About Tales from the Trenches™
MATTER’s signature Tales from the Trenches series is an opportunity to hear the early stories of some of the global businesses we read about in the news — straight from the founders who led them to greatness. This series invites seasoned healthcare entrepreneurs to the MATTER stage to share learnings, stories and key takeaways from their journeys. Tales from the Trenches is free and open to the public.
Bob Badal is a healthcare industry veteran and kidney care expert, with a career spanning multiple successful startups, corporate operations and ventures. Along with his work at Strive Health, he co-founded Treatment Technologies & Insights (TTI), a digital healthcare company, in 2017. Bob began his healthcare career directly out of college working in both health plan network development and hospital administration roles. Come hear about his career constant: to identify and deploy disruptive solutions to improve patient care.
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Steven Collens, MATTER (00:09):
Hello everyone, and welcome to our Signature Tales from the Trenches series, which we are delighted to produce with VillageMD. I'm Steven Collens. I'm the CEO of MATTER. We're a healthcare technology incubator and an innovation hub with a mission to accelerate the pace of change of healthcare. Uh, we do three things. First, we incubate startups. We launched about seven years ago in 2015. We've worked since then with, we're in 750 companies. They range from very early to growth stage startups, and we have a suite of services that help them at every stage of development. Um, second thing, we work with large organizations like health systems and insurance companies and life sciences companies to strengthen their innovation capacity. We help them, uh, find value in emerging technology solutions and unlock the value of their internal, uh, innovators and hel, and help them create a more human-centered healthcare experience through system level collaborations.
And third, we're a nexus for people who are passionate about healthcare innovation. We bring people together to be inspired and learn and connect with each other, and we produce a lot of programs, including large scale events for the broader community, as well as small programs that are exclusively for our members. Uh, tales From the Trenches is our longest standing, uh, series that MATTER where we bring interesting, accomplished entrepreneurs, uh, as guests and, and discuss with them their journey, um, what they learned along the way, the successes, the mistakes, the challenges, uh, of the journey. We produced this series together with VillageMD, which is a leading provider of value-based primary care services that has an extraordinary, uh, partnership with Walgreens to scale, uh, nationally. Uh, today our guest is Bob Badal, who is the co-founder, uh, former Chief Revenue Officer and known advisor to, uh, Strive Health. He's a healthcare industry vet veteran and a kidney care expert with a career that spans a variety of, um, startups and corporate, uh, roles, uh, as well as, uh, ventures. Um, leading the conversation with Bob is Paul Martino, who's a co-founder and Chief Growth officer of VillageMD. Paul is a 30 year healthcare industry veteran, and has really helped build VillageMD into the industry leader that it is today. Paul and Bob, thank you so much for joining us today. We are really looking forward to the conversation. I'll turn it over to you.
Paul Martino, VillageMD (02:50):
Hey, Bob. Hey, Paul. Thanks, Steve. How you going? Now, I have to admit, for those of you that are in the audience and saw the picture of Bob, I think we now have a faster younger looking Bob Badal today. How you look at, I, I think you said it, you were wearing the hair a little tight these days, huh?
Bob Badal, Strive Health (03:07):
Little tighter. You know, I, I'm trying to set a good example for my 10 year old son. You know, you gotta keep it tight and professional.
Paul Martino, VillageMD (03:13):
Well, he's learning from a pro. That's all I have to say. How have you been?
Bob Badal, Strive Health (03:17):
I've been good. Thanks, Paul. It's great to see your face again. And, uh, I assume you'll unpack a little bit of where we originally connected, which is kind of fun too.
Paul Martino, VillageMD (03:25):
Yes, yes. In fact, why don't we start there? Um, so you and I go back, I don't know, half dozen years, maybe more. Yeah. Um, I, uh, uh, uh, came to know Bob from our time together on a board of an early stage company that's in the physical therapy business, Ivy Rehab. And, uh, have to say, I miss you in the board meetings, uh, your, your, uh, uh, kg wisdom is what I would call it was always beneficial. And I wanna, I wanna probe on that, but before we do, um, tell us a little bit about your journey. I mean, why healthcare? Why did you get into this in the first place?
Bob Badal, Strive Health (04:01):
Yeah, that's, that's interesting. Uh, you know, I wish I could tell you that, oh, I, I was brilliant enough and, uh, and knew myself well enough that I picked healthcare. But to be honest with you, I think healthcare picked me, uh, very, very early in my career. Uh, I, uh, got introduced into it through the health plan side. Similar to you. I think you worked at Cigna, right? Uh, I did. Yeah. Uh, for me, me, in my case, it was Fhp Healthcare, which was, uh, a large health plan at the time that, uh, it was, it was kind of a neat entry point. In some ways it's because of who I knew, uh, and some family connections, uh, into fhp. But also, I would tell you that I probably sought it out a little bit because of where healthcare was going at the time. Uh, managed care was becoming very, uh, relevant, uh, relevant, good, relevant bad.
It was transforming how care was being delivered. It was transforming how care was being paid for. Uh, and there was something exciting about that newness or that disruptive play that f h p Cigna and others were doing at the time. And so, from that point forward, you know, in a lot of ways, some people, at least maybe early to mid-stage of my career described me as a generalist because I was able to get, uh, a good amount of time with experience in network development and sales and some other things within the health plan side. And then when I left, uh, the health plan world, I became a hospital administrator. And so I got a taste of the provider side of healthcare, though I would tell you, Paul, and you'll, so
Paul Martino, VillageMD (05:32):
You've seen both dark sides, <laugh>?
