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Ep 14: Dr. Iman’s Incredible Idea

 
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Shaan: So I want to start with the who are you? So give us your name, and give us the name of your company and what your company does.

Iman Abuzeid: So my name is Iman Abuzeid, I’m the CEO and Co-Founder of Incredible Health. Incredible Health is the fastest growing hiring platform, for healthcare workers in the US today. Hospitals and health systems use our platform to hire permanent nurses today in less than 30 days, it normally takes them 90 days or longer. And our platform has driven the efficiency of hiring by 25 times. The reason that matters is the healthcare industry employees and most number of workers in America today. It is the largest labor sector in the country, but it also suffers from the biggest shortages. Our demand for health care as a country keeps going up, but we don’t have enough workers in the system and so it’s becoming harder and harder to hire.

Shaan: I want to talk about the product because I’m intrigued at how you’re doing this.

Iman Abuzeid: Yeah.

Shaan: There’s a couple things when I was looking you up, that was interesting. One was that you’re not a tech person who tried to just go solve this random problem that you didn’t really understand. You came from the healthcare world. So you have your MD.

Iman Abuzeid: That’s right. I am a medical doctor by background.

Shaan: And we were just talking right before this that you went through med school, you finished but you’d never practiced, right?

Iman Abuzeid: Correct.

Shaan: You went into management consulting.

Iman Abuzeid: I went into management consulting, and the reason I didn’t practice is because my interests were more around making an impact on a more macro level, impacting the entire health system or impacting an entire industry. And so don’t get me wrong, one-on-one patient care is great, but it wasn’t necessarily for me or where my interests laid.

Shaan: And so you realized that when that, “Hey I’m in medical school, I don’t necessarily want to be a practicing doctor.” When did you realize that?

Iman Abuzeid: Probably two years before graduating, and I was thinking about dropping out but I didn’t because my dad wouldn’t let me. And maybe that resonates with the immigrants out there and those of you with immigrant parents, I’m originally from Sudan. My parents are Sudanese, dropping out was just not an option.

Shaan: And you come from a doctor family too.

Iman Abuzeid: That’s right. My dad’s a surgeon. My two older brothers are surgeons.

Shaan: So growing up the question is-

Iman Abuzeid: Yeah.

Shaan: “What type of surgeon do you want to be?” Not, “What do you want to do?”

Iman Abuzeid: Exactly. Yeah.

Shaan: Okay. You realize this and you realize it in what, in one moment? Or was this a slow burn where you were, “I don’t know if I really want to do this.” Was there a day where you were, “This is not for me.”

Iman Abuzeid: It was definitely a slow burn. And then it was just a decision point where I was just like, “I cannot do this for the next 40, 50 years.”

Shaan: And that’s got to be a pretty tough realization to have.

Iman Abuzeid: Yeah.

Shaan: What happens, you break down crying that day. You’re, “Oh my God, I’m so far in, but this is not what I want to do.” Well, how did you deal with that realization when you had it?

Iman Abuzeid: No, it definitely wasn’t any crying. It was more around, “All right now it’s time to figure out what to do instead.”

Shaan: You went straight into problem solving mode.

Iman Abuzeid: I went straight into problem solving mode. I mean no regrets. That degree does give you a lot of credibility, whether you deserve it or whether I deserve it or not.

Shaan: I looked at you differently right now.

Iman Abuzeid: Yeah.

Shaan: I’m talking to a doctor. Great.

Iman Abuzeid: Yeah. I don’t use much of that knowledge, but it does provide credibility.

Shaan: And why consulting? Because most people I know they go into consulting for the money, they go into consulting because they kind of just don’t know what they want to do and that seems like a reputable career. You don’t strike me as the type of person who’s doing it for just resume building, or even just for money. Why did you go that route then?

Iman Abuzeid: Yeah. I didn’t know what I wanted to do. I just knew I wanted to do more. I want it to have a bigger impact. At the time management consulting would give me an exposure to a lot of different things and it did, I got to work with hospitals all over the country. I got to work in operations and strategy, and I got exposed to a whole new set of skills that I grew and a lot of smart people.

Shaan: And somewhere along-

Iman Abuzeid: But-

Shaan: Okay, what’s the but?

Iman Abuzeid: But it was very corporate.

Shaan: Yes.

Iman Abuzeid: Very, corporate.

Shaan: And that didn’t sit right.

Iman Abuzeid: That didn’t sit right with me, no.

Shaan: Yeah. You’re wearing a leather jacket right now, you seem super corporate.

Iman Abuzeid: Yeah.

Shaan: So at some point you decide, “Also this is not for me.”

Iman Abuzeid: Absolutely. I knew it wasn’t for me. And so again, I’m, “Okay, I need to just go explore and see what else is out there.”

Iman Abuzeid: That is actually what led me to apply to business school. And I ended up doing my MBA at Wharton, and during those two years I got a lot of exposure to entrepreneurship. There were a lot of former entrepreneurs there who were my classmates. There were classes around entrepreneurship, there was just a lot of activity there. And again, the Wharton MBA gave me exposure to marketing, and operations, and strategy, and finance, and accounting and all these other fields of business that I had no exposure to before.

Shaan: So, you’re a believer in the MBA? Because I am an anti MBA guy

Iman Abuzeid: You’re anti MBA? Okay. So I believe that there are multiple paths to success.

Shaan: For sure.

Iman Abuzeid: Right? For entrepreneurship in particular, there’s 2000 different ways to reach the goals that you want to reach. For me personally, and for, I’m sure several other entrepreneurs, that MBA and Wharton Business Shool or whatever it is, take whichever, Harvard, Stanford, whatever. It did help me in two or three different ways. So first it’s the brand and the stamp, all right? So when you are going into a venture capital firm, or a hospital, or you’re trying to convince someone to join your team, having that stamp in that brand helps. I mean at the end of the day, look, we’re still in a world where brands and stamps matter, where you went to school, where you worked, it still makes a difference.

Iman Abuzeid: The second thing I got out of it was a network, and I’ll talk about that a little bit more later, but that that is the network-

Shaan: We’ll bookmark that.

Iman Abuzeid: You can bookmark that. That is the network that got me into Silicon Valley, that got me into the top venture capital investors that, and so the network helps. And then the third piece is just some of the knowledge there did help. I mean I think some of my most helpful classes, for example, I took a negotiations with Adam Grant. I am using that skillset and negotiating every other day.

