Raising $17M for the Uber of Medical Scans

It's an interesting viewpoint. I'd say a scan should not have a price variance of an order of magnitude. But at the same time, there are quality differences: the quality of the machine, the quality of the radiologist reading that scan, the experience of that radiologist, and just how nice the facilities are — some patients want to pay a premium for that kind of setting. So there are barriers to quality, although I'd agree with you it's maybe not as vast as some prices suggest.

For us, we don't want to create a complete race to the bottom, because that's not sustainable. If it does happen, the classic constraints pop up like they have in the UK — there's not a huge incentive for private providers to appear, because NHS reimbursements are just so low. But in my mind, I'm a free marketer. I think there should be competition, to a very large extent. Why should healthcare be immune to price competition?

I haven't seen it — can you expand on it?

Yeah — that's kind of what our whole business is about, right? Increasing access by building a really delightful experience, one that creates the least anxiety possible for what is normally a very high-anxiety period: you've been told you need to go and get a diagnostic test.

We use a similar framework internally with our product team. It's not necessarily the 11-star experience, but it's a more Amazonian way of thinking — working backwards from the press release you dream of putting out about what your product does. And you're right, the basics matter. Scheduling: you should be able to book from your phone or the web without having to call anyone or sit in a waiting line on the phone. That's number one for us.

We have three pillars. The dream experience is, number one, you can schedule your test without ever having to speak to anyone — 95-plus percent of healthcare providers in the imaging space in the US still make you phone up. Second, price transparency: you should be able to compare prices across all imaging providers and all modalities from your phone or computer.

And third, you should not have to be given a CD or any physical hardware to carry your results around. The vast majority of imaging centres in the US and the UK are still using CDs as a storage modality. So those are the three basics.

But where I really see the space going is using technology to enhance the quality of the patient result. Right now we're the only company in the UK that offers a report that's actually patient-friendly — meaning you don't have to be a clinician to understand the findings. We use natural language processing, via a company called Scanslated, to take those clinical findings and make them readable by patients. To us, that's a five-star experience: the patient doesn't have to sit in that period of anxiety between getting the report and going back to a doctor to understand what it really means.

Going a bit further into the future — I'm sure you've seen all the different AI startups getting funded, Musty, specifically in the radiology space. There are billions of dollars of capital being put to work there. What all those AI companies are essentially trying to do is look at those images and generate some kind of impression without a radiologist necessarily being present. And all of those AI companies will really struggle for distribution. It is so hard to go imaging centre by imaging centre trying to sell your specific point solution — we've been there and done that.

The way we've used Scan.com is that we can be that single layer of infrastructure. All those different companies in the AI radiology space can partner with us, and any images flowing through the Scan.com system — put there by a doctor or a patient — we can apply that technology to. That elevates the Scan.com experience beyond just going directly to the imaging provider.

Correct. Exactly. We really see ourselves not just as the booking platform, to use your earlier analogy, but as the infrastructure layer through which every single scan is booked — and the distribution channel partner to what is the future of radiology, which is AI.

A few hundred dollars. Including the health system costs, probably closer to a thousand.

Well, you're not too far off our current experience, apart from the Rolls-Royce. We actually do provide transport in the US — via the Uber API. We're the only company that does that in the imaging space; we literally have Uber integration. And we provide follow-on care. You get access to the provider, because to order imaging — specifically advanced imaging — the vast majority of centres require a referral note, and we provide the doctor to write that for you if your symptoms warrant it.

So the vast majority of what you described we already do, apart from the AI to speed up the images — that technology is coming out, but that would be the imaging centre restoring that, not us. What I find interesting about what you're saying is that yes, we provide instant access to your doctor to speak through the results. But actually, the vast majority of imaging requests are made by the referring provider — your family doctor or primary care practitioner. One of the big value propositions we're exploring is making the radiologist who read the results available to speak with the doctor who requested the images, because there's often uncertainty about what some of those results mean.

Currently that infrastructure just doesn't exist. You get a PDF with the radiologist's name at the top — you could probably find their email — but no doctor does it, because it's a complete hassle. We're looking to make that possible through our system. But the vast majority of what you described is how we do it today.