Bob Badal, Strive Health (05:33):
I have. I have, uh, and you'll smirk at this. Uh, you know, I was young at brash, and I'd walk the halls of a hospital, and you would think that you'd, it'd be difficult to not experience the pull of your heartstrings when you're walking the halls of a hospital. But again, because of my brashness and competitiveness or whatever, I, I saw it more as money, power, prestige, and, and an opportunity to actually learn a little bit about the provider side so I could deploy that knowledge somewhere else. I didn't know where, but, uh, and then I guess, well,
Paul Martino, VillageMD (06:04):
So on that though, Bob, you know, you, you said, you know, power prestige, do, do you, without, you know, being disparaging in any way, do you feel as though health systems still have a little bit of that orientation? I mean, I know when I go, I'm dressed like this. Yeah. Right. And I go, and they're very,
Bob Badal, Strive Health (06:22):
To the team
Paul Martino, VillageMD (06:23):
Included cufflings ties, and I mean, do you think that
Bob Badal, Strive Health (06:27):
Yeah, no, I, I do, I think there's a still, and we're generalizing a little bit, but there's a hierarchical nature, uh, within that health system world. And your title is important and based on how much authority you have. And, but also, I mean, you gotta, we're on the clock a little bit. I was in my late twenties, I guess. So the first time I grew out to goatee, because I'm talking to doctors that are 40, 50, 60 years old, and they're saying, who's this young punk? And so, in, in my case, I, I think I had a little bit of bravado and a little bit of stick my chest out because I felt like I needed to do some of that while I built up the muscle strength of actually knowing what the hell I was doing, uh, which took a while. Yeah, it
Paul Martino, VillageMD (07:08):
Took a while. So, yeah. So, so I, and I wanna understand your journey, because for me, right? I spent 32 years working in health plans, the last one being a really big one, publicly traded anthem. Now, El el, uh, Evelyn or El, however you say it, you, you did a stint on a plan side, a stint in a health system, and then you also worked at DaVita.
Bob Badal, Strive Health (07:29):
I did. Between the health system and DaVita, though, I did, uh, about four or five years in healthcare consulting. Uh, which to be honest with you, prepared me for what DaVita, uh, is, uh, or was at the time. Without that, uh, intensity of intellectual rigor and analytical horsepower and the skills that you pick up in consulting, I think I would've not had, uh, as successful a career at DaVita. Uh, but when I joined DaVita, it was, gosh, uh, 2003, late 2003, it was just coming out of the turnaround from what was total renal care into DaVita Ken Theory. The c e o had brought in a whole new, uh, leadership team. And, and I was, uh, fortunate enough to be a part of that in the early stages. I mean, when I got to DaVita, Paul, I'm gonna estimate here, we probably had about 250 dialysis facilities when I left. 13 and a half years later, we had over 2,500. Uh, so think about the
Paul Martino, VillageMD (08:23):
Good growth. Really good,
Bob Badal, Strive Health (08:24):
Paul Martino, VillageMD (08:25):
So, big company, good growth. Yeah. Which is different than Stride. So I want to get to that too. Yeah. But, but, so how long did you work in these large organizations, growing them, making your way around, as you said, Roman, the hallways, talking to docs that were, you know, a number of years senior to you?
Bob Badal, Strive Health (08:42):
Yeah, tilt 2016, I was on the corporate path. I was in big, beefy, bureaucratic, other than maybe the consulting stint, uh, organizations. And, you know, I was thinking about this, this before the call today. You, you know, generalizing a little bit, but there's, there's two paths, right? You take the entrepreneurial path, you take the big corporate path. Uh, I come from a family of entrepreneurs. Uh, were very, very successful in their own right. And there was a passion and a drive. They had to be their own boss and to carve out their own lane. And I was excited about that, but I also saw some
Paul Martino, VillageMD (09:19):
Comfort. You didn't get the memo on that. Yeah,
Bob Badal, Strive Health (09:20):
<laugh>, yeah. There was some comfort. Uh, and it's not that it's easy on the corporate path by any stretch of imagination, but there was more comfort, I guess, in security for me to pursue that path. What has been interesting as we pivot to conversation shortly to strive and some other, uh, uh, NewCos that I've launched, boy, uh, maybe one lesson learned for myself. I wish I had gotten that bug earlier because, uh, that stage zero to three ish, zero to five ish stage company is what I truly love and I'm so passionate about. I guess I just wasn't ready to,
Paul Martino, VillageMD (09:53):
Well, how did that happen? I mean, I, I, I'm, I'm 32 years in and I jump out, and everybody that I grew up in the business knowing said, what's wrong with you, <laugh>? Why? Why would you do this at this stage of your career in life? Right? So, h h what happened there? Talk about
Bob Badal, Strive Health (10:08):
It. Well, when I left DaVita in 2016, I had the gift of what my wife called going on a pro leisure tour. Uh, we, uh, I spent, uh, a good two, two and a half years outside of kind of the structured workforce. Um, we did a lot of, of travel, uh, with our young son. Uh, I started picking up some board and advisor work, including where, where we met, and the diversity of the work or portfolio, uh, that I had developed, the diversity of individuals that I started meeting that, you know, maybe you're a little insulated from when you're working at a big company for 13 years and you don't realize there's a big world out there. Uh, the entrepreneurial energy that I picked up from these different individuals I started meeting, and just the intensity with which I, uh, put myself out there to wanna meet, meet as many people as possible, I, I think, uncovered it for me. Now, uh, there were also some, uh, milestone events or key events, uh, both with an electronic patient reported outcomes company that I launched called Treatment Technologies and Insights, and then subsequently Strive about a year later, uh, that drove me to those opportunities. Uh, but, uh, I think I was ready for it, Paul. You just have to be ready for it.
Paul Martino, VillageMD (11:27):
So, I, two questions. Hopefully they tie together. The first is why renal care? I mean, that's, there's a lot of people trying to, big companies. You mentioned you worked for one. Um, and then talk a little bit about the idea, and then how do you go get somebody to believe in it, believe in you, and go get the capital to get it off the ground?
Bob Badal, Strive Health (11:48):
Yeah. So Weis Strive, I, I think is what you're asking more.
Paul Martino, VillageMD (11:51):
Bob Badal, Strive Health (11:53):
Uh, granted, I had a huge amount of experience in the industry, 13 plus years, that teaches you what works, and it teaches you what is broken, uh, in the industry. That said, when I left DaVita, I had no plans of getting back in the renal care space.
