3 Things: Pipe for Drug Copays, Next Gen Wix, Twitter Intel
Happy Sunday and a very warm welcome to all the new subscribers! I’m thrilled and honored to have you as readers and truly appreciate your thoughts and feedback 🙏. Each edition of 3 Things will contain a dive into 3 rabbit holes I’ve found myself going down recently and associated business opportunities. Subscribe to get each week’s edition straight to your inbox and if you enjoy it, please share (I suck at self-promotion so can use your help)! This past week I’ve been thinking a lot about:
Pipe for Drug Copays
Next Gen Wix
1. Pipe for Drug Copays
Building a business is hard enough. During early and growth phases, you’re burning cash trying to grow, find product-market-fit, and eventually scale. Historically, the way that businesses funded this trajectory was through venture capital, and sometimes debt (from a bank) when it made sense. Over the last few years, we’ve seen alternative funding sources pop-up like Clearco (fka Clearbanc) for e-comm merchants to get non-dilutive funding originally based off ad performance data (now they look at revenue and channels holistically) or 8fig for Amazon sellers which provides dynamic growth capital based on manufacturing and supply chain needs. This type of funding has moved beyond just e-comm and now solutions like Pipe, Capchase, and a handful of others provide capital sources based off of recurring revenue contracts where they front you the money that they know will be paid based off of existing ARR contracts. This has become wildly popular for B2B SaaS companies who would prefer to grow without taking more and more venture dollars.
On the consumer side, we’ve also seen success with neobanks like Chime, Dave, MoneyLion, etc who provide cash advances based off payroll. I started thinking about what other markets these types of models could apply to and I recently learned that 1.3 million prescription fills are postponed in the US each year just because patients need to wait for their monthly Social Security checks to arrive in order to cover the copays. Adherence is one of the biggest issues in the healthcare system today so by simply allowing seniors to pick up their drugs when they need them, regardless of bank account status, we could be saving billions of dollars in future healthcare costs. You would hook into a patient’s bank account and go through providers who are writing the prescriptions as the onramp for patients. You could create a checking account and debit card that gets funded when a prescription is written and then is debited when the social security monthly payment comes in. This would be offered free to the patient and provider and as you show improvements in drug adherence, you’d monetize through payors.
2. Nex Gen Wix
There is no shortage of options when it comes to WYSIWYG (what you see is what you get) website builders. In the mid 2000s, an explosion of companies came on the scene like Wix, Weebly, Squarespace, etc that made it possible for a non-technical person to build a website very easily. They provide a drag-and-drop interface with tons of templates for various use cases like personal website, portfolio, blog, fashion, restaurant, travel, tech, and much more. It went from few people having the ability to create a website to anyone being able to have an internet presence. Websites are also a great business as once someone creates one, it’s very sticky and people have high willingness to continue to pay monthly for hosting. There are also tons of ancillary upsells you can offer like SSL, email, domains, professional services (to make your site look really nice), SEO tools, and a variety of premium features and plugins. Squarespace alone did $784m in revenue in 2021 and expects to do ~$870m in 2022.
While these sites absolutely democratized presence on the internet, they tend to produce very simple, and similar-looking sites. Many people still struggle with using the templates and achieving what they want from both a visual and messaging perspective. With all of the new advances in generative AI, there will be a next wave of website builders that use text, image, and video foundational models under the hood and enable people to very easily type in prompts and generate outputs that become components which can be dragged around the screen. Don’t know how best to describe your product so that people will buy? Type in some information about the product and out will pop a perfect tagline and description. Don’t want to use stock imagery or pay for a photoshoot? Describe what you want to see and out will come a beautiful image. You can even use object replacement to add your product directly into the image for e-comm use cases. The business model for this type of company is already well established so I wouldn’t reinvent the wheel here but you could add a variety of new premium features that weren’t possible before.
3. Twitter Intel
Despite all of the drama that has been unfolding with Twitter for the past few months, and the fact that it can be a cesspool full of bots and somewhat horrible humans, there are still 329 million users of the platform (with almost 70% spending time on the site daily) and Twitter is the 9th most visited website on the internet. One in four adults in the US frequent the site and the user base tends to skew liberal, affluent, educated, and techy. Many people flock to Twitter for news, information, to learn from experts on various topics, and to ask questions of their audiences. There are currently over 500 million tweets sent per day and the company brought in $5B in revenue for 2021 (though still posted a net loss of $221m). There is so much useful data being shared on Twitter, and in particular, lots of information on private companies that doesn’t exist anywhere else.
Despite the insane volume of information posted it’s exceptionally hard to search Twitter or leverage a lot of the intel. A service could scan Twitter for thousands of keywords and create insights as to which companies, products, and services are mentioned most frequently for those keywords. Package this data up, create real-time customizable and queryable dashboards, and sell to VCs, PE, startups, and other software vendors. VCs might want to know which companies are being mentioned most frequently when people ask which tool is best for X. Startups might care about competitive landscape and sentiment analysis while also helping to identify prospects. This data could be married with both internal 1st party data and other purchased data sources to help inform marketing campaigns, messaging and positioning, as well as investment decisions for financial institutions who could use this as both a sourcing and diligence data source.
That’s all for today! If you have thoughts, comments, or want to get in touch, find me on Twitter at @ezelby and if you enjoyed this, please subscribe and share with a friend or two!
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