Mens health and personal care startup Hims offers up a pretty straightforward business proposition. Founded a little over a year ago, Hims seeks to tap the millennial male market by offering up skincare solutions, hair-loss products and erectile dysfunction medication (specifically, a generic form of Viagra) online. The firm also launched Hers — its female centric health and self-care brand — late last year (on the one-year anniversary of the Hims launch).
But it is a straightforward idea that has built up a lot of momentum — and very fast. The firm is cruising toward a $1 billion valuation and unicorn status as it is in the final stages of negotiating a $100 million funding round, according to reports in Recode that were confirmed by TechCrunch.
Specific details on the ongoing funding round remain a bit hazy, but reports seem to concur that a new growth-stage investor led the round, with participation from existing investors. TechCrunch further reported sources saying it is a “super big fund” that isn’t SoftBank and that hasn’t previously invested in Hims. The firm had previously raised $97 million in a round that closed over the summer.
But the firm’s simple premise, and rapid ascent to unicorn status, has also stirred up some division.
“As a business proposition, Hims seems fine as far as it goes. But potential investors should ask themselves, is this the stuff of which unicorns are made? The company offers largely commoditized products that might be cheaper elsewhere,” one Bloomberg columnist noted.
And, according to reports, Hims spent months negotiating with investors over the $100 million round currently in proces, “with some of them balking at the valuation.”
But according to Hims Founder Andrew Dudum, Hims is not only an eCommerce venture selling products, it is a healthcare platform dedicated to creating close — and loyal — patient relationships. By focusing on areas like erectile dysfunction and hair loss, he said, Hims is working to help men (and more recently women) access better healthcare by removing middlemen like pharmacies and doctors when the prospect of having to deal with someone in person may keep a patient from seeking care due to embarrassment.
The online service, apart from selling the goods, also charges a $10 membership fee which covers access to the platform and to the firm’s network of prescribing physicians. To get medication from Hims, customers fill out a questionnaire, then perhaps have a quick telemedicine consult with a doctor or a back and forth via email. Those looking for hair loss drugs might have to submit a photo. A perscription is authorized, and the goods are shipped directly to the patient’s door.
“We’re the front door of the doctor’s office,” Dudum said. “We are completely different from anything in the health-care system.”
The firm is different, to be sure — but not totally different. In the startup sphere there is Roman, another direct to consumer men’s health brand offering an eCommerce solution for younger men looking for access to things like generic viagra. According to reports, they’ve been courting many of the same investors. Him, with its incoming $100 million in investments and unicorn status, seems to have pulled ahead in that race — though it still has to contend with legacy sellers of both Viagra and Rogaine, some of whom offer lower prices.
And there are those who question the idea of adding medications for hair loss, erectile dysfunction or anything else to an eCommerce portal — even one with a telemedicine component.
“You’re seeing a direct-to-consumer movement that probably will have some people doing things that are unsafe,” said Adams Dudley, director at the Center for Healthcare Value at the University of California, San Francisco.
But Hims notes that it turns away applicants frequently, because its oversight process works. And the firm says it is bringing into the healthcare system people who otherwise tend to avoid it — young men.
“They’re trying to target these fairly universal problems,” said Arash Mostaghimi, a dermatology professor at Harvard-affiliated Brigham and Women’s Hospital who advises Hims, “and either help people who wouldn’t get care otherwise or make it easier for people to receive the care that they need.”