Joe Spector on Building Hims, Dutch & the Future of Telemedicine | Coffeez with Joe Shalaby

0:00What's up, everybody? Welcome to another episode of Coffees for Closers. Today, I'm sitting down with an absolute legend, someone I'm truly a fan of, and I use their products on the daily, and they continue to gain more market share and help a lot of men. What started off as a crazy vision is now a household name. Please welcome the co-founder of HIMS, Joe Spector. Welcome to another episode of Coffees. Hey, I'm so excited to chat with you. So I'm going to dive right into it. I got a lot of questions. I'm really excited about all the things that you're doing, the projects that you have underway, the way you're really changing the landscape of so many different things.

0:42But before I dive into that, let's ease the waters. Joe, you look like you're in great shape. What's your morning routine? I am part of a group of dads called the Dojo. and three days a week we have a 5 30 a.m uh hour hour and a half workout and uh and then on the other days I'm doing some sort of a Peloton cardio workout and it kind of serves two things one is that it's good for my mental health but it's also been a way to build community I think men And oftentimes it's hard to find camaraderie. And as an entrepreneur, there's so much shit that we're dealing with all the time. And it's been pretty awesome to find this group of guys to connect with.

1:39So that's kind of been my secret power. That's so cool. How'd you find them? It took, I mean, it's in the small community where I live. And it took me a while because I am not a morning person. In fact, through college, and even before kids, I could easily sleep to noon to even into like two o 'clock in the afternoon if I had my way. and I think I have kids so they were a force function that got me up in the morning but this workout group it meets so early I never thought I could do it but just like so many things if you prioritize it you'll make it happen and the thing is every time I leave the workout out, I feel so ready for the day.

2:37It has definitely been a game changer to my routine. And I've been doing it now almost three years. And like I said, I I'm in the best shape of my life in my forties. Yeah, that's awesome. You look, you look like you're in great shape. I train every day and I'm, I try to be in a part of so many dads groups. I got four kids. I'm involved in all their sports. I'm still an athlete, jujitsu, basketball, pickleball, like you name it. I'm just a big kid. I collect sports cards with my boys. I like whatever it takes to be a kid. I'm like doing it. Yeah. Yeah. I love it. I love it. Yeah. So let's, let's talk about a couple of journeys you have.

3:17Let's first off. And I, I know about the journey that you had with starting HIMSS, but let's take it back. Let's start with how did HIMSS start? How did you come up with the name, the concept, and what did people think when you came up with that company? When HIMSS started, it was so classic looking back. And in the middle of it, you don't realize what's happening. But looking back, it was so classic because it really was an idea on a whiteboard. And for me, it's like they say, luck is preparation plus opportunity. So by the time even I got to the table of the whiteboard, this is already 15, 20 years of everything that happened before.

4:13being an immigrant, having, I've probably gone through at that point, almost a dozen startups that didn't work out. So it was the hustle and all those lessons learned that by the time I got to HIMSS and I saw that opportunity, I was also ready to take advantage of it. And so that's kind of the preamble on hymns. What appealed to me, a couple of things. By that point, I sort of said to myself, like, what's important, which is I love working with consumer businesses because they affect people's everyday lives. They make people's lives better. And that was something that was important to me that was going to motivate me to, you know, stay up all night, you know, and be creative for how I get things done because I love consumer businesses.

5:07I love the impact that it has on people. So that was one thing that drove me to the opportunity. And then of course, you know, personal experience, obviously, I don't have hair and men's wellness. I understood the problem. I understood that if I had this in my 20s, it would have been a game changer. And I think combined with, you know, my own experience being an immigrant, not growing up with a lot of money, I knew very clearly, like, the reason I didn't know this existed is because I'm not, you know, wealthy enough to have my own kind of private dermatologist. So the opportunity spoke to me. And then once we started going and executing on it, it just took off like crazy.

5:58um we spent about a year in stealth mode and at the time it was actually called club room so we we spent you know getting the pharmacy um at the time there was lots of legal challenges because telemedicine was not as prevalent as it is today and many states actually didn't allow telemedicine without a physical exam first, which by the way is all these lessons I later took into my company Dutch. But putting all the pieces together was something I was prepared for. And once we went to market, I think it basically took off like wildfire. And so then a year in, we used an agency. I was part of the team that helped brand it HIMSS.

