Why 1stAvailable has an unbeatable strategy behind their startup

- March 24, 2014 8 MIN READ

Fail fast, try new things. This philosophy has been echoed by many entrepreneurs – including Eric Ries, author of The Lean Startup and Michael Kordahi, developer evangelist at Microsoft. Although not all startups are comfortable with failure, the experts behind 1stAvailable.com.au have embraced the ‘fail fast’ philosophy and believe it has contributed to their success.

Launched in 2012, 1stAvailable.com.au is considered a breakthrough for both healthcare professionals and patients. From a consumer perspective, it provides a free-to-use, central online booking portal to find and book healthcare appointments at any hour of the day. The service is accessible on the internet via a PC or smartphone. Currently, 60 percent of 1stAvailable’s online bookings are made through the mobile app.

On the other end of the spectrum, 1stAvailable improves practice efficiency and profitability by freeing up front desk staff, improving customer service and filling up costly last-minute cancellations. Essentially, the startup aims to alleviate and create capacity in an overextended healthcare system – and in a timely manner, given the increasing shift towards digital technology.

The inspiration

The original idea behind 1stAvailable was conceived by a Sydney-based dentist, Dr Rick Luu. He was concerned about the vacant appointments costing his business money year-after-year. One day, he was trawling on wotif.com and realised the underlying purpose of the site is to sell last minute inventory. This sparked an idea, which turned out to be far bigger than he’d initially envisaged.

An experienced team of veterans in both the healthcare and online markets – including 1stAvailable’s Co-Founder and Managing Director Klaus Bartosch – currently runs the startup.

Bartosch has a well-established civil engineering background, and has spent the last 30 years in various positions in the IT and high-tech fields.

He helped build Host Works, a company that catered to highly esteemed online businesses like wotif.com, seek.com, carsales.com.au, realestate.com.au, and ninemsn. In fact, Bartosch’s personal resume includes 15 of Australia’s top 20 web businesses to his credit, so it’s understandable why he wanted to stake his own claim as an online entrepreneur.

“I was responsible for managing online applications and systems for these top companies (Wotif, Seek, etc.). I worked with the founders and CEOs before they became the great companies that they are today. That background was instrumental in providing some of the insights into what we need to do to become the number one online player in the healthcare market,” says Bartosch.

Initially, the 1stAvailable team focused on the dentistry market, but was quick to expand their horizons – now including all healthcare services from personal training to physiotherapy. This was partly due to the specialisation and complexity of the dental industry, but also because they saw the broader possibilities for customers using the 1st Available app.

Is the healthcare industry slow to adopt technology?

What makes 1stAvailable truly disruptive? At first glance, 1stAvailable comes across as a ‘no brainer’ kind of product. After all, technology that allows patients to book appointments online is an obvious next step for the healthcare industry, isn’t it?

Apparently not. The healthcare industry doesn’t necessarily have technology on its ‘to adopt’ list.

Bartosch admits that they have captured less than one percent of the healthcare market. Out of 400,000 healthcare providers in Australia, they have 3,500 practitioners signed up to their services. A small percentage of the healthcare marketplace is still a huge mouthful of the overall pie chart, meaning many potential billions of dollars in profits.

In the case of 1stAvailable, 3,500 customers were acquired over a period of two years – so we can estimate an average of five new customers per day. Each practitioner pays $50 a month for the service, in contrast to HealthEngine users who are charged on a pay-per-booking system. This difference is one of the big selling points offered by 1st Available to healthcare practices.

“Our practices pay a simple monthly fee to publish vacant appointments online. The cost of the service to the practice is the cost of approximately one appointment a month per practitioner, so it’s a very simple ROI (Return on Investment),” says Bartosch.

The return on investment for the 1st Available app is very lucrative, taking into consideration that most private practices book in hundreds of patients every month.

Why then, is getting healthcare practitioners on board such a challenge? Bartosch believes healthcare practitioners are not business oriented. They’re not inclined to think about customer service, operational efficiency and other aspects that come into the day-to-day running of a business. And so, without business acumen, it’s hard to adapt to a changing landscape.