Shaan: Right.

Iman Abuzeid: Learning the basics of finance and accounting helps when you’re running a business. Learning the basics of operations helps. So, there is a knowledge that you gain there as well.

Shaan: Right.

Iman Abuzeid: But it’s not the only way, that’s my point, right?

Shaan: So I agree with you [crosstalk 00:05:48] words I put on it. So I agree with when you said there’s 2000 different paths to success in entrepreneurship. The way I would say it is, 2000 different paths to the line. To get success is really only one way to do it entrepreneurship. Which is to start something and start trying to get a customer and then once you get a bunch of customers you get your operations to work, and then once you get that going make some money.

Shaan: And so what happens before that is often where business school, or mentorship, or starting off being an affiliate marketer, whatever. There’s a million different paths to the starting point where you have the confidence, you have the idea, you have the clarity of what you want to do, or you have the guts to just go do it. And so that’s kind of where for a lot of people who aren’t quite there yet, great, get exposure, move to a different place, work at a startup, work at a big company, consult, whatever you got to do to get to that starting line.

Shaan: But it’s like if you ever done one of these races, like Tough Mudder or Spartan race or something. So they have this gimmick where before you start you have to climb this wall and it’s like the obstacle before the race even starts. And like that’s that first wall to me is the buildup of confidence, knowledge, knowhow, whatever, to get you to just go. So that’s, how I think about it.

Iman Abuzeid: Yup. But even after the starting line you’re using-

Shaan: You’re using-

Iman Abuzeid: You’re still using.

Shaan: You’re still using, you need to know how to climb walls.

Iman Abuzeid: Yeah. But your point is right. This is now the end of business school, I’ve got an offer to go back to McKinsey and I’m, “Man, I really want to do this entrepreneurship thing, and where is the best place to do that?” The San Francisco Bay area. And although I’ve gained some knowledge, I’ve gained a network, I’ve gained a brand, I haven’t actually done anything yet when it comes to startups and entrepreneurship.

Shaan: But you got the stamps.

Iman Abuzeid: But I got the stamps. So what I decided to do is I moved to the Bay area, because this is the best place in the world for startups, especially technology startups. I become an employee at an early stage company that’s ventured in healthcare technology, it’s called AliveCor. And I was leading product and that is where I learned to work with engineers, and designers, and data scientists, and marketers, and what it takes to launch a product, to grow a business. I mean I just learned so much. You learn a lot as an early stage employee.

Shaan: So you were short of 10 years in the making, building up to being prepared to start Incredible health.

Iman Abuzeid: That’s right.

Shaan: And now, just to give people some context, so Incredible Health, you started it how many years ago now?

Iman Abuzeid: Two years.

Shaan: So years ago, you just raised a big flashy round.

Iman Abuzeid: I did. Yup, from-

Shaan: Give us the details. So you raised a bunch of money from Andreessen Horowitz and the wave of support that came out was pretty remarkable. So I had wanted you on the podcast before that because Suli had told me about you and how great you were. And then when I saw that that was the reminder of, “Oh wow, I didn’t actually know much about your company before.” And I started reading up, and I was pretty blown away. So you’re at Silicon Valley, you were working at a startup, bridge the gap. When did you say, “I know what I want to do, I know what business I want to start.”

Iman Abuzeid: Okay. So like many stories, it’s not that straightforward.

Shaan: Mm-hmm (affirmative)-

Iman Abuzeid: So during my time as an employee at the startup I meet who becomes my co-founder. His name is Rome Portlock, he went to MIT, he’s been building software for the last 15 years. Best engineer I know, high integrity, the best technical co-founder you can have.

Shaan: Okay.

Iman Abuzeid: Right? And so I convinced Rome, I’m, “Hey, let’s just go start this company.” And a lot of stars have to align for a company to start. You need to have the right co-founder, the right idea, you got to be willing to take the risks, all of that, right? And so we leave and we start working on an idea. It is not Incredible Health.

Shaan: Right.

Iman Abuzeid: We are working on a completely different idea at this time. We’d been working on it for a few months, like a year, and it’s just not working. It’s not growing.

Shaan: And it’s just you two in apartment or co-working space boardroom.

Iman Abuzeid: Yes, apartment.

Shaan: While working at an apartment and you’re at a start of the year, you’re, “Oh, of course this is entrepreneurship. It’s going to be hard,” by the end of the year how are you feeling?

Iman Abuzeid: Not great. I mean, I’m just, “Oh my God, we made a big mistake here. What are we going to do? This thing’s not growing. It’s a software tool is just not working.” Around that time… this is where Wharton comes back in, right? I had a professor named Adam Grant.

Shaan: Famous guy.

Iman Abuzeid: Now he’s famous back. When I was taking this classes he was-

Shaan: Just a professor.

Iman Abuzeid: Yeah. One of the youngest tenured professors at Wharton. And the thing with entrepreneurship, especially here in the Bay area and probably all over the world, you do need the right mentors and advisors around you. And we’re actually running low on cash too. And so I ask Adam, and Adam’s a big believer in introductions and so am I actually. Thing with introductions it takes like five minutes of your time, but you can change someone else’s life.

Shaan: Right.

Iman Abuzeid: So I ask Adam for introductions to six or seven people, and he immediately does these intros and-

Shaan: Who are these people? Why do you want to meet these people?

Iman Abuzeid: These are either former operators who’ve built startups and exited, and/or venture capital investors.

Shaan: You weren’t trying to raise money at this moment. Was it more, “I just need to talk to some smart people to help me?”

Iman Abuzeid: Yeah, exactly. So one of the introductions is Hunter walk.

Shaan: Mm-hmm (affirmative)-

Iman Abuzeid: Who is a managing partner at a fund here called Homebrew.

Shaan: He’s prolific tweeter first, investor second I think.

Iman Abuzeid: Hunter’s just awesome, right? He’s done all kinds of stuff. But yeah, I know. His day job is Managing Director at Homebrew. I meet Hunter. Hunter doesn’t invest. But What he does do is he introduces me to someone named James Currier.

Shaan: I know James.

Iman Abuzeid: All right.

Shaan: James comes on the podcast.

