SaaS Founder Interview with Rachel Mertensmeyer, Founder of RexPay
Rachel Mertensmeyer 0:00
Hey everybody this is Tony Zayas, thank you for joining another episode of the SaaS Founder Show, joined as always, by my co-host, Andy Halko. Andy, how are you today?
Andy Halko 0:15
Doing fast at the fantastic, great day in April. That is what Mr. Robbins would say.
Rachel Mertensmeyer 0:26
Yeah, absolutely. So this week, we have an exciting founder that we’ll be talking to in just a moment, I’ll bring her on. But Rachel Mertensmeyer is the CEO and co-founder of formerly RexPay, and they’re going through a rebrand right now. So I’m excited to hear all about that. But this is a solution that’s delivering the billing experience that patients love. So with that, when we bring Rachel on, Rachel, thank you for joining me today.
I’m doing great. It’s great to be here.
Awesome. Well, very cool. So why don’t you go ahead and tell us a little bit just about RexPay/ Rivia health, and just what it is you guys do, and we will go from there.
Of course. So Rivia Health is a suite of software that makes it easier for patients to get visibility to understand, manage and pay all of their medical bills in one place. And we partner with healthcare provider organizations like hospital groups, healthcare systems, urgent care corporate groups, to help them make it easier for their patients to pay their bills. And as a result, we help them automate manual tasks for their staff, we help them get paid faster, reduce defaulted payments, and overall increase revenue, as well as provide an amazing patient experience.
Very cool. So medical billing, that’s a big and messy kind of endeavor. It could be or seems, where did the Where did that idea for, you know, this solution come from?
I actually had a personal experience with medical billing, where I had a severe injury in 2016. And that led to over 38, medical bills across 11 different health care systems, and over $10,000, in medical debt that I was personally responsible for. And so I realized through that experience, that 80% of patients like myself felt confused by medical bills. And in fact, even though 80 to 85% of healthcare systems offer zero-interest payment plan options for patients, 50% of millennials use credit cards to pay for their health care, and another 10 to 15% use their 401k savings, to pay for health care. And that’s really a disconnect and just a lack of visibility to safe financing options that exist. And then on top of that, there’s the fragmentation of having to pay bills across a lot of different platforms, that’s really difficult to manage. And so from that, I thought, you know, there’s Turbo Tax, there’s Credit Karma, I use all of these financial health tools that are apps for me. But there was nothing in the app store to help me manage my healthcare finances. And that’s why I created RexPay, and we enable patients to see their insurance information and manage and pay all of their bills in one place. And we also add education in the app to help patients prevent pain, a duplicate bill, or explain to them what an EOB is, and then it’s not a bill. And we also help with Bill aging guidance, so patients can prioritize what bills they pay first, versus which ones they can wait on without something impacting their credit score.
Andy Halko 4:20
Like, yeah, that seems like there’s a lot there. Where did you start? So, you know, how did you like break that down into this is what I’m going to solve first and how I’m gonna, you know, build the business.
Rachel Mertensmeyer 4:33
The genesis of the platform was really around the ability to pay any medical bills, any provider simply by taking a picture of the bill with the app. So that was kind of the first core feature, the Corlew was the ability to take a picture of any medical bill, upload it to the platform, and then be able to just hit pay. That was kind of the original vision And we do provide that, in fact, patients can pay bills that are digitally uploaded through our system in less than six seconds. And patients can pay bills that they’re paying by uploading them through the picture format, in less than three minutes or two minutes. So it’s a really easy process. And that that was the core genesis of the product.
Andy Halko 5:27
Now, I’m kind of curious, did you have a technical background? And, you know, how did you get into, you know, going from a problem to actually like, truly tangibly building something.
Rachel Mertensmeyer 5:39
Um, I don’t have a technical background in the sense that I’m not an engineer. But I have done product management previously. I my career started out in Shanghai, China, actually. And there, I was working for international advertising agencies and helping global companies localize their digital platforms for Asia Pacific, different countries across Asia Pacific. And so that was really my first exposure to product development, product management, and really fell in love with innovation during that time. And then after that, I worked in consumer goods, and I did product development with Avon and Unilever. So I did Global Product Management. And that was, so I had a product management background, but I didn’t have a technical background. So what I did is I built a team that had the technical background, and then helps them manage the development of the platform.
Tony Zayas 6:45
How would you say that experience, you know, in product management, like what advantage Did that give you going into this endeavor? We’ve talked a bit about, you know, through our the series that Andy and I do on the value of, you know, product manager, you know, for software companies, and SaaS and whatnot.