Paul Martino, VillageMD (12:11):
Bob Badal, Strive Health (12:12):
And as time went by, and as I mentioned, I've started meeting a lot of different individuals, including creating a, uh, uh, some or maybe reestablishing some relationships with various venture capital firms and private equity firms, one of those being nea, uh, and a longstanding, uh, uh, relationship I had with one of their lead investors there. Um, the strive idea was, was floating around there, uh, it was our renal care, disruptive play, and of course, I was a renal care expert, kind of within their, their wheelhouse that they wanted to talk to about that. Along with my other, uh, co-founding partner, a guy named Chris Raelle, uh, who had also worked with me at, at Strive. Uh, we both started beating up this idea and testing the assumptions they had in this one PowerPoint, uh, along with some other, uh, venture folks from Town Hall Ventures. And, and it, it just kind of fell into place. Uh, but for me personally, uh, I knew that something needed to be changed, uh, in this status quo. And I, in my core, uh, I love creating disruption to the status quo. I'm extremely competitive, and, uh, what I knew
Paul Martino, VillageMD (13:23):
So on that, don't you think it takes that thread in order to disrupt? I mean, you have to be competitive. You have to think, you, you can come up with a different sort of approach, right? Otherwise, you know, being the next renal care company like DaVita is not all that interesting,
Bob Badal, Strive Health (13:38):
Right? Yeah, no. And, you know, strive's very different than a kinda a large dialysis organization. Our business model is not providing bricks and mortar dialysis. It's so much beyond that, and it's upstream, chronic kidney disease, uh, renal care. Uh, but yeah, without that hunger, without that confidence, self-confidence that we can disrupt the status quo. But also, part of your question, Paul, was how do you convince a customer to agree with you, especially early on, that they should invest in a commercial partnership or whatever, as a handful of things? Number one, obviously you need to have, uh, proven experience in the industry. Well, it's one thing to say Chris and Bob are dialysis guys, but we knew that wasn't gonna, uh, kind of get us over the line. And so we had to bring other experts into our team, including our chief medical officer and others, that, that had done similar things to what Strive does, but Strive has been able to take it to scale.
Paul Martino, VillageMD (14:31):
Yeah. Yeah. Yeah. Uh, how key was the, you said a, a medical director, maybe a chief medical officer. How critical was finding that person? And then maybe just talk about that a little bit too, because similar to you, um, and in my company, uh, I as a non-physician, right? You can say, say, I, I know a fair amount about renal care. I could say, well, I know a fair amount about primary care. I've never seen a patient, I've only been a patient. Right? And so, h how do you get over some of those hurdles?
Bob Badal, Strive Health (15:03):
Yeah. Well, well, first, it, it was paramount, uh, for us to bring in strong clinical leadership, including a cmo as well as a clinical ops, uh, type focused expert or experts. Um, it's one thing for you and I to sit in front of a, a health plan or an integrated health system or an at-risk medical group and say, Hey, we have the end all be solution to primary care or renal care. But if we can't, uh, truly connect the value to the patient experience and the delivery of care, which we can't, right? We're, we're not clinically, uh, right. That's, uh, we would've fallen short. Uh, and so the sales cycle in, in the case of strive, the sales cycle was always, at least in the early days, to start on the clinical side and get buy-in from that clinical leadership with whoever our customer potential customer was. And then once we got that box checked, we're able to move into pop health or network management or, uh, the business or enterprise cycle.
Paul Martino, VillageMD (16:00):
So talk more about that. How long was the sales cycle? And I do want to go back to, you have to get money, right? You have to do a capital raise. So I wanna learn a little bit about that. But first, sales cycles at the beginning especially are, they're tough, right? Yeah. You can get discouraged pretty easily. Yeah. What kept you going? What was it like, and how long was the sales cycle?
Bob Badal, Strive Health (16:21):
Sales cycles? Very long. Uh, anywhere from six months to 18 months. Uh, we had some deals that, uh, in the early days of Strive, we were convinced we're gonna be our anchor customers. And to this day, they still haven't signed a contract four, four and a half years later, right? <laugh>, uh, which as you stated can be very, very frustrating. Some of those anchor customers you find out, actually, were even going to school on you to take that idea and, and build their own solution, uh, is what it is. Uh, but what kept me going, what kept the team going is the fact that we knew we had something that could be valuable, would be valuable for patients, would be valuable for bending the cost curve. And, and, and just generally, uh, I improve healthcare across the board. And, and you j you gotta be so, uh, confident around that.
Uh, you know, it, it kind of takes me back to something, boy, I wish I had more of it. Uh, I have a certain amount of confidence. Uh, uh, but, uh, I was thinking about this call this morning and that entrepreneurial spirit in that drive and that self-confidence, I, you know, not to get too personal, but when I think about my dad as an example, he's one of those individuals, almost like Michael Jordan, that there, there is no, uh, uh, scenario where you will fail. It just ain't gonna happen. Right? And to have that drive and to have that intensity and that self-confidence is, is a game changer. And you have to have that. Maybe not everyone needs to have that, but some of the key folks in the organization need to have it and remind those that falter a little bit. Hey, hey, don't forget our North Star. We're, we're onto something here. I think you muted, Paul.
Paul Martino, VillageMD (18:03):
Sorry. I'm reading this book called Grit. Mm-hmm. <affirmative>, I dunno if you've, uh, heard about it or read about it. Um, if somebody turned me onto it, and the, I don't, without giving away the story, because I think it's very well worth reading, um, the conclusion that this, this particular researcher came to was that the people that succeed most are those that have grit. They're, they're, they're sticktuitiveness is, you know, there's people that are the smartest. There's people that are the most, you know, have a lot of resources. I eat money that can propel, but the people that, that actually have the, the most grit are the people that, that succeed. You said something that was very interesting to me. You said there's, you know, somebody four and a half years later. Right? What that tells me is you're staying after it four and a half years later. Right? <laugh>.
Bob Badal, Strive Health (18:52):
So, that's true. I, I, I personally and amm blessed to have people in my life, both personally and, and work that are, have that same kind of dog on a bone, uh, competitive streak that we hate getting nos and a no is an opportunity to turn it into a yes. Right? That's the salesman in me. And I, I, I, I need that, it drives me. Uh, but let me add something to grit. Uh, you can have grit, but what I, I, I think is a, is kind of the secret sauce to turning grit into success is, uh, a hug, grit. With a hug, uh, grit with, uh, a soft same hug about that. Yeah. Same
Paul Martino, VillageMD (19:31):
Hug. Keep going.
