helping a person to find and afford a therapist via a free-to-use portal, by making it possible for those therapists to accept a wider range of insurance plans, and by helping those insurance plans facilitate more therapy appointments for their patient networks — is announcing a major round of funding on the heels of strong growth.

The startup has raised $70 million, money that it will be using to continue expanding its platform with more partnerships, more hiring for its team (it wants to have 300 people this year) and opening up in new regions, aiming to be nationwide this year in the U.S.. This round, a Series B, has a number of big names attached to it: it is being led by Andreessen Horowitz, with Thrive, GV and Accel also participating. (The latter three are repeat investors: Thrive and GV led its Series A, while Accel led its seed.) This Series B is coming in at a $750 million valuation.

The rapid pace of funding, the backers, and that valuation all underscore the timeliness of the concept, and also the traction that Headway is getting for its approach.

When we last covered Headway — it raised $26 million just last November, six months ago — it said it had registered some 1,800 therapists on its platform in the New York metro area, where it is based. Now that number is up to over 3,000 with its network now covering not just NYC, but also New Jersey, Florida, North Carolina, Texas, Georgia, Michigan, Virginia, Washington, Illinois and Colorado. It has over 2,000 patients joining the platform each month and has so far helped facilitate 300,000 appointments, with a current average of 30,000 appointments each month. Revenues have in the last year, menawhile, grown nine-fold.

The approach that Headway is taking — creating not just a vertical search portal for therapists, but building a back-end system to help those therapists grow their business by making it easier for them to accept insurance coverage — comes directly out of the experiences faced by one of the startup’s co-founders.

Andrew Adams, the CEO of Headway, told me last year he came up with the idea after he moved to New York from California several years ago to take a job. In seeking a therapist, he found most unwilling to accept his insurance plan as payment, making getting therapy unaffordable.

This is a very typical problem, he said. Some 70% of therapists do not accept insurance today because it’s too complicated for them to integrate, since about 85% of all therapists happen to be solo practitioners. So something that should be accessible to everyone becomes something typically only used by those who can afford it, or have entered into social care programs that might provide it. But that leaves a massive gap in the middle.

“This is the defining problem in the space,” he said at the time. “Health insurance is built around a medical world dominated by billers and admins, but therapists are small practitioners and don’t have the bandwidth to handle that, so they don’t. So we thought if we could make it easier for them to, they would, and they have.”

And indeed, if you are needing to see a therapist, the very last thing you need or want to be doing is spending your time trying to work out the economics of doing so: you need to be focused on finding someone who you feel you can talk to; someone who can help you.

The problem is a huge one. In the U.S. alone it’s estimated that there are some 82 million people who have treatable health conditions. Headway was founded on the premise that most of them currently do not seek that treatment because of cost or accessibility.

A lot of therapy has traditionally been about seeing people in person — and arguably the fact that we’ve had so much reduced contact with people has contributed to mental health issues this past year — but in the event, Headway has definitely adapted to the current climate.

The company says that some 89% of its appointments at the moment are being carried out remotely. This is down from 97% at the peak of the pandemic in the U.S., and has been slowly starting to taper off, the company said. Some of the increased volume, meanwhile, is a direct result of therapists working remotely: they can fit more people in to a daily schedule as a result.

In terms of insurers, the company currently works with Aetna, Cigna, United Healthcare, Oscar and Oxford and says the list will be growing. On interesting detail is that Headway has not only built out a bigger funnel for these insurers in terms of the practitioners that they work with and individuals who can subsequently use insurance to pay for therapy, but conversely has served to be a conduit for those insurance groups in bringing more patients through to those therapists, who are now a part of their networks, by way of Headway’s platform.

Headway says that using its system can help a patient get an appointment within 5 days, versus the the 30-day average you typically face when using an insurance directory.

It’s the kind of scale and “software eating the world” efficiency that has attracted Andreessen Horowitz to backing companies before, with the added detail of this being particular relevant to the time we are living in.

“By getting the mental health provider community on the same page with insurance companies for the first time, Headway unlocks affordable mental healthcare for millions of Americans,” said Scott Kupor, managing partner at Andreessen Horowitz. “We’re incredibly excited to work alongside the Headway team.” Kupor is also joining Headway’s board with this round.

Cherry Miao, a former Partner at Accel and Headway’s lead seed investor, is also joining as Head of Finance & Data.

“I’ve been fortunate to work with some of the world’s most influential startups, and know that being part of Headway’s meaningful mission, robust business model, and incredibly talented team is a once-in-a-lifetime opportunity,” she said. “I’m thrilled to be helping rebuild America’s mental healthcare system for access and affordability.”

