This Week in Startups - Amazon launches "Amazon Clinic" + Calibrate CEO Isabelle Kenyon on metabolic health | E1614

Episode Date: November 17, 2022

Molly rides solo today as she breaks down Amazon’s new telehealth business, Amazon Clinic. (1:40) Then, Calibrate CEO Isabelle Kenyon joins Molly for another edition of the Next Unicorns! (9:30) (0:00) Molly tees up today's topics! (1:40) Molly breaks down Amazon clinic (8:15) OpenPhone - Get an extra 20% off any plan for your first 6 months at https://openphone.com/twist (9:30) Calibrate CEO & Founder Isabelle Kenyon joins Molly for the Next Unicorns to chat about calibrate and GLP-1s (20:52) LinkedIn Marketing - Get a $100 LinkedIn ad credit at LinkedIn.com/nextunicorn (22:30) Understanding how inflammation causes many chronic diseases +  obesity epidemic (35:51) MicroAcquire - Sell your business with no fees at https://try.microacquire.com/twist (37:19) Calibrate’s enterprise business + inequality in healthcare Check out Calibrate: https://www.joincalibrate.com FOLLOW Jason: https://linktr.ee/calacanis FOLLOW Molly: https://twitter.com/mollywood Subscribe to our YouTube to watch all full episodes: https://www.youtube.com/channel/UCkkhmBWfS7pILYIk0izkc3A?sub_confirmation=1

Hey, everybody, welcome back. Welcome back. It is Wednesday, which means we have our segment, next unicorns. I have a great interview with Isabel Kenyon, who's the CEO and founder of a weight loss startup called Calibrate that is super scientifically focused. And we have a fantastic conversation about the state of the health industry, how we treat obesity or don't, and why this company is hopefully on its way to unicorn status. It's fascinating.

But before that, I have a news item that is right on. On topic, I'm talking about Amazon launching its own clinics, not just for employees anymore. Everybody is trying to disrupt health care, and that is what today's show is all about. It's going to be a great show. Stick with us. This week in startups is brought to you by Open Phone. As a startup founder, a lot of mistakes are easy to roll back, but using your personal cell phone number as your company number isn't one of them.

Open Phone makes it easy to get business phone numbers for you and your team, right on top of your existing devices. Visit openphone.com slash twist to get 20% off your first six months. LinkedIn marketing. To redeem a free $100 LinkedIn ad credit and launch your first campaign, go to LinkedIn.com slash next unicorn and microacquire. The startup acquisition marketplace. Start the right acquisition conversations at your own pace. Get free and instant access to over 100,000 trusted buyers with,

total anonymity. Say goodbye to brokers and meet your ideal buyer today. Go to try.com slash twist. All right. I'm kicking off solo for a minute to talk about Amazon actually launching Amazon Clinic, a telehealth service for citizens in 32 states. Now, we have sort of kicked around what Amazon is going to try to do in health care. We know they had offered some health care solutions specifically for their own employees. But, This appears to be Amazon actually offering a telehealth service called Amazon Clinic for all kinds of regular health consumers. This, of course, is coming one day after reports that Amazon could lay off as many as 10,000 employees. The company has unveiled its new telehealth service called Amazon Clinic.

Now, we've been speculating for a while and talking about Amazon's ambitions around the healthcare space. the company does offer, I think, some internal health care services for people who work there. But now there's this actual telehealth service available in these 32 states that include Alabama, California, Alaska, Hawaii, and New York. And the website says they hope to expand to more states in the coming months. I'm going to go ahead and say that a 32 state rollout coming out of the gate is still pretty big. Amazon Clinic is described as a message-based virtual care. service that connects customers with affordable virtual care options when and how they need it. Supposedly, it will provide care and consultations for around 20 specific conditions,

including allergies, acne, hair loss, erectile dysfunction, help with quitting smoking, rosacea, motion sickness, pink eye, heartburn. So you're kind of basic stuff that goes wrong that, to be honest, you don't necessarily need to go to the doctor for, like you sort of know if you've got hair loss or seasonal allergies or yeast infection. They will also offer prescription renewals, it looks like, for things like your blood pressure, prescriptions, migraines, asthma, hypertension. So a fairly kind of straightforward things that bother lots and lots of people offering. They also have a new store for health care that lets users choose from a wide variety of

health care providers. And then every clinic on the platform has been vetted by Amazon. clinical leadership team. It works like a pretty straightforward app, it seems like. You just choose your condition on the platform with help of a kind of hilarious and sometimes slightly graphic-looking diagram. You choose the provider that you want to interact with and fill out a brief questionnaire. And then the patients and clinicians have a little chat, literally, over Amazon's message-based

portal. After that consultation, then the health care provider forwards a treatment plan, including any prescriptions to your preferred pharmacy. So kind of exactly how you would want telehealth to work for something pretty simple and straightforward. Here is the rub. At this time, Amazon Clinic does not accept health insurance. So the cost of services can vary depending on the health care provider. For example, the pink eye cost, which is conjunctivitis is the technical term there.

In New Jersey, you've got one provider charging $30 and another charging $48. So hopefully there will also be a mechanism for some price comparison. Amazon, of course, just to give a little history here, has been creeping into the health services industry for the past couple years. Late in 2020, they launched the Amazon Pharmacy, where customers could purchase pharmaceuticals online. Prime members can get discounts of up to 80% off generic brands, 40% off brand name medications. And Amazon Pharmacy also purchased PillPack in 2018 for $753 million. That was according to Pitchbook. PillPack offers medications in these personalized packets, which is,

great if you take lots of medicines a day. And then, of course, if you remember, and this was the big one, back on episode 15, 14, almost 100 shows ago now, wow. We covered Amazon's purchase of One Medical. Amazon bought One Medical for $3.9 billion in cash. And of course, One Medical is a member-based health platform that offers the same or next day booking for virtual and in-person consultations. That company has about 190 offices. So far, those clinics, do not seem to be part of the Amazon clinic, probably because the purchase actually hasn't gone through yet, because it is being investigated by the FTC.