Bob Badal, Strive Health (19:31):
You know, I've been, I've been in organizations where culture is, is paramount, right? And, you know, DaVita's an interesting example, right? That people outside will say, oh, it's very cult. Or, oh, you know, there's a lot of rah rah and, and stuff like that. But at the end of the day, there were certain components of it, just like in any culture that work well for you as an individual employee and some that maybe you pushed by the wayside. Um, I got a lot, uh, of learnings, uh, from the DaVita culture in terms of what works for me, how to show up. I had a lot of the kind of self-improvement I needed to go to to, uh, not only just focus on the grit and the intensity, cuz I was definitely defined as an intense person, in some ways still am. But to try to figure out those softer elements is important. When I think about the electronic patient reported outcomes platform, uh, that myself and two other individuals launched pre strive, uh, in the cancer space, I am blessed with two co-founding partners that have the soft touch, the caring, the heart, the familial love that we have in the organization, as well as balanced with, uh, an intensity for success and, and, and drive. So you gotta find that,
Paul Martino, VillageMD (20:42):
Keep going on that too, because culture actually matters, right? And if you're and two other folks are co-founding a company, usually there's somebody that sort of moves, moves to the front on the culture stuff.
Bob Badal, Strive Health (20:56):
Paul Martino, VillageMD (20:56):
And for me that it was a me for me or our company, that was me. I want to hear about it for you.
Bob Badal, Strive Health (21:01):
Yeah. Well, it was a little bit of history about treatment, technologies and insights. We launched it because of one of our co-founders journey, uh, in being diagnosed with non-Hodgkin's lymphoma. Uh, his life partner, uh, who became C e O of T T I or Treatment Technologies Insights, um, was a data scientist. And he did what any loved one would do for, uh, his partner going through, uh, a serious illness like that. He wanted to improve his day in any way he could. Well, because he was a data scientist, he started tracking every aspect of patient Zeros day, uh, to try to find out what made him feel would better or worse, that turned into a solution that led to what I would unsophisticated call and non-scientific call aha moments. Hey, when you do this, this, and this in combination with this, this, and this, you feel better.
Or if you tweak this, you feel worse. So do more of this and less of this, well, besides being a data, uh, engineer type person, this c e o, uh, Matt, this is name is the most loving, caring individual I've, other than maybe my mom and my wife that I've met in my life. And he has this passion for creating a culture and the hug, the, the know-how to give a hug when it's needed, uh, which is terribly important. And so he is the glue that drives our culture. He is the glue that everyone comes back to when times are tough. Uh, he is the individual that can, uh, on the culture side really push our organization forward. It so it, I mean, it's a gift when you find those folks, Paul, you hold onto it in
Paul Martino, VillageMD (22:35):
Life. Yeah. Yeah. Yeah. I, I, I totally agree with that. Um, I wanna explore what didn't work well, but before we get to that, because I know the audience a little bit, not great. Um, they are always interested in the capital raising part. And, um, just, you know, I think back to, uh, when we raised Series A at my company and, you know, we were, we had some angels and we ran it for a couple, couple and a half years, and then we got had to get serious about it because we felt as though the company was gonna be successful, and we, we needed to go get real money. Yeah. And, um, I, I, I will share that the person that we ended up selecting is our series A investor, uh, kind of came outta left field. We didn't know them really, uh, at all. And after the diligence part of them scrubbing us down, uh, they, uh, she asked at the end of a full day of this, she asked me this question, um, do you have a question? Any questions for us? And I said, I do. Why would you give us a term sheet with the terms that you did, I e the winning term sheet? Why would you do that? And her answer was, because after we met you guys, we went to school on you mm-hmm. <affirmative>, and you guys checked out. Yeah. So what was your experience like?
Bob Badal, Strive Health (23:54):
Yeah, I'm, uh, fortunate to have two different experiences that at least to talk about today, that are on both ends of the spectrum are raising capital. In the case of Strive, our initial investor, call it our seed round, uh, was NEA with a check of 80 million. That's a big seed round,
Paul Martino, VillageMD (24:13):
Right? That's a big seed
Bob Badal, Strive Health (24:15):
<laugh>. Yeah. And my co-founding partner and I, yeah, our co-founding partner, and I said, are you kidding me? We don't want that much money because we know we're gonna have to pay every dollar back. And is there a way we can get a little bit of success with a smaller amount, raise some debt or whatever. And, uh, it was wonderful advice we received from the lead investor at NEA that said, trust me, you're gonna want that money. You're gonna need that money. You are disrupting an organ or an industry that has got some big boys in it, and you need to swing for the fences. And he was 100% right. A year and a half later or so, we raised another 150 million and brought in CAP G and others. And we've also had some wonderful, uh, uh, o o other investors, smaller level investors, town hall ventures, echo A ventures, uh, Ascension Ventures and the like. And so,
Paul Martino, VillageMD (25:04):
But these are all marquee. Like if you're in this world, these are, these are the people you want, right? Yeah. And in some ways they can help you succeed.
Bob Badal, Strive Health (25:12):
Uh, there's the, there's the crux. You know, how do you raise capital? Why do you raise capital? And who do you raise capital from? I've always been the mindset you can find the capital. Yeah, there's some STR strains in the capital markets right now, but if you've got a good idea and you've got a great team, to your point, that can be, uh, an organization go to, can go to school on and assess and, and check out, uh, you'll be able to raise the capital. You really need to also find someone that's gonna add value beyond the dollars. Is it an organization that's gonna help your growth engine? Big surprise, you're doing a new co, you need growth. You need to find those anchor customers, and those investors need to help you do that. Are there other, um, enterprise level, uh, support that they can provide financial accounting, some other things before you need to hire? Uh, sure. Those are wonderful additive benefits as well. Um, and, and so, uh, I guess one takeaway, know your investor, know that they can bring more than dollars to get more than you think, uh, uh, in terms of dollars, I think is, is a less now such a
Paul Martino, VillageMD (26:18):
Good advice. That is great because we did a small A, which meant we were rushing to get go get B because we kind of had to. Yeah.