6:55That name, you know, kind of just, we probably looked at like 50 different names and that name, pretty much everyone saw how cool that name was. And then it took off. You have to remember the other interesting thing is like every startup is kind of like a snowflake because the stars and the moon have to align. And sort of all these things happen for a reason. At the time, Viagra was going generic. So that was like a huge opportunity. And then we're also in a world where interest rates were almost zero. And so we were raising$50 to$100 million of venture capital almost every quarter. Like in today's market, that's unheard of.

7:49So like I said, I think what happened in some is that it was this perfect storm where I think I was ready for the opportunity. but once it started to once we started to execute it just really took off and i would say i didn't look back until we went public but now you uh you said a couple things here number one interest rates were zero and you had you kind of there was a snowball effect that you really got to leverage and you came up with a concept where there was an extreme need with Viagra going generic. Now, what I found insanely fascinating with the strategy for HIMSS was it was in every health club in the nation, in every locker room, in every jacuzzi.

8:45all it was like all you could and how brilliant of a strategy to market when men are in their peak vein state like they're looking at themselves naked in the mirror just got out of the sauna at the gym and they go i need this you know i don't know how you came up with that marketing play but it was so direct and it hit you like you know i i remember distinctly i don't know if it It was five years ago. I don't even remember. But it was like, you got to just try this product. And it was just every day, all the time, every time you go to the gym. The strategy was right to the point, hit you like a bag of rocks in your face.

9:31And I thought that was just an incredible marketing strategy. I was blown away by it. How did you come up with that strategy? I mean, we had a great marketing team. I think the bigger thing of what you're saying, and this is like an entrepreneurial lesson learned in general from all that, to put it even in a bigger context, is there are no rules. Make your own rules. Create your own, in this case, create your own spaces, create your own opportunities. Because we weren't going to do the traditional, let's advertise on Facebook and Google and let's run this ad. Everything was what I learned from him is to think big, dream big and don't create these boundaries.

10:21So we advertised in gyms and that was a super cool get. But we also we advertised we did a campaign where we advertised in urinals. We advertised. I saw that, too. every every nightclub every gym basically anywhere where their men cared about their appearance yeah we we created our own ad inventory out of nowhere and like i said i think it was part of an overall philosophy of we're not gonna let traditional advertising but frankly traditional anything control us or box us in yeah it was definitely a very untraditional almost like um anti-marketing campaign you know you don't market in bathrooms like as a true like that's not a normal way to market a business you know like we had the penis cactus and i think that if you ask kind of before, it almost felt like marketing suicide to do something like that.

11:38But we made it fun and cool. And the whole point was, let's get rid of this stigma. Let's normalize the conversation. Let's make this something easy to talk about. And we definitely did that we had we had a great marketing team that executed and like I said made us approach the brand in a non-traditional way now one thing I'm fascinated by my research for this show and kind of studying what you've done is you know when you started hymns you started it with um you know uh a viagra alternative and a uh hair product and people just thought you were crazy for doing that you face a lot of backlash you had multiple failed startups and i think what i forget the term you referenced it as but you basically it was like par for the course for you it was just a part of the journey you know you looked at it like you know just just taking a beating as part of the journey, which is a great way to basically take entrepreneurship's life's lessons that it feeds you.

12:52What was it like when you're like, you failed six times and now you came up with another concept, totally outlandish. How did you deal with that? Everyone probably wanted you to do something like, go be a doctor or something. Go do something totally normal. I got a crazier idea now. I got even a crazier idea. What was it like just going all in after multiple failures on this project that had never been done? At this point in my journey, you have to just be honest with yourself and honest kind of with the bullshit meter. And for me, whatever it is I'm doing, deep down in my bones, I really do believe what I'm doing is good for the world, for the end customer.

13:47I think what I'm doing is the right thing. Because if it was a gimmick, then that would be a lot harder to take the punches on the face. But because in my heart of hearts, I believe that what I'm building at the moment is so great, is so helpful. With Dutch, for example, today, we're helping millions of pets get care for the first time. 50 % of pet owners that come to Dutch say that they have not been to a vet in years. Three years. The math I read. That's crazy. And our report that we're about to release, the State of Online Pet, is saying that today in America, 75 million pet owners skipped care because of cost or access.