September 17, 2020

X1 Card is a credit card based on your income, not your credit score

There are many reasons why you could have a good or a bad credit score. But if you’re just entering the job market, you may end up with reliable income and a low limit on your credit card. X1 Card wants to solve that by setting limits based on your current and future income instead of your credit score.

The company says some customers can expect limits up to five times higher than what they would get from a traditional credit card. And that limit can move up if you get a promotion at your job for instance.

“The consumer credit card industry has been almost untouched by tech and has relied on the archaic credit score system. Max [Levchin], David [Sacks] and I have similar scores — that makes no sense!” co-founder Deepak Rao told me. “We reimagined the credit card from the ground up to have smarter limits, intelligent features, modern rewards and a new look.”

Depending on your creditworthiness, you’ll get a variable APR of 12.9 to 19.9% and a balance transfer fee of 2%. There’s no annual subscription fee and X1 Card doesn’t change any late fee or foreign transaction fee.

Behind the scene, X1 Card is built by Thrive, the company that created ThriveCash, a loan platform that lets you get a credit line based on offer letters for an upcoming summer internship or your first full-time job after college.

You can then borrow as much as 25% of your total internship salary or 25% of your first three paychecks if it’s a full-time job. There are some fees, but it can be helpful if you’re signing a new lease and you don’t have any money on your bank account for instance.

Thrive has raised $10.25 million in funding from PayPal and Affirm founder Max Levchin, former Twitter COO Adam Bain, Craft Ventures general partner David Sacks and others. Read TechCrunch’s Natasha Mascarenhas article on ThriveCash if you want to learn more about that product.

Thrive gives loans to students based on summer internships and job offers

Coming back to X1 Card, the card is a stainless steel Visa card that works with Apple Pay and Google Pay. It helps you track your subscriptions in different ways. First, you can cancel your subscription payments from the app. If you’re trying out a new service and they require you to enter your credit card information to start a free trial, you can also generate an auto-expiring virtual credit card.

If you receive a refund, X1 Card sends you a notification. You can also attach receipts to your transaction in the app.

When it comes to rewards, X1 Card uses points. You get 2x points on all purchases by default — there’s no category or retailers that give you special rewards. If you spend more than $15,000 using the card in a year, you get 3X points. If you refer a friend, you get 4X points on your purchases for a month — each new referral adds an extra month with 4X points. Points can be redeemed at retail partners, such as Apple, Airbnb, Delta, Everlane, etc.

In other words, it’s a credit card. But what makes this product more interesting than your average Chase-branded card is that it wants to disrupt the credit score system. It’s going to be interesting to see if people can really get higher limits with that system.

Image credits: X1 Card

September 17, 2020

X1 Card is a credit card based on your income, not your credit score

Thrive gives loans to students based on summer internships and job offers

If you receive a refund, X1 Card sends you a notification. You can also attach receipts to your transaction in the app.

Image credits: X1 Card

April 8, 2020

Thrive gives loans to students based on summer internships and job offers

Thrive, founded by Twitter alumni Deepak Rao and Siddarth Batra, wants to fund student expenses by looking at job offer letters as a way to evaluate loans. Today, it launched its loan platform and is accessible to students on over 400 campuses across 31 states.

The San Francisco company helps underfunded students, a group that isn’t typically accounted for by traditional financial institutions that issue loans based on credit score. According to co-founder Rao, Thrive is for people like “first generation Americans, people who come from low-income families, or first generation students.”

Before launching broadly, Thrive secured $10.25 million in funding and $5 million in venture debt. Today, the company also announced that it has picked up a $200 million credit line from Credit Suisse.

Investors include Max Levchin, founder of PayPal and Affirm, Adam Bain, former COO of Twitter, and David Sacks, a general partner at Craft Ventures.

“We started the company with the mission to invest in human potential,” Rao said. “We basically built a product that empowers underfunded students and gives them access to funds for whatever things they need in order to transition into their professional lives.”

The cash can be used flexibly for items like new laptops or flights home.

Students can sign up on the platform and upload an offer letter for an upcoming summer internship or full time college postgraduate offer. Thrive validates the document then offers a loan to the students.

For an internship, Thrive unlocks 25% of the student’s total internship salary for a loan. For a full-time job, Thrive will offer 25% of an individual’s first three months’ salary.

Thrive charges students between $7 to $15 per every $1,000 they receive per month, and they’re allowed to take as much as they need from the dollar amount that Thrive offers them. If you take $1,000 and your internship starts in three months, and if you want to pay it back in one go, you have to pay between $21 to $45 above the $1,000 when you pay it back.

Once students prove they’re soon going to be employed, they can access the funds within one business day and then start paying back Thrive once they start their new job.