Bob Badal, Strive Health (26:27):
Right? Yeah. Being in that cycle of constantly having to raise is, is it's fun for me. I, I, I like that path, but at the same time, it's unbelievably distracting and it's just a mind suck and a time suck. Now, juxtapose that experience to the electronic patient reported outcomes platform, t t i that I launched, we self-funded it, pulled together maybe two or $300,000, decided it wasn't gonna be a business. We were doing it altruistically. It was the one thing in my life at that point, Paul, that I finally said, I'm just gonna give back. I'm not looking for a return. And we wanna improve cancer patients lives for free across the globe. We stumbled into a business model and then raised a friends and family round of a couple million. And that allowed us to stand up our platform and test some things. And then lo and behold, a year and a half later, we need to hire some folks.
We need more capital. So you could do a follow on friends and family or seed wrap. And so it's been doing the, or setting up the building blocks in a very, very different way, to be honest with you, as stressful as that process is, uh, I was mentioning this to Steve, uh, earlier, it's enjoyable in a lot of ways as well, because you get very, very well connected to the investors that their friends and family in particular, uh, and maybe family office type in investors that have different pressure points and different expectations, and, and maybe in some cases, not hitting so hard the way bcs or private equity, uh, folks do every day. And, and so that's been a fun journey as well. Yeah. So I love that. I've had both sides of it.
Paul Martino, VillageMD (28:01):
Yeah. Yeah. I've had kidney stones twice in my life. Series A and series B <laugh>, so, so you like it? Not so much for this guy.
Bob Badal, Strive Health (28:12):
Yeah, I hear you. I hear. So call me up next time.
Paul Martino, VillageMD (28:15):
Successes along the way, right? Because, you know, this is the other thing, uh, a again, at least for me, when you get money from other people, they're, they're gonna be around you a lot, right? They're gonna likely be on your board, maybe more than one, and they're gonna wanna know shortly after they've invested s they wanna see success points, they wanna see proof points, they wanna know what the story that you told them, right? The stories to tell are abundant, right? The actual delivering against them is the hard part. So talk a little bit about successes.
Bob Badal, Strive Health (28:48):
Yeah. I mean, uh, putting 'em into categories generally that, you know, investors, like you said, they wanna see return, they wanna see growth, they wanna see that you set these targets. How are you doing against those targets and line going like this? Okay. Uh, somewhat simplistic, but it is what it is. Uh, the successes has an example, uh, that we've had at strive to start our, uh, robust, you know, we launched it the end of 2018. Uh, when you have a line in growth that looks like this, we're gonna end the year at strive over 4 billion in total healthcare spend under management. We're gonna be in 25 states. Uh, we have 400 employees. Yeah. I mean, it's, yeah, it's a, it's a big organization, but, you know, how are you doing and operating operationally executing against that total dollars in healthcare spend under management, and, and the, the partnerships you have, you know, the first couple years, it's all about growth, growth, growth.
And, and, and beyond that, then you need to actually execute. And in the world of value-based care, where some of your dollars are kind of dangled out there that you have to go earn, uh, based on performance, uh, you've gotta have the operational engine to succeed. And, and Strive has spent massive amount of time and energy in bringing in the right resources, ClinOps, as well as just general blocking and tackling operations leadership to ensure that we do succeed in that. And, and, and, and we are, which is great. And that's a nice line, a storyline and, and success path to share with the investors in the t t I, uh, electronic patient report outcome space. Very different trajectory. We started in the B2C space, um, and we needed to build the tech platform, and we needed to, uh, ensure that we had a huge amount of patient engagement. It's stickiness. Uh, and on all of those metrics, we've succeeded as well. We've touched, uh, almost over 200,000 people, uh, in the cancer space and other immunology, immunological, uh, uh, diseases like rheumatoid arthritis and others. And so we're creating that stickiness and that creates value, especially when you think about our, our go-to-market strategy and how we partner with payers and providers and pharma organizations to provide real world evidence. And so different metrics of success. But y you gotta keep pushing. Uh,
Paul Martino, VillageMD (31:14):
So what about, you know, so it's interesting, right? Because, uh, there's an article in Crane Chicago Crane's business today about Walgreens, about them, you know, kind of pivoting and trying to be the healthcare company on, on every corner, which is, uh, I mean, this is 106, I think, year old company that wants to morph themselves into something. I mean, what do they know today? They know pharmacy, right? Yeah. And so they, they, they're, and so what, what, that's, so that's what people read about us. They think that these guys are like this monster successful organs, but we have made an unbelievable amount of mistakes along the way. Talk about some of the mistakes. What, what, like, what were, what were some of your learnings from those mistakes?
Bob Badal, Strive Health (31:55):
Yeah. For me, probably the top of the list would be, uh, especially when you're starting out and you're bringing in all the important resources and talent and leaders that you need. Uh, there's been times where I have, and, and the team has been myopically focused around, uh, the resume, uh, the work experience, the analytical regru, the, the experience they had in consulting, which means they must be smart and strategic and maybe under clubbing, the likability trust factor, that familial factor, uh, that's terribly important, especially in the New coast stage or early stage where you are in the trenches together. And if you are not liking each other, oh geez,
Paul Martino, VillageMD (32:43):
That's a tough road ahoe, right? Yeah,
Bob Badal, Strive Health (32:46):
Paul Martino, VillageMD (32:47):
Yeah. So, I, I, I know I can't say this publicly, but I'm going to, when Tim Clive and I started the company, the most important thing that we agreed upon was the no asshole rule, right? I
Bob Badal, Strive Health (32:57):
Was gonna say the same
Paul Martino, VillageMD (32:58):
Thing. And so talk about that.