Iman Abuzeid: Oh, that’s great. Okay. So James Currier is five time entrepreneur, exited a bunch of times, and he’s running this fund. At the time it was included in accelerator as well. Today’s just a fund called NFX. I meet James Currier… I will never forget this. This is a Skype call, he’s in Hawaii at some angel investor conference or something. I’m in my apartment in San Francisco and we’re just talking and he’s, “You know what, I really like you, Rome sounds great too, join the NFX accelerator.” And so accelerator starts a few weeks later, two days into it we’re, “Okay, we need to pivot.” And Rome and I go into this whole self exploration.

Shaan: Self discovery.

Iman Abuzeid: Self discovery. Thankfully with the support of the NFX partners.

Shaan: Right. And James is good at pivots. If you’ve ever heard of house party today.

Iman Abuzeid: Yeah.

Shaan: Before, that they were Meerkat. Which was really popular live streaming app right before Periscope blew up and kind of killed them. And before that there was something else, Life on Air.

Iman Abuzeid: Yep.

Shaan: And James was working with Ben Rubin, the founder and helped them pivot, he’s, “Why don’t you just keep it super simple and just do this one button that makes you go live streaming on Twitter?”

Iman Abuzeid: Yep.

Shaan: And that took off and I have heard this story from two or three people. I have gone to him several times just being like, “Hey, my shit’s not working. What do you think?”

Iman Abuzeid: Yes.

Shaan: Within five minutes, have this amazing amount of clarity as to why your shit’s not working, and what might work better. And you’re, “Wow, you’re so much better at this than me. This was amazing. Thank you so much.” Was it like that for you?

Iman Abuzeid: Yeah.

Shaan: Because, that’s what I’ve seen from him.

Iman Abuzeid: Pretty much. Yeah. So James Currier, Pete Flint, Gigi Weiss-Levy they’re the partners at NFX. I mean, they have been doing this internet tech startup games since the late ’90s, right? So they’ve got 20 years on us.

Shaan: Yeah.

Iman Abuzeid: And you see a lot in 20 years, you build a lot in 20 years. They’ve made a gazillion mistakes that they can tell us not to make.

Shaan: Right.

Iman Abuzeid: They’ve seen the trends, they’ve seen what works, what doesn’t. Having access to really great mentors and advisors is very helpful. They have to be very high quality mentors and advisors.

Shaan: Right.

Iman Abuzeid: But they can end up saving you six months of time, two years of time. I’m just a big believer now in getting the right tribe and the right people around you so you can succeed.

Shaan: 100%. And so you go there you’re, “We need to pivot.” You do yourself discovery. Is that like you go and you do a bunch of drugs in the field, what’s your version of self discovery?

Iman Abuzeid: No. It’s me and Rome in a co-working space. Just trying figure this out and-

Shaan: Coffee was your drug.

Iman Abuzeid: Yeah. And what we realized is I come from a family of doctors, surgeons, and a lot of my friends are as well, and they are complaining about under staffing. At the same time, Rome’s sisters are nurses, or he comes from a family of nurses, and they were saying, “It takes me two, three months at least to get my next job.” And we’re, “What? This doesn’t make any sense, right?” And so we looked into it, start doing the market research, started doing the customer research and we realize what a big problem this is. How inefficient the entire process is. How is it that a group in such high demand has such a terrible job search experience, why it takes them two, three months to get their next job. And we’re, “This doesn’t make any sense.” And then that’s when we’re like, “Okay, there has to be a better way.”

Shaan: And that line is really key. Most ideas come from that. There has to be a better way. When you say that to yourself, if you ever find yourself saying that just realize you’ve stumbled on the nugget of what could it be a business idea, because this is a problem and the current solution sucks and there has to be a better way. And if you just keep looking for those moments you may stumble into your idea.

Iman Abuzeid: That’s right.

Shaan: So you realized the shortage, what causes the staffing problems, what causes the delays, the long timelines and the under staffing? What is the root cause?

Iman Abuzeid: Two root causes. Number one, there’s just not enough supply. Our demand for healthcare as a country keeps going up. We don’t have enough workers in the system. But the second problem that’s even more urgent is that the hiring tools and processes that these hospitals are using, and healthcare facilities in general are using, have not changed since the 80s. And they’re relying on external job boards. “Hey, I post a job and hope something great happens.” Or traditional recruiting agencies. Now the issue with job boards is its quantity over quality. Yes, you get a lot of applicants, but you’re relying on humans to sift through all of that, to screen through all of those applicants to match them to the right jobs. When each hospital recruiter is trying to fill a hundred jobs at any given time, that is crazy inefficient.

Shaan: Yep.

Iman Abuzeid: And then the traditional recruiting agencies, they’re also using humans to source and to screen. And as a result they’re very expensive. They’re charging 20,000, $30,000 or more per hire. So that’s not cost effective for a hospital. Now, thing is this problem we’re tackling is very urgent for hospitals and for our health system as a whole. Because when you’re understaffed you can not deliver quality care, right? You need great healthcare workers to deliver their product, which is care, right?

Shaan: Mm-hmm (affirmative)-

Iman Abuzeid: And when you’re understaffed you’re paying overtime, you’re paying for contract workers, which usually cost two times more than your permanent workforce. And hospitals are thin margin businesses and that eats into their margins.

Shaan: Mm-hmm (affirmative)-

Iman Abuzeid: Coupled with that you’re burning out your existing staff because you’re asking them to work overtime, and the harder your existing staff is working the more likely they are to create medication errors, readmissions, patient satisfaction goes down. Honestly, patient mortality goes up when you’re understaffed, right? So this is a hair on fire-

Shaan: And when they are over worked they leave too.

Iman Abuzeid: Exactly.

Shaan: Which, means you are more understaffed.

Iman Abuzeid: Exactly. So the turnover is very high in this industry is as well because they’re getting burnt out. So this is a hair on fire problem for every hospital CEO and their entire C-suite. It is a problem for those running hospital units. This is a significant issue.

Shaan: Yeah.

Iman Abuzeid: Yep.

Shaan: And so you started to realize this.

Iman Abuzeid: Yep.

Shaan: And there’s two paths I want to go. I want to figure out, “Okay, what’d you do with that information? Once you realize it’s a big problem, how did you go about solving it?” The other side of me is just really fascinated with how a hospital works. Maybe it’s because I just had a baby 13 days ago.

