The Exchanges

Q Tell me, this is a good, good time to segue into that, like, what exactly is Judy Health? What, what do you guys do? And, and even, I know the name has changed, I don't know if what you do has changed, but curious what it was at the beginning as well.

A So, Judy Health is a health benefit manager, so anyone who works for a company and you have a benefit plan, Somebody's administrating your benefits, so that's medical, pharmacy, and the longer tale of dental, vision, and ancillary benefits, but the point of it is your insurance or your benefit provider is the person that manages your account, you know, and so this is what Judy Health provides. We started in pharmacy benefits, and name of the company in the early days was Capital Rx. Talk about Gritty. People often say, oh, like, what was the name? Capital RX, what did it represent? I'm like, nothing. The domain name was available. Nobody had any trademark rights on capital RX. So it was clean. And more importantly, I wanted it because it sounded common and people are like, what? Because in healthcare, you want to feel like you've been around forever.

AI assessment note: “Judy Health is a health benefit manager... We started in pharmacy benefits”

Q What about, uh, in terms of finding these candidates, did you any, like, how did you, those first 30, 40 hires, did you do anything interesting on the outbound side in terms of finding them in the first place?

A Yeah, so, alright, first 40 employees, I go to one degree of separation. You know, is it someone I worked with, or someone very close to me that I respect worked with this person? So, I'll give you a great example. Uh, I was looking for someone on the implementation side, so this is someone who knows how to set up a benefit plan, which is extraordinarily difficult. And I asked all around, because, you know, I've been in healthcare for a while. I know people in different companies. I'm like, who's the best person in implementation you've ever worked with? And I kept getting the same name, this woman by the name of Karen Durker, who still works with me here. And I'm like, what the heck is a Karen Durker? And I'm like, what are the odds three different people both said the same name?

AI assessment note: “first 40 employees, I go to one degree of separation.”

Q example being the obvious one, you know, let them run DVDs, whatever. But in your case, probably not. I mean, how do you get started? Where do you go? Because I'm thinking to convince the buyers is probably not easy to convince the VCs is probably not easy. I mean, you have a track record, so maybe that helps. But anyways, how do you get started on something like this?

A Yeah, you bootstrap is the honest one. And I want to be fair. Health technology was starting to become interesting, you know, 2016, 2017. So there was a market there, but pharmacy benefits was observed to be this Impossible fortress to get through because it was dominated by three massive players, and no one had really had commercial success kind of overturning them, and, and what I mean by that is there's certainly been other pharmacy benefit managers, but they replicated the model. They did the same exact thing as the leaders in the market segment, and they grew to a certain point, and then they flatlined. No one had ever scaled And started to take money from what I would call the two most valuable categories are Fortune 500, because they're large and prestigious. The second being health plans, because they're even bigger than Fortune 500 customers. So if you could service a health plan on the benefit and technology side, that's a huge deal. But no one had been able to do it. So how do you get started? We bootstrapped. And when you bootstrap, You might have this vision of this powerful platform that's going to process claims and administrate patients and workflows, but you're going to start with a small build, and you're going to license third party software, and you're not going to be thrilled with what you're given. You're going to have to rely upon third parties. You're go…

AI assessment note: “So how do you get started? We bootstrapped. And when you bootstrap,”

Q And this was like in-house call center that you had?

A In-house. Yeah. Domestic. You're like, whoa, but What I knew was if we were bringing noise to like nothing, and this is what customers were saying, they're like, I'm not hearing any complaints. In fact, people have actually gone out of their way to say this was a really good experience. That is going to set the tone with the customer, and then what you're going to do with the customer is you're going to do something that is not going to be price efficient, which is We would go on site to actually go over the review with the customer. So, at a minimum, you have quarterly reports and you have an annual review, and I was like, we're going to every single one of our customers.

AI assessment note: “In-house. Yeah. Domestic.”

Q Do you remember the first Customer you signed, those probably smaller customers, and how that happened?

A Yes. You know, I often say unions are very good early adopters when it comes to cost savings and service, because one, they want to make sure their membership is, is treated on a level like family. The second part is municipalities and public sector and unions, they have fixed budgets. You know, I often say, if you work with a fortune 500 plan, You know, if their cost goes up five percent, they just pay it. A union has to consider sustainability. You know, very precisely how many union do, how much is the union dues that we have? How much goes to benefits working with actuaries? How long can we maintain the benefit at this rate? Do we have ample amount of membership to survive? You know, corporate America Doesn't necessarily have this same sensitivity to price that unions do for the reason I just described. And so, unions became at the heart of our business the first couple years. You know, those first two years, you know, I would say I bleed taft heartly in the sense that I, I will forever be very thankful for unions. I also, also will point out I am the son of a public school teacher who is a union member as well, and so, I understand the importance that benefits play in the public sector and for unions because it is a critical part of their compensation package. Oftentimes, you know, unions and public sector have very good benefits.

AI assessment note: “unions became at the heart of our business the first couple years.”

Q employees after four years, which is incredible because there's A lot of turnover in, you know, in, in tech and all these kinds of startups. Um, the key you said was really hiring for mission. So I'm curious on just your hiring approach, especially the first 30, 40, 50 employees, like how did you go about hiring them? What did you do that was, that was different, that was unique?

A So the first. 40 or so I was certainly involved with, and if it wasn't me hiring or recruiting that person directly, it was certainly me being involved with a panel of review, like, Hey, tell me why these hires meant a lot. So we do a meet the new hires meeting, uh, every Monday here in our company. And I tell this story when I meet the new hires, cause I normally see a new class every Monday of 20 or 30 new people. I mean, it's crazy. And when they come in, you know, I tell them the story once upon a time, we used to actually take you to dinner. We used to be like, Hey, like it was such a huge moment that we hired someone this month. We'd be like, all right, like Linda, we're taking you to dinner. They'd be like, all right. But then over time that didn't scale. And then we used to call everybody. Like I used to call every person individually and be like, Hey, welcome to the company. I want to introduce myself. That didn't scale well with calendar. So now we do it as a group and it's a meet and greet. They introduce themselves. They ask a question of me and it could be anything, personal, business, experience, et cetera. And you know, the whole goal is for me to get to know them a little bit better and for them to get to know me better. But going back to your question is the piece that we kept finding over and over of people that were just our high performers, like our A player…

AI assessment note: “going back to your question is the piece that we kept finding over and over”