Thread by @ModernGrowthIn1

$HIMS - Hims is a highly differentiated consumer healthcare brand that is vertically integrated, highly efficient, and creative in marketing, differentiated, and pioneering the pathway towards truly affordable and accessible healthcare.

Long thread, buckle up!

What is Hims & Hers’s Mission?

Mission - Our mission is to make healthcare accessible, affordable, and convenient for everyone.

I love this simple mission from Hims, they want to provide affordable and convenient healthcare to everyone.

I believe it is so simple and inspirational that their employees can easily decide what decisions will allow them to achieve their mission.

It also provides them a lot of room to innovate and developed new products and services.

What is the current healthcare experience?

The existing healthcare system is highly fragmented and inefficient, lacks transparency, and is unfriendly to the consumer.

In addition, myriad issues related to insurance coverage and other cost barriers stand in the way of too many Americans getting the treatment they need and deserve.

The legacy system does not allow patients to receive proper care in a timely manner and ultimately drives poor health outcomes.

What trends are affecting healthcare now?

Supported by increasing deregulation and broad societal shifts, demand for and provision of telehealth services is surging.

Telehealth enables more efficient allocation and utilization of existing clinical resources that could otherwise go unused.

With an aging population requiring more complex care and a younger generation that is accustomed to digital technology, telehealth offers an efficient way to leverage finite resources.

What does Hims & Hers do?

Hims is building brands that represent the front door to the healthcare system for a new generation of healthcare customers.

From the beginning, Hims brands have stood for de-stigmatization and access.

Hims has been designed to encourage customers to engage with and seek treatment for conditions that are often embarrassing or stigmatized.

This strategy has allowed Hims to engage with customers who may not otherwise be willing to or want to engage in their healthcare needs.

Hims has been positioned itself as a trusted guide and partner for customers as they explore, learn about, and seek treatment for their health and wellness needs.

Hims designed and built their digitally native, cloud-based technology centered around the consumer, and design everything with the consumer in mind.

Hims’ platform has websites, apps, telehealth platform, electronic medical records system, pharmacy integration, and mobile accessibility combine to provide consumers with a seamless, easy-to-use, mobile-first experience.

Hims integrated technology platform allows Hims to serve customers efficiently from start to finish

Initially from customer discovery and purchase of offerings on Hims, to connecting customers with medical providers for telehealth consultations, to the fulfilment and delivery of customer orders, and finally through ongoing clinical management by medical providers.

How does Hims & Hers make money?

Hims offers a range of health and wellness products and services available for purchase on their websites/apps directly by customers.

These offerings generally focus on chronic conditions, where treatment typically involves the use of prescription medication on a recurring basis and ongoing care from healthcare providers.

Hims also offers over-the-counter drug and device products and cosmetics and supplement products, which are primarily focused on wellness, sexual health, skincare, and hair care.

Most of the offerings on Hims are sold to customers on a subscription basis.

What is Hims & Hers’s Market Opportunity?
Hims TAM in their core categories is ~$350B, they plan to expand in adjacent categories and nearly double their TAM over the long term.

How did Hims & Hers evolve its platform and products in its current state?

Hims started with products in Hair Loss and ED, then added Anxiety, Depression and Dermatology, and Primary care, with a lot planned for the future.

What is Hims & Hers’s Growth Strategy to capture this market opportunity?

- Expand brand awareness

- Acquire more customers, cross-sell and upsell other products

- Category expansion into new chronic conditions like sleep disorders, infertility, diabetes, cholesterol and hypertension

- Leverage existing capabilities to penetrate new sales channels and further improve operations

- Expand into new geographies

What is Hims & Hers’s Moat?

Brand - Consumer-first healthcare brand that has very high Customer and Provider satisfaction(NPS 65+), that is highly trusted.

Switching Costs - Hims has built a trusted relationship with Gen-X and millennials who will spend a majority of future healthcare spend with Hims.

Technology - Full-service vertically-integrated telehealth offering

Scalability - Highly extensible business model with expanding unit economics

Network Effects - Hims connects consumers to healthcare providers in a very cost-efficient way and will benefit from more scale on both the consumer and provider sides.

What is Hims & Hers’s current Insider Ownership?

Andrew the founder owns 14% of the company and the overall insider ownership is 37%

What do Hims & Hers’s current Financials look like?

All numbers are for Q3 2021

Revenue - $74M
Revenue Growth - 79%
Current TAM - $350B
Gross Margin - 74%
Free Cash Flow - (Not Profitable yet)
Total Debt/Equity - 0.18 (Strong Balance Sheet)
Net Cash - $64M

EV - $1B
EV/Revenue 2021 Guidance - 3.9x ($263M guidance 2021 full year revenue)
EV/EBITDA - 26x (My estimate of $39M EBITDA for full year 2021)

Incredibly compelling entry point IMHO for a hypergrowth business.

Tagging and sharing with few folks on fintwit who might be interested
@AlphaBetaAnil
@SixSigmaCapital
@InvestiAnalyst
@Investing_Lion
@TSOH_Investing
@dhaval_kotecha
@InvestmentTalkk
@hhhypergrowth
@LuoshengPeng
@EugeneNg_VCap