Iman Abuzeid: Oh, congratulations.

Shaan: Thank you.

Iman Abuzeid: Wow. And you’re here. That’s great.

Shaan: And I’m here. Well, is it great? That’s the question. I think my wife-

Iman Abuzeid: Your wife probably disagrees.

Shaan: Maybe she says it’s not great.

Iman Abuzeid: Yeah.

Shaan: But when we were there the nurses were so amazing. We had a baby at Kaiser here and literally there’s a nurse, Laura that I will never forget her. She was so incredible, she was so thoughtful, so helpful. And we stayed an extra night because we were like, “Why would we go home? This is amazing.” And normally I never want to be in a hospital, but this was such a great experience because of the nurses specifically. So my interest is in this area right now. So tell me a little bit about hospital work. So you said hospitals have margins, hospitals have CEOs. Most people, I think when they think of a hospital, it’s just they think about the sort of, it’s almost like a public school, right? It’s like you go there, you get your service and you leave. You don’t really think of a hospital as a business. So tell me about the hospitals as a business. So are hospitals for profit or nonprofit typically?

Iman Abuzeid: Yeah. So there’s 6,000 hospitals in the US, and just to be clear I mean hospitals aren’t the only type of healthcare facility we have in this country. There’s also urgent care, and skilled nursing, and surgical centers.

Shaan: Sure.

Iman Abuzeid: It’s a huge industry. And hospitals specifically usually run on very thin margins. 3% is the average.

Shaan: Wow.

Iman Abuzeid: Relatively poorly run hospitals 1% or less, a very well run hospital may be 5% margins. I think 50% of their operating costs goes to labor.

Shaan: Yup.

Iman Abuzeid: This is a very labor intensive industry. You need your healthcare workers to deliver the care. The doctors, the nurses, all the other allied health professions are needed to make this work.

Shaan: It’s like a restaurant, but worse.

Iman Abuzeid: Yeah.

Shaan: And restaurants are like 10% margin and 35% labor costs.

Iman Abuzeid: Yep.

Shaan: This is even harsher in that sense.

Iman Abuzeid: It is.

Shaan: And who owns the hospitals? Are hospitals usually independent, city-owned, is it franchises? Tell me about that, I don’t know anything about it.

Iman Abuzeid: It’s a whole range. Most are nonprofit. There are some for profit hospitals as well, or some that are publicly traded. If I was to segment industry into three main areas. One is academic medical centers, so Stanford Healthcare, Cedars-Sinai, USC, UCSF, these are all clients of ours, but they’re academic medical centers.

Shaan: Okay.

Iman Abuzeid: And they usually affiliated with a university. And then you have your large health systems, HCA, Tenet, Providence, St. Joseph, Adventists Health, also clients of ours. These are large health systems, some of which are publicly traded as well. And then you have lots of community hospitals.

Shaan: Gotcha. So that’s my healthcare in a box, understand. Once you have this insight and you’re like, “Okay, this is what we want to do,” you’re in NFX at this point.

Iman Abuzeid: Yep.

Shaan: Where do you go from there? How do you get this thing off the ground?

Iman Abuzeid: The other key point I want to just make really quickly, just before we leave the topic of ideation, right.

Shaan: Okay.

Iman Abuzeid: Yeah, you want to solve a significant problem. There’s probably three or four other criteria that you want to meet before you start committing 10 years of your life to it.

Shaan: Hair on fire problems. That was one. That was your checklist.

Iman Abuzeid: Hair on fire problem. It should be ideally a huge market because if you just capture 1% of it, 2% of it, then you’re fine, right?

Shaan: Mm-hmm (affirmative)-

Iman Abuzeid: The third piece is whatever you come up with, your unique insight needs to be at least 10 times better than what’s already out there, okay. It needs to be faster, better, cheaper, whatever, it is. But at least 10 times better. It can’t just be some small incremental improvement.

Shaan: And how do you judge that?

Shaan: Because everyone loves their baby. Everyone thinks their ideas are 10 times better. So what’s a more nuanced way of thinking about it? Is it 10 times better at one thing, like 10 times cheaper on one axis, Is that the way to think about it? Or I guess for you guys, how did you come up with “Yeah, This is 10 times better, not two times, not three.”

Iman Abuzeid: Yeah. It’s either 10 times cheaper, 10 times more efficient, 10 times better NPS score or customer experience.

Shaan: So deciding, “In what way am I 10 times better?” Is a more intelligent way.

Iman Abuzeid: Yeah.

Shaan: Than just believing, just loving your own thing so much that you just decide.

Iman Abuzeid: Absolutely, and it doesn’t even necessarily have to be 10 times better technology, right? It could be looking at it and be a different business model, or a different approach. It could be lots of different things that make it 10 times better.

Shaan: Right. Okay. So hair on fire problem, large market, 10 times better solution. What was your other one?

Iman Abuzeid: Competitors. All right. So ideally you don’t want 500 competitors, okay? You also don’t want zero because maybe the market doesn’t exist.

Shaan: Right.

Iman Abuzeid: The ideal is… I don’t know, 10 to 30, this is a little bit arbitrary. Combination of publicly traded companies, or incumbents, maybe a few startups, but that’s it.

Shaan: Yeah. And so you down this checklist and you’re, “Okay this idea seems to tick all the boxes.”

Iman Abuzeid: Yeah. More and more criteria. I mean we talked about this a lot, the founder market fit. What uniquely suits you as founders to solve this idea specifically?

Shaan: And so for you this was pretty natural.

Iman Abuzeid: Yes.

Shaan: For you and your co-founder.

Iman Abuzeid: We are very comfortable with healthcare.

Shaan: And did you think of other ideas that didn’t fit that?

Iman Abuzeid: Yeah.

Shaan: Where you’re, “Oh I’m going to make a credit card?” Or some other style of business.

Iman Abuzeid: We thought of a lot of ideas and because they didn’t meet one of those criteria, they were just filtered out.

Shaan: And how long did you spend kind of going through ideas? Was this a week? Two weeks, a month?

Iman Abuzeid: We were under pressure. Demo day was coming up, so yeah-

Shaan: That’s helpful.

Iman Abuzeid: Maybe four weeks.

Shaan: Four weeks.

Iman Abuzeid: At most.