Why 1stAvailable has an unbeatable business model

In a world full of generic thinkers, Bartosch is one who embodies the best aspects of a high-tech specialist, new world entrepreneur, and online idealist. This is reflected in how the 1stAvailable is structured as a service.

If we go one step back, we can understand why an online model is so important in healthcare booking systems. One example Bartosch provides is that of someone suffering from a mental illness. If they have an after-hours crisis, they can enjoy the comfort of booking an emergency appointment online, and go to bed knowing that help will be available. In other cases, people may feel embarrassed about the services they need – such as sex therapy, colonoscopy, etc. – and feel uncomfortable calling up the practice to make an appointment.

The impact of an online model is larger than just convenience for the time-poor. It makes healthcare more accessible.

“The business is not just about making money, it’s a business that has the potential to profoundly change the health of Australians and the cost of healthcare in this country. It surprises me that we’ve tried and tried, but still can’t get the government to wake up and realise that they should be getting behind and supporting businesses like ours,” says Bartosch.

Sites like wotif.com or realestate.com.au are like search engines in that they present the end-user with too many options to choose from, potentially causing further confusion. Whereas when a patient searches for an appointment on 1stAvailable, they will be presented with one appointment. While this may seem restrictive, there is a strategy behind it.

As Bartosch explains, “We don’t show you a practitioner’s full day’s or week’s availability, simply because you don’t have to know. The more information that I put in front of you, the more confusing and difficult it is to make a decision.”

“But more interestingly, if you have five practitioners in a practice – one is brand new and the other four have been there a long time – if I was to show you the full week’s availability of every practitioner (like other competitors in the market), you as a patient will be drawn to the practitioner that has a full diary than the guy who has an empty one. It’s the same reason why you’d walk into a full restaurant rather than an empty one. But the new practitioner may have twice the skills, he might be the best at what he does.”

Bartosch adds that this has a “profound impact on a practice’s ability to drive patients to the new guy they hired, simply because of the natural problem of human selection.”

If 1stAvailable presented multiple availabilities – like 5:30pm, 5:40pm, 5:50pm and 6pm – the patient is more likely to not show up on time, thinking the practitioner’s diary is empty and that punctuality doesn’t matter.

“We don’t present these options deliberately to keep you committed to the appointment – which is ultimately good for you and good for the practice,” says Bartosch.

“There are many subtle UI things that have been honed from day one, that make us quite unique in the marketplace.”

But how did they build these strategies? Bartosch says they’re constantly surveying their users, and using that information to refine the product.

“We conducted a bunch of surveys before we launched and we utlilised the survey to help us understand how we should modify our services or engage with our providers or consumers. We adopt and apply all of our learnings on a regular basis. In fact, we introduce an upgrade to our platform every two weeks,” he says.

“Every two weeks there’s a new deployment, new capability, new functionality, or new technique.”

Bartosch continues, saying this is how wotif.com, seek.com.au and carsales.com.au became successful. They had a strong sense of vision, direction and purpose. They constantly reminded themselves of what their motivation is for doing what they do, and had a clear idea that they wanted to see eventuate.

But more important is their ability to iterate. Klaus says these web companies innovated constantly because the market is always shifting for one reason or another.

When you really look at what makes 1st Available different, it comes back to their unusually independent-thinking business paradigm. The company motto states how dedicated they are to their business pursuits: “Fail fast, try new things. We will sit down and evaluate, test and make a decision about why we’ll try something first and give it a go. If it doesn’t work, we stop and move on. We don’t get hung up on it.”

Self-belief: “My startup saved my life”

Perhaps one of the most interesting results noted by 1stAvailable is customer feedback. They ask first-time users a question that is fairly standard: “Would you recommend 1stAvailable to your family and friends?” There are three options. Interestingly, 80 percent say ‘yes’ and 20 percent say ‘Already have’.

“It’s interesting that people will proactively, without being prompted, tell their family and friends about this new-found convenience of booking appointments online. So once introduced, it grows momentum,” says Bartosch.