Rachel Mertensmeyer 7:12
Um, I think a good product manager is really essential. And I was the product manager on our team for the first year and a half. And then I hired a product manager to come on board, when we started fundraising. And I needed to be wrote a lot, and I couldn’t be with the team. But I think it’s an essential part of the team. Because you really need someone who can understand why you’re building features, and how the features are going to directly impact the revenue, how the features are directly going to impact the business model, and why customers would care about features, right? Because I think that it’s really easy for designers to think about features, in one way and engineers to approach feature development in their own way, by having a really good product developer who can connect all of the insights from engineering and creative and the founder, and the business need, and the customer need is really what the what I think the girl brings to the team.
That’s great. So how did you bridge the gap with the technical side? Who did you bring in or partner up with to, you know, for the development side of things?
So I was very fortunate to meet Carlo Burgess, who is my co founder, through a friend of mine, who I’m I knew in Shanghai, and he was a longtime friend of her. When I was first starting RX pay, I kind of just put it out into the ecosystem with all of my friends. Hey, I’m starting this company, and I’m looking for a technical co founder. Does anyone know anyone? And that’s how I was connected with Harlow. And Harlow is an incredible engineer. He knows more coding languages than anyone else I know. And he has a lot of great experience in artificial intelligence, and OCR, and that’s how he actually developed the ability to realize the vision of uploading any medical bill in any format and being able to pay that on behalf of patients. So he was my co founder and he led the development of the product. And then we also were really fortunate through LinkedIn recruiter actually to find Nicole Cortez, who is our front end engineer, and she actually joined us right out of boot camp, but she’s completely brilliant and amazing engineer and has learned multiple Pulling, which is very quickly while she’s been with us and as is now really taking on a lot of leadership on our team. And after about three years of working with us, she’s now an engineering manager. So we’re really lucky to have her as well.
Andy Halko 10:16
I’m always curious, as part of that, you know, I think every one of our founders has a different story of of how they made this happen. Did you start building this while you were working in another job? Did you you know, quit and go all in? Did you find funding versus Bootstrap? You know, how do you make it a reality?
Rachel Mertensmeyer 10:37
Yeah, um, so I did go to my boss at Unilever. And I quit my job. I told him, I’m quitting my job. I’m, you know, moving to San Francisco, this is what’s happening. And he said, Why don’t you sleep on it? He said, Why don’t you come back tomorrow morning, and tell me what you want, and how we can keep you on in any way that you would like to stay. So he said, Just come back and tell me what your ideal scenarios maybe you don’t have to quit. And so he actually kind of talked me out of quitting my job right away. We what we did is I worked part time for Unilever. And then I and he, I also worked remotely. So I moved from New York to San Francisco, was able to continue working for Unilever worked part time for them. And then part time was doing a launchpad digital healthcare accelerator program in San Francisco. So it was like the big the busiest three months of my life, because I was still doing corporate work actually had two computers open at all time. So I was like, answering questions for Unilever. And then like doing my research for my accelerator program, and really didn’t sleep very much. But it was super exciting and thrilling. And it was a really great journey. So during that time, I actually met our first investor, who was Al Pacino. And I met him on a plane, a Southwest flight from San Francisco to Phoenix when I was flying to see my family. And I told him what I was doing. I didn’t know he was an investor, but I just was excited about what I was doing and shared. And then he decided to put in 100,000, to start and then continue to invest in our company from there. But he was our first investor. And we incorporated the company, after we finished the accelerator program with his investment.
Andy Halko 12:43
Wow, that’s such a really cool story for sure. So much to unpack there. But I guess I’ll start with the accelerator piece. Can you talk about that? Because we hear that as a lot of the journeys that founders have. I’m just kind of curious, you know, how Why did you get into it? Was it valuable? For those other founders out there that are thinking about getting involved in accelerators? What would you tell them about the experience?