14:3875 million. So I know that what we're building at Dutch is ultimately good. but yes like as a result i get called out i get crazy people who are angry and mad at me um but i know i'm doing the right thing for ultimately in this case pets so it just boils down to follow your gut trust your instinct make sure that you're doing good for the world and god has a way totally i think in the end it will work out if what you're doing is not a gimmick and ultimately good. That's not FDA approved. And you're basically saying you're going to regrow your hair or we're going to solve your erectile dysfunction.

15:24How does that even work with all the legalities behind launching a product that's basically part of medicine? I'm in a hyper-regulated industry, but man, medicine's even more hyper-regulated. It's like Now, with the peptide business, doing it as a blacklisted strategy with all these new gimmicks that are coming out in the medicine space. But you guys were in your face marketing everywhere you go. So I know that regulators were up your butt. So walk me through that process because I'm very curious about it as an entrepreneur. Everything is calculated risk. So in our case, the products we're selling are not addictive.

16:15And so they're not controlled substances. So I think that was one thing. It's not like the likelihood of you dying by taking too much Viagra or that you're going to get addicted to Viagra. That's not likely. So that was kind of like one barometer. The other one is that, like I said, we knew that ultimately this was gonna lead to greater good. Lots of people had no, like me in terms of hair or ED, had no idea that this was even on the market. Just to put some context, one Viagra pill was almost like $50 to$100 for one pill. And the generic is just a few dollars. So the level of access that opens up is incredible.

17:08And without HIMSS, I don't think people really would have known that this is something they can actually get access to. And we kind of, to some extent, see the same thing today, because at Dutch, we might talk about really common medicines that a dog might have, like flea and tick, or almost two thirds of dogs have a behavior anxiety issue. But the fact that you have to bring your dog into an office, people just kind of say, you know what, it's not that bad, just forget, I'm not going to do anything. But by opening it up, and with telemedicine, it's so frictionless, it's so accessible, that it just brings so many more people into the medical fold.

18:00So that's what HIMSS did. So I think, ultimately, like the question was, that we'd ask ourselves is, you know, if we were in front of a state board, like, who's going to be upset that we made a bunch of guys hair grow at a cheap price? Like, who's, who's being hurt in this situation. And so I think it felt like a low level of risk to take. The erectile dysfunction pill was a competitor to Viagra at a fraction of the price, right? So that's where it gets tricky because the generic is not necessarily FDA approved, But the way that the regulations are is that a doctor, a human doctor can write you something off label or can kind of give you a choice and can give you an off label option as a choice is kind of ultimately how we're.

18:56So I guess the other lesson learned from HIMSS into Dutch is that when you're in a highly regulated industry, the letter of the law and knowing laws, especially in this case, healthcare is regulated at the state level. So it's kind of like 50 countries. You have to know the exact wording of each state's laws. And knowing the wording can make a world of difference to how you're able to execute your venture. Yeah. So it's funny because in my business, the mortgage business finance money that we lend, we lend nationwide, we state regulator, and then you have like an overseer of the entire country.

19:43And then you have like an overseer of the entire country of the, you know, like another overseer above them, which is the CFPB. It's like, so you got the regulators, then you got the mortgage licensing registry, then you have the CFPB who regulates all of us. Right. So the nuances with state-specific regulation is crazy because you have to mention, like in Texas, these words, and then in Arkansas, these words. It's like, I wish there was a simplified solution to these state regulators where it's like, you know, make it easy so we could get products to help people faster. At the end of the day, we're here to serve.

20:18We're here to help. I agree. And with this bureaucracy, it's like, you're just making our job tougher and more expensive. You're adding to the legal costs of having to know state by state. And I think to some extent creating consumer confusion, because like you're saying, the customer is thinking, why are they saying these words? They don't make sense to me. But like you said, you're saying it because you were forced to say them. Yeah. And then why are they saying this in California and not in Texas? I know. I know. No, it definitely, it's weird, right? In healthcare, if you broke your foot in California, shouldn't we be fixing it the same way in New Jersey as we are in California?

21:06Like what's the difference? That makes no sense. The advent of AI and stuff, things are going to get more streamlined where there's a way where every state is on the same page. They started to roll something out in our industry called SES where every regulator is on one platform so that they can all kind of communicate to it. Because there's been a disruption between if it's regulated state level and none of the states talk to each other and they're all asking for the same thing or something different and they all have their own regulation and no one communicates. It's a nightmare and it's a cluster and it's really disruptive to any industry.

