Invest in VetPronto: On-demand, house call veterinarians

What does your company do?

We provide on-demand veterinarians who treat your pets in the comfort of your home. 65% of American households have a pet—there are 77 million dogs and 86 million cats who need check-ups at least twice a year. But only 30% of these animals ever see a vet in their lifetime because the experience is tedious, and sometimes even impossible for urban pet-owners without a car. We're fixing that. Pet owners can get vets when they need them, where they need them: right at home.

Where will your company be in 5 years?

We're the first mobile service scaling house-call veterinarians for more convenient pet care. We're active in Los Angeles and the Bay Area, where we have over 50 on-call vets and nurses and 3500 customers who book up to 4 appointments a year (the industry standard is only 2 a year). And they love us: that's why we have a five-star Yelp rating from over 270 customers. The next step is to expand to New York, then across the U.S., so all pet-owners can call vets to their home for the best care.

What are you guys building?

The highest quality and most convenient veterinary care. The service currently revolves around house calls as we believe that the best care happens at home. We will be expanding the service to include virtual care as well as ancillary pet services.

How did you guys come up with this idea?

We started about three years ago with the theory that there are a lot of smart people and money going after human health problems. Let's learn from what these companies have done and apply it to pet health, given the role that pets are now playing in the family. In the process of experimenting with a number of ideas, we talked to over a hundred pet owners and learned that going to the veterinarian was the worst part of owning a pet. These discussions allowed us to stumble upon a pretty obvious idea; an on demand house call vet service that's on par with the other on demand services.

What changes in the market drove the development of your idea? Which companies inspire your work?

Perhaps the biggest change is customer expectation in terms of how the business treats the customer. The days of going to a doctor’s office and sitting for who knows long in a waiting/exam room, then getting a few minutes with the doctor only to be thanked with a confusing and big bill are numbered. We have really worked through every aspect of vet care to make the client feel respected while also providing amazing vet care. There’s a whole bunch of moving parts behind the scenes as we have effectively built a distributed hospital and need to get the right people, supplies, medication and information to the right place at the right time. Most of these processes have been automated and we feel like we are at a point where we can roll it out to a number of cities.

Are there companies you look to for inspiration that are doing this really well but in a different industry?

There are a number of pioneers in the on-demand category like Uber, Instacart and Postmates who have inspired just about every on-demand company. However, the ‘Uber for X’ analogy breaks down pretty quickly in health care. We prefer saying that we are building a virtual hospital rather than an Uber for vet care. There are a number of companies that are doing similar services for human health care like Circle, First Line and Heal. They are all great people and we have good relationships with them. There are things we've learned from them and things they've learned from us.

Can you walk me through what that process looks like without you guys and if you're just going through a traditional vet and how that changes with you guys?

The first thing you have to do is find a vet with availability at your required time. That can be quite challenging. Once you find one you're then going to have to get an appointment booked. Very few vet offices offer online booking so you have to call them up and find a mutually convenient time. If you are lucky enough to get an appointment in the somewhat near future, then you have to get yourself and your animal to the vet. If you don’t have a car, you are at the mercy of the Uber/Lyft driver. Also, it is likely that your pet doesn’t enjoy traveling, especially if you have a cat. And, it is very likely that your pet will know that you are going to the vet get very stressed out before you get to the office. For some animals, the stress of going to the vet does more harm than what they had to go to the vet for in the first place. (And this often means that pets just don’t end up getting the medical attention they need). Now you're at the vet. You’ve got your cat screaming in its carrier as it’s surrounded by a waiting room of obnoxious, barking dogs. Or you’ve got a new puppy in for its first vaccinations and you’re stressed it’s going to contract whatever hideous disease is coming out of the adjacent dog’s nostrils. But let's assume all goes well and they are able to treat your animal. More often than not, the doctor will perform additional services that you hadn’t anticipated so what seems like a simple $70 visit easily escalates into multiple hundreds of dollars of laboratory work, ‘waste handling fees’, ‘restraint fee’ and other obscure items. All in all, it's a pretty miserable experience for both the human and the animal.

How does your app improve users’ experiences with vets?