Amazon also offers employees Amazon Care, which debuted in 2019. That was its first big foray in some ways into offering care, specifically as opposed to prescriptions or something around that. That service lets Amazon employees get in-person or virtual health services, but now Amazon with, I assume this bigger rollout is in the process of winding that down.

It's not too clear how much traction that service gained or how many employees actually used it. However, Amazon, of course, use it as a big beta test, one assumes, to get a deeper understanding of what they need to deliver healthcare going forward.

So I guess our big question is, what's the big play and what's the vision? Does Amazon expect this to become a new core, much like AWS, is it the kind of thing where they might be getting a little, it might be a little bit of a side quest, if you will, somewhat like the acquisition of Whole Foods, which I think was kind of like fine and is now in one of the segments that lost money in Q3. And I'm going to remind you here that AWS, Q3AWS operating income was $5.4 billion, up 11% year over year, down about six percent.

quarter over quarter and that is the only profit center at Amazon. The healthcare thing does feel a little bit like a distraction for Amazon, but I guess we'll see. I wonder if it hadn't already been so far along if CEO Andy Jassy would have continued to pursue it as aggressively as this. But, you know, listen, I could be wrong. We're at a moment where we're really seeing a lot of disruption in health care. people are realizing that the way we're getting healthcare,

you know, we have the founders of the Land Bee on talking about how it's a customer service issue. Healthcare is bad customer service. And so anything, I think, they can make it simpler and more straightforward for consumers will probably be a little bit welcome and people really do trust Amazon. So I guess we'll see. On the program today is Doreena Kulia. She is the founder of Open Phone. Welcome to the show, Doreena.

Thank you so much, Jason. Great to be here. Now, what mistakes do most founders make with phone numbers in their startups? Really, delegation, right? Because what ends up happening is that as a founder when you're starting, you do everything. You are the salesperson, the support person, the... You make the coffee, you do HR, marketing, sales, recruiting, everything. But then eventually you have people joining the team.

And what ends up happening is if as a founder, your phone number, let's forget about the privacy, the spam, all that problem. Let's say it doesn't exist. but you're not going to want a year into your company, two years into your company, to have all the support calls or all the questions come to you because now you've just hired your support team. Why did you hire them? So that's another reason why having that separate number makes so much sense because you can always delegate those calls to your team as you grow. All right, everybody, here's your CTA, the old call to action.

Twist listeners, 20% off any plan for your first six months. Just sign up at openphone.com slash twist. And if you got an existing number, no problem. They'll put it right over. Openphone.com slash twist. O-P-E-H-O-N-P-H-O-N-E dot com slash twist today for 20% off. All right, enough about Amazon Clinic. Next up, another edition of the next unicorns featuring an incredibly cool and promising startup.

Isabel Kenyon is the founder and CEO of Calibrate, a startup treating obesity like what it actually is, America's biggest health care problem. Here she is. Isabel Kenyon is founder and CEO of Calibrate. Welcome to this weekend startups, the next unicorn. Hopefully a next unicorn right here. Are we still looking for unicorns in 2020? Do you think so?

Yeah, definitely. We're just looking for different kinds of unicorns, which is a really exciting discovery. I appreciate you having me on too much. So tell us what is Calibrate? How's the work? Calibrate is a metabolic health business on a mission to change the way the world treats white.

And so we believe that 200 million American adults living with overweight and obesity is the underlying pandemic, is the epidemic at the source of all cardiometabolic disease. And we believe we know how to treat it. And we believe that we need to get access to as many of those people as possible. And so we designed a program that combines what's called intensive lifestyle intervention, a combination of changes to the way you eat, sleep, exercise, manage your emotional health, and medication, new medications called GLUC-B1s, Glucigan, like peptides. And we combine those two things to change your underlying physiology, improve your metabolic health, help you lose weight, and help you get off of medication and sustain results long term. Amazing. Before I ask you for the details on all of those things, how did you get into this? When did you start it?

And what made you want to make this your, you know, 24-7 passion? For sure. I grew up in New Jersey. I spent the early part of my career living and working in Hong Kong. a recruiter called and said, it seems like you like high growth things, you should go work in startups. I went and worked in e-commerce startups in London and New York.

I broke my back in pelvis skiing. It was the worst interaction I'd ever had. I said, this feels like one big retail business that should be an e-commerce business, which is the right amount of naivete to have to enter the healthcare industry. Yep, yep. You're not alone, though.

I want to spend the rest of my career fixing health care. This is the problem of our times, and my experience was so miserable. and I want to make this better for other people. And so I joined the early days of a pharmacy startup called Capsule in New York. I got to build out the operations, the growth, the sales and marketing, and then I got to spend time with pharma companies at the end doing partnerships. And so we're spending a lot of time thinking about what does the future of direct-to-consumer

pharma looks like. What is going on with the price of drugs? How do we make those drugs cost-effective? What is going on with the total cost of care in this country? And how do we bring that down? And my mom had a doctor's appointment. She learned like one in two American adults. She had prediabetes.

And she told me, you have to help me find a doctor who can help me lose weight. And I did. Turns out every fancy academic medical center in the country has an obesity board certified doctor. There were a couple thousand of them then. There are 5,000 of them today. But like I said, there are 200 million of my mom. And so when we went, I learned about the standard of care.