Shaan: And so what was your daily life like at this time? Wake up and go to the whiteboard, or what was you guys’ process during those weeks?

Iman Abuzeid: Yeah, it was a lot of white boarding, it was a lot of talking to the NFX partners. It was talking to family members, that was very helpful. My brothers were very helpful with the ideation phase. It was reading science fiction, Isaac Asimov, it was watching Black Mirror. It was whatever it takes.

Shaan: Nice.

Iman Abuzeid: Whatever inspires you. Yeah.

Shaan: And so you’re doing this, and how were you feeling during this time, was this an energizing time or was this like, “Oh my God, stress.”

Iman Abuzeid: This was the highest stress point I’ve had in my entire entrepreneurial journey.

Shaan: Wow.

Iman Abuzeid: Pivoting is hard, but the thing is, it should be acceptable. A lot of massive companies today were pivots, Slack, Twitter-

Shaan: Twitch.

Iman Abuzeid: Twitch, many, many, right? And so-

Shaan: Instagram.

Iman Abuzeid: Instagram, you just have to be many things in entrepreneurship, you just have to be brave, bold and just take the leap and pivot.

Shaan: Yeah. For those who don’t know, Instagram started as like a location checking and service called Burbn. Slack started as a video game. Discord started as a video game. Twitch started as Justin TV, which is a totally different thing. Groupon started as a political activism platform, and they all pivoted into these really big successful companies. So pivots definitely can work. But like you said, very difficult and the further in you go, the more difficult it gets. So you guys were pivoting with two people, sometimes I’ve pivoted when we have 20 people working at the company. That’s very hard pivot to do.

Iman Abuzeid: Yep.

Shaan: Some people do it at 2000 people. That’s, I’m sure it’s even harder. So you could pull off the pivot and so where do you… First, how’d you come up with a name? Incredible Health is an incredible name.

Iman Abuzeid: Thanks.

Shaan: Where did the name come from? I know the NFX guys really care about names, which is-

Iman Abuzeid: They care a tone about names.

Shaan: Silicon Valley is like, “Oh marketing? That’s just something you do last.” Just engineering, whatever name you want slap it on it. Most people don’t think about names. The NFX guys are like, “No, names super matter.”

Iman Abuzeid: They do matter. James Currier has a whole talk, a whole rant. Maybe he’ll do it on your podcast when he’s on. Well, language matters. Everything from the name of your company down to the tiny copy in your app, to your emails that you’re sending out. Language matters. It is often the first time users, or customers, clients interact with you. We went through a lot of different names. James Currier was really helpful in this as well. We went with Incredible Health because it’s unique. It sounds big. Sounds amazing. I mean, who doesn’t want to be affiliated with a company called Incredible Health?

Shaan: Right.

Iman Abuzeid: If you’re an employee, an investor, a client, I mean, it’s incredible, yeah.

Shaan: So who came up with a name?

Iman Abuzeid: Oh gosh. I think, I’m pretty sure we were in James Currier’s garage, just going through a bunch of names. Me, Rome, James, yeah.

Shaan: And what was the other contenders, or the really bad names?

Iman Abuzeid: I mean, honestly I can’t even remember, but it was-

Shaan: Fairly Good Health?

Iman Abuzeid: Yeah, exactly. And you have to look at domains and trademarks and this and that as well.

Shaan: Yeah.

Iman Abuzeid: It was all names that sounded over the top.

Shaan: And so where are you guys today? Give us a sense of the success so far. You’re obviously early in the journey, a long way to go, but you’ve definitely done enough. How much did you raise in the most recent round?

Iman Abuzeid: Yeah, so we raised 15 million led by Jeff Jordan, Andreessen Horowitz. Jeff Jordan, if your listeners don’t know he’s probably the top marketplace investor in the world. He was a CEO of Open Table, President of eBay. He was early investor and board member right now at Airbnb, at Instacart, at OfferUp at Lyme, at Pinterest, he knows what he’s doing.

Shaan: Jeff Marketplace Jordan.

Iman Abuzeid: Yes, exactly. So where are we now? So we’ve been working on this for two years. We have grown across California. We have over 150 hospitals using our platform right now, including Cedars-Sinai, and Stanford, and HCA and many others. And the reason we raise a Series A actually it wasn’t because we needed it financially, we were actually doing quite well. We built the California business to the point where it was profitable. The reason we raised a Series A is to take over the entire market to become a category defining market leading company as quickly as humanly possible.

Shaan: And the smile on your face when you said that, you were loving that idea, that was the biggest smile I’ve seen from you so far. She’d been raised an eyebrow a little bit as she wanted to take over the world. I love it. So you-

Iman Abuzeid: And I will say this, our mission, it’s only mentioned our mission right? Our vision is to help health care professionals live better lives. And our mission is to help healthcare professionals find and do their best work. And that’s what we’re trying to achieve, the entire team is on a mission.

Shaan: I love it. So the business model then is when you place somebody you take a cut or how does, Incredible Health make money?

Iman Abuzeid: The employers pay incredible health when they hire.

Shaan: Not on the subscription. It’s on hire.

Iman Abuzeid: No it’s different, we have a couple of different models out there. Customize per client.

Shaan: Yeah.

Iman Abuzeid: They can purchase a pack of hires or there’s also subscription as well, where they just get access to the platform.

Shaan: And so is the key metric for you guys, how many people placed per month or how many hires per month.

Iman Abuzeid: Number of hires, exactly.

Shaan: What’s your goal? Where do you trying to get to with that? Is it, a certain number? Is it a growth rate? How do you think about that number? What are your metrics.

Iman Abuzeid: It’s a monthly growth rate in number of hires.

Shaan: And so what do you want? 20% per month or something like that.

Iman Abuzeid: Yeah, exactly.

Shaan: And so why 20% how do you decide that, every entrepreneur has to decide their own goals and sort of your fate will lie in both picking the right goals and then your ability to execute. But if you pick the wrong goal, that’s a pretty weird failure case because you know you succeed at hitting the wrong goal. So how do you pick 20%.

Iman Abuzeid: I think every company, KPI’s and metrics matter a lot. A company at the end of day is one giant project, right? And it needs to have goals and so picking what the right metric is going to vary by company. In our cases, number of hires in other people’s cases is going to be monthly active users. There’s going to be one metric that is the most important. And then there’s secondary metrics as well that also matter.