VetPronto has a simple booking process that is available via a smartphone app, website and telephone (we have a call center staffed 8am - 8pm). Clients can usually book appointments for the same day. Our pricing is simple and transparent and we can usually tell you what the visit will cost before you book. Take a blood test for example. There are dozens of different kinds of blood tests each with their own costs. If you call a typical vet clinic and ask how much a blood test will cost, they probably won’t be able to give you an answer. For Vetpronto, all of our blood tests are all $200. If someone calls asking the cost of an exam and blood test we can tell them that it will be $350. It's an answerable question. After you book an appointment you give us some basic information about yourself and your pet. We call any previous clinics and request records on your behalf. These records are uploaded into the system, providing our vets will all of the necessary medical history. On the day of the appointment, our vet (and vet nurse, if necessary) will arrive at your door and begin the exam. If any additional or unexpected services are needed, the vet will explain the benefits of the services and their associated price. This is a large part of our training, making sure the vets are very explicit and open about the things they're doing and the associated costs. After the appointment you will get an email summary from the vet discussing any findings and providing instructions for next steps. You will also get a receipt with the details of the charges. If you need any medications, we'll give you a link to the online pharmacy where the prescriptions will be pre-approved.

From a cost comparison perspective what does it look like? What's the premium folks are paying for this amazing service?

We're about 10-20% more expensive than normal vets.

Who are your customers?

Most of our customers are busy professionals who can’t afford to take X hours of the day to go to the vet. The convenience is a major factor for them. The next largest group are people whose pets are unable to travel and/or go to a vet clinic. Because of the way the pet reacts to travel or going near the vet clinic, they literally can't get their animal to the veterinarian. The vast majority of our clients were people who actually didn't even know house call was an option.

How are you finding your customers?

Most of our customers come from word of mouth. Fortunately, our clients seem to be very willing to tell their friends about VetPronto. We also drive a decent amount of new bookings from intent based paid channels like Google (paid and organic) and Yelp.

How do you guys rank from a ratings perspective?

They're off the chart. On Yelp, we now have over 270 reviews, 262 of which are 5 stars.

What's your estimated LTV? Your blended calculation you mentioned was 50 on the paid side. How much is your average customer spending in one year?

The average appointment is $300, of which about $100 is gross profit. Our clients average 3-4 appointments per year, meaning one year LTV is $300-$400.

How much do people spend on this specific vet service that you guys are servicing?

The average vet bill is ~$250 at a bricks/mortar clinic. Our average bill is $300, which means are are about 20% more expensive.

What is the size and value of the veterinarian market?

The total vet market is $17 billion a year.

How much of that is for specific stuff that you guys do? I'm sure that some of that's surgery and other things that you can't do at home.

We can do $14 billion of the $17 billion. The $3 billion difference is surgeries.

How does going to a new market work for you guys? You're in two markets, you'll be expanding to a third. What’s the plan?

Like any two-sided marketplace, we have to manage the demand (pet owners) and supply (veterinarians). Although we don’t have everything figured out, we feel like we have a pretty good grasp of the playbook. We start looking for a local vet partner 3-6 months before we want to launch. This person will support the initial appointments as well as get most of the on-the-ground operations set up; recruiting and training vets and nurses, ordering supplies, finding laboratory and euthanasia partnerships, etc. Once demand ramps up and we can support multiple vets, the local partner steps back into more of a managerial role. Most of the operational stuff can be handled centrally; confirming appointments, answering calls/emails, requesting records, approving prescriptions, etc. The marketing activities for the new market is handled centrally and needs a 2-3 week lead time for set up.

So you’re letting vets focus on courting patients and finding other vets to work with them and then I'm assuming you can give them some type of revenue share on that kind of specific geography?

Pretty much. But, it is important to note that the vets do very little marketing/acquisition work on the demand side (targeting pet owners). That is rather technical ‘growth hacking’ work that is done much more effectively from a central location.

Tell us about how things are going, what the book numbers look like for the markets you're in right now and why now is the time to command you a third market.

San Francisco is our most mature market and it is going well. Up until the (very typical) summer slowdown, we were growing by about 15% a month and almost 200% per year. We should be cash-flow positive in San Francisco by September or October. The expansion decision is primarily due to the evolution of our operations and marketing. We have automated enough processes to the point that we are confident we could be working multiple markets in parallel. The marketing has also gotten to where we think we can basically replicate that model in 5-15 other markets pretty quickly.

What do you think it costs to open a new market and get to the point where it's ultimately going to be self-sustaining?

We need 50-75K of working capital to get a new market to cash flow break even.

What are your revenues look like right now?

Before summer started, we were doing $100k per month. The summer monthly revenue was closer to $70k. We saw a similar slowdown last year.

What factors are affecting your growth as a company?

Since word of mouth is our primary growth driver, we need to make sure every customer has as great of an experience as possible. In most customers, just getting a vet to their house is enough. However, we are striving for an amazing service where all touches with VetPronto are delightful. The more that we are able to delight, the better the word will spread.

Tell us about the biggest challenges that you see moving forward that you're going to have to solve to grow to the extent that you mentioned earlier.

One of our concerns that we haven't really answered yet is the variance between new markets. From an operations and marketing perspective, we have identified some obvious differences between the markets. However, it is likely there are other differences that we will only discover after we launch.

