#75: Bootstrapped Their Digital Health Platform to Global Scale with 200 Employees – Shameem Hameed

Hey, everybody. Welcome to the Practical Founders Podcast, where every week we hear an amazing story from a serious founder who built a valuable software company and did it without big funding. I'm your host, Greg Head, and this week my guest is Shamim Hamid.

the CEO, co-founder, and chairman of ZH Healthcare. ZH Healthcare makes the blue bricks enterprise, no-code, low-code, customizable. comprehensive platform for digital health solutions for healthcare organizations all over the world. This is a bootstrap success story with over 200 employees, hundreds of clients that serve millions of patients. with an enterprise class solution.

even though they were bootstrapped. They've got a unique vision. They're solving really core problems for healthcare innovators of all types that aren't using the big hospital solutions and doing it the way it's always been done. It's a great episode with Shamim.

And we're live with Shamim Hamid, the founder, CEO, and chairman of ZH Healthcare, a global software company. Welcome to the Practical Founders podcast, Shamim. Thank you, Greg. Appreciate the invitation. We were just chatting up here. You're further away. You keep moving around the world. You started in India. You've lived in the U.S. And where do you live now, Shamim? I live in Geneva. Right outside Geneva, there's a small village called Coppe. In Switzerland? In Switzerland, yes.

What brings you to Geneva? Actually, it's a funny story, right? It's like my wife was working for the federal government, U.S. federal government, and she got selected as the secretariat director for global. organization under the UN called Group on Earth Observations.

And she said, I'm going there. Would you like to come? And I said, I would like to be married. So I'll come with you. Isn't that what entrepreneurs do to their spouses? Maybe she did it back to you after all these years. She did it back to me. And at the time, it was all... the COVID and everybody was working from home.

And even all my U.S. employees, everybody was working from home. So I thought it did not make any difference. But I followed her. We had all the diplomatic trappings and everything that goes with it. So once I came here, it also opened, you know, once an entrepreneur, you're always looking for opportunities. It opened the opportunity within the pharma sector for our product. And so we ended up starting.

a subsidiary here, hiring people. And so we are entrenched in this area as well. So it opened Europe for us. Wow. Quite by chance. Yes, of course. Maybe that chance, whatever we'll call it, the luck factor, that crazy other factor out there is timing and location and opportunity. But we put our glasses on to go see that and make the most of it here. So, Shamim, let's talk about ZH Health.

your software company. Where is it today? How many employees? What is it? Who do you serve? And then we'll get into your journey. We are about just under 200 employees. We serve the healthcare sector. So we serve those people who are looking for differentiated digital health solutions in the enterprise level.

on the care delivery side as well as the patient engagement side. So we have some really big customers who are not happy with the way that other people are doing business so they are, I would call them change makers, innovators, standard, traditional. EHR systems or digital health solutions don't work for them. It doesn't adapt to the new way that they are doing things. Many of them are that they are launching new products and they considered whether they should.

develop from scratch or use a platform like ours, which you can build and roll out solutions quickly, iterate quickly. So I would call myself like the AWS. which is for the infrastructure, but this is for applications and we focus purely on digital health. And we are also going to be certified as a software as a medical device for the entire platform, which many other people don't have.

So it has been with customers who are, like I said, doing differentiated digital health products. Some customers are... global, so they have operations in Africa, in Latin America, and they want their solutions to work there as well as in the U.S., yet be on the same platform. That's a big lift for most of these products out there.

To be global. Yes, a global kind of rollout in 36 languages. Oh, my goodness. It's an enterprise solution, basically, for major digital health applications. And does that mean hospitals? Or something else out there? It doesn't necessarily mean hospitals, but we also...

have hospitals who are using our system. So in Costa Rica, for example, the largest healthcare provider, Grupo Metropolitano, is using our solution in two of their hospitals, hundreds of clinics and pharmacies, all integrated into one solution so that they can roll it out. Initially, we were doing for almost all ambulatory clinics and those kind of solutions with larger... Which are physicians' offices, not the hospitals, right? Physicians' offices, larger number of providers.

So our best fit customers are customers who are doing things differently, new services, new products, amalgamation of services. Like one of our customers have this. um they they have 17 locations they are doing physiotherapy with natural cures that they get into it and then they have a specialized way of delivering those protocols and other things they have a different financial models and revenue models so they have the subscription packages.

you know, that most of the providers in the U.S. are fee-for-service, right? So you do a service and you get that. But these people have like a package service and people can buy into that set of things, kind of like a beauty treatment and all this kind of stuff. But at the same time, they are also doing cash basis and not necessarily insurance basis. So you can integrate a lot of different kinds of revenue sources and other things into.

one application that they can roll it out and it's very difficult for standard applications to do that. Either you have to do a custom development of these applications which is going to mean that you are spending a hell of a lot of money than you would otherwise do. But when you come to our applications, these are components with low code, no code that they can drag and drop and build that application quicker or one fifth of the time that it takes for them to do it otherwise.