From our interactions, one thing is clear: Bartosch has something that many entrepreneurs lack today, he truly believes in the service he promotes. And of course, it is doubtful that Bartosch would waste his time or risk his investments on anything that didn’t meet his criterion. He not only profits from his business venture as Managing Director and a shareholder in 1st Available, but also is a user of the product he provides.

Nothing demonstrates this belief and personal conviction better, than a fact that Bartosch only recently made publicly known. His exact words being, “I don’t share too often, but I am an example of how our service can impact someone’s health – 1stAvailable actually saved my life.”

In October 2013, Bartosch was raising money for cancer research, along with other members of Vision Crusaders – a charitable cycling team he founded. He was about to embark on a cross-country bike-riding trip to raise money; and having been diagnosed with Arthritis, the swelling of his right knee seemed like a symptom of the disease. Though he didn’t think much of it, his family encouraged him to get a physical checkup.

Reluctantly, through 1stAvailable, Bartosch booked an appointment with a local doctor. The doctor assigned a preliminary blood test, which found that he had no white blood cells in his body. Otherwise, he was fit as a fiddle.

The doctor wasn’t too concerned but referred him to a haemotologist nonetheless. The haematologist discovered, with an additional bone marrow biopsy, that Bartosch had advanced stage Leukaemia. Upon receiving the results, the haematologist called Bartosch – advising him to get emergency treatment in a hospital immediately.

Without the treatment Bartosch received, his condition would have killed him. He is now in remission, and claims that the simplicity of booking a doctor visit contributed greatly to him being alive today.

Like many patients, Bartosch would have ignored ‘mundane’ symptoms being checked, if it wasn’t convenient to access and book a medical appointment. This incident demonstrates the sheer practicality of the 1st Available mobile app.

“I probably would have ignored it and pressed on, but because at 9pm I could book an appointment, I did and it saved my life,” he says.

He adds, “Persistence and belief in what you do is 9/10th of the law.”

With such inherent convictions at the heart of 1st Available, success is sure to follow their efforts, purely out of good karma and to balance the scales business-wise. Financially speaking, 1stAvailable is predicting a break-even point in June 2015.

Raising capital

Thus far, 1st Available has raised a total of $6 million, including tax grants for research and development – with $1.5 million coming from a recent fundraising round. All Directors of the company have invested in this round, but the majority has come from both existing and new shareholders.

Grays Online founder Mark Kehoe and former Salmat CEO Grant Harrod have been brought into the fold as Directors, partly due to their former associations with Bartosch, but mostly because they have an enormous amount of faith in 1stAvailable.

The Australian healthcare marketplace is in a highly competitive climate, so this may be the greater incentive for such large-scale investments. The healthcare industry and online appointment providers are would no doubt want innovative solutions that are user-friendly, both for consumers and practices.

The race to create a workable system that successfully integrates multiple practice management software systems is undeniably risky and competitive. As an example, healthengine.com.au received $10.4 million from Telstra and Seven West Media in 2013.

While 1stAvailable is footing some inherent risks by trying to enter into the Australian healthcare market, their founders have a steadfast belief in the public as users. Because practitioners haven’t been quite up-to-speed in adopting 1stAvailable’s technology, Bartosch is hoping to see a consumer activist movement.

“We even thought at one stage in our marketing, that we should leverage the fact that people find booking appointments frustrating and create an activist movement – that is, get consumers to collectively demand an online booking provider. But we failed,” says Bartosch.

With the new cash injection, 1stAvailable will be changing their strategy and embarking on a more aggressive marketing mission.

In the mean time, nothing says more about a company than how its employees feel about working there.

“When you talk to people in our company, and ask them ‘why do you work for 1st available’, they’ll look you in the eye with huge passion and express the view that the business is making a real impact. It’s offering real benefits to consumers, to all Australians,” says Bartosch.

It doesn’t get better than that.

More information on 1stAvailable can be found via 1stavailable.com.au.