Tell us about the team. Who are the founders and key executives?

The three founders are Katherine, Soren and Joe. Katherine is the COO, Soren is the CTO and Joe is the CEO. Soren and Joe have known each other for eight years and previously founded an email marketing company called RestEngine. It was eventually sold to Twitter and became Twitter's email infrastructure. Katherine is the veterinarian. The way we loosely breakdown responsibilities is that Joe handles the demand side (pet owners), Katherine handles the supply side (veterinarians) and Soren builds stuff to enable both sides. The reality is we all do a little bit of everything.

What do you think are some important things for folks to know about the business?

It's hard to overstate just how much better the experience is when vet care is handled in the home. I think the best evidence of that is our Yelp reviews.

Do you have any direct competitors that are in the space or is it really just traditional vets?

There are a few other vet care start-ups, but we have a 1-2 year head start and are 5-10x their size in terms of clients, technical development and operational processes. I like to say that our primary competitor is lack of awareness. The vast majority of pet owners don’t know that house calls are an option. As that changes, our business’s growth will hopefully accelerate.

1	50+ Veterinary professionals / 3500 customers in LA and Bay Area
2	40% of customers book follow-up appointments in 6 months
3	35% Gross margins / 1 year customer LTV: $350
4	5 Star Yelp rating with over 270 reviews
5	15% Compounded monthly growth
6	65% of all U.S. households own a pet

1	Changes in the demand for our products and services could negatively affect our operating results.
2	The significant competition in the companion animal healthcare industry could result in a decrease in our prices, an increase in our acquisition costs, a loss of market share and could materially affect our revenue and profitability.
3	If we are unable to effectively execute our growth strategy, we may not achieve our desired economies of scale and our profitability may decline.
4	We may experience difficulties hiring skilled veterinarians due to shortages that could disrupt our business.
5	Any failure in our information technology systems, disruption in our transportation network or failure to receive supplies could significantly increase testing turn-around time, reduce our production capacity and otherwise disrupt our operations.
6	If we fail to comply with governmental regulations applicable to our business, various governmental agencies may impose fines, institute litigation or preclude us from operating in certain states.
7	Changes in regulations or user concerns regarding privacy and protection of user data could adversely affect our business.

Director	Occupation	Joined
Soren Berg	CTO @ VetPronto	2014
Joe Waltman	CEO @ VetPronto	2014

Officer	Title	Joined
Soren Berg	CTO	2014
Joe Waltman	CEO	2014
Katherine van Ekert	CMO	2015

Holder	Securities Held	Voting Power
Katherine van Kert	2428048 Common	24.3%
Soren Berg	2428048 - Common	24.3%
Joe Waltman	2428048 - Common	24.3%

Date	Amount	Security
11/2016	$362,718	SAFE
12/2015	$85,000	SAFE
01/2016	$114,800	SAFE
10/2015	$10,000	SAFE
06/2015	$690,000	SAFE

$50,000	Geographic Expansion. We are going to use funds to expand to new markets. We estimate that it costs $50k - $75k to get a new market to break even.
$100,000	Improve Operational Efficiencies. We will be automating a number of manual processes as well as launch route optimization that will increase vet utilization. We are estimating costs of around $15-$20k to optimize our processes.
$150,000	Expand Service Offering. We will launch an upgraded native mobile app that will include virtual care options (e.g. video chat). We estimate it will cost around $20-$25k to enable this.
$1,000,000	Additional Geographic Expansion. The amount that we raise will determine the number of markets we can launch. We will be launching in New York in the fall and then hope to be in 2-3 other cities by the end of the year.

Class of Security	Securities (or Amount) Authorized	Securities (or Amount) Outstanding	Voting Rights
Debt Securities			No
Options	939,400	79,289	Yes

Why you may want to support us...

Why investors us

we've raised $1,262,518 since our founding

Our team

In the news

Downloads

The Best Pet Care Happens at Home

Problem: The Vet's Office is Outdated

Solution: Get care at home, on-demand

★ ★ ★ ★ ★ from 270 Customers

All Your Pet's Records Together

Only At Your Convenience

Completely Transparent Pricing

We Screen for the Best Vets

The Market is Ready for On-Demand Pet Care

On-Demand Services are Now the Norm

More Vet Graduates than Jobs Available

Owners are Spending More on their Pets

We're Growing Fast: 3500+ Customers in Just 2 Cities

Our Next Steps: Expand and Optimize

How Your Investment Will Help Us

Launch to New Cities

Expand Our Services

Start Optimizing Operations

Better Care, Together

Investor Q&A

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Risks

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The Board of Directors

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Past Equity Fundraises

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VetPronto Expands to 15 Cities

VetPronto February 2017 Update

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