Well, that means we're doing a great job, because it looks like a smooth experience on the face of it. The same argument could be used for Uber, for Airbnb, for hotels.com — you just go and get the supply, put up a website, and it all works, right? Maybe get some VC money to advertise it.

What is super hard, and has taken us years, is the infrastructure side. We integrate with all the different PACS and RIS — radiology information systems — of every imaging centre we work with. That facilitates all the live scheduling, so when you go on the website you can book a live time and date at that specific centre. And once you've done the scan, typically before you've even left the centre, your results are available in the Scan.com portal for you or your physician to view. All that underlying infrastructure is super hard, super time-consuming and super expensive to build.

So the consumer brand or website you see is just the tip of the iceberg. You'll see a couple of copycat sites in the UK that are just the tip of the iceberg. The reason they aren't as successful is that, in my opinion, most aggregator or platform businesses are winner-take-all. There's only one Uber, there's only one Airbnb, there's only really a couple of hotel booking sites. That's why we've been lucky enough to raise from some of the best VC funds in the space — because they recognise that model.

Well, I'll actually challenge you on that. One of my biggest lessons in consumer is: don't just do consumer. Over 50% of our volume is actually what we call B2B2C — physicians, doctors and clinicians using our system to order or request imaging for their patients. Then there's a long tail: clinical-trial companies using our software to order imaging for their enrollees, and very large personal-injury law firms ordering imaging for clients in a litigation process. So the vast majority of our revenue is not consumer. Consumer is difficult, especially in a space where repeat rates are low — by virtue of it being a diagnostic scan, you're not going to need them on a regular cadence, hopefully.

That said — and this is specific to healthcare — you need to think about how you increase repeat rates, because repeat rates are what drive a sustaining business. For us, that was moving into the physician-led space, but also thinking about screening and preventative care. In the next couple of weeks we're launching our mammogram product for women over 40 in the UK who want to order one privately, then moving down through all the different screening processes over the coming months. So one of my lessons is: think about repeat rates. And in healthcare they're really hard, so you've got to think carefully about them, because consumer can get super expensive.

To get back to your earlier point about raising loads of VC money — the easy thing for a competitor to do is go and buy a load of Google and Facebook ads. We don't want our business to rely on that as a channel. And second, think about the patient and the scenario they're in. Typically when they approach a business like ours, they're in a moment of extreme high anxiety. So making the whole experience as smooth, easy and frictionless as possible — back to that five-star point — is what we've done. Hopefully you'll see from our website that we're the easiest and most compassionate way to order imaging in the markets we operate in.

We could talk about this for hours — I've spent a lot of time thinking about it. The answers differ drastically between the UK and the US, the two geographies we operate in.

In the UK, 90-plus percent of diagnostic imaging volume is in the NHS, and the NHS is struggling to keep up with demand. So there's a huge opportunity to partner with the NHS to help manage their waiting times. Over 20% of patients in the UK are waiting more than six weeks for an MRI, but we know there are thousands of spare slots a week in the private sector. It's not a capacity problem — it's a logistics problem, a matching problem. The way the current NHS frameworks are set up just doesn't facilitate real-time matching of excess demand to excess supply. It's a technical proposition, and we're coming at it from a software-provider perspective, as opposed to the typical NHS framework where private providers bid for contracts. So it's a long game, and we're getting close.

Second, two of the big five healthcare insurance groups in the UK are investors of ours — Aviva and Simplyhealth — and they have increasing market share because of the shift from socialised to private medicine. Those who are willing or able to pay are going and getting private medical insurance. So instead of you going to your doctor and having to phone round hospitals to find who's in-network and what times they have available, you just log into Scan.com and book it yourself. If you're a Simplyhealth customer and you call up saying you need an MRI, they'll tell you: go to Scan.com, that's where you book it. So we're really excited on that front. Then there's the consumerised stuff, and the personal-injury law-firm piece on the smaller side, and a handful of clinical trials.

On the US side, we're very concentrated right now on the personal-injury side, and the self-pay side for under- or uninsured patients. But the big long-term volume in the US is on the commercial pay — health insurance — side.

It's obvious, and it's probably underexplored by us right now. Quite frankly, we're treading a bit carefully because of the ethical incentives around referring to a partner you've got a better financial outcome from. We have agreements in place, but most of them aren't monetised right now. It's something we should probably explore a bit more.

