Why a Software Engineer Turned Down 8 Other Offers to Join the Alto Team
Cross-posted from Utsav's blog
What Does Alto Do?
Alto is, at its core, a pharmacy. A pharmacy is traditionally defined as: "a store where medicines are prepared and sold." Indeed, Alto satisfies that definition, but it goes further than that. The most obvious way is through same day, courier delivery, but that's just one piece. For example, Alto also handles the complex coordination required between a patient, their healthcare provider, and their insurance.
There were many facets that attracted me to the opportunity in the retail pharmacy industry:
- Market size: In 2018, drug spend in the U.S. topped $420 billion, and its only increasing. In 2015, just 3 years prior, it was $364 billion.
- Ripe for disruption: Of the top 25 retail pharmacies in the U.S., not a single one was founded after 1976. The 5 largest pharmacies in the U.S. are, on average, 86 years old.
- The status quo: The NPS for one of the largest retail pharmacies in the U.S., CVS Pharmacy, is an astoundingly low -5. That's right, negative. For comparison, that's worse than Comcast (-3). Worse still, a recent New York Times article highlighted severe issues at chain pharmacies, caused by chronic understaffing and corporate profit-seeking. One pharmacist reported to a regulator, "I am a danger to the public working for CVS." 
- Lives at stake: It's estimated that up to 50% of medications are not adhered to, creating up to $300 billion in avoidable drug costs annually. Even worse, it's estimated that more than 125,000 avoidable deaths each year can be attributed to medication non-adherence, more than 3x than from car accidents. Alto's patients' adherence rate is 77%, 30% higher than the industry average.
- Delivery: By delivering medication, one Alto Pharmacy can service the equivalent of 400 chain pharmacies. This leads to substantial savings in retail expenses and better utilization of pharmacists and technicians.
- Centralized, specialized care: By centralizing pharmacists and the care team, each member can be more specialized in particular therapeutic areas--such as fertility or psychiatry--than the traditional retail pharmacist.
- Customer happiness: Alto's NPS is astonishingly high, not just for a pharmacy, but for any customer facing business: over 80. Indeed, Alto's reviews on Yelp are overwhelmingly positive.
- Provider Experience: AltoMD, Alto's platform for healthcare providers, saves doctors and other providers on the platform tens of hours of paperwork, coordination, and other administrative tasks each week. The platform also gives visibility into the fill status of patients' medications, something that most providers do not have today.
- Extra Mile: Alto coordinates proactively with healthcare providers and insurance to resolve issues, such as submitting prior authorizations and handling billing issues.
- Patient first: Alto always puts the patient first. For example, Alto is always looking for the best price for the patient, whether it be through the patient's insurance, using a coupon, or rebates. Even if it reduces--or eliminates--Alto's profit. These cost savings aren't small; by last count, Alto has saved its patients $23 million.
- Alignment on mission: Alto is a mission-driven company, and while many companies have missions on the wall, it's rare to see strong alignment on a mission. In every encounter with I had with Altoids, their earnest belief in the company and passion for the work it was doing was unmistakable.
- Leadership: Alto's CEO, Matt, and CTO, Jamie, are modest, determined, and passionate. Their humble approach to building a company is a rare breed. For example, consider how Alto started: by buying AG Pharmacy, an independent pharmacy in the Mission District of San Francisco. The reasoning was simple--they needed to truly learn the needs and services a pharmacy fulfilled before they could hope to improve it. Just listen to Matt talk about Alto on recent podcast, and I think you'll understand why I admire, and believe, in them.
- Engineering growth. Alto plans on quadrupling its engineering count in 2020. It was exciting for me to be a part of that because I knew that would be a critical period in the company. Furthermore, they had accomplished so much already with fewer than 25 engineers. This was impressive because Alto has to work with 4 distinct parties--insurance companies, healthcare providers, its own operations team, and consumers--and build software that brings them all together.
- Ambitious expansion plans: Alto aims to serve 100 million people by 2025. This expansion will allow Alto to redefine the role a pharmacy plays in people's lives.
I'm inspired by Alto's commitment to always put patients first. I'm inspired by the ambition to fix a massive, fundamentally broken industry, piece by piece. But most of all, I'm inspired by the notion that a company can both be a good business and a force for good. We need more of those in our world.
If this inspires you too, I invite you to apply and join us. Even if you're skeptical, I still invite you to apply. I think you'll find an ambitious group of people in service of one mission: to fulfill medicine’s true purpose — to improve the quality of life — for everyone who needs it.
If you have any questions about Alto, or ideas to make it better, please do let me know. I'd love to talk to you.
2. Not including mergers and acquisitions. https://www.skainfo.com/reports/most-powerful-pharmacies