And it's a SaaS solution, so they end up paying it. So the total cost of ownership comes substantially down. And we become kind of like the backbone of most of these organizations.

This particular company that I talked about have about 1,000 users. There's another one with sleep medicine oral. There's an oral appliance for sleep apnea, and they are providing services to almost several. 700 dentists across the United States, and they provide the software for them, and which is kind of white labeled. So they take our application, configure it the way they want it, and in fact, make a new product out of it, white label it.

they take it to market. Many of our customers, end users don't even know that they are using our solution. So it's a platform as a service, right? For healthcare specific. You ended up as a platform where...

In this vertical industry where a lot of times in vertical industry SaaS, the industry works a certain way. The software does exactly that. You can plug it in really fast. But if you don't work that way. You need to go rebuild all this complicated stuff from patient engagement and clinical side, EHR, to building and revenue management and all that stuff. And you have a platform that they can.

use the building blocks, your bricks, I guess you'd say, the BRIX, do they make it themselves? Or do you have a services team that will... build it quickly for you services team but everything that we do is made it in such a simple fashion

that the client can themselves do it if they have a competent technology team. The idea, the end goal is for... the platform to be something like Canva or Shopify, where anybody without the coding experience can come and set up their own digital health solution the way they want it. So right now we have a professional services division that takes care of most of our customers are enterprise customers. So they would like us to do it for them.

Yeah. And what does an enterprise customer pay a year? Are these $100,000 deals or million dollar deals? They're probably not small. Yeah. Our typical customer pays us like about half a million dollars a year. I see. Okay. So that's kind of like 40 to 50 grand a month in MRR. Yeah. And this is mission critical. It runs there. Yes. Whole organization, really. Customer loyalty is high. Churn rate is substantially low. We have 96%, 97% customer retention. Our existing customer growth is around 100.

140%. So what I was saying is when they make a product, they are going out and bringing in more customers themselves. So when they grow... It's like that VC thing, right? You invest in them and if two of them succeed, you succeed substantially. So we have that kind of a thing going on where some of our customers are really growing fast. We sometimes don't even have to go out and sell ourselves. Right.

Yeah, what I'm talking about is not just the growth of that company alone. So many of our customers are building products on our platform and then reselling it to their customers. Oh, I love that. So it's not just the growth of the main company, it's also the growth of their... market, you know, in their sub entities, if you will see their customers as well. Like I said, the oral appliance company is selling, when they first came in, they had like 20 dentist offices that they were catering to.

And then they have expanded to 700 and their growth plan is to be 6,000 in the next two years. Do you have other, let's say, non-healthcare providers, but like an expert in a particular industry that says, I'm going to build. the beautiful digital health solution on top of, uh, the blue bricks platform with blue HR and all of that, and then resell it like a lot of people do with Salesforce. Is that a version? Yeah. Okay. Yeah.

So some of our customers are entrepreneurs themselves, right? So we have one. So this guy is particularly, I can't name him, but this guy is particularly in the management service organization. So they manage multiple offices of doctors or clinics or physicians, whatever the case may be, pain management. So he came out and built a solution. specifically for pain management. And then he goes out and does that he's not a doctor.

Right. So he gives the solutions and the tool sets for them to manage that office efficiently. And we have had other customers as well. So one of the customers that we are right now talking to is, again, I can't name names. This is one of the things that I posted on LinkedIn the other day. The Voldemort customers, right? The Voldemort, they cannot be named. They cannot be named. So I coined that term, Voldemort customers.

So they have 25 years of research from one of the largest universities, well-recognized universities in the world today. And they have this behavioral change algorithm. And so when you go out into the market and just with that algorithm, it doesn't make sense because you cannot just sell that ingredient alone. You have to package it in a solution. And for them to build everything else from scratch was too much. It's not worth their time. That's not their intellectual property.

So they ensconce that application, that algorithm, into the application that we provide, and they're able to deliver a good-looking product to the customer that is end-to-end complete. So that's some of the things that we do. So what we tell to digital health developers or new entrepreneurs is that, and this is my pet theory, is, you know. the difference between a chimpanzee and a human beings are two chromosomes. In fact, the chimpanzee has two more, right? And so...

That small differentiation makes a huge impact. So whenever you're innovating in a certain area, you're innovating in that small percentage. So you focus on that. We are giving you the rest of the stuff. Again, this is not anything new. Like we talked about this before with AWS coming into the market. You had server farms before that. The biggest check that went out to these founders were building out the server farms. AWS comes and they say, you don't need...

the server farms. We will give you what you need. You go with it. You build your application on top of that. The same thing with us is you have that smaller area where you're really focusing on. You build that. You can build the rest of the things on our application. That's what we do. That's a modern thing in software. And you and I have been around a... ways in this industry. We're experienced in this industry to remember when it was really hard to build all the...

commoditized platform stuff. But now you can, with a big team in India, which I know you have, and modern technologies, you can build out the commoditized aspects of most. software relatively quickly compared to the old days. Maybe you did it the hard way and we'll go back and talk about that. Greg, I still remember right when I first started in the US and I was doing this.