Rachel Mertensmeyer 13:14
Well, for one, I would say, you know, be very picky about what accelerator you’re a part of, because you really don’t get excited just because an accelerator invites you to be a part of it, right, you need to shop around and find the accelerator that’s right for your business. Because it’s really about if you don’t have a lot of startup knowledge, so if you’ve never made a pitch deck before, for example, and you need help, learning how to talk to investors, if you need help learning to understand what a convertible note is, for example, then that’s a really great reason to go to a more generic accelerator, or really any accelerator because usually what they do is they give you all of the foundational tools that you need to start fundraising and create your business plan and also give you some tools around execution and market testing and that type of thing. So if you haven’t done that before, and you don’t have that knowledge, or you don’t have friends that have that knowledge that can help you with that, then an accelerator is a really great reason. That’s a really great reason. Another really great reason to join an accelerator is if you have no network, or if you’re entering into industry, that you don’t have a networking or if you’re entering into an industry where maybe you don’t have a lot of knowledge of the industry itself and it’s a specialty industry. That’s always a little bit tricky as a founder, but you know, I didn’t have a healthcare background. So for me, it was really important to join Digital healthcare based accelerators so that I could get their knowledge and their network and benefit from that as a jumping off point. So that’s something to think about, you know, just make sure you’re finding the accelerator that has the network and the industry knowledge that you need. You know, there are accelerators that specialize in SAS or accelerators that specialize in products, you know, physical product development or engineering. So you just want to find the right one. And then the other watch out, I would say is, be really careful about giving away equity to be part of an accelerator, because a lot of them really request a significant amount of equity. You know, 6%, when you’re starting out might not sound like a lot, but that’s actually a really significant chunk of your company. And when you’re going to raise your series A and series a VC investors want to see that you haven’t sold more than 40% of your company. So if you’re giving away 6%, out of the gate to an accelerator, that’s pretty risky. So you just want to make sure that that really is going to have a payoff. And a lot of times, if they’re promising a lot of introductions, don’t really take that as a guarantee, because sometimes those don’t materialize the way that you want them to. So those are those are the comments I would have on accelerators.
Andy Halko 16:23
No, that’s great stuff. For sure.
Rachel Mertensmeyer 16:26
Rachel, if we can back up just for a second, I would love to hear you know, even though your employer gave you that opportunity to, to, you know, work part time while you were launching the business. What was the when you made that decision to go and give your notice, even though you ultimately didn’t follow through on that? What was going through your head? As well as how did you know the timing is right to make that leap.
Um, I was very scared, I was actually shaking, when I was talking to my boss, like physically shaking, it was pretty embarrassing. And so there was a lot of stress hormones in my body. And it was very scary to think about, you know, leaving this job that I’d worked so hard to get, it was really my dream job, you know, that I had been working towards working on the dove brand, one of my favourite brands, and, yeah, so, um, it was scary to think about quitting that for something completely unknown. But the reason I felt like it was the right time, and I felt confident in the decision was because I really believed in the product that I was going to create, and that there was a need for the product. So I think that I would not have done that if I just was wanting to start a startup and I didn’t really have conviction behind the product that I was going to create. So I think that’s really important when you’re a founder is, you know, you’re gonna make a ton of sacrifices, personally, for this business. And it, it has a very small chance of paying off, right, only a very few percent of companies make it and even smaller percentages have the 10x return that you hear about. So it’s really important that you believe in the company that you believe in the product. And that’s also going to be what creates a culture that moves your team forward through difficult times. So if you don’t have that really like, maybe take a pause and wait until you do.
Andy Halko 18:41
Did the complexity of the healthcare market impact you when you were planning this and as you built because it could be a little daunting, how, you know, all the different players, obviously, compliance that is involved HIPAA, you know, how did you think about that as a health care founder at the start of this, and then how has that evolved for you over time?
Rachel Mertensmeyer 19:08
Yeah, it’s, um, it was drinking from a firehose, in the beginning, and still is really, but because healthcare is always the industry is always changing, even though somewhat slowly, but yet, in the digital space, there are major shifts that happen seemingly overnight, because you have these really large incumbent organizations and there’s a lot of merger and acquisitions that are happening in this space that can shift things around. Um, so yeah, it’s, it was a lot to learn up front. And I think before we really started getting a lot of investment dollars and building the product, we had to do a lot of legwork to understand what the regulatory requirements were and what the blockers were and Unfortunately, when you’re in healthcare if you can’t really move fast and break things, so like, with your, if you’re doing a SaaS platform where you’re not managing people’s financial and health data, it’s a little bit easier to just like, get something out there as quickly as possible. And that was one of the disadvantages that we had going into this industry and product is that it took us a lot longer to get to an MVP, because we had to make sure that we were building a fully robust, secure and scalable platform.