I learned we've known how to treat obesity for three or four decades. And it's been trapped in this tiny academic medical center where you You wait months on months for appointments. You pay fee for service for appointments. You go back every three to six months. And you order bars and shakes to eat in the front. And I was like, there has to be a better way. And so I started emailing doctors who had published research on the medications,

who had published research on intensive lifestyle intervention. And I put them all in a room together at the end of 2019 and said, what would it look like to bring this program to more people and more places? And that's how we launched the direct-to-consumer business, which was basically saying, let's get the date. Let's prove that this works at scale. Let's prove that you can deliver this digitally. And then let's use the direct-to-consumer business to fundamentally change the access equation

and get payers to pay for this and get employers to pay for this and get the government to pay for this. And that's where the business is now, which is really exciting. Wow. Well, congratulations on what you've built so far. And I love the idea that you were like, not only am I going to tackle healthcare, I'm going to tackle the single biggest problem in healthcare, the single biggest underlying condition that Americans have. I feel like you don't just like how much.

I do. I do. I'm very energetic. You don't just like it. You love it. It's such a cool wedge because, you know, digital therapeutics and digital health has existed for a couple of decades now. And people haven't engaged.

And we talk all the time about meeting the consumer where they are. And we talk all the time about that being on their phone. That's fine. that's correct. But you know where they are? They're not thinking about their diabetes. They don't wake up thinking about their cholesterol. They wake up thinking about their weight. And that's where they are. And that is the way to pull someone back into the healthcare system to help them understand that their weight is a metabolic condition, is a chronic disease. And to help them understand how their weight impacts their cholesterol, their blood sugar, their blood fat, that is what it's all

about. And so if you can really meet someone where they are, which is a condition they actually care about, you get to pull them back into the healthcare system for the first time. And that's what I love about this business. Yeah. All right. We're going to talk a little bit more about the evolution of the business. But first, let's break down those elements that you mentioned, intensive lifestyle change, medication. Walk me through the parts of the program and how specifically it works. They're basically three pillars. The medication is amazing. They're called Glucigan-like peptides, everyone's body makes GLP1. The hypothesis is that over time as our bodies have evolved, we're not making the right amount anymore to properly regulate our metabolic systems.

Glucculan-like peptide is a brain-gut hormone. It moves between your brain and your gut. It regulates satiety and appetite, but it also regulates the overall metabolic system and your insulin reaction. If you think about all the hormones being intertwined, cortisol, adrenaline, your sleep hormones, your hunger hormones, when they get out of whack, they are all unbalanced. And so we called the first product, the metabolic reset, and we called the business calibrate because we want to help you recalibrate your metabolic system and help you understand that this is a system of hormones. And so what we did was build the program around the underlying physiology. What are the things that help people understand their physiology better? What are the things they need to know about food? What are the things they need to

about sleep, exercise, emotional health. All four of these things trigger your metabolic health. You cannot lose weight if you're not sleeping. You cannot lose weight if your cortisol is going all the time. And we're all living in this crazy environment, especially during the pandemic, where we are under tremendous amounts of mental health pressure, tremendous amounts of stress. And so it's about helping people understand how those things are correlated and related and giving them the tools. They're not complicated tools. And they're not unproven tools. These tools have been tested and proven through decades of research,

mostly funded by the NIH, the National Institute of Health. Yeah. The diabetes prevention program was an incredibly powerful way to understand. What are the tiny tweaks that people need to make? If you want to eat a bunch of sugar, that's fine. But you've got to go for a walk after. And it's not really fine. My chief medical officer would kill me.

I mean, no, no, no. It's really not. But I think one of the things that is so powerful to me, there were a couple of things that I learned when I started Calibrate that I feel like are so important to share with the world. One is the calorie model of obesity has basically been disproven. Like, it's a thesis. It's a hypothesis. So I wouldn't go as far as saying it's been disproven. We have a lot of evidence to suggest that it's not correct.

We have a lot of evidence to suggest that it was the world is flat. It was simple. People understood it. Calories in, calories out, imbalance. you'll gain weight. But it's really not that simple because our bodies are complicated and our bodies send all sorts of signals about when to save things as energy, when to save things as fat. And those are all driven by hormones. And so what we know now is that there's an insulin model of obesity and that hasn't been proven either. That's also a thesis, a hypothesis. But we really think that for most people,

when your insulin gets out of whack, that is when your body starts doing all sorts of things that help you gain weight, make you store weight in a way that is really evolutionarily defined. We were starving for thousands of years, right? We had to save energy and conserve energy. And so I think what's really powerful is just changing that perception for people. And so we set the mission of the business to change the way the world treats weight because we want people to understand that it's not as simple as they've grown up thinking it was. Fat is not bad. Calories are not bad. There are no bad. There are no bad. Bad calories. There's a book called back gal. There's no bad calories. But this is a huge part of

what we help people understand is how are these behaviors linked? And that's the lifestyle intervention. And we built that in partnership with a cardiologist at Tufts who runs the nutrition school, a sleep expert who's done all of the research on insulin and sleep and how, you know, if I don't know if anyone read Matt Walker's book, it was very popular a couple years ago, why we sleep or why sleep matters. And he goes. through in the book, if you deprive people of sleep for a couple of nights, they'll test diabetic. Really? Literally. These things happen immediately. And so helping people understand how these things are connected. It's like a knowledge is power concept. It's like you don't, it's not like a

homework concept. It's not like a dramatic lifestyle change. There's no calorie restriction. There's no calorie counting. But it's just helping people understand how these things are connected. And that's a lifestyle program. And it's delivered through both content, community events, and also one-to-one coaching. So you get on a Zoom with a coach. And that person is holding you accountable. It's a stand-up for all the tech listeners. It's what happened in the last couple of weeks?

What's happening in the next couple of weeks? What's your goal? And then the second piece is the doctor and the medication. And that is where we're saying, you need a doctor to help figure out which medication is clinically appropriate for you. How do we reset your GLP-1 in a way that gets your body set up for sustainable long-term weight loss?