I had to ship servers from the US to India through the customs channel because we did not get the right kind of servers in India. Yeah. And I was the first one to adopt this VOIP for, you know, this kind of... calls and others. So it's been a long journey, right? I know. And kids these days, they won't believe me when you have to tell you had to go. Yes. No, that whole thing. So yes, but you've built this full scale.

digital health platform, all the components that you need to run a healthcare organization, patient engagement to billing and everything in between without any outside funding. So.

You didn't start yesterday. No. So let's talk about your crazy journey, Shamim. How did you get started with this? Let's do a little preamble before you started ZH Healthcare and zeroed in on what it really was and so forth. Tell us, where are you from originally? I'm from a southern state in India, the southernmost state in India called Kerala. It's by the Arabian Sea in the tip of India, southern tip of India, where the...

Southern Indian Naval Command, shipyard and other things reside. It's one of the most educated states in India, 99%, 100% literacy. most advanced, most diverse, most harmonious within communities and all that. So I started there. I was trained as a lawyer. I'm sorry to hear that. Yeah. Yeah, I'm sorry. Yeah, I tell everybody I'm a recovering lawyer. And then I started my career initially as...

as a stockbroker there, you know, we ended up having a stockbroking firm and we needed software for the stockbroking firm. This was way back in 89 and we couldn't find good software. So there was a company that was developing that. Long story short, I ended up being an investor and chairing that company and they branched out into hotel management and hospital management. So that was my first exposure into the hospital management or the healthcare sector.

From there, there was a time when I don't know whether I should say this, but I lost my shirt. in the stockbroking business. We can lose our shirts in the software business too. Yes. Yeah. So I lost my shirt in the stockbroking business. And then I had to... move out of the country and explore my luck somewhere else. So I ended up going to Saudi Arabia because we had a lot of relatives there who invited me there and said there's a lot of opportunity, especially for software over there.

went there, did the software business, and then I found the opportunity to come to the United States. So I come to the United States and... I was looking for opportunities. And so I was looking for arbitrage. You know, medical billing was one of them. So people took the medical billing business, did it in India. There was a good margin. So you had a good lifestyle business. The offshore arbitrage. You could charge a fee for it here and do the work overseas. Exactly.

And then we wanted software for that too. And so when we started looking around, the cost of the software just blew my mind because in India, we were selling hospital management systems. at the same price most doctors were paying here for their clinic management systems. So you're talking about 500 bed hospital management software being sold in India at a certain price, the same price that they were paying for a five doctor practice. Right.

That was ridiculous to me. And I said, there's a way to reduce this. This is just too much that you guys are paying out here. And I refused to pay that kind of money for the software I needed in-house because I just couldn't bring myself to it. So we said, let's look at open source and develop our own system because there might be open source because they have a lot of experience.

already a lot of functional knowledge in that. What year was this, Shamim? This was in 2006. Okay, yeah. 2006. And so we identified an open source project. Um... which was doing EMR systems. It's open EMR, right? Right. And so it was at the time that Obamacare and other talks were going on. And so the idea was we'll offer free EMR systems.

to our doctors in exchange for getting their services. So we took the EMR software, we started developing the billing software on it, and we started contributing this back to the community. And then people started coming to us and said, hey, we want you to do this customization for us. And then we saw a pattern here, right? People, why couldn't they just download the software and use it themselves? Because they had different needs.

And this kept growing. And big organizations like International Planned Parenthood Federations, the Peace Corps, all these organizations were coming in there and trying to build this thing for their own... different way of doing things. So that's how we started getting these new customers.

So after we started doing this for a while, we saw that we were redoing the same thing and yet the customers were not getting everything they needed. They needed to go around and then still host the solution, take care of the upgrades, the securing. certification, all those kind of things, just so that they can get a solution that was customized to their needs.

Right. And we thought that this is not a nice way of doing it. And especially this was quite labor intensive from our side. We were like an outsourcing shop and I did not want to do that. We wanted to be a product company. We said, why don't we build a platform? even for us, right? Even if customers come, we can configure these solutions rather than code these solutions and give it to them. So we started doing that.

that became quite appreciative for the market. And we were able to reduce their cost and give them a good solutions to these things. So one of the big breaks we got at the time was UPMC. you know, one of the biggest healthcare systems, contacted us. They had this entrepreneur in-house program. They were launching a new company, which was doing quite different things.

in a post-acute care and reducing the re-hospitalization of people. So they wanted a solution and they saw the platform. It was really great for them. And that company has kind of stuck with us in its various formations for the last 10 years now. And so that's the kind of way that we started building this thing up, you know, where everything was configurable.

