A pioneer in the field of diagnostic tests, Dr A Velumani, Founder of , said that his brand was hyper-focused on a single problem statement.
“I focused on a 15 gram gland in the human body to build a business valued at $1.5 billion…my advice to entrepreneurs is don’t chase four rabbits at once, else you will end up with none,” said Dr A Velumani in a conversation with Founder and CEO of YourStory, Shradha Sharma. His advice to entrepreneurs to develop patience, maturity, and frugality resonated with all those present at the opening fireside chat of the maiden edition of Tamil Nadu Story 2024.
Building in efficiency and frugality from the word get-go has been a game-changer for Thyrocare, and was responsible for bringing down the overall costs of diagnostic tests in India, as determined by a Chennaiyin, said Dr Velumani.
Hyperfocus on problem statement
Picking a disorder and not a disease as the area of focus has ensured repeatability among customers who have been using Thyrocare services for over 20 years now, said Dr Velumani.
“I am from Coimbatore and those of you who are familiar with the restaurant chain Annapoorna would know that the brand had one cloud kitchen and 10 restaurants back in the 1970s. We did something similar with Thyrocare with one diagnostic lab and 20 sample collection centres when we started in Mumbai,” he said, adding that this ensured maximum efficiency for the infrastructure and machines deployed.
Dr Velumani likened the offering made by Thyrocare to a buffet of tests, with the cost of collection and transportation of samples remaining the same at one-third of the existing rates. This compelled competitors to offer similar services at competitive pricing.
“There is no company on earth which has closed down due to pricing things low; they have closed down because despite the higher prices (for the customers) they could not keep the costs (of running operations) low,” added Dr Velumani.
The challenges
Incorporated in 2000 in Mumbai, Thyrocare was among the first branded diagnostic labs offering home sample collection and a selection of tests to customers.
The son of a landless farmer from Coimbatore, Dr Velumani decided to focus on the diagnostics space after completing his PhD at BARC (Bhabha Atomic Research Centre) in 1995. In order to set up his business in Mumbai, he took on the challenge of being an entrepreneur in a city where he did not know the language.
“Nikal pado, raasta apne aap banta jaeyga (Once you start walking a path, you create the road to the destination)….we measure challenges compared to where we are at,” said Dr Velumani, adding that it is important to make mistakes for entrepreneurs.
“If you repeat the same mistake again and again, you will be a beggar; if you make a new mistake everyday, you become an emperor. So, my advice to entrepreneurs is to make new mistakes everyday and make them fast,” he added.
On exit and entrepreneurship
While Thyrocare sold 66.1% of stake to API Holdings, the parent entity of PharmEasy in 2021 at a valuation of $1.5 billion, it has seen ups and downs since then. The listed entity, which went public in 2016, currently commands a market cap of $404.8 million, approximately (Rs 33.87 billion) today.
Dr Velumani said that 2021 was the right time to sell given the peak of valuation after running the business for 40 years straight. “To be honest, I got the best price…I had also lost my wife and it was one of the primary reasons for losing interest. And I was tired, working from 7 am to 11 pm for 40 years straight. Now I am in a better place with a good balance of money and time,” said Dr Velumani.
His advice for entrepreneurs starting out today is to not be swayed by money and build out the business without diluting much stake in the initial days.
“No one has achieved success without discipline. Those who have, find it difficult to sustain the success,” said Dr Velumani, adding that entrepreneurs will do well to pace themselves for a marathon rather than a sprint.