And then how do we get you off that? medication. And that's where pharma disagrees with us. Big surprise. Farma thinks you should be on these medications forever. And we think you'd bankrupt the health care system if you did that. These are not cheap medications. The list price are up to $1,500 a month. We spend $10,000 a year treating an individual's health in the U.S. Okay? So we're talking about bankrupting. Wow. So what we say is we need to find a total cost of care equation that makes sense. And so the pillars are basically who's coaching, community content, and then the medical education part. And what's really important to us is that one, we guarantee results, guarantee that if you stick with the program, you'll lose 10% of your body weight.

And for the employer business, for the payer business, we guarantee we will get you off of medication. And we guarantee that we'll sustain results after we do that. Dang, that's a big promise. It is a big promise. Hey, everybody. I'm here with my pal, Tom Eschbacher. He is the senior sales manager at LinkedIn Marketing Solutions. And today, we're going to talk about marketing for startups. And LinkedIn did a great new internal report called today in startup marketing. Welcome to the program, Tom. Thanks, Jason. We've been talking about ICP, ideal customer profile. This is a critical concept for all founders to understand how can LinkedIn help with the startup figuring out who is their ideal

customer. It's hard to know, especially for companies who are really getting started. And one of the great ways that LinkedIn is able to help is by providing you additional insight on who's visiting your website from all channels organic paid search what have you our website demographics feature looks at the professional attributes and I'm talking about the job function job seniority company industry company size even company name to help you hone in on the audiences that are most engaged with your site we can look at this down to the particular page so you can get product level insights. And what you're going to do is take that, share it back with your sales and product team, and add that to the anecdotes that they are bringing to provide a really holistic

view of what an ICP can and should look like. Fantastic. We think your B2B marketing on LinkedIn ads and get a hundred dollar credit on your next campaign. I kid you not, a hundee coming to you in free advertising and marketing. Go to LinkedIn.com slash next unicorn to get $100 off. Again, LinkedIn.com slash next unicorn for $100 off. Of course, terms and conditions do apply because they're giving you a hundee. Okay, I have more questions. I want to dig in a little bit more to the things that we know now that we didn't entirely know then because it does seem to be and it's been slow and coming in some ways that there's an understanding now about insulin, inflammation, specifically that that maybe wasn't there before, right?

That is that is probably to your benefit at this moment in time because there are parts of what you're offering that are as old as time in some ways and other parts that are based on fairly new understanding, new signs. So talk to me about the parts that are new. So the insulin inflammation connection is real and we believe in it. I would say there's a lot more research to do. And so it's really easy to say cardiometabolic is. disease is a spectrum. And it starts with overweight, and then it goes to obesity, and then it goes to

pre-diabetes, and then diabetes, and then cardiovascular disease. Starting to connect it to all inflammatory disease is happening. We are publishing data. We are publishing research, not calibrate the world, is publishing data and research demonstrating that weight causes inflammation, and inflammation causes all other chronic disease, most other chronic disease, about half of cancer. And so I think we are starting to understand more the link between those things. I don't think it's as obvious yet as it could be. But for sure, reducing inflammation is important. And it's one of the biomarkers we measure in addition to the CDC's definition of metabolic health, because we believe that if you decrease inflammation, you're going to make people feel better. You're going to make people

feel back and control their bodies. And you're going to ultimately drive better health outcomes. And so it's something that we care a lot about and we'll continue researching. But there is, we are in the first inning, if not like before the, whatever you call before the first inning here. We are literally just starting to talk about this. I mean, SSRIs have been around for decades. And a couple months ago, we just published the first data saying, maybe they don't work for most people. Right. Exactly. Antidepressants for those of you who are listening who don't know this phrase. Turns out they don't do anything. Well, for some people and for some people they do. But this is like, we're moving towards precision medicine, right? And I think one of the things that's super powerful is for decades

on decades, on decades, we didn't even test medicine on women in childbearing years, i.e. all the years. Yeah, I know. How could we know? Real familiar with that one. Uh-huh. So let's talk a little bit more about the medications now. So the medications are not included in your price. Correct. Right. And they are in most cases not covered by insurance while we're talking about things that are. but we'll share more. Okay, so tell me, are they, can they be, should they be? Yes, so GLP ones are as a category about $25 billion of spend in the U.S. drug market this year. The U.S. drug market on the retail side, so excluding specialty drugs that we would use for cancer or rare disease is about $350 billion.

So this is a big category. And they have become standard of care for type 2 diabetes diagnosis. So instead of giving someone who gets diagnosed with type 2 diabetes insulin, which ultimately makes them, more insulin resistant and makes them need more insulin over time, we now say, let's give them GLP1 and let's see if we can re-regulate the body's own production of insulin. And sometimes that works. Sometimes that doesn't work. Sometimes we need to add insulin on top. But they are a huge category for diabetes and they've been around since 2003 for that category. And so we have three different five-year studies on them. They're safe. They're cardioprotective. They're anti-inflammatory.

The way that they work, they're not stimulants. This is very different than what we've seen in the past in terms of weight loss. And so as a, quote, side effect, we saw that people were losing weight. I would suggest that's not a side effect. That's the mechanism of action. Actually seems. But we weren't thinking about obesity as a chronic disease then. And so in 2013, the American Medical Association voted and they said,

obesity is a chronic disease and we need to start treating it because this is the next diabetes. And the way that we thought about diabetes 15 or 20 years ago when we said lifestyle choice, stop drinking soda. And today, the way we think about diabetes, and we say, huge category of chronic disease, very expensive, needs to be treated with medication, is totally different. So if you grew up thinking about diabetes as a lifestyle choice, today, most people don't think about it that way. And some people never even grew up that way because they're younger. And so they just think about it as a chronic disease. And that's where I think we are with obesity, which is in 10 or 15 years, we're going to say, this is a chronic disease that needs to be treated that way. And so what's

happened is there are about, I believe there are 11 GLP-1s approved today. About six of them are effective for weight loss. Four of those are labeled for diabetes. And so if someone has diabetes or pre-diabetes, we can treat them with that. And they have broad formulary coverage, 90-95% commercial formulary coverage. And then the obesity drugs have about 30 to 40% formulae coverage. And so between the fact that where I started the conversation, 50% of American adults are living with type 2 diabetes or pre-diabetes. And then the other population that we're treating has obesity, we can usually find coverage with insurance companies for one of these drugs. Oh, great. Okay. What is not covered? Where did I get that impression?