Andy Halko 20:36
Yeah, that’s really interesting. Because on the MVP side, we’ve talked to a lot of founders, you know that a number of them. And this is a smart approach in some cases is that, you know, the MVP is something you’re just thrown out there. And sometimes in the software space, it’s even vaporware, you know, it just kind of, they’re doing the work manually behind the scenes. But yeah, I’m really that’s intriguing to me that for you and in your space, that that’s really not even a possibility. So I guess my question would be, how did you approach deciding what feature sets and what it would do given that you had to have such a thorough MVP?
Rachel Mertensmeyer 21:15
Yeah, so we did a lot of research with users in the beginning. So before we did any UX design at all, I personally interviewed 200 patients. And then I coded all of the interviews and found patterns around what the core pain points were in their experience and what their needs were. And then you prioritize the feature sets based on that. And of course, there are still features that I wanted to build that still have not been built, you know, three and a half years later. So I think that’s also something you have to just kind of live with as a founder, that you’re not going to have all of the bells and whistles that you envision out of the gate. But you just have to really decide what are the features that you have to have to make this product, add value, and make this product something that people are willing to pay for? So that that was how we started out and made those decisions?
Andy Halko 22:20
Yeah. No, outside of the, you know, running through the interviews and doing that, I’m just, I’m always curious if there’s a methodology that you have to ranking, you know, as you’re listing out features, and you’re evaluating them, did you have any methodology that you’ve used that’s out there or develop your own to like, do it in a logical approach?
Rachel Mertensmeyer 22:42
That’s a good question. I wish I could say I did have a really robust methodology. Um, but I really didn’t, it was more around just kind of getting feedback from users and then evaluating what’s the revenue driver? Right. So what’s your business model, that’s an important place to start. So our business model was transaction based model. So when patients pay bills, we make money. So we had to make sure that we were starting out with features that drives bill pay, and then motivate patients to upload and pay their bills as easily as possible. So that’s really how we prioritized and what our methodology was, if you will, but we didn’t have a really structured approach to it outside of that.
Andy Halko 23:32
I mean, that is, you know, it’s focused on revenue growth. I definitely a methodology.
Rachel Mertensmeyer 23:41
Well, thanks. I’m glad you think so.
So, Rachel, over the, you know, over the growth of the business, how has your role changed? I know, you said you were focused on the product management early on, how was it changed as the founder, you know, to your role and what you’re responsible for today?
Well, it’s evolved a little bit over time. And we actually had 20 team members, because we have scaled up our team right before COVID hit. And so at that time, I was primarily doing fundraising and making sure that I was casting the vision for the managers and everyone knew what the priorities were. And then I was being an evangelist for the company, right. During that time, I was traveling on calls pitching, getting our name out there as much as possible. And then when COVID hit, we actually had a lot of the funding in the pipeline pulled out within a period of three days when the financial markets were impacted in March of 2020. And so we had to completely restructure our growth. trajectory and what our plans were. So we actually had to cut our team down to seven people. And that happens in, you know, like a two week period of time, I had to make the decisions, work with our advisors and make the cuts and then inform everyone. And so that was a really difficult time for me. And so I’ve definitely been in the trenches and more hands on as a team of seven, everybody has to do a little bit of everything. And so I’m still jumping in and writing email campaigns and, you know, helping with the sales team and making sales calls adding to HubSpot. And, um, you know, I don’t I don’t do a lot directly with the product, that’s still the product manager and the Director of Engineering and our, our operations leader are really owning product. And so sometimes I miss that right, sometimes I miss being proud of the product, more intimately. But right now I’m more focused on sales and revenue growth. So I guess you could call me the chief revenue officer, in addition to still fundraising and managing the team.
Andy Halko 26:15
Yeah, tell us more about I guess, that experience of having to switch directions. I, I always want to know, the mentality of it. You know, you obviously said it was difficult, but, you know, when founders are faced with these big challenges and big changes to their plans, you know, how did you I guess, fortify yourself mentally go through it work through the you know, that, you know, on a personal level?