Well, it wasn't $16 million. We don't disclose the cost, but it wasn't 16, I can tell you that. The history is that it was owned by an incubator in Los Angeles that had been sitting on the domain for about as long as I've been alive and had done nothing with it. They tried to use it for a scanning iOS app when iOS was first released, but that got commoditised quickly. They just really believed in what we were doing.

What does Scan.com mean? It shows the magnitude of what we're trying to achieve. We want to become the place, the website, where — whether you're a patient or a doctor — you order your imaging. It's the obvious choice. You couldn't pick a better name. If you're building that single interface for ordering imaging for both patients and providers, you have to have a name that represents that level of ambition.

From a commercial perspective, you're bang on. We chose it because when a doctor said "go to Scan.com," the patient wouldn't forget where to go. The way our business grows is with physicians and clinicians as our biggest ambassadors and distribution channel, so we needed the patient to remember where the doctor told them to go.

Then there are tangential benefits. When you type "scan.com" into Chrome, it goes straight to our website — you're not paying Google a couple of quid each time to bid for that click on your own name. Most companies don't have that luxury. And an increasing portion of our traffic is direct, which is great commercially.

Thank you. You're right — I get a message every week or two on LinkedIn and email saying "can we buy your domain for a thousand bucks?" and I'm like, no, you cannot. Great quote from Taleb there. For us, we walk into a doctor's practice — we've got three or four salespeople on the ground now, in the US, in Atlanta — with their Scan.com shirt on, and the doctors are like, "ah, what's Scan.com? How do I not already know about this?" So I agree with you.

It's tough — it really is. In our space, we're a supply-constrained marketplace, so we need the capacity on the imaging-centre side for patients and doctors to come. If a patient or doctor lands on our website once and doesn't see any capacity for the next few days, they're probably not coming back — they'll go elsewhere.

So we solved for that first, and we were upfront with the imaging centres we'd work with. We said: you're not going to lose anything by joining our network. It's important to note our model is transactional — imaging centres only get charged when we generate them more volume. So we said, join us, we'll pay for the integration ourselves. That's another big learning: at the front, any marketplace-style business has to subsidise one side to get the initial flywheel spinning. So we subsidised the supply side by essentially paying for it — doing the integration ourselves and fronting the money. We were honest: it'll be a few months until our consumer website and physician portal are up and running, so please bear with us.

That's why the vast majority of successful marketplace businesses are typically VC-funded — you have to front some cash to get the flywheel spinning.

Second, to solve the cold-start problem, we took a lesson from the UK. We launched nationally there, which was a real slog, because we had so many dark spots with no coverage. That made it really tricky to get payers and national providers on board. So we did the opposite in the US. We launched the US market in February this year, and it's grown incredibly fast — five times faster than our UK business was at the same point. The reason is that we went super deep and super narrow: just a 25-to-30-square-mile radius of Atlanta, in Georgia. We have pretty much every outpatient imaging centre integrated into our network there. So when we went out getting referring providers, they had every single imaging centre they were used to dealing with, but in one place.

I highly recommend that approach for any marketplace business setting up. It's also way less expensive to test your hypotheses, because you're in a much smaller area — especially in the US, which is a ginormous country. Focusing on one area and getting it right makes a big difference, and your feedback loop is so much shorter.

Really good observation. My pushback, when an imaging centre group tells me that, is: okay, well, you've got your own page on Scan.com — you prove that value to your patient. Just like a hotel: an 800-pound-a-night hotel versus a 200-pound one proves its value by having a great, enticing profile, and number two, amazing reviews. That's why I loved your interview with Stephanie recently, all about empowering patients to leave great feedback. That's what we're about too — the patient should be doing the marketing for you if you're that great. So that's my pushback.

Second, our timing was extremely fortunate in the US — and this was in no way pre-planned. On July 1st last year, 2022, there was a price transparency act passed by Congress that forced all the health insurance companies to disclose their negotiated rates with healthcare providers. So that data is publicly available — typically in seven-gigabyte CSV files that you'd need a supercomputer to read, but it's available. Because of that, we don't necessarily need to go and ask imaging centres for their negotiated rates; we can pull them ourselves.