Iman Abuzeid: And picking the right metric matters because you want your entire team regardless of their function, focused on that metric because every team has levers that influence that metric. In terms of what the actual growth rate number is, I mean that’s a function of your ambition whether you’re a venture backed or not. Yeah.

Shaan: So how’d you pick 20 and just in your case.

Iman Abuzeid: If we want to take over the entire market in less than say eight years, that’s the growth rate required.

Shaan: Love it. So work backwards from the end state the way [inaudible 00:27:28]

Iman Abuzeid: Exactly.

Shaan: And so what were the moments along the way? Because now everything sounds pretty good and you’ve told us about when you had to pivot.

Iman Abuzeid: Yeah.

Shaan: How tough that was. The stress of doing that. When you have a demo day, four weeks away where you’re going to be on stage telling investors, this is what I do, and you don’t even know what you do yet.

Iman Abuzeid: Right.

Shaan: So, that’s really tough.

Iman Abuzeid: Yeah.

Shaan: But I think, once you have the funding, once you have the clarity, once you have the team, once you have some momentum, things do start to work. Were there any other moments of doubt or rejection or any other real struggles that you guys went up against that you remember?

Iman Abuzeid: Yeah, multiple and I mean honestly we still have them. I think raising our seed round, the initial capital was challenging. The Series A was a lot, a lot easier because you have more proof points and we were fortunate enough to have all the, the top three of venture capital firms in the world wanting to investment, so we were able to be very selective.

Iman Abuzeid: The seed round eventually… so okay, we just raise a $50 million Series A summer 2019 is when we closed. Two years ago when we were just Rome I, we were raising our seed round. We were just raising the initial $2 million and at that time, honestly its just two co-founders and an idea. We have a couple of health systems or hospitals that are in contracting. We have some nurses on the platform, but there’s not, much going on yet. And probably have to go through 75 to a hundred meetings to get that seed round done. By the end it was oversubscribed, but yeah, it was a grind. And the thing is with fundraising, and one thing that entrepreneurs may not realize, especially those outside of the Bay area, is that it is a little bit of a game. There is a playbook, and you have to know the rules of the game.

Shaan: How did you learn those rules?

Iman Abuzeid: The best advisors and mentors in the world.

Shaan: Okay. Somebody out there is listening. They’re, “Okay, there’s a game, there’s rules and there’s a playbook. Where the hell do I find this thing?” How do they get their hands on this playbook?

Iman Abuzeid: There’s a few ways. Number one, go to nfx.com and read their content.

Shaan: Okay.

Iman Abuzeid: I’m sure they have multiple blog posts on how to raise. And number two get the right mentors and advisors. And the danger here is I notice a lot of people who call themselves mentors, advisors, experts in entrepreneurship, and there’s a risk of them taking an advantage of entrepreneurs. What you have to look at is their track record. Have they been CEO’s? Have they exited? What have their successes been? People track records, you can look up online. So you can figure out if someone’s legit or not without even talking to them.

Shaan: And for you, when you reach out to these people, are you reaching out saying, “Hey, please do you mentor?” Are you saying, “Hey, let’s get a coffee.” Are you saying, “Hey, can you help me with this specific thing?” What worked for you as far as recruiting those mentors to you?

Iman Abuzeid: I usually do very succinct, concise emails with ask. The other thing that really works is warm introductions. So having Adam Grant facilitate the introduction helped having Suli Ali, who was one of your former guests here facilitate intros helps like warm introductions, helps.

Shaan: Yeah. In fact, so it helped even more so in our intro. So he was, “Hey.” I was, “I want to have her on.” He was, “Great, here’s the intro you guys should meet.” And I was, “Great, I’d love to have you.” You were, “Great, I’d love to come on and let’s schedule it for like two months from now.” And so we did the best thing ever.

Shaan: When you’re emailing with somebody, you usually BCC out the person who made the intro.

Iman Abuzeid: Yeah.

Shaan: You’re, “Okay, I’m moving you to BCC now. We’ll take it from here.” And he jumped back in from BCC and he was, “No, don’t wait two months. Do it like this weekend. Do it now.” And so that’s the type of intro that, you can rarely get somebody who will vouch for you, not just in the introduction, but really say, “No, you need to meet this person. You need to do this. Come on, let’s do it.”

Iman Abuzeid: Yeah.

Shaan: Those little things can go a long way.

Iman Abuzeid: Absolutely. And then there’s an overall like context here that we can’t ignore and that is the culture of Silicon Valley.

Shaan: Mm-hmm (affirmative)-

Iman Abuzeid: It’s the culture of the tech scene in San Francisco Bay area. This is a culture where people help.

Shaan: Yeah. Pay it forward culture.

Iman Abuzeid: It’s a pay it forward culture. Usually when you ask someone for something, especially if it came through a warm introduction, they usually help.

Shaan: Without expecting anything back.

Iman Abuzeid: Without expecting anything back. Honestly, that is, look, I’m really biased and I’m pretty strong opinions that if you’re building a technology company and you want it to be huge, the San Francisco Bay area is still the best place in the world to do it. So to the extent that you can get here and build your network here, that is a huge advantage.

Shaan: Yeah. I’m a similarly minded. When I, about six, seven years ago when I moved to San Francisco I was sitting in Australia and I wanted to start a startup and I just knew, well, if I can come to Silicon Valley, that’s the Mecca for startups. I don’t know why. I don’t know what’s better about it. I don’t know what I’ll get out of it, but I just knew I got to be there. It’s if I’m going to be an actor, I got to go to Hollywood.

Iman Abuzeid: Right.

Shaan: That’s how I felt about it. If I want to do a start up, I got to come to San Francisco and of course you can start it anywhere and there are many great examples, but if you don’t have anything tying you down to a certain place, don’t be afraid of just jumping in. In fact, the first thing I did was I just changed my phone number. I just changed it to 650 area code.

Iman Abuzeid: Oh wow.

Shaan: Which I thought was San Francisco, but it’s actually Palo Alto. So I kind of missed. But I did that when I was sitting in Australia and I just mentally made that shift. I’m a local over there. And then I just moved and I said, “I’ll figure it out after that.” Because I believe proximity is power and if you can get around people, if you can get proximity to the people you want to be, like things will just work out of osmosis just by being around those people you will get better.