So, Shamim, let's talk about this. This is a practical founder story that you were entrepreneurial, just the arbitrage. I could do it cheaper. I'm going to get into business. You had a service business that did the outsourced medical billing. for physicians' offices and whatever else, and you went around and got business. And then you discovered a software need for yourself and others and opportunities. So how long did you have this services business doing the billing outsourced?

And, you know, experimenting with open source and doing it yourself and funding that on the side. How long was this software business kind of an exploration side job before you realized it was a business? Oh, no, it wasn't an exploration. I mean, I saw the opportunity and committed to it.

Every single profit we got from the billing business, we put it out there. We had the other business, like you said, the steel business that we were doing. Yeah, you had another steel company. You mentioned that. We talked about that. before the call here i saw that you're linked it you have vector shades you know started two years before this it was it's a steel detailing business that is again we

provide sharp drawings, technology-enabled business that had good margins. So we took everything we got from that and the building business and put it into developing the software saying that this is going to be the future. And this is exactly what we were going to do. Everything we built, every customization request that comes in, we built it with the intention of making that configurable. So we don't look at a need. Productizing. Yeah.

So we did that. Wow. So you're also in this really deep, complicated vertical of the healthcare industry. It's probably the largest vertical industry of them all. Globally. In the nuclear industry. Yeah, it's very complicated. But you didn't come out of the healthcare industry. You just started serving them and then you got attached and you saw things a little differently probably than the insiders and the rest there.

When did you get your first commercial customers with whatever you called it at the time, your software? So you had your billing company since 2006. When did you... launch a software product and start making product revenue. So the first customers were our billing customers. So some of the billing customers were... So the software we developed for the billing customers when we started showing them the...

The deep analytics that we could do, the billing software piece of it, that part was the first one that we rolled out. So we had very, very strong, and we still do, in the RCM side of it, revenue cycle management. The billing side, right? at the billing side. And that was big value for these customers because most of these people were doing insurance claims. They had big rejection rates and there was no follow-up. So we simplified that for them substantially and we showed them how.

easy it was for them to do it themselves as well.

So those were the customers who started it. And then the Obamacare started. And everybody wanted the software and Practice Fusion came into the market. and started providing this EMR for free. And so every doctor wanted it and they wanted the money back. So there was a government or the ecosystem support also because the government was throwing money.

at this thing and everybody wanted to get. Otherwise, they would be penalized. Yeah, in the US, there was a mandate that the healthcare industry needed to... digitize and get electronic health records, no longer your paper files that filled up all these offices. They needed to go digital. 2008, 9, 10, the flag went up. You need to get digital. And the industry slowly moved. Not everybody.

did right away but uh it was a it was a land grab as we say in the big market space and you guys were off and running when did you stop doing the building services business and said this software business needs to be focused on and it's driving itself? The billing business, we still have it.

We still have it as a part of our thing because that is, like they say, it's the start. And so we did not go after new customers because we had existing customers or even the customers who use our software will come and say they need some. billing services along with that, but we are not aggressively promoting it or anything. We still do it. So that was a good thing for us. Now, here is a thing that you need to remember when you talked about the flag went up and all that.

One of the biggest disservice that happened in this industry was that forcing of people to go digital at the time because anybody who had... anything to do with software started coming out with this EMR systems. And the only thing that they were focusing on, get out an EMR system so that the doctors could get their money. They never focused on the usability of the doctor.

And that is what led to the biggest backlash and burnout. The burnout for the doctors and the nurses, because it became a data entry operation for most people, which they did not have the time. It brought down revenue for most of these people. That was the opportunity that gave us our break. We told them, and so we brought in this cognitive design.

into the software and we said, look, we are going to make this fatigue less for you by this cognitive design. So just a small example of that is when you go into a software application, usually the labels are put in dark. and the data entry, the box is lighter, just in terms of the font. We flipped that. We said, because you are looking at a screen for eight hours a day.

You already know what the label is. That need not be the one that should be sticking out to you. It's the name of the patient or the date of birth of the patient. Simple things like that, you know. We have what we call a dynamic form builder, wherein the doctor can decide.

which sort of form that he wants to use. He can design his own form. That would change their life if they do it two dozen times a day and they can save 20 clicks each time. That's really huge. What you see is what you get, right?

That's the kind of things that we brought in that made life so much easier for the doctors. It's like I have been using this form for the last 15 years of my practice. Why should I... change because you guys are asking for this kind of a form because that's easier for you. That kind of cognitive design and the usability focus that we did enabled us to make substantial inroads with our customers.