Or did I get that impression because I read Twitter? There's still a long way to go, right? On the obesity drugs, you're still at 30 to 40 percent. And the government doesn't cover the obesity drugs at all yet. So CMS has said, we will not cover Medicare, Medicaid, the VA have said we will not cover these drugs for obesity yet. Meanwhile, we're having a national crisis where we can't register people for the military for the first time because they have obesity. So there's a lot of work to do there, and we're big supporters of a bill called the Treat and Reduce Obesity Act, which asks CMS to start covering these medications. Why did they, they passed a ban, right? They sort of specifically banned covering that. It's not just an oversight because of like Fenn-Pen? Like, what happened?

That caused the government not to- This is a whole other episode. I do like to, I am fond of saying that we humans like to overcorrect. We do. So Fen, Fenn, for those who you don't know, was a drug produced by Wyeth in the 1990s. It was, in the end, almost 6 million Americans took it, which is crazy. And in the end, a little bit dangerous. So there were people who had serious heart defects as a result, and it was ultimately pulled from the market.

it was effectively a stimulant and it effectively suppressed your appetite and it was really effective at doing that. People had 20% plus weight loss on it. And so it was the first time that most people who lived through that generation were introduced to weight loss drugs, were introduced to the concept that there is a drug that can help them lose weight. It wasn't working on the underlying mechanism. It didn't work on sustainable weight loss. It didn't work on this idea that you can change your body's underlying physiology. And I think that's one of the the things that's hardest to correct in people who remember Fen, because it really just, well, you took it, stopped you from eating.

And when you weren't taking it, didn't stop you from eating. Whereas GLP-1s are changing your body's metabolic system. They're changing the physiology. They're changing the way that you think about food. They're changing the way that you think about energy and exercise and sleep. They have a very interesting, especially when paired with strength training. They have a very interesting propensity to, in a way that was very different than Fen-Fen, help people lose fat before muscle mass.

They're still muscle mass lost, but disproportionately more fat than Fenn Fent had. And so we're in a different era. But the federal government doesn't still have any hangovers there, which is nice. State governments do. So Florida still has a hangover there. There's another southern state I'll think of, I think it's Mississippi, has another hangover there where there's, where there are there specific laws saying you cannot practice weight loss medicine. And so we've gone and gotten waivers because we've said, this is good medicine.

and we're able to practice in both states. As a result, we worked with the medical boards. How, okay, if the goal is, let's keep talking about the science a little bit, if the goal is to get people off of this medication, like, how do we know that it really does? I mean, change your metabolic physiology is something that has, I think, that has sounded like the dream forever. And then it's like, I don't know, I get to be 47,

and my body's like, yeah, we're not doing that anymore. Your metabolism's totally changed. Or, you know, it's like, is this really possible to change that in a way that lasts? We will only learn with businesses like Calibrate, right? We will only learn with real world evidence. We will only learn by practicing this type of medicine and seeing if we can set a new standard of care here. And so so far, we have titrated off, of the population, we have titrated off, 97% have maintained weight loss of greater than 10%. Wow.

That is not the, by the way, that is not how much weight people want to lose. Okay. there's an amazing guy at Penn named Tom Wadden. He's been keeping track for I think about 40 years of how much weight people want to lose. It varies. It's bounced anywhere from 10% to 30, 35% over the years. Right now it's around 15, 20%. That's what people want to lose.

There is no evidence yet suggesting that people can do that sustainably. There is no evidence suggesting that once your brain has gotten used to a fat mass, a body weight, essentially, that it can truly recalibrate at a much lower set point, which is why bariatric surgery is broadly considered a failure because even most people who go through it end up gaining weight back to a point where they're still at significant weight loss. 10% is wildly significant. If you have a BMI and BMI is not a perfect metric and we can come back to that, but if you have a BMI above 35 above 40 and you lose 10% of your body weight, we are talking about reversing 90 plus percent of type 2 diabetes, 95% of Nash.

We were talking about serious medical savings and serious quality of health improvement. But that's not what people want. They want to lose 30% of their body weight forever. And that's where the business back to the mission is about changing the way the world treats weight, changing the way we think about it and talk about it, helping people recalibrate their expectations and saying, I always say, calibrate is not the quick fix. If you Google right now how to get a GLP1, you'll find a bunch of quick fixes.

It's not calibrate. It's not showing up to a coaching appointment live on Zoom. It's not committing to a one or two-year program. It's not committing to making long-term lifestyle change. But what we do is we say for the people who are ready to commit and who are focused on their health, let's do it. Let's go. And so a lot of our members have recently been diagnosed with diabetes or prediabetes. A lot of our members have recently had a health scare that makes them think that existentially it's very important for them to be back in control of their weight and their health.

When I think about who this could be for, and I hear you say that 10% number, it sort of feels like a lot of us are at the point where it would be beneficial to knock off that 10% now before it gets worse. And yet, it might not be until we have a pre-diabetes diagnosis, for example, that we're either motivated or our insurance will cover this intervention. Like, I wonder at what point in people's kind of journey should they come to calibrate. old question, right? Like, where do we invest in preventative care? Exactly. And if the cost of drugs was nothing, we could invest in preventative care a lot earlier. But because the cost of drugs is not nothing, and because the cost of delivering high quality care is not nothing, we have to figure out where is the right intervention point. And that is what we are doing in our payer business and what I find really exciting and interesting. And so our direct-to-consumer business says, take the FDA label.