Iman Abuzeid: Yeah, absolutely. A law has been written about the talents in the Bay area, the Capitol in the Bay area, the massive companies that have grown out of the Bay area. One area that’s not talked about enough is the information network in the Bay area. And the Bay area is its own network effect. And when you can talk to CEOs or engineers or data scientists or marketers or whoever who are building some of the biggest companies in the world and the fastest growing, you know one 30 minute coffee can end up saving you eight months of time.

Shaan: Right.

Iman Abuzeid: These information networks and the information exchange that’s happening and it’s happening thousands of times a day across the Bay area, over coffee, lunch, dinner, brunch, drinks, whatever. That is a lot of information being exchanged and it could be tips on fundraising. It could be who to hire. It could be KPIs, it could gross tactics, it can be lots of different… even information that’s not supposed to be shared that’s proprietary about competitors and so on as being shared, right?

Shaan: Right.

Iman Abuzeid: So you do want to hook yourself into that scene.

Shaan: And the culture you mentioned I think is real because the analogy I gave is, okay, if you go to Vegas and you walk around in the middle of the day in Vegas, you’ll see people holding this two foot piña colada walking around outside. It is culturally normal to drink during the day, to stay up all night, to do all the things that people do in Vegas. And people love burning man for this reason too. If you’ve got a burning man, it’s culturally okay to just hug strangers, go share food and there’s no money.

Shaan: There’s a culture of burning man that makes certain behaviors normal. In San Francisco, the Silicon Valley in general, there’s a culture that says it is totally normal to believe that you just average old you can, build the biggest company in the world can change the world, can do anything. If you meet people here who work for a bank or work for consulting company, they almost apologize when they make their intro.

Shaan: They’re, “Yeah, I work at whatever bank, but that’s just for now. I’m, waiting to go do my next startup.” There’s a culture here where the normal thing to do is to venture off, create an invent new idea and go try to build a company. That’s not really normal in most places and just having that shift from being, you’re the outlier to your part of the norm. It’s a pretty big cultural shift. And if nothing else, you get that just by being here is, it’s normal to be a little bit crazy here and that works in your favor.

Iman Abuzeid: Yeah, absolutely. All right. Now we’re done with our Bay area rounds.

Shaan: Yeah. Everyone outside the Bay Area is all right, this guys are drinking the Koolaid over there.

Iman Abuzeid: Well, yeah. It’s inexpensive place. That’s the one knock against it, the cost of living, the cost of running a company here is very high. I mean, the only way I’m able to justify it is increasing your-

Shaan: Your company’s value.

Iman Abuzeid: Value. Exactly. It might be two times more expensive, but your company might end up being 10 times or more valuable.

Shaan: You talked a little bit about NFX. What are some other things that you read? Like when you go open up your laptop and you open up some tabs. What are some things that you like to read that makes you better? Because I’ve, found that one of the things people really like on this podcast is when we share out, “Hey, I go to this subreddit everyday.” Or, “I go to hacker news in the show tab because that’s where I get to see new ideas.” I’m just curious, what are some things that you like to read? Some podcasts you listen to, what makes you better and then maybe other people will like those resources too.

Iman Abuzeid: I’m a big fan of reading content written by operators that have been successful or investors that have been successful. Operators I mean that’s kind of an obvious one, right? For the investors. I mean the one thing about them, and I know VCs get a lot of criticisms, but the best ones, they’re paying attention to entire trends, landscapes, markets, and sometimes what they write is pretty good. A lot of it’s not. So you have to pick and choose what matters.

Shaan: So who, do you like to read.

Iman Abuzeid: Yeah, a love NFX is content. I think First Round does a pretty good job with content. I think Bill Gurley specifically has really fantastic blog.

Shaan: And are you big on books? And I’ve met two schools of thought when I’ve been doing this podcast. One is people are like sponges. They’re constantly looking for information. They read it, they digest it, they love it. And there’s other people who are, “Yeah, I kind of dismiss all of it. I really don’t read any blogs. I tried to stay off Twitter. I just focus on doing my thing. And so, which camp are you more in? Are you more of a sponge? Are you more in just blinders?

Iman Abuzeid: Honestly, I do both. at different times. If you’re seeking inspiration and trying to stay on top of things and yeah, you either read the blogs, read the read the books. If you’re just trying to get stuff done and move your metric from, 15% to 20% or whatever it is, then you need to just focus on that Twitter and all that becomes a huge distraction.

Shaan: And so, let’s finish out with a bit of advice to you when you were 21 so not specifically you, but the next you. So somebody who today they’re a smart person, they may be going into med school or they may be thinking about… It seemed like for you it was really important to make an impact, but you didn’t know how. I think that’s probably really common of, I want to do big things, I want to have a big impact, but where the hell do I start? And so, what would you be saying to like the 21 year old version of you who’s thinking those thoughts?

Iman Abuzeid: Yeah. Great. Look, I’ve thought about this a lot actually.

Shaan: Have you?

Iman Abuzeid: And I have a whole framework that I’d love to share.

Shaan: Please share.

Iman Abuzeid: And it’s a career framework particularly for those in business careers. I think there’s only three things that you can aim for. Number one is cash, number two skills and learning, and number three is lifestyle. And at any given time in a particular role, you can only optimize for one of those three things you’re going to compromise on the other two.

Iman Abuzeid: So if you’re trying to optimize for cash, specially risk adjusted, then yeah, go to investment banking, go into management consulting. You’re optimizing for cash, you are absolutely going to compromise on skills and learning and you’re going to compromise the lifestyle, particularly those in investment banking and other finance roles. If you’re trying to optimize on skills and learning, then go to startups because you’re going to learn the most and gain the most skills in the shortest period of time and that can be founding your own company, it could also be an early employee.

Iman Abuzeid: And you’re absolutely going to optimize on skills and learning. You’re probably going to compromise on cash and you are probably going to compromise on lifestyle cause you gotta work a lot. Now if you want optimize for lifestyle, you should just go join some giant corporation like Google or Facebook or Microsoft or even in the non tech world, Genentech, and you are definitely just going to work nine to five.