Bob Badal, Strive Health (32:59):
Yeah. I mean, that was literally, those words were kind of the rule of thumb for Chris and myself and any, you know, Chris at Strive. And, and the same applies with Matt and I at, at at t t I, uh, as you grow, it becomes more difficult to control maybe that asshole factor or whatever, but nonetheless, um, you, it doesn't mean you shouldn't bring intentionality and intensity to it, uh, and have the right processes and structure to make sure you filter on that. And, you know, throughout my career, I've ebbed and flowed, uh, in terms of the relevancy of that. But boy, I've learned it later in life. I'm 54, I'm much older than you, Paul. And, and, and the fact of the <laugh>, uh, I, I, I, I put that at the top of the list with any organization I work in. You know, as I've, uh, moved into more of an advisor role at Strive and dedicating more of my time, uh, to TTI and, and doing some other board and advisor work, that is the most important thing to me. Life is too short. I don't wanna work with people I don't like, uh, it might be a sexy idea. It might be a fun idea. It might be, you know, highly capitalized. I don't care. I gotta really like the people. And so misses as well as successes have all kind of focused around the people. People and people.
Paul Martino, VillageMD (34:15):
Yeah. Yeah. Yeah. I like that. I like that a lot. So you, you hit on something though, uh, you said as you get bigger, as you grow, it's, it's harder to do. So if the founders, uh, have that sort of belief, fundamentally, I can see that that stays together pretty nicely. But how do, what about adding people? Like, what are you looking for in terms of characteristics where you say, I think this person has all the right credentials in terms of their resume, but culturally, I don't know if they're gonna be the right kind of fit, or conversely, here's a person that doesn't really have the right resume, but I'm gonna take a bet.
Bob Badal, Strive Health (34:53):
I mean, it's, it's, it's that conversation. I can't tell you how many folks, uh, across all the organizations have worked at that we've said no to, because of that lack of fit. There was something that didn't feel right. And we're all instinctive, uh, beings, and we all know what we like, and what we don't like is to have the courage to, to recognize it, to see it, and to follow it. Uh, so the next kind of follow up question is, okay, how the hell do you find those people then?
Paul Martino, VillageMD (35:20):
Yeah, yeah, exactly. It's right. Cause they're hard to fight, right?
Bob Badal, Strive Health (35:23):
Yeah, they are. And you know, it might be too simplistic and somewhat tactical and just blocking and tackling, but I have tried, especially, uh, when I left DaVita to focus every single day and every single week on either, uh, mentoring folks within my network or finding mentors for myself. I mean, you're a great example. This other folks that I, I learned so much from in their style of how they work, their people skills, their, uh, uh, unique capabilities and leading companies, et cetera. But the sincerity with which I try to bring, uh, to the relationship building is a key for me. And as I expand and reach out to more and more people and truly care about what they have to say and get to know them as individuals, I find that I get access to more and more folks to say, you know, Bob, you're a really likable guy. I wanna introduce you to this person and that person in my network of folks that I meet expands, and big surprised, those are the people I tap into, uh, in the organizations I'm affiliated with.
Paul Martino, VillageMD (36:30):
You know, one thing that, uh, as I think about you, you, you know, your time, our time together on the board, you're, you've been on boards, you've started companies. You, you at one point said you're gonna spend a lot of time with people, 80 hours, 90 hours a week, you're gonna run around at JP Morgan, which starts on a weekend, right? How do you, how do you balance it, right? You're 54, you have kids, um, and what keeps you going, right? Because at this stage of your career, my career, maybe it's time to say, you know, so how do you balance it all?
Bob Badal, Strive Health (37:01):
Well, the first thing about age is interesting to me. I don't know if it happened to you, Paul, but I blinked and I dunno when it happened. And I became the old guy in the room, and it really bumps me out. Cause deep down, we both feel young and we've got another 30 years of work minimum. And that's just the way we're wired. But you just hit on the most important thing for me that I didn't learn, uh, until I was in my forties, which was my why. Now, it's not to say that your why doesn't change and what motivates you and, and keeps you going. When I was young, as I said earlier, money, power, prestige, that was the why. And then learn, learn, learn. Because that's gonna be important to build this basis, to be able to do something next, whatever the next was.
I didn't know. But, um, in my forties, I got married late in life. I had a son, uh, late in life. It immediately became my why. And that's what drives me every day. Uh, and it's hard to create balance. I would tell you, um, maybe I'm blessed in that because I, I had a child later in life and had a little bit of financial security. I could make some trade offs that when you're kind of up and coming, you little have a little bit more angst around doing, uh, to dedicate more time to family, uh, than, than to work. But, uh, I have learned it the hard way because of, candidly, the first two years of my son's life that I missed. And I don't blame the company I was working with. I blame myself, but I refuse to make that trade off again in a lot of ways. And so, it's my why now that why can also cause me to say, oh my God, I'm gonna go a thousand percent into this for the next five years, because that allows a more stable and comfortable lifestyle for my family. But it is my North star, and I wish I, uh, maybe, I wish, maybe that's the wrong word, choice. I am, uh, happy to encounter folks that have a why that is 100% focused around their, the new code they're starting, right? Um,
Paul Martino, VillageMD (39:00):
You know, I I I I love that you went there because, uh, I was presenting to a group, uh, inside our company, uh, Wednesday of last week, our analytics team. Now, this is a bunch of biostatisticians actuaries, you know, the profile and, uh, not necessarily the most interactive, affable, uh, k kind of folks. And I, I decided, uh, because part of what they asked me to talk about was how did VillageMD get going? What? Like, what was happening? And how did you get? And so if you go back to 2009, there's a great Ted talk, Simon sins start with why, right? And so for those of you that may not know him and may not have seen it, um, he talks about most people in the company, really, all people in the company know what they do. What are, what, what are we doing at at VillageMD? What are you doing at the companies that you've been part of? Some people know how they do it, but very few people know why.
Bob Badal, Strive Health (39:56):
Paul Martino, VillageMD (39:57):
And, um, if there, I, I was, I'm thrilled that you, you brought that up. Um, and so for those that are listening, I, and, and this ties to another thing for me, Bob, if you're, if you really have a why around what you're doing a, around your business, and why did you decide that renal care, in the case of strive, was what you wanted to do, or, um, you know, the, the work in the oncology business was what you wanted to do? I believe it's easier to raise money from investors because the, the, the passion and the believability factor is so high. Yeah. Right? I mean, if you're, if you're just making it up, they're probably gonna figure it out.