Rachel Mertensmeyer 26:45
Yeah, that’s a good question. Um, you know, just being a little bit vulnerable, it was really challenging to keep my mental health in the right place, so that I could be a leader and could be strong for the rest of the team. And to keep the company going, um, it you know, as a founder, when you’re going through those moments where you have two weeks of runway, or you have to make these really hard decisions, where people who you treasure and who you’re so proud have chosen to follow you and work at your company where you have to let them go, like, it’s so painful. And as a founder, a lot of times, I just wanted to go in my bed and pull the covers over my head, and just hide and cry, you know, it sounds kind of pathetic. But that is like a real moment, right? Where you have to let yourself for me, I just let myself feel that moment. So sometimes, that’s what I did, I gave myself 30 minutes, I would like set a timer. And I’d give myself 30 minutes to get into bed, pull the cover over my head, and like, have that poor me moment. But I would have a time limit on it. And then I’d like get out of bed and be like, Okay, I can do this, like, let’s go, let’s problem solve, and go for it. Um, but I think it’s also really important to have people around you who can encourage you, and who can also call you up and out of that despair, because I had some really great mentors. You know, Tyler linemen, Wendy Jamison, and my partner, Alex Mersereau, have been really encouraging for me in those moments. And so I would call a friend and or mentor, and let them know how I was feeling. And they would say, Hey, you got this, like, you had stopped feeling sorry for yourself, you know, get out of bed, you can do this. And then they would also give me some strategic advice about how to think about things. So I think it’s important to make sure you have that support network that can help you through those times as well.
Andy Halko 28:59
I love the vulnerability. I think that’s the reality of being a founder and entrepreneur, I’ve had my business for 20 years, and there have been plenty of those moments where you just want to, you know, go ahead and govern yourself and not come out for a day. So I did it. And I think that’s what people need to hear it to your point, you know, I’ve had over the years, many other entrepreneurs that are my trusted circle that when I’m in the depths, those are the people that you could go to. Right. Did you so it sounds like you had a really great network mentors. You know, how did you find these folks that you ended up surrounding yourself with?
Rachel Mertensmeyer 29:41
Yeah, um, so a lot of it started with networking and pitching, just saying yes, right. Any pitch event that I would get invited to, I would go and even if it was like a really small, local event, that type of thing. And then you just start meeting people, and you build your network. And then they people introduce you to others. And I was fortunate enough to have that develop into a really strong network in the Arizona startup community. We were at Arizona innovation competition winners. So every year the Arizona state government selects 10 companies that they give a grant to, and they go through a special program, and so that I got some great mentorship through that program and are now board member, Brenda Schmidt is amazing. And we met her through the startup community in Arizona as well. So I think that that is really important as a founder in their early days, that’s just build your network and say yes, and go go to the meetup events in your local community and build those relationships. And also, you know, reach out to old friends and old, maybe old bosses that you’ve worked for before. And don’t be shy about asking for whatever you need, you know, just call people and ask, when you’re a founder, you can’t be timid or shy about that, because you’re gonna have to ask for funding, you’re gonna have to ask for favors introductions. So you just have to really start getting comfortable about making the ask.
Andy Halko 31:25
Yeah, I think that’s such a great important point is being willing to ask and that we’ve pinpointed that on a number of these founders shows is that there’s just the reality that if you don’t ask, you’re never going to get anything,
Rachel Mertensmeyer 31:40
right. And you get a lot of nose. But then you get a yes once in a while, and that that’s what makes the difference for your business. So
Rich, I’d love to hear a little bit about the culture of the business. And just overall, but then I’d also like to hear, you know, when you did have to make cuts to the team, obviously, that’s always painful to have to do that. But how did that impact the rest of the team that people that stayed on? We’ve seen that sometimes, you know, when you’re when a business goes through some challenges, sometimes that draws people, you know, closer and, and everyone kind of gets on board and really unifies excited, curious to hear, you know, how that all played out for your team?