The FDA label says anyone with a BMI of 27 plus, the VA has published, they believe that is about 70% of American adults. Fine. Go self-pay $1,500 a month for medication. I don't think it's a good idea. I don't think there's a total cost of care return there. And I don't think that ultimately you're going to be happy yo-yoing on and off of medications that are expensive, injectable, hard to find, hard to get, and a total pain. But if you look at a population with a BMI 35 plus, if you look at bariatric surgery diversion, if you look at pilots who need to fly on airplanes, if you look at truck drivers who need to have non-diabetic A1Cs, there are populations where this really matters and where the ROI is immediate. And so that's where we're starting on the enterprise business, really saying, who are the populations where this has an immediate ROI?

And then over time, let's expand that. because over time, the cost of the drugs will come down. Generics will enter the market. The cost of the drug will come down. But for right now, the cost of drugs is very high. And so it's really important that you think about the cost of calibrate, the cost of a service, whether it's calibrate or not, wrapping around plus the cost of the drugs and the ROI you get on that.

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and I'm interested in buying some newsletters right now. And buyers like me can browse the listings for free. And the platform, of course, is totally free for sellers. Sign up for a premium $390 a year access to all the deal info at try. dot microacquire.com slash twist. Once again, try. dot microacquire.com slash twist. And if you want to list your company, go to the same URL.

All right. Talk to me about the enterprise business. It sounds like. So let's go through the different business models that have existed. The DDC business still exists. It's my favorite business. It's my baby. We learn.

We get to lab. We get real feedback. I always joke, if your employer pays for something and you don't like it, you're just going to stop using it. If you pay for something and you don't like it, you're going to send me an email. So, and then how much does that cost?

Today, it costs about $135 a month for year one and about $50 a month for year two. And about 71% of people buy a year two product in the direct-to-consumer business today. Wow. On the enterprise business, we launched with our first client workday on October 1st. We have three other clients live now, and we have about a million lives going live

in 2022. So very, very exciting, really, really driven by the immediate need that employers are feeling around the cost of spend here, around the drug spend here, and the cost of care here. And what's really indicative of how broken the system is, is that because these drugs are, standard of care for type 2 diabetes, we want to make it easy for people to get them. And because of that, that means bad actors. Right. And get them. Right.

And so even if you don't have an obesity drug on your formulary, you just notice that all of a sudden, Optum published data on this in their Q3 earnings, you just notice that all of a sudden your drug spend on diabetes, drugs is up 36% year over year. Do you think the diabetes incidence is up 36% year over year? No. But you think patients are getting access because the pipes aren't smart. enough to stop them from getting access. And so what we sell to what we sell to employers is utilization management, who are the right people to get the right medications for the right amount

of time. And how do I make sure that that's what's happening to optimize your total cost of care and your ROI? Explain the bad actors to me a little bit more. You mean people are just wanting it to lose weight. But like it's just it's easy. Like a consumer goes to their primary care and says, I want to lose weight. The primary care says, okay, let's see if Wagovi is covered. Wagoe is not covered. Let's see if ozempic's covered. The pipes aren't smart enough to stop you from getting ozempic whether or not you have diabetes. Got it. I see. Okay. We would never do that. I want to be clear on the record that we would never do that.

But it is for sure happening in every doctor's office in America because why would it not? Doctors don't have, doctors can't see formulas. It's intentionally opaque. They can't see which drugs are covered and not covered. Right. But what's happening, we have done several interviews, by the way, on this, the pharmacy benefit manager thing and the, you know, how that all the pricing gets obscured and the coverage gets obscured on purpose. But so, but all the way back to the beginning, you mean people are walking into a doctor's office saying, I want, I am not pre-diabetic. I want to lose weight. I would like this drug. And the doctor's like, okay, if I can get it covered, I will. A billion views called OZempic weight loss journey on TikTok. Wow. OZempic's a diabetes drug. Right. But back to our prevention conversation, you can understand why people want to take it or they want to take, right? Like, is this where you- It's the same molecule from the same manufacturer in a different colored bottle.

I mean, how does this not make your business even more complicated, right? I'm sure you have people yelling at you saying, this is a lifestyle thing. This is, you know, how dare you say that my obesity is a bad thing? And then you have people who are just like, I don't want to work on them. Why would you deprive obesity patients of treatment? Right. Right. Who's to say that diabetes.

patients are more deserving of treatment than obesity patients. You asked this question a couple of minutes ago, like, where is the right place to invest in preventative care? And why is this even preventative care? These are real diseases that need to be treated. I was on a panel this week called wellness care. And I was like, let's, this is healthcare. This is healthcare. And I think it's a, it's a hard question and it's a hard social question. And because we live in this world in 2022, where everything has to be black or white and you have to be right or wrong and there's not room for nuance, it's a really hard conversation to have. And that's why I'm glad we have 20 minutes to talk about it. Because otherwise, I'd end up with some soundbite where I sound like an idiot.