Thrive’s payback structure is similar to the income-sharing format that a company like Lambda School uses. Lambda School says it gives students the option to pay zero dollars for tuition, and then pay 17% of their salary they earn from a job that pays a minimum of $50,000 annually for two years.

So while it’s not new to bet on salary, Thrive is looking at turning the concept of incoming sharing on its head and applying it to loan financing.

Lambda School aims to cash in by upskilling untapped talent

When they founded the company in 2017, Rao and Batra were both classmates at Stanford and then co-workers at Twitter. Rao comes from a low income family, so he personally felt the blow of costs that come with being a grad student in the United States, from flying home to paying for your laptop. Or just even dinner.

Thrive declined to share specific financials or comment on profitability. Rao did say that the company is growing “5 times year over year” and has enough funds to avoid raising venture capital until the end of 2021.

“Our biggest expense is the ability to fund loans, and we are not funding loans through equity money,” Rao said. “At the end of the day, it’s like a software business, our biggest cost is the cost of goods, which is capital, and someone else is funding the capital.”

Not needing more venture capital might be especially helpful as we enter a time of economic uncertainty due to COVID-19. Unlike other fintech companies, which have had to harshen their underwriting standards to prepare for risk due to the uncertain economy, Rao tells TechCrunch that Thrive will not change how willing they are to write loans.

Some tech internships have been canceled due to COVID-19, he noted, and if students have had an offer rescinded, Thrive “updates the payment plan accordingly.”

“As long as your internship is still active, your offer is still issued,” he said. That doesn’t matter whether the intern will be remote or in-person.

Thrive is expanding its business as undergraduate and graduate students are entering a job market with historically high unemployment. We’ll see how a tough job market impacts a company that depends on offer letters for loans, and whether their bet on alternative financing pays off.

October 16, 2019

Arianna Huffington’s Thrive Global is buying a startup that uses neuroscience to boost app usage

When Arianna Huffington stepped down from her role at the Huffington Post to start Thrive Global, she said the goal of her new business was to help a generation “avoid the burnout that all too often comes with success today.”

In practice, that has meant creating a business that sells mindfulness and general health and wellness tips and tricks to a cohort of corporations that believe increased mental and physical health can lead to greater on-the-job productivity.

Now, Thrive Global is adding a tech tool to its arsenal of cognitive behavioral therapies with the acquisition of the Los Angeles-based startup, Boundless Mind.

Originally called Dopamine Labs, the company was founded in 2015 to bring some of the same technologies that social media companies like Facebook used to boost engagement to a broader range of applications.

Meet the tech company that wants to make you even more addicted to your phone

Terms of the deal were not disclosed, but the stock and cash acquisition will see all nine members of the current Boundless team join Thrive Global. Previous Boundless investors including Revolution’s Rise of the Rest Seed Fund and Esther Dyson will join Thrive Global’s cap table.

“We were very impressed by their neuroscience-based artificial intelligence that they used to power changes in behavior,” says Huffington. “We can use technology to hook people to unhook them from unhealthy behaviors.”

Boundless “epitomized the use of technology to encourage healthy habits,” Huffington says.

From Huffington’s perspective, most health problems in the U.S. are actually rooted in behavioral problems rather than biological ones. “Until 100 years ago, people died from infectious diseases… Now most people are dying from behaviors,” says Huffington, quoting Boundless Mind co-founder Dalton Combs.

Roughly 70% of healthcare spending in the U.S. goes to behavioral change and lifestyle-related conditions, says Huffington. Thrive Global tackles the issue through a combination of pop psychology and celebrity advice, while Boundless uses artificial intelligence and machine learning nudges.

The Boundless technology works by monitoring what activity is happening on the phone’s tap screen (similar to Apple’s screen time monitoring). What Boundless does on the back end is analyze that data and create prompts to encourage behavior — in much the same way that other companies’ apps have notifications to prompt re-engagement.

Going forward, the Boundless team is hoping to use more of the information coming from a phone’s increasing array of sensors to better refine its notifications. Results from the adoption of the company’s software vary, but Boundless points to data from apps spanning health, fitness, productivity, finance and e-commerce – including a 60% increase in walking, 30% increase in productivity and 21% increase in engagement around diet and exercise.

Arianna Huffington and the co-founders and staffers of Boundless Mind

Thrive Global has three pillars to its business: live workshops, a digital health program called Thriving Academy, and a newer mental health focused package called Thriving Mind.

The company has already signed corporate partners like Accenture, JPMorgan, Hilton, Bank of America and Procter & Gamble, and Huffington says customers have already seen results in lower rates of employee attrition and better employee satisfaction results on surveys.