Yeah, um, well, first of all, culture is something that’s always been really important to me, as a founder, and I haven’t always done a great job. So I’ve failed in many respects, and I’ve been learning a lot. But I’ve definitely made an effort and tried really hard around creating a culture where people feel supported, where they feel like they have permission to go on vacation and rest and come back. And not you know, burnout is something that’s been really a difficult challenge that we’ve had to fight, especially during COVID. So we were all working in an office together, for the most part, and then we went remote when COVID hid for safety reasons. And so that was like a big culture shift, trying to figure out how do we keep this fun culture where we did happy hours, and we had bonding experiences? How do we do that in in a, in a remote environment where people are so sick of being on zoom all day, like, it’s kind of hard to ask them to do a zoom happy hour after they’re like zoom burned out from the whole day. So that’s been a challenge that I haven’t really solved yet, to be honest with you. And we’re figuring out what the right cadence is for that. Fortunately, now that things are opening up again, we’re going to a model where we’re going to be meeting up, you know, as a team, like, once a quarter in person to do some fun retreat or something like that, and then staying remote the rest of the time. But communication is a lot more challenging when you’re messaging over teams all the time. So that has been something I haven’t quite cracked yet. But what we did when we first started the company is we created a mission and values statement. And we also created our decision criteria, you know, how do we make decisions at this company? What what is going to guide our decision making? And then we also created some values around what do we want to represent? And how do we want to act out our jobs together in this company, and so that was kind of a good guiding principle in the early days. And we’re actually revisiting that now as a team, and we’re rewriting it and it’s really interesting to see how as our business has changed A lot of those decision making criteria and values and ways of working to change as well. So it’s important to stay flexible, and, you know, keep updating that. And another thing I’ve learned is that it’s really important for that to be a collaborative process, and not as top down. Of course, your team needs you to set a vision, and have leadership and have an idea of, you know, what the mission and the vision is, but then it’s really important to get input from the team on, you know, okay, what do you think about this decision making criteria, because your team sees things in the trenches that you may not, and they’ve, my team has brought up great points to me about why we need to revisit certain values or how we’re wording it. So that’s been a really good learning. And then, in terms of, like, when we had to cut the team down, that was really challenging, because a lot of team culture is made up of individuals that bring their own energy to create the team culture. So when you have to cut the team down, then not really, you’re losing a lot of the sparks that were making it what it was, and you kind of have to find a new rhythm, and the team has to become really blended together. So we did a virtual team retreat right after that happened to kind of get everybody kind of gathered together as a smaller team, it was really important to let everyone know that who was on the team, like what was happening, and we really adopted a culture of transparency, where I communicated at all times, and still do, like, here’s how much runway we have. Here’s what I’m doing to get more funding. Here’s what’s happening on a cash flow and revenue standpoint, and what we need to do to drive this forward together. And also, I think making the one cut up front was important, because I think that it can be really painful for team members, if you’re making like a lot of different cuts along the way. And then people start feeling insecure about their jobs. And that can really hurt culture. So I think if you need to make a cut, like, pulled off the band aid, cut deep once, and then let the rest of the team know, hey, like, we’re in it together, we’re in it for the long haul. Let’s do this. So those are a few of my thoughts on that. But it has been really difficult, you know, because everyone on the team is now doing a lot of extra work.
And so that means that you have to work even harder to keep the culture good and avoid burnout. And so I’ve tried to do that by encouraging time off, and I instituted a we did it holiday. So we make sure that once a month, we have a long weekend, even if there isn’t a long weekend, there, but we we have goals that we set, and then we earn it as a team. And then when we hit our goals, we get that long weekend off. And we’ve never missed our goals. We actually have a we did it Friday coming up this Friday. So anyway, try to do you things like that, just to make sure that people can rest?
Andy Halko 38:23
How about for yourself? You know, I think one of the things I always again, having had a business for a long time is that work life balance? You know, and we’ve heard it on this show talked about work life, harmony, and all of these things. How have you approached? You know, because as founders, we just want to be in the business and you’re always thinking about it, but how do you manage your mental time off and, and your balance of work versus life?
Rachel Mertensmeyer 38:56
Um, it’s a great question. Um, I don’t think I do a great job. I wouldn’t, but I’m also probably not failing 100%. Um, I went to yoga on Monday night. So that was great. That was the first time vendor yoga and a while I actually did an outdoor yoga, which was really nice. But I think that, in short, I try to have a principle of taking my weekends. And if, unless there’s something I really have to do, and the way that I asked myself this question, like, what would happen if I didn’t take care of this until Monday? And if it’s not gonna severely impact any of my team members, or the company, then it waits until Monday, right? Because there’s a lot of things that on Friday you think you have to do on the weekend. But if you really take a minute to evaluate priorities, maybe you don’t absolutely have to do it right now. And to a certain extent, as a founder, there’s always something you need to be working on my, I’ve never gotten through my to do list. So, um, in order to avoid complete burnout, you have to allow yourself to recharge, and really just focus on the key priorities that are going to drive your business forward, and that what your team needs from you right now. And then the rest will kind of take care of itself. So, I use the system of organizing my to do list by high priority and urgent, so like important, urgent, important, non urgent, and then non important, non urgent, etc. So that’s how I have my to do list organized. And then I put admin in a separate category that’s like, these are administrative things that can happen when my brain is kind of like already tired, and I just need to do rote work. So I don’t know if that’s helpful, but it is extremely challenging. So if you can make sure that you have an exercise routine, and you make yourself rest, at least on the weekends, you know, that’s, that’s important.