Well, now you've got a full platform, let's say a suite, right, from all these components. Did you start with one corner of these component elements or did you have to have a pretty wide? integrated solution in the beginning no we started with we we were lucky in the sense that We started with the billing, right, which was the most important thing. Then we already had most of the features. of the EMR system by understanding the open source part of it. So we built all that separately with

With the new approach that we took, the usability approach of that we took. Then what has happened is when we started getting these enterprise customers, and I heard a lot about your other entrepreneurs, we built those. features that the customer wanted. You followed the customer.

like requirements right yeah we we demand this yes yes yeah they said this is what we want we don't want all these things this is how we want to do it we build that accordingly except for the fact that it we build it in a configurable manner So if a customer came and said, I want this cash payment and this is how I use it, we said, okay, can this be used in outside the United States?

And we said, okay, we should include the pesos into it and all these other things so that it can be configured in any part of the world. So every single feature that we build has been built with customer money. Right. And that's how we started making these components. So they come up with, okay, we want to add payment processing into it. So we include Stripe into it or something else. And so we have... So our platform is not wedded to one. So if a customer says we want to do

one kind of payment processor, you can do that. Or we want to do another one, you can do that too. We build that API into it. Same thing with clearinghouses. Clearinghouses, most of the EHR systems are vetted to one clearinghouse through which you can... send the claims. We say you can use multiple and you can use one clearinghouse for this kind of claims and you can use the other one for other kind of claims.

which all proved to be good for most of these customers because some customers will use those multiple clearinghouses because they get better rates for that. Right. Saving them money for all these kinds of things. It's a common thing. The product business. You know, the answer is usually no. This is how the software works. But in the service business, we'll build it for you. The answer is always yes. If you want that, we'll build it. But you answered yes, but you productized it, right?

You give them the qualified yes, which is we'll do that. And we'll think about how this could fit into our global platform and be productized. So not just our team could do this without. engineers in the future custom, but you could do it. So you had a product approach to this very complicated industry. Because, Greg, remember, I was trying to build an enterprise-level software.

I wasn't trying to build a small niche product that will only do one thing. I wanted to give a comprehensive solution, an enterprise-level software at affordable cost. with the latest cutting edge technology. That is what I was trying to do. And that required us to have more features than a standard standalone product. Yeah.

And as you grew these in the big healthcare industry with this big platform and big customers, that's usually that you're getting traction and growing and adding employees. That's usually a sign that VC funding, with a big vision, you've got VC funding usually lines up. How come you didn't raise VC funding with this big vision? So when I started...

my entrepreneurial journey, I wasn't even aware of VC funding. I'm sure. Let's be straight about it. And even up until 10 years ago, my dad used to ask me, why don't you get a job, right? Yes, I remember those days, right.

Right. Being an entrepreneur was not a big thing. You had to be a doctor or an engineer. That was the big thing. So I wasn't aware of it. It's after I came to the U.S. that I saw that this was... possibility because I'm not even from a big tier Indian city so VC funding was something like exotic you see in the movies and other things so you come here

I'm part of the Washington, D.C. establishment. I go and I see these kind of things. In the tech community around D.C. and Virginia and Maryland, yes. Right. So I was part of the MindShare alumni group, which is 800. 800 plus CEOs of tech companies, part of the EO. So I go there and I see this and I said, okay, why don't I give it a try? And when I go there and give it a try,

First of all, the first rejection letter I get is the EHR market is saturated and there's not much you can do there. Okay, fine. That's good. And then we are trying to tell them the distinction. Many don't get it. So it's a customizable application. So at the time, low code, no code was not a one.

coined i think at the time we are talking about low code no code at the time and so who are going to use it they were looking at physicians offices and like i said i'm building an enterprise software it is not specifically good for smaller practices You have to be at least 50 plus users or practices who can see the value in what we are doing. Otherwise, we are more niche. The big guys want to do it their way. Their way.

It was. And then I found myself cutting my feet to fit the shoe of the VCs. I go back and look at the decks I have prepared and I'm like, I'm looking at... What the hell am I doing, finally? Somebody wanted to tell me, you are an EHR company, focus on EHR. We build out a deck and some names and everything.

It's not what we are. We are a digital development environment that is quite complete. We have all the features, but we enable other people to build impressive, innovative solutions. That's what we are. And it did not gain traction. It became, and this is a long sales cycle. I said, I'm going to stay in the long, that's the vision.

That's my vision, and I'm going to stay there as long as it gets done. So they're like, we have a five-year exit plan, and this is what we need to get done. You need to do this. No. It's not going to happen. So finally, I told my people. We are not going to go that round at all because at the time, even now, we have been profitable from day one. It's our margins we are investing back. Even this year, we are putting back $3 million into the company.

What else do I want? I want the money. What I don't get without that connections is the contacts. the right kind of people that can come and scale the company up. I do have a regret for that, that I'm not able to hire the best talents. But otherwise, if I have the patience, I can build the company.

in the way that I wanted and I can experiment. There were two instances in which I had two other businesses where I had to shut down the company because the investors were not ready to experiment further or try to pivot or track. Right. So that gave me a lesson that is every time if we are failing, we cannot make a change and try to persevere. And many a times that perseverance is when things start.

falling into place. And at the slightest problem, these guys will say, let's have an orderly shutdown. Yeah. And that's not what I want to do. Yeah. Shamim, let's talk about that because... It's kind of a myth that VC funding gives you life, right? It's a founder. And what you're saying is it's more like a gun to your head with a short fuse that says if...

