Founder Profile: The Founders Behind The Robo-Pharmacist

 

Summary

The pharmaceuticals industry has remained undisrupted for years and is in desperate need of innovation mirroring that of companies like Amazon, offering on-demand, tech-driven services. NowRx founder, Cary Brees, set out to change this. NowRx is an on-demand pharmacy with the ultimate goal of developing AI-powered robotic technology for free, same-day delivery of both prescription and over-the-counter (OTC) medications.

Back in May of 2018, we rated NowRx a Top Deal for the massive market opportunity and impressive traction. The team is now raising its Series B round as a Regulation A offer on SeedInvest. The KingsCrowd team once again has given it a rating of a Top Deal due to its continued success.

After rating NowRx a Top Deal not once, but twice, we thought we would chat with founder Cary Brees and learn more about how NowRx came to be, potential exit opportunities, and more…


Kingscrowd
Can you tell us about the genesis story of nowrx?
Cary

One day in early 2015, I left his doctor’s office with a prescription in hand and drove across town to his local pharmacy where I found myself waiting in three separate lines: the first to drop off the prescription, the second to pay (after a 20 minute wait for the medication to be counted out by hand!), and the third to speak to the pharmacist. I found himself thinking: in the world of on-demand where you can order a car to pick you up within a few minutes, or have practically any retail product delivered to your doorstep, how can it be that pharmacy still requires you to drive to a pharmacy, stand in multiple lines, and often wait for 20-30 minutes or more for your prescription to be prepared?  I immediately called my friend and former work colleague, Sumeet Sheokand, NowRx’s current CTO and together we researched the industry and surrounded ourselves with industry experts. We jumped in and NowRx was born. Four years later NowRx has raised $10,000,000, $7,000,000 via crowdfunding, has 5 licensed facilities spread across the San Francisco Bay area, Orange County, and Los Angeles, and has delivered more than 100,000 prescriptions to 18,000 customers.

Kingscrowd
For those that don’t know how do you define nowrx as a business?
Cary

Most consumers hate going to the pharmacy because traditional pharmacy is inconvenient, time-consuming and expensive. At NowRx we overcome these problems by utilizing high-tech robotics and AI enabled distribution centers to provide low cost medication, free same-day prescription delivery, and unparalleled customer service.

Kingscrowd
Can you talk about the efficiencies of this model over traditional pharmacy?
Cary

Fixed overhead is less than 1% compared to retail pharmacy.  For example, we service the Mountainview area with one 5,000 square foot commercial facility where our rent is $2.00/sft.  In that same area, there are 20 traditional pharmacies accounting for 300,000 sft at $6.00/sft rent. That is a massive savings.  In addition, all of our pharmacies are high tech and leverage automation and robotics to make fulfilling each prescription much more efficient than traditional pharmacies. 

Kingscrowd
You’ve grown from $4.7 to nearly $8m in revenue in 1 year. how are you driving this traction?
Cary

To date, we have not done that much consumer marketing which makes this growth rate even more impressive.  98% of this growth has come from doctors and medical offices recommending NowRx to their patients, and patients recommending NowRx to their family and friends.  It’s not that surprising when you look at our market research numbers: 71% of our customers are very likely to recommend us to a friend; 86% are Very likely to use NowRx again and 80% say we are very good at meeting their pharmacy needs.

Kingscrowd
How do you expand from $8m to $100m+ in revenue?
Cary

Consumer Marketing and more pharmacies!   This is a local business. Each pharmacy has a 10 mile radius service area so we need to build out pharmacies nationwide.  This will be the primary use of this capital raise. Our first pharmacy outside of Northern California is already leased in Orange County CA and about to be operational.  We expect the OC location to double our overall business.

Kingscrowd
From a geographic expansion standpoint, what are the next key cities to enter?
Cary

As I said, in the immediate future, Orange County in SoCal.  Next ones might be Phoenix and Seattle but we are still evaluating various markets.  We do want to prove the model outside of California though.

Kingscrowd
I know in nyc, capsule seems to be the on-demand pharmacy. how do you think about competing with others in the space as you expand geographically?
Cary

This is a massive space, estimated at over $300B in sales per year.  98% is controlled by the dominant traditional pharmacies, so a competitor like Capsule just helps spread adoption of same day pharmacy delivery.  Also, as I said before, this is a local business and we are not in NYC so we don’t run into them. I think their recent big capital raise is a validation for the opportunity to disrupt this space and there is definitely room for multiple players.  Our proprietary pharmacy management system, Quickfill, is certified by SureScripts Health Alliance Network and the DEA which we believe puts us ahead of most competitors.  

Kingscrowd
How does owning and creating all of your own tech better enable you over competition?
Cary

From an investor viewpoint, having our own tech and IP is hugely attractive especially if the tech is unique and drives productivity and efficiency which ours does.  Obviously having your own tech is a huge barrier to entry to others looking to enter the space. From a business perspective, it gives us a massive advantage when it comes to flexibility, creating new features that customers want and integrating with our various partners and vendors, for example, drug manufacturer coupon databases and of course health insurance companies. Whoever provides the best customer service will end up winning in this space and we believe technology is the way to do that. 

Kingscrowd
What does the team makeup look like today and what areas do you need to expand to scale?
Cary

Most of our staff works in the pharmacies – either as pharmacists, pharmacy technicians or drivers.  As we build out more pharmacies we will have to staff them up. We also need to continue building out our tech team and marketing/sales teams.

Kingscrowd
At what point can nowrx achieve profitability?
Cary

We look at on a per facility basis because it takes time to scale these things up.  Right now it takes about 12 to 18 months to hit breakeven per pharmacy.

Kingscrowd
As you think about exit for investors, what do you see as viable opportunities?
Cary

We see a few options.  Our preference is to go public via an IPO.  However, right now we are seeing lots of disruption in the industry and there is potential for strategic acquisition.


We at KingsCrowd are excited to see where Cary and his team take the company, especially as they close out their Series B funding, again, a Top Deal. Since we first rated this deal, the company continues to grow and significantly increase both revenues and margins.

NowRx is currently raising funds on the SeedInvest platform and is offering preferred equity with a minimum investment of $1000 and a pre-money valuation of $65M.


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About: Olivia

Olivia is a graduate of Wellesley College with a Bachelor's in Neuroscience and English. She has spent time as an investment intern at Glasswing Ventures, an AI-focused VC fund in Boston where she helped develop machine learning algorithms for identifying early signal success factors of startups.

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