Andy Halko 41:11
I love it, I use the same methodology. They are important, urgent, you know, important or urgent. So I think that that’s a great way in that grid to do it. How about delegation? I think one of the biggest topics we have as founders figuring out how to delegate, right, cuz, you know, sometimes we want to take things on ourselves, or, you know, we’re afraid to delegate or whatever it might be, how have you handled that? And how has it changed over time for you?
Rachel Mertensmeyer 41:44
Yeah, I would say, um, I think letting go of the product ownership was like, a really good first step. And learning to trust my, the team that I’ve put in place to manage that, you know, even today, like yesterday, I heard something about the product and what they’re working on. And I was like, oh, yeah, I really just want to like, jump in and be part of that. But you have to be disciplined about, you know, just because you enjoy working on something, or you care about something, doesn’t mean, you should be doing that. And I think what helps me to learn how to delegate is to think about empowering your team members. And actually the fact that if you’re always jumping in to do their job, you’re disempowering them. And you’re sending them a message that you don’t trust them to do their job. And that’s really demotivating. Right? So that’s actually something I learned the hard way. But once that kind of clicked for me, and I realized, oh, wait, I’m actually like doing my team members a disservice by getting involved, then that really helps me kind of learn how to just step back and trust that they’re going to execute and that I hired the right people.
Andy Halko 43:09
That’s great advice.
Rachel Mertensmeyer 43:12
Rachel, I would love to hear about the kind of evolution of the business, you guys are rebranding from registry to reveal how I would like to hear about what inspired that and kind of what is next, for the business in the next 12 months? Let’s say?
Yeah, thank you. Well, um, we started out as a direct to consumer product. So we created a product where patients could manage all of their bills in one place. And we created a brand RX pay that was really centered around the patient need and in insight that patients described their experience as traumatic and they use really severe language to describe how traumatic their experience was, and often described feeling buried that they weren’t drowning, that they needed to be rescued. And so that was how we came up with the idea of wrecks the rescue dog, who rescues you from medical bill mayhem, and we tested that with consumers, and they loved it because it makes something really scary and traumatic, friendly and approachable. And you can kind of take a breath around it. But now, our customer is no longer the consumer. Our customer is the VP of revenue cycle at a health care system. And so the brand that they’re looking for is very different than the brand that the consumer is looking for. And we actually lost a few enterprise deals because of the brand fit, not not fitting with their brand ecosystem. And they actually gave us that direct feedback which was We’re really grateful for. But we have to move to this new Rivia health brands that we’re creating to really fit our new customer and their environment, their brand ecosystem and what they’re looking for. And also, it’s representing that we are growing our AR capabilities, we’re growing our software suite beyond just the mobile app. So now we have an online portal, we have a back end system with configurability and API connections. And so we have a suite of software. And we’re going to continue to expand beyond that. So that’s why we wanted to move from a pay like RX pay name to Rivia health, which can encompass more services and more products. As we grow.
Andy Halko 45:57
How did that transition happen? You said your customer was the end consumer and then went to being you know, someone in health care? Did Did your app change? Did the way you decide to go to market changed? What was the evolution there?
Rachel Mertensmeyer 46:14
It was the go to market strategy that shifted. So we learned that acquiring users one at a time is very expensive. And our pricing model requires volume in order for us to start making money, right? So even with 10,000 users or you know, however many users on our platform, we still wouldn’t really be breaking the MRR thresholds that VCs are looking for to get to Series A. So with direct to consumer alone, we needed millions of patients on our platform, and that’s really expensive to acquire, right? So instead, what we thought about is okay, what if we partner with the health system to onboard their patients and give the health system a tool that’s going to help their patients manage their medical bills, which in turn, will help the health system get paid more efficiently? Right. And so that was the pivot that we did. So that we’re now for example, one of our customers that we just signed, has 140,000 patients every year that that are flowing through their system, that we have direct access to onboard to our platform, without any cost cost free. So that’s an example. And then, of course, other customers in our pipeline, do have a million patients or millions of patients. And so as we move into the enterprise space, that’s how we’re accessing the volume that we need to get to the annual reoccurring revenue thresholds that we’re targeting.
Andy Halko 48:09
So I’m curious to dig in there a little bit, because again, we’re talking to founders, you know, and they’re facing a scenario where they’re going to market and maybe they’re struggling to get the volume or the, you know, acceleration that they want. How did you, you know, come to that, that appear funny, or mindset was it? You know, was there an advisor? Was it over time, was it I kind of knew this, but it just needed to click for me, you know, how did you actually get to that little bit of a pivot.
