Pivoting Early: Finding Success By Listening to Your Customers w/ Munjal Shah

ABOUT THIS EPISODE

Some entrepreneurs wait too long to pivot their business to more fertile ground. Not Munjal Shah, CEO and Co-founder at Health IQ.

In all of his ventures, he has found immense value in avoiding a narrow, locked-in view of his business. And in this episode, he talks about the importance of pivoting early if the data points towards a more sustainable business.

What we talked about:

  • Early startup successes with Like.com and Andale
  • The power of pivoting early
  • Finding a mission in life with Health IQ

This discussion with Munjal Shah was taken from our show Startup Success. If you want to hear more episodes like this one, check us out on Apple Podcasts.

If you don’t use Apple Podcasts, you can find every episode here.

Listening on a desktop & can’t see the links? Just search for Startup Success in your favorite podcast player.

Welcome to start up success, thepodcast for startup founders and investors here you'll find stories ofsuccess from others in the trenches as they work to scale some of the fastestgrowing startups in the world stories that will help you in your own journeystart up. Success starts now welcome to start up success. Today wehave a very respected and admired start up entrepreneur and found her with ustoday on the show, a Jalla and we're so excited you're. Here welcome and thankyou thank you for having me, so I know your wealth with health. I Q, you foundit it a while ago and I really want to get into that and what health I Q is upto. But first I want to talk a little bit about some of your past successbecause we have so many start up founders in our community that that'stheir dream right, so the purchase by Google, the other purchase. So if youwant to, could you just share a little bit about what kind of has happened inyour past and if I could ask you some questions about it? That would be greatsure yeah. So I started my first company, I one thousand nine hundredand ninety nine. It was called Andelys and we made selling faster on marketplaces like e Bay and Amazon market place at the time and started that company. When I wastwenty six years old, we sold it in about five years later in two thousandand four was a bit of a complicated exit. But eventually it got brought byAli Baba and you know learned: a ton went through good times bad times. Youknow two thousand two thousand and one in the Internet. Space was not an easytime, and so we went through all that and then eventually kind of made it outtogether, side and then started my second company in two thousand and five,which eventually became called Licomi, and this was a visual search engine. Sowe used computer vision to search inside of photographs looking at thecolor shape and pattern realized, it was a great technology to apply forshopping for aesthetic items like hand, bags and shoes and jewelry and turn itinto a shopping engine that we sold to Google. In two thousand and ten- and itwas like, I think, gooles ten largest acquisition at the time that they haddone by dollars, and so you know those are my kind of first twoentrepreneurial experiences and then, after a brief time and Google, I endedup starting my third, which is health like you, and so each of them has kindof a different flavor and I'm happy to kind of take it through them. But it's you know I kind of always knew I wouldbe an entrepreneur, but it s. You know it's not been basically about twentyyears now do start up another. It's incredible, and I remember readingabout like Com at the time and what struck me was how you switched gears,how you changed, because that's not what the technology was originallydeveloped for right, that's exactly right! Yeah! You know Iwas saying I'm more interested in being successful than being right and- andthat is the foundational belief you...

...have to have- I think, to be a greatentrepreneur, which is that you know we all have a theory of what our companyis going to be or what the products going to be, and sometimes you're rightand it works and sometimes you're not and in the case of LICO. We started outwith this idea. Okay, look: There's technology, we can bring the concertinside of photographs and lots of people had just gotten digital camerasat the time. This is, if you remember, a kind of two thousand five, twothousand and six and people are starting to take them, and cell phonecameras were starting to get decent, and so I said you know what a great idea tosearch inside of photographs, but our first thought was: Oh, we searched forfaces and do face recognition and use it to organize your personal photos andwe launched a service called Ria and we thought Oh, this is great and peopleloved it. I mean. I remember tech crunch wrote the really glowing reviewon it. We actually did a launch party and Michael Arrington Back Yard, and wewere like the fifth article ever written on Tech Ranch, and I mean itwas like this whole thing where we suddenly emerged and then we looked atthe data and it was like people would use it and upod their photos andorganize it and then they've never come back. It was like, Oh and, and it was thebrink data it was, and people like this is the greatest thing and everybody'stalking about it and the blokes fear just thought we were the you know: catsme out and and then I said you know, we've got to change this and I rememberit was very hard because everybody was like people think this is great like.Why are we changing it? But but again the data said we needed to change and everybody pivots their company. It'sjust that most people pivot when they're down to like no money left andthen it's too late to pay. Has Your right right, like I, like everybody,Vivit, don't get me wrong. That's not the unique part, it's privity Orly,that's the unique part, and I think that what that was the realizationwhich was you know, this isn't working, lets, apply it and then actually one ofour users said it. They said you know why? Don't you apply this to shoppingbecause I searched the internet all the time and I'd love to up load, aphotograph of something and then have you find me things that look similar,that I can buy and that's where we thence at all. Let's take the sametechnology but apply it to shopping and we said: Well, you don't need it toshop for a computer, you just type in the serial number you're looking foryou need it for something. That's aesthetic that's hard to describe, andyou know linguistically hard to describe and that's where we stumbledupon the idea of a shopping search engine for fashion, using thistechnology and then that took off and and then of course, Google thought itwould be a great technology to add to the little shopping and I'm kind of therest o the rest of that history. So you know even even health, like you, westarted out as a quiz we actually had. The original idea was a fico score forhealth, using blood tests to calculate score, and then we're like like this is a Goin to work and weended up building the health I q test...