21:38Yep. Well, as an immigrant, I know all too well that this is the founding of America is a battle between states' rights and federalism and states' rights. And as a result, this is what happens. Yeah, I'm also an immigrant. I came when I was five. What country did you come from? Uzbekistan, former USSR. Oh, nice. I came from Egypt. So third world, poverty stricken, rose from nothing. you know so how did you come here so i had an aunt who had married to bring my mom her sister over um on a visa and so we immigrated when i was five years old um and what happened was i'm coptic orthodox i don't know if you're orthodox as well you're russian orthodox and but uh we were persecuted we were like killed off um all the time and it's still happening now where basically the Christians get killed by the Muslims.

22:35They go into the churches, they bomb them, etc. So we came on asylum. Wow, because we were getting killed off. And we moved to the valley, we were living in apartments. My dad was a physician in Egypt, and then came to America, had to start med school all over in his 30s and worked as a gas station attendant, still grinds till this day. But But the immigrant mentality is one of absolute grit. I started working really young. My dad still works as a physician till this very day, 76 years old, just turned 76, January 31st. And it's funny because he was just telling me this story. Went to this clinic.

23:12He moved. Now he'd commute. He lives in Costa Mesa. He bought a house in Hemet. Commutes from Hemet to Costa Mesa, which is a couple hours. And then he retired from that job in Hemet. Got a small job at a small clinic in Costa Mesa. And then now they called him back in Hemet. Now he's going to work two jobs as a physician. I'm like, dad, you're 76 years old. You don't need two jobs. You don't even need to make money. You're insane. Crazy. I get it. Two jobs, 76 years old hustling two jobs. That just shows you. That always is a reminder to me how much I suck. My dad's 76 hustling two jobs. Why am I slacking?

23:51Trust me, I feel that way too. Why am I slacking? It's hard, I feel like, for some of the people who work with me, because then that immigrant mentality, I think, is all over them. And where I'm also feeling like I'm tough on myself, too. Like, why am I slacking? But I feel like with people I work with, it can, that intensity is just kind of, it's foreign. And so I think it can be a lot. It rubs them the wrong way. Rubs them the wrong way. Sometimes freaks them out a little bit, huh? Yes. I think once they know what they're coming from, at least they have context. But yeah, I have a, you know, it's so awesome to meet other people who, because I think our stories are aligning pretty similarly in terms of also coming here on asylum and kind of the grit and the hustle that you just have built into you.

25:00Now, I'm going to ask you a question because, you know, you came from poverty, immigrant. Now you're in abundance. And this is something I'm struggling with as a father. I have four kids. How many kids you have? I have three kids. Okay. So how are you instilling that same level of tenacity, grit, work ethic? Because they have this abundance. They're given everything, you know, and, you know, they're not coming from poverty. They don't have to work at 13 years old. Yep. And it's something I struggle with because all their friends are wealthy, you know? So, you know, it's, it's a struggle for me and I'm actively working on making sure and every day talking to my kids about hard work and I got them in all these activities and I'll tell you my protocol.

25:46Um, what are you going to instill that same mindset and grit and you know, the ability to rise above and, and with their back against the wall mentality? I'm definitely trying. I feel like we'll, we'll see as they progress, but, um, In terms of little things, I think one thing, first of all, in general, and I say this even at Dutch too, is no one's too good to take out the trash. So all of them, they have to pick up my dog, Eddie. They have to pick up his poops all the time. And they're always the ones taking out the garbage and sweeping the front of the house. So I want to make sure they don't feel like they're too good to do chores like that.

26:32I think the other thing is we, my wife and I were pretty open with them about money and how much things cost. Because again, I want them to understand the value of a dollar and what it takes to make money. I've also said to them that they're going to be responsible for paying college for themselves. And I've said that they're not getting any money from us because I want them to believe and feel that it's on them to make the decisions for the rest of their lives. They're also, so I'm Russian, I speak Russian. They're all learning Russian. I want them to learn the Russian language, which kind of language has its own set of kind of cultural, especially, again, I think Russian, a harsh reality that you learn through the literature and through learning the language.

27:30And then just other things. So I'm Jewish. And, you know, just recently I took them. We went to Germany and we went to a concentration camp. So I want them to really see that other people definitely have to struggle. And like, this is like why we're here and the freedom that America offers them. Um, so kind of, I still think they're, you know, meanwhile, they're, you know, traveling, which I didn't really do until I had my own money and a job. Um, but I think I'm, you know, trying my best to kind of plant some of these seeds so that they're not completely unaware that there's this other world exists.