If you fail and you try again and it doesn't work, that's it. We're down. We're out. We don't want to put any more money in it. But up and running companies that have profits and invest, they have the patience to try and try again. keep trying and keep trying. They can survive long enough to figure out really hard problems. And funding doesn't really have the patience to solve a lot of problems. It's kind of contradictory to what people think VC funding will do.

It will work for, so all founders are not charismatic. All founders are not charming. Many times these people are quite nerds, right? They cannot even articulate their... Great vision, right? It works for those founders who are movie star, charismatic, Tom Cruise-less. who walks into a VC, they can convince them, they can tell them this is happening. And many times they bullshit these people. We have enough stories out there. But others cannot do that. And so...

It's trying to convince them about your convictions. And so if you are running a company on your own, you have a conviction. You believe in what you do. You have done hundreds of hours of research and months and months. thousands of hours of research, and you know where you're going. You know. And then when you go to convince these people, they're often looking at their cell phones. They look at this thing, fighting it.

tops and then they say, no, this is not going to happen. That's the initial pitch. Once they're invested, they might put in more time. But if you don't have these characteristics of going and articulating your stuff and convincing them about where you're going and don't have everything else, you're not going to succeed. So the stuff is stacked.

highly against you to make that experimentation and go the path that you want to go. And that's the frustrating part of it. And many times managing that itself takes a whole... A lot of time from you. Oh, yes. That's a big deal. And let's just say there's VC-funded game where the vision and the commitment of the founders matches the vision and the intensity and the background of the VCs.

They can dance together and it works, but that's pretty rare out there. The founder of Funding Fit, where somebody said they were really helpful. We got through all the hard times together over and over and over and over again, which is... Mr. Horowitz's book. Yes, The Hard Things. He talks a lot of things about that and one of the examples where he said is he had this company which was going bad and then they...

took something out of that that they had built in-house and it became a big product, right? And if most VCs behaved that way, if they were supporting that way, that would have been great. But that's not what's actually happening in actuality. Right. And I'm Horowitz and those people have excellent charisma. They can articulate. They are well connected. They have the pedigree. They can go and do it and people listen to them. But most of these.

these practical founders like you speak to, they don't have the pedigree or the background that these other people will accept.

Fine, I can say that I have done all these things, but, you know, I talked to one of the VCs recently and I said, when Zeus Healthcare started by Athena Health, Jonathan Bush came out and they were trying to do what... we were trying to do at least that's how i perceived it and the big company came in yeah yeah the vc who had looked at us and uh said he had passed and i i emailed him and i said

Zeus Healthcare is doing exactly what we are doing, and they just raised $35 million. Then the response was, oh, he's a non-operator. He has built a company. So it's not the idea, right? It's also... the people. So there's a whole lot of things that has to come together. But by the way, Zeus Healthcare moved from that and they're trying to be the LinkedIn of healthcare data. But that's a different story.

So it's a whole bunch of things have to align for you to first get the VC funding and then to be trusted by the VC and then to be supported by them. Do it again and again. Yeah. Have a successful exit. That's like becoming a movie star. Yes. It's pretty rare. These big exits are rare.

I have to explain this to people. They see the headlines in the tech news and they go to TechCrunch and there's another funding, funding, funding. What they don't see is behind the scenes. And that literally 1% of 1%. of the funded companies are the ones we see and they don't see all the rest of them. And it's totally possible and it can work, but the odds are against you.

When you start taking the big funding drugs and that game has even changed in the last 10 years. Let's talk about your growth between you had your billing company, you got the software going over in the billing corner. In between that and having 200 employees and customers in all these countries around the world in a successful, profitable company, what were some of the challenges you faced? What were some of the big...

growth superpowers that you had to keep keep going i think my biggest blessing and i have no doubt in saying this is my partner right my co-founder right so he happens to be also be my first cousin He's 16 years younger to me. And what is his name? Shahzad, Mohammed Shahzad. We practically grew up in the same house. So that is very good. And he's the smartest man I know. And I think today, there might not be anybody who...

is better at healthcare IT than he is, right? And this is over the last 15 years that he developed that skill when he came in. You know, he was 23 years old. I just pulled him in and I said, I'm going to start this thing. You want to join me? And he said, sure, why not? And we started learning mostly about digital health together. I've seen very big experts and I don't think they hold a light to him.

And is he the technical leader of this very big vision? Actually, he's a computer engineer, but he is the product specialist. He's the chief product officer. The second biggest blessings were my two other. first employees, but I have elevated them to co-founders. We have decided that they will be co-founders. So one was my current CFO. He's extremely savvy with computers and other things. So when I first started taking the open source and analyzing it, he actually coded most of it.