So I agree — two years ago this model wouldn't really have been viable, because you're correct: it's basic game theory. Why would imaging groups disclose their pricing if they'd then have to compete on price?

Good question. I think that's right — I often see people trying to raise venture capital on a PowerPoint with untested hypotheses, and building some kind of waiting list is a great way to test your hypothesis. It definitely wouldn't work in imaging, because what everyone's trying to do is not be on a waiting list — but that's actually where most of my customers come from. In most other verticals, though, I completely agree that'd be the way to do it.

Another tip: really make sure that if you want to raise money, the market you're entering and the business you're proposing actually warrants venture capital. There are so many businesses out there that don't actually need venture money, and if they were a little more patient, they wouldn't have to give away half their business — or more — over time to grow. If you're raising from a $500 million fund, to make that investment work your business needs to be worth more than $500 million, and the vast majority of businesses aren't going to get there. So be really thoughtful about raising. And as you said — if you want to create a copycat website and do something like that, you don't need to raise any money; you just need a few hundred quid to spend on ads.

Yeah — and these are mindsets we really try to instil in everyone, and look for in the people we hire. Our number one value when hiring is grit. You need it more than in most other industries. In healthcare you really need grit, because — as you mentioned — people in healthcare do not like change. You have to ask a lot, be prepared to hear no a lot, and then explain again why your solution is better. That requires a huge amount of willpower, and probably something a little bit wrong with you, in that you're not content with the status quo, you've got a chip on your shoulder, and you're looking to prove yourself.

I'm a big fan of Frank Slootman, the CEO of Snowflake and previously CEO of Data Domain — that's exactly what he preaches: look for people who've got a chip on their shoulder and something to prove. That's realistically me, and it's what's allowed me to get where we are.

Secondly, and closely related, is curiosity. I knew nothing about the imaging space, or really the healthcare space, a few years ago. But I was really curious to understand how things worked, and why they didn't work as I thought they should when we launched the company in 2021. My parents launched a motorcycle business — neither of them had ever ridden a motorcycle — and my granddad had a business in the computer space while working in a post office, knowing nothing about computers. So I probably got that level of confidence around attacking problems you don't know anything about.

For me, lack of domain expertise is a superpower, if you possess the right level of curiosity. It's so much easier when you go into a meeting in question-asking mode rather than sales mode — genuine question-asking mode, really wanting to understand how things work and how they can be made better. You have longer, more insightful conversations, and people's guard goes down. That's what worked so well for us in the US. I asked our referring providers, doctors and imaging centres: how does this work? What's different to the UK? And if you look at our US product, it's not like we copied and pasted Scan.com from the UK — we started with zero lines of code and built everything from scratch, because we were super curious about how things worked and realised we couldn't just transpose a solution from one to the other.

I don't have much more time at the moment, but one clear area for me — even if there's a time in my life when I'm not working on Scan.com, or if I was talking with a new founder — is the geriatric space. Naturally the population is getting older, everyone knows that. I think you had Ben on, from Cera? And I'm friends with someone who runs a business called Lottie. Both are in the care-navigation space for people seeking care homes and retirement homes, and that's just such an obvious space that needs digitising.

If you look at the UK and the US, net migration is going down — that's the populism piece right now, that migration needs to reduce. But at the same time the supply of the nursing population in the geriatric space is decreasing. So how can we bring technology to cope with the obvious excess demand? I read a statistic recently that 10,000 people every single day in the US are turning 60. That's the industry I'd look at. It's not an idea, but it's a problem space I find fascinating.

Then, secondly — you've probably read the Andreessen piece about the trillion-dollar super app. That, to me, is a bit of a pipe dream. But what I think genuinely could be a hundred-billion-dollar company, in the UK or the US, is a new health insurance provider. You've got Bupa, Aviva, Simplyhealth, AXA, Vitality in the UK — they're great, and we're partnered with a lot of them — but there needs to be an innovative new player coming to market to compete. It's super hard, as you'd see in the US with the demise of some of the Oscars of the world — I don't think they executed properly. But I'm actually meeting Amit, the founder of Peachy, tonight for drinks. I'm fascinated by what he's doing, trying to innovate in the health insurance space. And in the UK, as we move — fortunately or unfortunately, depending on your opinion — towards this more state/private split, there'll be enough demand for another large health insurer.