28:15That's not privileged like they are. If nobody's listening to my show, I'm the biggest beneficiary. Cause I get to sit with someone like you for an hour, pick your brain on parenting, life faith struggles so you know i always ask about parenting advice especially with high level entrepreneurs because we all kind of are going through that same struggle because we need our kids to make sure that they're like us or better ideally better um so i have them like on school from seven to three then it stands from three to seven and then it's more homework from seven to eight and it's that's that's uh like that's a that's what we do you and i right like we just that that's life like that's you grind all day and then and then go to bed do it again the next day so all my kids starting at like three four like my four-year-old you know it's school then it's jiu-jitsu then it's kumon and then it's you know wind down so it's the regimen of of that work ethic where it's not easy like they don't like going to jiu-jitsu it's tough a regimen where it's oh emulate that's work for them that's the same thing that we do it's you know so it's the same thing, kind of where that 30 minutes in front of the iPad or, you know, whatever is earned time, right?

29:28I do struggle with electronics. I'd like them to be reading ideally over. So we're fortunate enough to be like the community, the Egyptian community is very tight knit. So we're very involved in the church and the community and the sacraments of the church and making sure that they stay in a faithful place where God is always front and center. So I try to just instill a godly lifestyle jewish uh you know obviously the jewish culture and faith is very similar yeah as in silicon as long as they're there it all boils down to doing the right thing we're all trying to do the right thing and do god's work with whatever venture we have that's the the mantra of the show that's the vision of my company when i started it so so yeah i keep them grinded keep them grounded and i involve my kids in my business as much as i can uh that's why I started content.

30:17My daughter thought I was cool because I became an influencer and her friends were like, well, her dad's all famous on YouTube. For a moment there, she thought I was the coolest guy. I don't get that with my kids, but I will definitely - No, no, it's not anymore, except to my boys. I'm cool to them because I play sports and stuff, but no, my goal is like, okay, if my daughter thinks I'm cool, that's all my goal is, but she doesn't think I'm cool anymore because I stopped doing that. My board doesn't let me do that kind of content. Like it was fun. YouTube. I'm a finance CEO. Like I got to keep it pretty rigid.

30:52That's where I am. I will. I'll definitely also involve my kids in Dutch. And my favorite that I love to do is a role play and negotiation with them. And because kids are kind of so innocent, but, you know, they don't have the filters and all the built-in stopgaps that we have in our brains as adults. They always, I end up getting pretty good advice on a potential negotiation with them. And it may not be exactly, you know, word for word, but I think they've definitely inspired me in negotiations to ask for something or to, the way after a role play, it's been kind of fun to see their suggestions.

31:41Oftentimes their suggestions are just, that's what you should go with because that's raw, that's authentic, and it's not disillusioned by the world. It's like, that's just truth speaking to you. When my son gives me suggestions, I'm like, you're right. I'm going to go with that. One thing my boys, everyone's proud of, and my sons, it's like everywhere they go, when they shake your hand, they're trying to break your hand. Everyone comments And it's like, man, that's a great handshake. He went to baseball practice yesterday, shook all their coaches' hands. None of the other players had a strong handshake.

32:16He shook their coaches' hands, and he smashed his hand. And they're like, that's our star player. Got to go in and make yourself known. Yeah. So I just do that as much as I possibly can. But I'm getting coached, man. I'm doing these podcasts learning from life. Like I said, to me, one of the best things from hymns that I'm using, I think, for Dutch is to dream big. I think oftentimes what I learned as an immigrant is when I got to America, I was so busy on survival. I was only able to see things, just what's in front of me. and I think after HIMSS, I realized that just like what we're seeing with Elon Musk, who's saying, you know, I'm going to go to Mars or we're going to have AI data centers in space, is you've got to dream big, bigger than even maybe you imagine, and then you work backwards to make that dream a reality today.

33:21But that was a new way of thinking that I did not have have before the hymns experience that i'm now taking into dutch oh i just read a crazy article about elon musk and his vertical integration of this whole ai vision of colonizing mars it's like it's unreal what he's doing totally and i'm sure part of it is like he's just he's making shit up but then he's like how do i make it now now let's make that real and that's one thing that the i hope the listeners take away it's like just dream big big hairy audacious goals like jim collins's books always talk about. Now, we didn't talk about Dutch as much as I'd like to.