These kinds of correlations don’t mean causation and the company is still working to better quantify the benefits of adopting its workplace wellness protocols. One of the places where Thrive Global is putting its brain training regime to the test is in call centers in Central America,

“You can imagine how the Boundless intervention will allow us to hyper-personalize,” says Danny Shea, Thrive Global’s head of global expansion. In call centers that could mean prompting an employee to take a break after a long or stressful call.

“We’re thrilled to see the continued growth and market expansion at Thrive Global” said Somesh Dash, General Partner at IVP and member of Thrive Global’s Board of Directors. “The combination of Thrive’s mission and Boundless Mind’s technology is truly remarkable and the integration will help Thrive scale a game-changing and differentiated behavior change technology platform to enterprises around the world.”

To date Thrive Global has raised over $65 million from investors including JAZZ Venture Partners, IVP, Marc Benioff, Ray Dalio, and Kevin Durant.

May 30, 2019

Pitching accuracy rates of over 99% for multiple cancer screens, Thrive launches with $110 million

For more than 25 years the founders of Thrive Earlier Detection have been researching ways to improve the accuracy of liquid biopsy tests.

The fruits of that labor from Dr. Bert Vogelstein, Dr. Kenneth Kinzler and Dr. Nickolas Papadopoulos — all professors and researchers at Johns Hopkins University — is CancerSEEK, a liquid biopsy test that has demonstrated specificity of over 99% in a retrospective study published by Science earlier this year.

By minimizing false positives, in cancer screening tools and providing a test with proven accuracy doctors can take treatment actions earlier, which can lead to better survival rates for cancer patients.

Now, with FDA approval for its tests for pancreatic and ovarian cancer and a new study underway with a large healthcare provider, CancerSEEK is being rolled out to market through Thrive Earlier Detection with the help of a new $110 million round of funding.

Thrive works by analyzing highly targeted sets of DNA and proteins in the blood to detect cancer.

“Over the past 30 years we have made great strides in understanding cancer. Combining this knowledge with the latest in molecular testing technologies, our founders have developed a simple and affordable blood test for the detection of many cancers at relatively early stages,” said Christoph Lengauer, Ph.D., partner at Third Rock Ventures, and co-founder and chief innovation officer of Thrive, in a statement. “We envision a future where routine preventative care includes a blood test for cancer, just as patients are now routinely tested for early stages of heart disease. We know that if cancer is caught early enough, it can often be cured.”

As part of its rollout, the company’s screening tool is being evaluated in DETECT, a study of 10,000 currently healthy individuals that’s being conducted in conjunction with the healthcare organization Geisinger. So far, 10,000 women between the ages of 65 and 75 without a history of cancer have been enrolled in the trial.

“To be truly useful to patients, new medical technology must be developed with rigorous evidence and designed to be affordable and readily integrated into routine medical care,” said Steven J. Kafka, Ph.D., partner at Third Rock Ventures and chief executive officer of Thrive, said in a statement. “With the help of experts and strategic partners, Thrive is launching today to advance a novel test for the earlier detection of multiple cancers, which we aim to augment with an integrated service that helps patients maneuver the often confusing path that follows a cancer diagnosis.”

Third Rock Ventures actually led the Series A financing for Thrive, and comprise the bulk of the company’s executive team, while Kinzler and Papadopoulos — the researchers from Johns Hopkins who developed the technology — will have seats on the company’s board.

Other investors in the round include Bill Maris’ Section 32 investment firm, Casdin Capital, Biomatics Capital, BlueCross BlueShield Venture Partners, Invus, Exact Sciences, Cowin Venture, Camden Partners, Gamma 3 LLC and others.

According to Thrive, ovarian, pancreatic and liver cancers are difficult to detect because they can develop in pathways that aren’t always well understood.

Using CancerSEEK, Thrive hopes to develop a blood-based test that can be used in routine medical care, with the goal of identifying multiple cancer types at earlier stages.

The technology works by following genomic mutations in circulating tumor DNA (ctDNA) and cancer-associated protein markers in plasma to identify abnormalities that are common across multiple cancers. In a retrospective study published by Science in 2018, CancerSEEK was shown to perform with greater than 99% specificity and with sensitivities ranging from 69% to 98% for the detection of five cancer types – ovarian, liver, stomach, pancreas and esophageal, which the company says are cancers for which there no screening tests available for average-risk individuals.

Thrive’s research has attracted an all-star executive team in addition to Lengauer and Kafka from Third Rock. Former Goldman Sachs lead medical technology analyst Isaac Ro is joining the company as chief financial officer, and the company’s head of research is Isaac Kinde, a co-inventor of the CancerSEEK technology.

It’s hard to overstate how transformative the Thrive test could prove to be. Having a blood-based diagnostic test for cancer prevalence and the ability to initiate treatment earlier radically improves the chances for surviving a cancer diagnosis.