...and then lots of people took it, but itstill wasn't a business. It was just a test right and then we pivoted that to doing it for life insurance andrealizing. Oh, if you can pass the health like you test, your healthconscious and you probably have a lower risk, and so we turned it into a lifeinsurance company and then more recently have now realized thatactually health, conscious people, you know W H, which we knew, but we justcouldn't figure out how to do it. We built the same thing for medicareinsurance, something called Medicare supplement and we do the same thing forauto insurance because it turns out most seniors are dimensions, actuallythe major cause of senior accidents, and if your health, conscious, you haveless dimensio because you know so one of the things I found is you justkeep moving until you find water and even if you find water, if you can findeven better water, bigger body of water, you move to that and you just can never get locked in. You know in terms of being so focusedthat this is the idea the market wants. Like I used to tell people, I said: Ifan investor tells you it's not a good idea, it doesn't matter O, they don't listen to it becauseInvest Ou, know, you'll get all kinds of opinions and if you just blow withthe wind like you'll, just be a plastic bag in the way and like this is goingto work but the. But if a customer tells you then or ifenough customers to tell you, then you do need to change and I think that'sthat's the divining Rod. I've always used that. I mean I'm glad we'rerecording this, because this is like the best advice. There's so many thingsyou said in there that are like nuggets. You know first, don't pivot when you'reout of cash, but earlier on the data- and you talked about the data and youjust said what customers say is that kind of the primary data that has ledyou on these successful pivots yeah I mean customers say or just you know, inthe pivot, to life insurance. A lot of it was regulatory for how I you likeweed to understand. Where could you make a different price? Because not inall you know it's not all insurances, where you're allowed to price differentlay. So sometimes it's it's pivoting to where the customers say. Sometimes thecustomers. Always you know, health conscious people, always bon a lowerprice m. it's just that in some product lines you're allowed to by lot to do itand some you're not so so, there's different reasons to pick differentthings, but in general you know. I think that you always want to find the mostfertile ground to put your business in. I think so many of US choose a businesssector that you know or you came from or your last job was in, but you knowit's like. There are some places where the land is just desert and no matterhow hard you work in nothing's going to grow. There's some places where all of thesoil is is like. I don't you know, there's something called in the Lubianolike the top. Soil is like six teeth, yes and I guess a lot of Argentinasthat way, which is why the grass is so great and the beef is so good everright. Someone was just explaining this...

...to me. Yes, well yeah, so actuallyvalley is actually an Alluvian plane by the way, which is I used to be all orchards here,but the but none the less. The you know youwant to find, like the really fertile oven want to find the alluvian playingwith extra miracle grow. It that's what happened to Pelton ifyou think about it, Ye I hate replaying and then somebody portmore grow in thebusiness. Just exploded. Yes, and I think that's what I would say he lookfor, but that being said, how did you get into health then? Based on yourbackground, so yeah? I knew nothing about insuranceand you know about intact, and I need nothing about health care.Unfortunately, you know that's the other part of everybody always says youknow, find your mission in life. I'd actually say. Sometimes your missionjust finds you, and so in fact, that might be the best way to find yourmission is just keep your eyes open. What so o we sold the company to Googleit closed on a Friday in August. I think it literally was August twentieth.I want to say- and I remember that day I burned in my memory and August twentyfine- I was running a tenk race and you know I had run in high school like Iwas a cross country, runner and and track athlete, but you know I hadgained a lot of weight over the years and I still ran, but I wasn't reallyrunning very fast and I ended up with chess paines and ended up in the ER, soI was thirty seven at the time my father had his first heart attack inhis mids. It didn't end up being a heart attack, although it was something significant and I just said: okay, Iguess you know this. Is My wakeup calling anyou know as an entrepreneur. I still remember the first thought I had when Iwas having those chest pains in the middle of that run. As somebody askedme they're like, were you scared, I'm like? Actually I was more mad and he'slike Wat mean- and I was like it just worked this whole ten years finally gotinto this financial goal. I had had as a reprenn and this a symbolic all yousoldier, company, Google, like in Silicon Valley, that's this form ofunited, graduation and and then I'm like and I'm gonna die. I'm like thisis not fair, Oh yeah, I and good point, and so that was thefirst thought that went through my head, which is maybe a little unique, socanal thought, but the ER state all. But you know I both for decade yeah and so then I changed my diet. Ichanged my exercise. I lost thirty pounds which an I'm only five, six ofthirty pounds on me was actually a lot and just you know, learn to ton. I endup taking some classes at the school of Medicine and Stamford and Androchronology and some other areas, and just I loved it. I just found it sointeresting in I I remember thinking God had I found kind of this healthscience before maybe I would have done that instead of become a computerscientist, because I just found it so interesting and in yeah and then I just and then I saidall right, I m going to build another...