Rachel Mertensmeyer 48:41
Um, it was really through our advisors. So we have some amazing advisors that are also investors in our company. Randy lips is one who was really encouraging me to go this route. He is the founder and CEO of Omni cell, which is a publicly traded platform for digital healthcare products. And so he’s an amazing mentor for me. And Randy, along with Brenda Schmidt, and other advisors that we have, we’re really directing us to find an on ramp, as you call it, that platform where you can onboard a lot of user volume through a larger platform. And we did research to see if health insurance plans would be the right on ramp or if employer groups would be the right on ramp. And we landed on health care providers and we we landed on health care provider systems because they have the most to gain in terms of the bottom line financial benefit of what we’re doing. So that’s the starting point. However, there definitely is a value proposition for employers and health plans and those could be Future channels for us. But we wanted to start with the healthcare provider organizations initially.
Andy Halko 50:12
Yeah, it’s really cool. Um, so what’s the future look like for the the software, you kind of hinted that you’re looking to expand, but what’s the next year look like for both the software platform and, you know, generally the business.
Rachel Mertensmeyer 50:30
We’re really focused on commercialization right now. So we just brought on a new enterprise salesperson who’s amazing, David Coyle, he has 20 years of experience, selling revenue cycle software, and he was part of a startup called crane, where, where he was employee number six, and he brought them through to IPO. So he’s really a great asset for us. And we’re really focused now on commercializing with these enterprise customers and bringing more customers on board and getting our MRR up higher so that we can do our first Series A round. And we have a few venture capital firms that have been following our journey for about a year and a half to two years. And they’re really excited about what we’re doing. And they just have like a few milestones that they want us to hit in terms of revenue. So the plan is to do our Series A round, kind of later this year, early next year. And then from there continue to grow as a company and with the platform, we’re going to continue to add features that are adding value to our customers. And right now, the platform is very feature heavy on the patient side, the user side. So we need to add some more continue to add some more features for the healthcare provider system and like what they need to make it even more valuable. And we have been doing that over the past year. But we’ll continue to do that.
Cool, well, great. So before we wrap up with kind of the last question, we usually like to end here on the show, tell us where you know, visitors can learn more about Rackspace slash Rivia health as well as you and be following your journey a little bit.
Thank you. Um, well, you can follow me on LinkedIn, that’s probably the best place to follow my, my journey. And then you can follow Rex page on LinkedIn as well. That’s where we post all of our announcements now Revia, health on LinkedIn. And then also, you can follow us on our websites. So you can look at Rivia health.com, or Rex payne.com. And it’ll direct you to this site. We’re in the process of rebranding the site right now. So pretty soon, you’ll see the Rivia health branding come up. But yeah, feel free to follow us there. Or on LinkedIn, those are the best sources at the moment.
Andy Halko 53:14
That’s great. So the close up, I always ask, you know, if you were able to go back in time, right, before you started the business and have coffee with yourself, what is one piece of advice that you would give? Before?
Rachel Mertensmeyer 53:30
Just one piece of advice? Yeah. Okay. Um, I think the biggest, the biggest piece of advice I would give is really focus on how fast can you get to revenue, and just make all of your decisions around getting to revenue? And also, how scrappy can you get to revenue without accepting investor funding, because, um, I accepted investor funding too early at nine, I accepted too much too early. So if I was to go back and do this, again, I would accept the first check. But then I would be a lot more scrappy about it and make that check last a lot longer and get to revenue before accepting more funding, because if you’re not in revenue, fundraising takes a lot longer, it’s a lot harder, especially if you’re a woman or a minority. And you also have to compromise on your valuation. And so you’re selling a lot more of your company early on than you really need to. And also, if you’re not in revenue early, then you’re really not validating the features that you’re building in the product. So if you just get to revenue as fast as you can and really build your features around what’s going to drive getting there.
Andy Halko 55:07
That’s great advice. Thank you.
Rachel Mertensmeyer 55:09
Yeah, for sure. Now, that’s fantastic. Rachel, we just want to say thank you. This has been a great conversation. We appreciate you sharing with us. And to our viewers. We will be back. See you guys next week. Until then, take care again. Thank you, Rachel, we appreciate having you on today.
Thank you for having me. It was great to be here. Take care. Thanks. All right. Good luck, everyone.