He was an accountant, chief accountant, and he was doing it. And then when we finally decided to hire somebody, we hired our current CTO. who was laid off from IBM. To our luck, IBM decided to let go of a brilliant guy. And he came in. And for all of us, it has been a learning process. We do not come with all this knowledge. The thing is, all these four of us, we have this ability to commit and to learn and we were fearless.

is one way of saying it. The other way of saying is we were ignorant about the pitfalls. So we said we wanted to build an enterprise software. We did not know we were going up against $30 billion companies, right? who had watches of 200, 300 million. So we just put our head down. So these four people are the real key.

I mean, I can exclude myself. And those three people are the real key behind this. And most of the things, the company's growth and the product design, everything, I will attribute to all of them. the business model. So I have been very blessed in getting the support of these people. I say I'm just the guy sitting in the armchair and directing people.

But that's how we started. And we started putting small teams together. Our biggest challenges have been hiring the right people, especially in the United States. So we have gone through professional services. We have tried to hire the right kind of head for the professional services. high cost people. I remember Steve Jobs' interview where he said, we decided to bring professional managers, but they were also not good and we finally ended up having people from the inside.

The same thing, right? I had people with quarter million dollars salary or even more and ended up just screwing up most of the stuff and alienating many clients. It has been... That level of senior management hiring from outside has been a big problem for us until recently. Now, you know, because now we are more well known and people have seen what we have done and our client base people are still better. But even is it ideal today? No. But the first thing people ask is, are you funded?

The executives you're trying to hire. Right. Executors is the thing. And sometimes I believe probably that's been a blessing. Because the moment my experience with some of the people who came in has not been really good. It may be that I hired the wrong people, but whatever I've seen so far, that has not been good. So that has been one of the... biggest challenges. The second challenge is because it's an enterprise software, one of the logically the best path is to create an ecosystem.

to ecosystem of implementation teams, other companies who can do implementations. So we have been vetted by some of the biggest names in the industry, large systems integrators. And they have loved our product and whenever they get an RFP or something, they come to us and we have done it. One of those experimentations... The first one that we did, it was a $40 million project. We had one of the largest systems integrate globally coming in.

And we thought it should all be fine, right? Because they have the experience of 150 years. It should go well. Totally screwed up. They did not put the right people and all that. It's finding that right partners who can work with us in an enterprise level. So these are all growing challenges for us, right? Yeah.

One is a professional service. The implementation side, those are the things that we are struggling and we are trying to make sure it works. Now we have a system. We are good. We have a good internal team. We are able to implement that properly.

by far the biggest challenges in that growth. Otherwise, it has been pretty good growth. Not a lot of things. It is very satisfying to see. The first clinic that opened in Africa once, the first patient was a child, a newly born child, right? That itself was so heartwarming. in the country of Ghana. They have 35 clinics being run by one of our major customers, Sanford World Clinics. And it's part of the Sanford Health System.

And the entire way of doing business in Ghana is different from how it is being done in the United States. It's like an average doctor sees 20, 25 patients a day in the United States there. 120 patients a day. So that, you know, cycling of the patients has to be quick. Oh, my goodness. It was totally different. But those are the main challenges.

Software companies that are growing one in three million, it's the small team that can do it. And then that three million revenues to 10 million, something like that, that range is when. Leaders need to take over. The CEO can't manage all the people and they go through the growing pains of the leaders and looks like you went through those. But now you've got a solid leadership team and trying to add slowly and strategically to that.

which can be a very big challenge. But how has your role changed, Shamim, in this growing company with 200 employees? You call yourself chairman and you give credit to your senior leadership team. What things do you work on? that keep the ship moving? So this year, and since this year, I'm focused more on the visibility of the company.

Actually, I should have started doing it long ago, right? So usually when you see most of this VC-funded startup, the CEOs out there promoting the company and all that. We did not have that luxury. It's one of the main reasons we don't see that there are more practical founders out there than the VC-funded ones. It's just what we get to see. Right.

And so since this year, I've had the luxury of not being involved in too much day-to-day activities. Yeah. Until about last year, there were a... not as substantial, at least 50% of my time, I was spending more on the day-to-day aspects of it, including reviewing contracts.

I have moved away from that because of my team. Literally, you've moved away to Geneva. Yeah, literally. Yeah, that's true. Literally that I've moved away from that and now focusing more on... communicating the value proposition of the company outside so mostly on sales and marketing marketing more than sales is what I'm trying to do so that's the change in the role empowering my people to take decisions and being aware of the consequences and telling them that it is okay to make.

You know, those kind of mistakes. Those are the good things that have happened. So my role has substantially changed over the, especially over the last two, three years. How does that feel? A lot of software founders. Can't imagine having 200 employees and not having hands on keyboard with the day to day and, you know, going through those growing pains and getting to the other side. But they're also.

founders that say, oh my gosh, this is so empowering. I can now see how I can move 200 people or 500 people and change the world on a bigger scale. You know, I don't have to do payroll myself anymore and that kind of thing. So how are you feeling about this change in your role? It's a big one. I am feeling the feeling that I have now is that I have built a sustainable company that will survive without me.