...company, it's going to be around healthand the last part was. It gave me a bit of a philosophy that health I Q isbuilt on to which was I remember when I was unhealthy. People would tell me torun and exercise and lose weight. You Know My mother would tell me my wifewould tell me what I joined the Club T. everybody told mehim, but it never. It didn't make me feel better and wanting to do thosethings more. It just kind of honestly made me feel bad about myself and I waslike this is not motivating, and then you know so so I realized a person justhas to flip that switch themselves and second, what you can use as anaspirational. Positive Metaphor: Ta to you know in cent them to do it andthat's what we do it. I was like you right. We give super rates for peoplewho are health, conscious of we give Mo financial incentive, but I just thoughtwe got to use this positive stuff. We can't shame them into taking care oftheir health or shaming them into that. It just doesn't work and it's not rightand it's just not effective, and so so that was that was kind of what got mein the health and and that I mean I didn't. I tried everything. I triedevery diet, different ones. I tried intermit and fasting and I tried everyworkout type. I got a zillion different medical tests just for out of interestand curiosity in many cases and just immerse myself in kind of a whole newsector and they're so different. So then was the thought. The quiz wouldinspire people other people to get better like you did with that. So then,then the idea was okay, we all realized. You know. Health was two parts. It'sthe cards you've dealt with and and which you can't really control, and youknow, obviously I didn't get very good cards, but it's also how you play thecards which you can control, and I thought okay, if we're going to priceinsurance, we kind of don't want to price it on the first part, becausethat's not in your control and that's kind of not fair, but you, but it isokay to price it on the second part, but there's no measure of that m likethere's no tool that tells you, you know how much responsibility you'vetaken for your health, and so we realized actually deep health.Knowledge is a reasonable proxy for how much responsibility you've taken,because you don't just bump into that knowledge have to kind of acquired, ithad to become a hobby, and so we built the health like cutest to measure thatpart and it turned out to be a really useful tool to kind of assessing riskand assessing just personal responsibility. I would tell peoplelike in the end really what helps like you does. It separates out two groupsof people, the group that say yes, it's my life and my health, and I want toyou know, try to make it better and I'm going to do what I can. The people thatare like God will give me what God will give meright right, that's the deserve, so you know. I think I think there is a this.is a business built around kind of that that philosophy, that's great and nowyou've delved into you were saying, dimensio with seniors and some otherareas yeah. You know health is one of these things that affects so manythingsa right now and one of the things...

...you know, it's obvious why if you'rehealth conscious you'll, probably end up being lower risk for life insuranceand lower risk for health insurance? Like I don't you know, most people getthat right, but when it went came to auto insurance, everybody was like whatI I get it, but you know so you're heath, conscious you're, not a betterdriver. Like you know what is that turns out the most? Do you look ataccidents for a hundred million miles driven? There are more act than sixtyfive plus than all the other ages put together, really yeah. You think sixteen year olds of therisks gonates, I would think now I have a sixteen year old son to and adriving. I will tell you yeah, I think the car we gave him has thisautomatic feature on my phone, where I can set the maximums feed? Oh yes, yes,I know that appeale they got their kids out of this future yeah yeah he's likeno. I want this other car. I know that doesn't have that, so he, but you think, sixteen years ofrisk, but it's really. It's really seniors with. What's called MC, Imoutonne impairment, which is early dementia and that are actually most ofthe fatalities in the senior market and othe accident, and so and you think,you're right all right, but dimension is genetic and is nothing you can doabout. It actually turns out. If you live a healthy lifestyle, you can cutyour genetic, your dimension risk in half, even if you have the worst cans,and so it's good news it there is yeah. You know living a healthy leftabed, adifference. There's I think health permeates more things than we think Iwas actually there's a professor at Stanford, whose research I help support.Who does a lot of work in the GUT BYOM and they got bacteria, and you know whyhealthy God is a key one of the keys to overall health, but he was telling methe other day that seventy five percent of the CERATONIAN, the kind of happychemical in your brain, is not made by your body. It's made by the bacteria inyour Gat, and so quite literally, whether or notyou're happy is partly the quality of the Food G. I find that fascinating because I knowso many people that struggle with got health. You know and it seems to impactso many assets PA. You know, parts of their life and that was kind of farmset. Yeah exactly- and I think that that's so what you've seen it help like you iswe've just following the we're pulling on the thread of you know what are allthe things of being health conscious, the fact in a positive way, and how canwe kind of generate that financial benefit for our customers? You know, Ithink of it, like home equity, you fill this O mecid every time you built thishealth equity and all we're doing is unlocking it. You know we're, like a...

