Radhika Saxena
As healthcare became increasingly equated with super-speciality hospitals, we wrote the requiem for the friendly family physician. Alas, the general practitioner (GP) was someone who knew our medical history, who listened to us, answered all our questions and who developed a personal relationship with the family over time. In the process, we received good medical treatment and care from a physician who cared enough to put patients before profit.
Dr Santanu Chattopadhyay is trying to revive this old practice with his Bangalore-based start-up, NationWide - The Family Doctors, a chain of medical clinics specialising in primary healthcare. Well, conventional wisdom still seems to work, as the start-up is receiving encouraging results.
Chattopadhyay, who founded the venture in March 2010 with an old friend Dr Shantanu Rahman, says, "Eighty per cent of ailments can be managed by a good general practitioner. Only 20 per cent patients actually need to visit a hospital."
But with specialists making big bucks and an increased government focus on tertiary care education, Chattopadhyay may find recruiting good doctors tough. His research revealed that only 1 of every 100 Indian medical students wants to become a GP. However, Chattopadhyay says he is confident of overcoming this challenge.
How It All Started
Chattopadhyay hit upon the idea in 2002, when he was practising as a gastroenterologist in the UK. Before he started his venture, he made sure he did his homework. He acquired an MBA degree from INSEAD, France, and then worked in the marketing domain with Johnson & Johnson, UK.
Back in India in 2007, he worked with Indegene Lifesystems, to get a feel of the start-up ecosystem. Chattopadhyay launched NationWide three years later but he and Dr Rahman spent more than a year researching different business models before they decided on the high-street clinic model. Their first clinic opened in Whitefield, Bangalore, in April 2011.
Patient Feedback Is Important
NationWide pays its doctors a fixed, full-time salary. In addition, there's an incentive programme which, uniquely in India, is based purely on outcomes and patient feedback rather than the number of procedures the doctor performs. "We tell our doctors they won't get more money if they prescribe another test just to get the patient to return to NationWide. To qualify for incentives, all our GPs require is high-performance scores." He adds that their doctors spend an average 15 minutes with each patient and see only 30 patients a day to avoid fatigue.
The venture has developed a multi-pronged programme to attract doctors, which includes mini-educational conferences, where they identify possible recruits. The incentive of career growth, training and a predictable salary also works as incentives. Doctors applying to NationWide are tested thoroughly on knowledge, consultation and communication skills, and they have to acquire a minimum score to pass muster.
Business Model
NationWide has 7 clinics in Bangalore that work as hubs, and 14 satellite clinics or 'spokes' that operate from corporate offices or residential complexes. Revenue streams include walk-in and subscription-based patients, with a consultation charge of Rs 200-250 for general consultations, gynaecology and paediatric care. The subscription model also starts at Rs 250 and offers a certain number of free consultations, discounts on rack rates and at partner hospitals, 24-hour access to a hotline and electronically maintained medical records. Soon, pharmacies will add to the pie.
Chattopadhyay claims 50,000 patients have consulted NationWide so far, and across clinics, they see between 100-150 patients daily. Staying away from traditional markets, the start-up targets the young, white-collar migrant population - someone who is educated, appreciates a doctor's attention, is information-hungry and belongs to mobile India. Referral tie-ups with major hospitals get NationWide's patients a 10-30 per cent discount at these facilities.
The start-up's team has grown to over 100 people including 20 full-time GPs, 17 consulting specialists as well as finance, marketing, technology, operations and housekeeping.
A huge set-up cost means every clinic takes a minimum 18 months to break even. NationWide's Whitefield clinic opened 2 years ago and is now clocking profits of about Rs 1.5 lakh a month. However, the Indiranagar clinic that started at around the same time is not yet in the green.
"It works like typical retail and is a function of picking the right location and the right target group," reveals Chattopadhyay, who says that opening the Indiranagar clinic in a back street meant no visibility and hence no patients. "We learnt that mere quality service doesn't work. Staying top of the mind is critical, which makes location supreme."
Initial Funding And Scalability
The cost of setting up a medical clinic is huge. But $1.2 million in two rounds of angel funding from Silicon Valley investors in May and December 2010 helped NationWide set up its first two clinics in Bangalore in April 2011 and a third in October the same year.
Once he was sure the model was scalable, Chattopadhyay approached venture capitalists to expand to other cities. In September 2012, Norwest Venture Partners came on board with Rs 25 crore.
Growth And Marketing
NationWide conducts marketing activities locally and globally. While local marketing activities are restricted to areas surrounding clinics, like visiting residential complexes and using newspaper inserts, global marketing includes social media like Facebook.
The start-up is also launching an information portal, where people can access quality information and post medical queries that their own doctors will answer - a free service that is also a clever marketing tool.
Replacing super-specialty medicine with conventional wisdom is not easy but NationWide has made a start!
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