We would never let that happen. And yet, someone would certainly find a way because it is really complicated. And while you have people who are walking into doctors offices and successfully getting prescriptions for this and, you know, whether they quote unquote need it or not, you also have I feel like I see Twitter threads pretty regularly from people who are like, I have struggled with weight all of my life. I cannot succeed at this. And I went and asked my doctor. And my doctor was like, you need to have more discipline. So I think you have like stigma. This is one of the most frustrating things to me about the healthcare system. Any change we make is at least 10 years from implementation, right? If landmark research comes out, which it did this summer. One of our advisors, Dari Mo Safarian at Tufts published research showing that for the

last 40 years, Americans' calorie consumption has stayed flat. Their calorie exertion, the amount of calories they use is actually increased, were more active than we were 40 years ago. At the same time, the obesity rate doubled. To me, this fairly conclusively proves that it's more complicated than calories in calories out. We have poisoned the food supply. We have poisoned our microbiomes. We are not processing food. We are not processing exercise. We are not processing sleep the way that we used to. Our hormones are not working the way that they used to. We are always in fight or flight. We are always, our adrenaline is always going. And we are always carrying ourselves with cortisol. And so all of these things mean we're dysregulated. And our bodies are not

working the way that they did 40 years ago. And so I think it's really, really important that we live with that reality and we think about where is the right place to invest and how do we prove that? And that's why the enterprise business is so exciting to me because you get to go say who are the populations who really need this. Yeah. Is there or will there be a version of Calibrate that's D2C without medication? Like, could I just do that to help? Probably. All of those things that you just mentioned that I relate to way too much. We've never ever been opposed to it. We've never been opposed to it. I think we believe that startups die from indigestion, not starvation, although maybe 2022 changes that a little bit. Stay on target. Stay on. Well, yeah. And so we're really focused on like one thing

and proving one thing and publishing results on one thing. But we get asked all the time, the biggest, um, the biggest group of people that we reject are people whose BMIs don't meet our criteria for prescribing. Um, and so I think, you know, we know that we know that we'll want a holistic program that addresses these four things. And ultimately, I hope we make it available. Yep. Um, but good for you because the road to unicorn is paved with focus. Um, Focus, focus, focus, focus. And relentless optimism. Yes.

That too. Well, yeah, when you, as you're starting to work with these enterprises, what have you learned in the short term? And how do you think you'll apply those learnings to, like, I don't know. I'm laughing, which is the number one thing I've learned is that like New York, Isabel doesn't really fly. We bring Midwest isabelle. Really? And we bring Southern Isabel. And we are active listeners. that's amazing.

But, you know, it's slow. And it is not the same. We put up our website on June 24th, 2020, and we launched some Google ads. And a woman in upstate New York beat my mom deciding up for Calibrate because she Googled meds for weight loss. She spent a few minutes on the site. And she took out a $1,500 firm loan to buy Calibrate. No one had ever done it before.

There weren't published results. there weren't five-star reviews. Like, there is just such a desperate need from the population of people like those Twitter threads who feel like they have tried everything and want to try the next thing. And because we always led with this results guarantee, people felt conviction from the beginning that they could believe that they would get outcomes from Calibrate. And so I think, you know, it is a wildly complicated market and everyone has a different story. When you're talking about 70 plus percent of the population, everyone has a different story. And we've

just started doing really good segmenting. We have five segments now of the people we're talking to. And they're all here for different reasons. They're all signing up for Calibrate for different reasons. And whether that's through their employer or direct, they're all thinking about it differently. What are the segments? Oh my gosh. I hope you didn't ask. Sorry, sorry. I just reviewed them for the first time last week. But the two that are most interesting are people who are like we just talked about, women in their 50s, women who have been through menopause and women who just want to be back in control of their health. I built this for my mom. This segment really, like really represents my mom for me.

This is someone who spent their whole life thinking about this and who wants to do it for their health now. The second is this skeptic, we call it. And this is a person who doesn't really think that the next thing's going to work, doesn't really think. that one thing is probably better than the next and really has to be convinced. And that's where the results guarantee really comes into play and saying testimonials really come into play, reviews really come into play, social proof referral. This year, the business, thank the heavens, has been able to really diversified from paid acquisition because of referral.

And so we spent the first year of the business really with Facebook, as most people were. and then Facebook broke. And we can't prospect there anymore. But what we can do is have members who have viral results share their experience with other members, or sorry, with people who aren't members, with friends and family members, with coworkers. And so for the first time ever, organic acquisition passed 50% of signups in August. It's continued to climb since. And organic is two thirds of that.

Sorry, referral is two thirds of that. Wow. how do you you don't have to give me all the segments um but i don't know the other three off the top of great perfect i'm letting you off the look now my cmo can do the next segment what happens so talk to me about a results guarantee like what does that look like in practicality because is it a money back guarantee or is it is you know yeah it's a money back guarantee it's a money back guarantee uh different states have different rules around how you call that yeah but it is a money back guarantee um and we basically say if you participated in the program, there's a calibrate commitment that you

sign up front. So if you showed up to 80% of your coaching, if you read 80% of your content, if you tracked your weight 80% of the time, and you took your medication as directed by your doctor, which might mean on, might mean off, and you don't lose 10% of your body weight will refund you. Yeah. Wow. Have you had to? I think you gave me this staff earlier, but, right? Yeah, a handful of times. Bodies are different. Everyone's different. And there's, there is no solution that works for everybody. But there are for sure solutions that work for the vast majority of people. And you also get to segment, right? Like within, we archetype within the program. And so we say, there are people who are really not responding to this food plan. Let's try another food plan.

There are people who are really not responding to this type of coaching. Let's try a different coach. We'll move people around the program and make sure that people are getting what they need. I want to ask you about equity because, of course, there are massive equity disparities in health. and in obesity rates, right? Let's start there before we even get to who can afford to pay for this and how do we help them there? This is the mission of the business. This is what matters. This is what drives the entire team. There is such a divide in this country between race and health outcomes. And it's unacceptable and socioeconomic indicators and health outcomes and social determinants of health and health outcomes. And all of these things are tied to it. obesity, in my opinion. And so I think about this a couple of ways. The first is that we used to think about obesity as wellpower. Obesity was about people who didn't try hard enough to eat well enough and to exercise enough. We now know that's not true. We just spend some time talking about that.