...you know the loan you take against yourhouse once you build up the home equity so that you can. You know he loft,because they call it right and you kind of move it out and we're letting youuse that money for other things, but you built it, you did it by runningevery day or you did it by walking every day. You did it by making goodchoices, you did it by even getting your check up. You did it by takingyour meds on time and making sure you were compliant with them. Like allthese little things make a difference and those are the people we rave toreward, and I mean that's, you know that's this is you know my other twocompanies were companies. I built right, but I kind of knew I would sell at somepoint this one I feel like is kind of my life's work like I'm like you know,I could see myself running it for ten or twenty years, and actually it's theonly one that I would say was missionary meaning yeah, the other. Youknow cool tech. I really liked it. I knew I want to be an oupen. I startedit this one, it found me and it just has a much depent meaning for me interms of you know why I wanted to succeed and why I work you know, eventhough I don't have to I work day and night on it, and so that's so inspiringme here. So you see yourself there for quite a while then running this yeah. Ithink everybody keeps seeing these overnight successes and think they'reovernight, but officially look at that was it like the average company T IPOis to like seven years right. Oh exactly and look at your success, Imean I think that was important to point out. You talked about five yearsand changes along the way. Yeah you're right at that to five years. My carcompany, five years from my second company this one seven years in and butthis one's not bigger than my first two companies were and I'm just seeing itthrough. You know further further yeah, it's almost like those. I I sold them at a kind of adolescence.You know where I this one I'm going to see all the way, at least adult hoodand hopefully be on so that's so great and any you know I get this people say:Ask this o any challenges you're facing right now with health. Like you, I meanlike what are you working on challenges it? You know. Other start up founderslove to hear about. You know what successful entrepreneurs are goingthrough yeah. You know I mean a, I think. A lotof the challenges are always the same. You know it don't change, they justbecome different, but you know you always got to find great people tobring on the team and you always got to convince them to join the team. You I'mdoing a call and in an hour and a half with somebody to you know convince themto join our team. Like that. That's just never ends yeah. I Never Er. Ithink that of the more unique challenges now we're seeing is you know. In the early days of health IQ? There were a lot of things. We did that built the culture really well, butthey were very physical, meaning you had to be in the office to feel themand to feel that, in fact of the culture and and now with Covin witheverybody being remote, we're trying to...

...redesign some of those things that weused to do that were so unique and some of them are not working. You knowvirtually like they're, not having the same impact, and so I think some of thechallenges are. How do you keep that connection? How do you keep thatuniqueness? You know, and one of my friends described it best. She actuallyquit sales force and started a google during the pandemic, and she say is theweirdest thing. On Friday I locked off and Fede back this laptop and onSaturday, this other laptop came and I opened it up and I was at the same deskin the same place just on zoom, but just the different people,that is to a change, and that is weird rights as dies. He also just was saying,but you know I bet she hasn't bonded to her new company yet the way and withtheir ole like is there just not that same connection, so I think I thinkwe're figuring out how to do that. Given our employees are all over andyou know, I'm not sure about the future looks like, but I'm not convinced it'severybody back in the office like the old days either. So right right,interesting, though, that culture recruiting hiring are some of you knowthings that that are always there like. You said there are the same issues thatnever go gosh. I could talk to you all day, but I need to let you go so this has been so interesting. You knowyou just have such great information. So thank you for being here no problem.Thank you for having me this was really fun. Thank you. You've been listening to start upsuccess to make sure you don't miss out on future episodes subscribe to theshow in your favorite podcast player. Like would you hear tap the number ofstars? You think the show deserves an apple podcast for more tools andresources for your own start up. Success check out berkely associates.Thank you so much for listening until next time E T.

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