Oh, wow. That is the biggest, you know, the satisfaction that I'm getting right now. And I tell them or I tell my wife, if I pass tomorrow. You guys won't have any problem with the income because the company is going to survive because I have put together a good team, I have put together a good product, and I have good customers as well. So that is the best feeling.

of that. And I hope that even on the sales and marketing side, it will become self-sustaining. And if I put my will into it for the next one to two years. That should happen. And maybe then I can go to a country club. Oh, right. Yeah, that's what we do after 30 years pulling businesses out of the dirt.

I don't think so. It doesn't work for me either. So, yeah. So let's talk about where does this go here? Can you imagine this growing steadily in your very big corner of the global healthcare? market and being 20 years from now an independent company? Or couldn't you imagine somebody buying this or partially buying this? Or I don't know.

You know, employees buying this. If you're thinking five to 10 years out, what is this going to be? I would like this to be an independent company of its own and not be bought out. Maybe we would end up acquiring other companies. That's what I would like to, because I have this pet peeve with most of these founders where they are building businesses to flip. And I have a problem with that, but that is...

I feel like if you have a vision, you have to complete it. Otherwise, don't go for it. And I think if there is any choice, if it is my choice, I would try to build the company into a billion dollar or multiple billion dollar companies. And that's the growth path that I'm looking at. Would I take some chips off the table? Yeah, I would like to take some chips off the table. if there can be investment from like-minded people. That's how I'm thinking about it today and to build a lasting...

Again, the ultimate objective is that anybody who wants to build applications in the digital health space should be able to do that easily without even contacting our professional services. and that each application can benefit anybody, a number of people. Right now, we have two million patients on our platform. Two million patients.

That's a substantial number of patients that are benefiting because of the platform. And it's not just in the United States. That's the thing. A lot of them are in the developing countries. And if I'm able to... make digital health accessible to more and more people, I would feel that we are succeeding. And if that vision is... aligned with whoever wants to partner with us, then I'm open to anything. That's the idea. That's amazing.

Yeah, it's a big vision. You know, a lot of practical founders have smaller vision. I want to get this to 5 million and take profits out and run it and work half time. And you're on the other side, you know. if you've got 2 million patients you could have 200 million what would be the difference your product would work you just need to get your message out which is what you're working on there's all kinds of ways to do it Shamim

You talk to a lot of founders in your mentor organization there in the Washington, D.C., Maryland, Virginia area, and you have some strong views about this. What advice do you have for practical founders out there in vertical industries, maybe the healthcare industries that have a conviction about what the world needs and what they...

And they may not have the perfect words for it yet, but they want to start solving problems and building customers and making a dent in the universe and doing these hard things. What advice do you have for these practical founders out there? that can help them in their journey? Find the right partner first. You need to find a good co-founder who is committed to what you want to do, like yourself.

That's the first thing. You cannot do it alone. And I have tried it because you being your own, you need another side to what you're thinking. You need somebody to reflect on. bounce ideas on and try to find the most contradictory person. My brother and I have big fights, right? That's the number one thing. The second one, and I don't know whether that is more important or not, is to cut off all your lifeboats.

Burn the ships, as they say, right? Yeah, burn everything so that you have no way but to succeed. You will find any way to get that thing successful. Like I said, when I lost my shirt and I decided to start doing something else, if I had another option, there was plenty of times I would have taken that.

So those are the two things that I can say. There's a lot of other things, you know, everybody keeps telling you business plan, value proposition, all that. But other thing, what needs to drive you? And that's the most important thing. If it's just for the money, then I don't have a lot to tell you. If it's just for the money, I really don't care what you do. Sorry.

Well, thanks for that. Great advice. Very wise advice. And congratulations on an incredible journey. What a life that you have created for yourself and your employees. And now your customers and all the patients, they're benefiting from having software that works the way. It should work, not just the way it used to work in their healthcare industry. I'm actually seeing from this that one of the reasons the healthcare industry is as painful as it is from a customer perspective is the software.

was built 15 years ago for an old business model and can't change to adapt to something that's more useful, more modern, more easy, more flexible, that you're out there changing the world. Thanks for being on the Practical Founders podcast, Shamim. What an amazing story. Thank you, Greg. Thank you for the opportunity. Appreciate it. Thanks for listening to the Practical Founders podcast. I hope you found this interview interesting and, well, practical and useful.

Please subscribe to the Practical Founders Podcast in your favorite podcast app and stay tuned to hear amazing stories from successful founders who are winning their big prizes and doing it their way without big funding. You can visit practicalfounders.com to join the community and get my weekly email with deeper insights for practical software founders all over the world.

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