What we do know is that obesity is genetic. There are crazy studies following twins who were separated at birth. They end up at the exact same weight over time. It's hormonal. So you go through different hormonal changes and those hormonal changes can be driven by accidents, by grief or by menopause or life changes. Pregnancy is another huge one. We know that it's biologic and we know that it's physiologic. But we also know that it's environmental. And I want to really unpack the word environmental because I think it's really important. So I used to live in Hong Kong.

The air quality there is terrible. If I developed asthma when I live there, no one would have said lifestyle choice. Right. You moved to Hong Kong. You got asthma. You just need more discipline about your breathing. If you live in America and you work two jobs and you don't have affordable child care and you live in a food desert and you don't have access to affordable healthy food, how the heck are you going to have any outcome other than obesity? Right.

It's an environmental outcome. We are sedentary. We've become way more sedentary. We have jobs where we sit here and we don't move. We are going to develop obesity and mass. And so I think for me, there are a lot of ways you can address this. But the ultimate strategy of the business was prove that calibrate works, prove that calibrate and then use those two proof points to get payers to pay for calibrate.

And payers starts with employers because they move fastest of the slow moving payers. And then it moves to fully insured employers. And then it moves to the government. And the government is where you find Medicare and Medicaid patients who absolutely need calibrate. Obesity and diabetes rates skyrocket with Medicare. Obesity rates and diabetes rates, we've just learned are skyrocketing with teens, especially black teens. And this is unacceptable. We have to figure out the food supply. We have to figure out how to get people moving. We have to figure out how to get people access to affordable food. Food deserts are the largest problem that we are

facing here. And we have to work harder. And if we had another 20 minutes, I would spend it talking to you about how we were lied to about fat for the decade of the 90s and how it was all funded by big food and how we were taught that you remember the food pyramid from school yes I just get so furious about that the bottom was carbs literally the bottom was sugar exactly I just I honestly like I feel like I was weirdly lucky enough to date a bodybuilder in college in the 90s which is one I learned about a high protein high fat diet and I'm ever since and have been like, wait, we know this. Yeah.

And we still, and you know, we keep saying like we know this, but we do not know this. I literally still have friends who are like low fat drinking whatever, some zero fat milk product. Every restaurant I go to, I'm like, do you have any full fat milk or full fat yogurt? Like, I'm not interested in low fat milk and low fat yogurt. Mm-mm. And it's like I live in like rarefied circles. I'm traveling between New York and San Francisco most of the time, right?

Yeah. Imagine that you're living in a rural community where you are not able to find this food, where you are not able to find this food affordably. Like, this is the problem of our times. When you think about COVID and when you think about the morbidity and the mortality of COVID, outside of age, it was metabolic health. We have some of the worst metabolic health on the planet, even skinny people. We literally, the CDC just shared, seven out of eight Americans do not meet their definition for metabolic health. And if you want to understand how broken the system is, their definition for metabolic health means without medication, you have a healthy waist circumference, you have healthy cholesterol,

you have healthy blood sugar, you have healthy blood fat triglycerides, you have healthy blood pressure without medication. And so that means that seven out of eight Americans are taking a medication for one of those five things. Wow. Wow. Or they're not taking the medication and they're not, then they're not. and they would be qualified to take the medication.

Like, this is such a, it is such a sick care system. And we have got to spend time and money making it a health care system. But we have broken incentives because we have employers paying for health plans. And the average employee sticks around for less than two years. And so we have to figure out a credit-based system where you get credit for investing in preventative care, or we're all on the hook as Medicare payers. That we have talked to a lot of, I feel like I particularly, particularly I'm starting to specialize in startup founders focused on the healthcare space.

And I'm happy to see that there are so many. And every time I interview someone who's a CEO in the healthcare space, I uncover some new horror about how it works. And I wonder what is your, you have to be an optimist to be a startup founder full stop, but especially in the space that you're in. What is your level of optimism about all the arrows coming at this very, very well defended fortress? The thing I think is so powerful is the way that science has changed, is the way that these drugs have advanced to a place where we are talking about weight loss pretty similar to bariatric surgery. Drugs that got approved this year, a diabetes drug that got approved this year demonstrated 22.5% average weight loss. That's pretty close to bariatric surgery. Drugs in the FDA pipeline for approval are demonstrating 25, close to 30% weight loss.

And so if we have access to medications that do this and we can figure out how to package the total cost of care effectively and affordably, I believe we will be looking at a different situation in 10 or 20 years. But I believe that people need to start thinking now about how to solve these problems and people need to start getting incentivized now. And the interesting thing is people love that staff, that consumers stay or employees stay on health plans for 1.9 years. But the interesting thing I've learned as I've gone and talked to employers is that for sure, if you work at a large retailer, your average tenure is six months. But if you stay there for a year, you stay there for 10 years. If you work at a huge industrial company, if you stay there for two years, you stay there until you die. Like, they know who in their population, they're responsible for taking care of. And what's really interesting is when I'm talking to those benefits,

managers for the first time they are talking about social determinants of health in the household. And they're asking questions like, why do we define dependence as kids? Why don't we define dependence as grandparents? They're the ones grocery shopping. They're the ones taking care of kids. They're the ones making food. Why don't we take care of that group of people? Isabel, this is amazing. Isabel Kenyon is the founder and CEO of Calibrate. And I feel like we're going to be hearing a lot more from you. Thank you. It was so nice to talk to, Molly. Congrats on what you've built and here's to unicorn status. First inning, so we got a long way to go.

All right, everybody, thank you for listening to today's Healthcare with Molly Wood episode of this weekend startups. Tomorrow, you are not going to want to miss it. We got a great interview. Jason's talking to our favorite CEO, Glenn Kelman, a redfin about the state of the housing market and whatever those two boys get up to. I'm sure it's going to be amazing. Stick with us and see you then.