Ananth Narayanan, who spearheaded the Myntra-Jabong venture, is building another billion-dollar business, this time in e-health care, away from the glamour of fashion e-commerce.
As CEO of Bengaluru-based Medlife, Narayanan believes technology is the core for a scalable business. But technology is not the only link between the business he’s heading now and the one he led till recently. Private label is there as well.
Medlife, a health start-up, is scaling up its private label, a term that regularly comes up in any consumer-facing or fashion business, to improve margins. The private labels segment, with around 100 over-the-counter products such as vitamins, supplements, and hand sanitisers, is growing in double digits. In fact, the company is aiming to double the revenue contribution from this segment, at 5 per cent now, over the next two years.
Before joining Medlife six months ago, he had analysed several other sectors such as banking and agriculture. However, he chose health care as he felt there was lack of technology in the space.
Narayanan wants to reach 15 million customers in the next five years, possibly to turn Medlife into a $2-billion player.
With over 72 million diabetics and 50 million heart patients in India, the company’s planning to address the fragmented health care market through its proposed diagnostics, express delivery and consultation services, all on one platform.
“We are transacting with a lot of data to predict what customers want even before they order. We need to be inventory ready in our business,” said Narayanan.
The company is also investing in data science to track the pattern of medicine orders and find out when a predictive preventive test might be useful. Technology is also driving the supply chain to make sure every order takes less than five minutes to leave the fulfilment centres. To make all this happen, the company is looking to expand its 100-odd tech team.
Three months away from breaking even, the company has aggressive expansion plans. “Unlike e-commerce, where all the growth is coming from tier-II and tier-III markets, in the e-health sector, only 40 per cent traction is from small towns and cities. Rest of the growth is coming from tier-I cities,” said Narayanan.
Medlife had posted 165 per cent growth in revenue to touch Rs 363 crore in FY19, while losses surged by 145 per cent to Rs 404 crore. The losses have been halved this financial year owing to growth in the diagnostics and private label segments.
Making a strong push into the diagnostics segment post the acquisition of MedLabz, it is scaling the lab business from the current 20 to 50 and plans to double its fulfilment centres from the current 30 in the next three years.
“Unlike e-commerce, where all the growth is coming from tier-II and tier-III markets; in the e-health sector, only 40 per cent traction is from small towns and cities. Rest of the growth is coming from tier-I cities”- Ananth Narayanan, CEO, Medlife.-Business Standard