Bob Badal, Strive Health (40:37):
Yeah. Some of the best entrepreneurs I've met are blessed with the fact that the y uh, touches their heart and also touches their desire to disrupt the status quo, or touches their, their need for capital, or what ego or whatever it is. But it's rooted in a personal experience. Um, a good friend of mine that I've done some advisor work for, uh, in the DME space, or maybe more broadly, the home, uh, services space tomorrow, health, this, their c e o, uh, has a great why. And it's a real heartfelt why, because of a personal, uh, journey his mom went through in getting discharged from a hospital. Uh, another company, uh, uh, close friend of mine, uh, the company's name is Ounce of Care. Uh, it's the intersection between, um, large, uh, kind of developers and, and, uh, in big urban cities and connecting them to, uh, healthcare. Uh, she's got a wonderful why as, as well, well around it. And so it just, it, it helps you get up every day. Uh, yeah,
Paul Martino, VillageMD (41:37):
It really does. Yeah. So, um, there's a question on the audience that I wanna shift gears to giving back. So let me, I'll get to that. But, um, somebody on, in the audience asked the question, what is J p m? And since you live in Northern California, <laugh> and I, I live in Chicago, uh, describe, describe what it is.
Bob Badal, Strive Health (41:57):
Uh, it is a, uh, uh, an event that, you know, primarily is, uh, an opportunity for new ventures, NewCos within the healthcare space to connect with the investor community. Uh, a lot of private equity, a lot of venture capital, uh, firms come to it. And you can learn about a lot of the things we're talking about today. It's just an, an ecosystem that breeds intensity in a positive way, entrepreneurial spirit and connectivity with the folks that you need to meet. So it is a wonderful, as I said earlier, speed dating opportunity to meet a lot of folks in a compressed amount of time. Um, that's, that's how I would
Paul Martino, VillageMD (42:39):
Describe it. You know, it's great factoid. Uh, there are more people in the city of San Francisco for the jp, what is this there? 35th, sixth, seventh year, something like that. Uh, there are more people that descend upon that city for this conference than there are hotel rooms available for them to sleep in. Yep. So, I mean, if you're in the audience and you haven't been, you don't need an invitation to the actual conference itself. Yeah. Um, all, all you, all you really need to do is go to San Francisco and sit in Union Square as you point it out, right? Yeah.
Bob Badal, Strive Health (43:08):
Yeah. And you'll have a great event and a successful event.
Paul Martino, VillageMD (43:11):
Yeah. Yeah. Seek out people is, is a big problem. Yep. So, um, I wanna maybe close us out with giving back, um, and I'm gonna share a story with you, and then I want to hear one from you. So if you do what you've done, if you do what I've done, you get to this point in your life. You said you're 54, I I will be 63 tomorrow, and, um, and I, we, we life's I've been lucky, right? Luck, grit matters. Luck does too. And so, um, I was thinking about giving back and what, what is it that we do to give back? So a story, we have a physician forum once a year, and last October, probably around 200, 250, uh, physicians participate. Clive Fields, who's one of the co-founders with me, who is a family physician in Houston, Texas. Uh, Clive decided that he wanted to interview one of his patients. Mm-hmm. <affirmative>, and his patient's name is Tommy Austin. Mm-hmm. <affirmative>, Tommy Austin is one of the founders of Make-A-Wish.
Bob Badal, Strive Health (44:18):
Paul Martino, VillageMD (44:19):
And Clive wanted to interview him because he want, he w he, uh, if, if I think Make-A-Wish is a wonderful organization, and, um, Clive wanted to have him share what it was, what was going on that got him started, because this guy was actually a border patrol agent in Phoenix, Arizona. Not what you, not what, or who you would think would start this type of an organization. Yeah. And, uh, ironically, there was a physician there that was not part of Village, and one of our folks wanted me to meet this woman mm-hmm. <affirmative>. So after I went up to Tommy Austin, Clive wanted to introduce me to him. After that, I was walking back from that, and the person on our in our company stopped me and said, please meet this doctor. And so I went over and I introduced myself, and I just asked the simple question, you know, you, you've been here all day, how's the session been for you so far? And she had very nice things to say. And then she said, uh, I, I said, uh, she said to me, but I'm, what I'm really interested in is the guy that you're gonna talk with tomorrow, Tom Austin mm-hmm. <affirmative>. And I said, oh, uh, do you know him? And she said, I don't, but I wanna meet him because my daughter received a wish.
Bob Badal, Strive Health (45:36):
Paul Martino, VillageMD (45:38):
Bob Badal, Strive Health (45:39):
Paul Martino, VillageMD (45:40):
So, so I said to her, do you wanna meet him now? I'll, I'll take you over there. And so, so I did, and she met her and her husband met him and started talking with him. And then I had this epiphany, and I said to Clive, um, you know, rather than just have you interview Tommy Austin, why don't we have Dr. Uh, and her husband? Why don't you have 'em get up there, tell their story about receiving a wish? Yeah. And it'll just make it so much more personal for the audience. Yeah. And so I decided that I wanna become a, uh, I have, I have become a lifetime donor to make a wish, and I'm on the board now in Illinois, make-a-Wish. That's wonderful. You give back. Tell me about your give back.
Bob Badal, Strive Health (46:25):
Uh, geez. Uh, well, the first thing in my kind of golden rule about giving back is, um, I, I don't broadcast it, uh, too much because I feel like, uh, there's too many folks out there that say, oh, look at me. Look at all the stuff that I've, I've done for this organization or that organization to try to get, uh, you know, accolades or, or whatever. Uh, there's a cohort of folks that do that in, in, in my case, uh, I am so, uh, moved and driven by two categories of populations, if you will, uh, the military. Uh, and then separate and distinct from that, those suffering from chronic diseases that I can actually have, even if it's one patient at a time, uh, and improvement in their life, the ability to bottle that up, the stories as, as you just described of one patient's experience, one patient's journey, uh, is so addictive to me.