Iman Abuzeid: You’re going to optimize on your lifestyle and you’ll relative to the finance industry, you’ll compromise a little bit on cash, but it’s still pretty good. And then you’ll compromise on skills and learning because guess what? Not that much gets done, right? And you’re not going to have that much of an impact if there’s 20,000 other people. And so, decide what matters to you and what you want to optimize on at any given stage in your life.

Iman Abuzeid: This isn’t a judgment thing and people can pick whatever they want. I have plenty of friends who are, moms and dads and they’re starting to pop out kids and they want to just optimize on lifestyle and that’s cool. But just know that’s what you’re doing, know that you’re compromising on other things. If you want to optimize on skills and learning, which is what I pretty much optimize on all the time. I’m just trying to learn as much as I can as quickly as I can and gain as many skills as I can. Then absolutely go for startups. And if you’re optimizing on cash and you don’t want to take on any risks and yeah, just go into finance.

Shaan: Why do you pick to optimize for the learning skill set?

Iman Abuzeid: A lot to do with how I grew up. My values, I have no problem with risk. I’m generally quite risk-taking. Education and learning was a big deal in my family. It’s one of my parents’ values. It’s prevalent throughout my family and it’s just where my interests lie.

Shaan: You like scratching the itch, the curiosity.

Iman Abuzeid: Yeah. As a result, I mean most people you employ at a start up are also trying to optimize for skills and learning because I mean, why else are they there? Right?

Shaan: Yeah. You surround yourself, other people who have made the same choice essentially.

Iman Abuzeid: Yeah, absolutely.

Shaan: Yeah, that’s a good one. I have a similar framework. You’re either trying to learn, earn, lifestyle or legacy.

Iman Abuzeid: Right.

Shaan: The last one is legacy, that’s around impact, which I think you’re also kind of doing right now.

Iman Abuzeid: Yeah.

Shaan: And so at any given time you switch gears. So when, I was in my twenties I specifically said this is the time to learn. And so I started one startup and the second startup then I joined a startup. I just kept doing that, even though they weren’t super high paying jobs. In fact, I lost money on some of them, but it was, “Oh, that’s my business school. I’m learning how to your business.”

Iman Abuzeid: Yeah.

Shaan: So that one only cost me 30 grand, no problem. And then as I shifted, it’s, “Okay, now it’s time to cash in some of those chips let’s earn a little bit.”

Iman Abuzeid: Yeah.

Shaan: Why are we earning? But we’re earning so that we can have, some cash in the bank so that I can go on another learning sprint where I have enough supply saved up, that I can go take some time and build whatever I want, to learn whatever I want, do whatever I want. And so switching gears, depending on where you’re at in your life is pretty important for that.

Iman Abuzeid: Yeah, absolutely.

Shaan: Other question I would have for someone like you is if you weren’t doing this company you’re doing now, what space or idea is most intriguing to you? So if I took incredible health off the table, what peaks your curiosity a lot. Where you’re, “Yeah, I don’t know what I would do, but I would go in this direction. This interests me.”

Iman Abuzeid: Yeah, great question. The areas on comfortable is like the healthcare technology industry, right? So I will just answer within that, I think there was a lot of founders that are working on things that are patient facing. I don’t think there’s enough founders working on things that are more around the operations of it. There’s a whole backend stack to the healthcare industry where there’s just not enough innovation. We’re tackling, one happens to be labor staffing.

Shaan: Right.

Iman Abuzeid: But there’s compliance and revenue cycle and lots of different areas in the operational stack of the healthcare industry. There’s just not enough innovation.

Shaan: So I’ve thought about ideas in that space. But the thing that always scares me is the adoption. Healthcare already has certain rules and regulations that get hard to be compliant and be a system that can be used. But you said hospitals you were going to, the systems they were using they were from the 80s. Guessing it’s like that for all their systems essentially. So how do you navigate that adoption? How do you get somebody to adopt incredible health?

Iman Abuzeid: You have solve a real need and be at least 10 times better. That usually gets you in the door. And then the other piece about the distribution of this is you just need fantastic language. And we talked about that earlier and fantastic people who can get access. And then the other thing is just don’t be intimidated. Look, it’s all hard whether you’re building an index company in healthcare or tech or whatever industry. It’s all hard. They all have different challenges and, but that’s what makes it so exciting.

Shaan: And so if somebody wants to get in touch with you after this, they hear this, they’re, “Wow she is great. I want to talk to Iman.” What’s the best way to follow you to get in touch with you. Shout out basically how people can get more of you.

Iman Abuzeid: Yeah, I do want to do a quick plug that we are hiring.

Shaan: Great.

Iman Abuzeid: Especially here in the Bay area.

Shaan: What are you hiring for?

Iman Abuzeid: We are hiring in account management, software engineers, designers, marketers, any role, product managers. Pretty much all the key roles we’re hiring for.

Shaan: You need great people.

Iman Abuzeid: We need great people who are going to join this mission and how to get in touch. Yeah, I’m, Imanaincrediblehealth.com, the website is incredible.health.com, I’m also on LinkedIn and Twitter and Facebook, so those are all channels that I check.

Shaan: Okay, great. I appreciate you coming in and telling the story and I love what you’re building. Very rarely do you find a business that is both a super interesting business model, a lucrative, “Wow”. Somebody built the marketplace for staffing, one of the biggest labor industries we have that would be really valuable company, and then the impact that that has, or “Wow, if we can get more awesome health care professionals placed quickly, that would be the knock on effects of that huge.

Iman Abuzeid: Yeah.

Shaan: And so I love that this has both the business fundamentals to be so juicy, but then also the impact, and I often find that you have to trade, and this is one where I feel like you didn’t trade, you got both, you got the impact and you’ve got the business side right.

Iman Abuzeid: That’s right. One other thing is just to help out entrepreneurs specifically, I believe in the power of intros and one introduction can change someone’s life. If anyone wants introductions to these amazing mentors and advisors that have helped us on our journey, whether it’s the team in NFX, James Joaquin at Obvious Ventures, also a very experienced operator. Charles Hudson at Precursor, Jeff Jordan and the Andreessen Horwitz team, like whoever. Right. I’m happy to help. And then quick plug just for the women entrepreneurs out there. I am a woman and the minorities, I am a minority too. It’s hard, it’s harder, and so I’m happy to help.

Shaan: Love it. Great. Thank you so much for coming.

Iman Abuzeid: All right. Thank you.

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