And so moving for me, uh, in the case of TTI as an example, with all the patients we've touched and all the patient stories we get, uh, I try to figure out ways to both help the, uh, the kind of the category of patients, but also the individual patients. Uh, I have found wonderful opportunities from the folks that I've been, been introduced to throughout my healthcare career, individual patients where I've been able to do something for them. And, uh, you know, there are some people that, uh, uh, want to have the biggest impact across the largest amount of, of, of patients, uh, or people. And my path has been one person at a time to do something differential or unique for that individual. And whether it's helping someone with transportation to get to the doctor's office in my own car, whether it be to pay for a holiday gift, whether it be to, uh, do things for the veterans through existing programs like Tunnel to Towers and Wounded Warriors, uh, my family and I do a lot around those things. Uh, just as a sidebar, my, my dad was in the military, and so I think that's probably where it was rooted, and, and I just can't think of enough, uh, that I, and we can do for, for those types of folks. Yeah. Uh, so I, I don't know if that answers your question.
Paul Martino, VillageMD (48:37):
It does. It does. And what I love about it is, you, you can actually understand it and feel it when it's like this pers as you said, some people just wanna talk about scale, and you know, that I don't understand. You get rewarded for that along the way, but I don't understand it. But the, the one doctor that you talked to that had a daughter, the one military veteran that you helped because they maybe couldn't afford a Turkey for Thanksgiving, I mean, right. Those are the things that make a difference. We, we did get a couple of questions from the audience and, um, two that sort of tie together. Uh, so I'm gonna read the question. I'm gonna a ask and invite you to comment about it. The question is about private equity's interest in healthcare and its acceleration in recent years, and what's the dynamic behind this? So I I you mean you've started two organizations within this window, probably a decade or so, a a ton of money going into healthcare. What's your take on what's going on?
Bob Badal, Strive Health (49:34):
Yeah. The intersection between tech and healthcare services and the power that those two things, uh, can bring to bear within healthcare if done right, is a very, very attractive investment. Uh, that's how I at least, uh, my focus is, is has been around in healthcare. It's that intersection between those two. And there's plenty of examples that show that success. And then taking a, uh, a NewCo or an early stage organization and creating a growth engine process behind it and, and the right resources and leadership behind it create one hell of a return. Uh, well, I mean, yeah. We shouldn't hide behind it. Private equity is looking for return. That's right. Yeah. They, they might have a nice conversation with you about how it's nice to make a change in the world and improve people's, you know, life, et cetera. But at the end of the day, it's return, return and return on investment. And so, uh, healthcare is, is primed for that. That because there's been a lot of inefficiencies and a lot of bureaucracy and, and there's been wonderful opportunities to aggregate assets that are currently disintermediated or spread out that with scale, uh, you can bring efficiency and, and return. And so, I mean, that's where most of it is driven in my opinion, or why pe PE is getting involved.
Paul Martino, VillageMD (50:47):
Yeah. Yeah. You know, you, you raised a really good point in that, uh, couple of minutes there. Um, I made the mistake of thinking that our series A and B investors would care as much about our idea and our business as we You do. I do. Cuz we, if you, if you start with Y <laugh> that you really care about that thing, right? And it's, it's, it's kind of not the right expectation to have that investors might care about it as much as you do. They're in it for the return, and that's okay. Yeah. But you have to know that kind of go. Um, last question before we sign off is around, uh, entrepreneurs partnering with nonprofit and safety net community health plans. And, um, the question goes on to say entrepreneurs require so much money, but in the community-based health plans, they may not have as much money. Mm-hmm. <affirmative>, talk a little bit about that because I think a big part of being in healthcare is giving back and giving back to underserved. And we all need to know what that means and not pay lip service to it.
Bob Badal, Strive Health (51:48):
Yeah, I think, uh, uh, one, it's unbelievably commendable. Two, it is the right north star, but three, you, it's very difficult, not impossible, uh, but very difficult to build your model just around that. Right? Uh, it's, it's a wonderful thing to have intentionality around, but you also need the profit side. Maybe that comes from the, the private, uh, or for-profit side of healthcare to be able to generate enough revenue, enough income to be able to, uh, support, uh, your, your primary focus. Uh, you know, people are probably gonna be shocked by this, but DaVita is a great example of that. Or let's say more broadly, large dialysis organizations, 90% of their business comes from Medicare, where they lose money on a fully cost loaded basis. 10% comes from private. And it was drilled into, uh, us at, at DaVita appropriately. So that, uh, we've got to do very well in that 10% to be able to care for all these, these, these folks where we're losing money on. And so it's somewhat analogous in some ways you can do both, I think is is the takeaway. Uh, yeah. Agree. But I think maybe just focused on one would be a little difficult.
Paul Martino, VillageMD (52:57):
Yeah. No, I, I completely agree. In fact, uh, we have publicly said, so has Walgreens that 50% of the co-located clinics that we open with Walgreens mm-hmm. <affirmative> are going to be in medically underserved communities.
Bob Badal, Strive Health (53:10):
Yeah. That's wonderful.
Paul Martino, VillageMD (53:12):
Um, so, uh, I think we're just right now, uh, uh, up on, out of time. Steven, I don't know if you're coming back on or we just wish everybody a happy holiday and sign off what's best. Just wanted to thank
Steven Collens, MATTER (53:24):
You both, uh, so much for this conversation. Um, loved the discussion and the insights and the rapport that you two have. And this really, um, a great conversation and a great way for us to, uh, close out the year with this series of, um, this series of Tales from the Trenches. Um, for those of you, um, listening, if you're interested, we will be, uh, restarting this series in in January. We'll, we've got, uh, Roy Smith who, uh, leads Soma Logic on January 26th. They have Char Martin from Cordes on February 21st. You can find out more about those and other, uh, programs on our site, which is matter.health, um, slash events. Thank you all so much, Bob and, and Paul, thank you, uh, once again. I hope you have a terrific holiday. Um, and it's always great to see you Paul and, um, and be around you and your founders. Uh, and Bob, great to, to meet you through this process and look forward to watching your success in your, uh, various companies. Um, so thank you all and, uh, enjoy the rest of your day.