‘Unicorn status? It’s meaningless!’ And why entrepreneurs are born not made | Evidation Founder Christine Lemke

26:16My experience with this health system was, So I have a condition called ankylosing spondylitis. In its day-to-day form, it means I have a ton of chronic pain in my life. And it wanes and waxes based on a few lifestyle changes that I can make or based on hormonal changes or whatever. But I live day to day with quite a lot of chronic pain and have lived with chronic pain for so long that I didn't really even realize I was living with as much chronic pain. It's sort of like that moment in the playground when, you know, you didn't realize you were different until some kid like teases you. Well, I've been living with chronic pain for so long that I didn't realize I was living with chronic pain until somebody like pointed out like, no, they don't have massive pain every morning that they can't really get out of bed.

27:02It was like one of those moments like, oh, really? You don't experience this either. And so it culminated in a very lengthy journey to get diagnosed and then figure out what to do to treat the disease and some of the symptoms. And I felt like, gosh, if I had known that I had chronic pain and I had known this isn't everybody's experience, and I might have been able to get help a lot sooner and not have to have, you know, decades of suffering without any help. And so that was my own personal motivation for tinkering, I call it, with some of the digital data in our everyday life and trying to understand whether we could enrich those conversations for people with their physicians and like even alert them to the fact that, hey, maybe you should talk to your doctor about this or this or that.

27:45So that's my motivating driver. I think I have three co-founders in this business, and I'm sure all of them would tell you a different personal story about why they're doing what they do. Yep. And I run a health company as well. So physical products and same thing, like personal journey. and just interviewed the founder of Ferragun actually. And like, again, like amazing personal journey. It's amazing. Yeah. It's just like so fascinating. You're right. Like health, people that work in health in general, it's weird not to have a personal journey or experience of some sort. You know, on a personal level, no one in the playground ever told me that I'm a Korean woman.

28:25So I'm actually lacking the self-awareness still. Maybe I'm going through chronic pain for all I know. I've missed those conversations. but you know, my health journey is slightly different. So, okay. I've got a challenge for you. Can you explain what your business does jargon free? Evidation measures health in everyday life so that you can improve it. And so what we do is we take all that data from either your phone that you carry around with you all the time, or increasingly people are wearing wearable devices like Apple Watches or Fitbits or whatever they might be using. And we take in all of that data, all this data that captures your everyday steps, you know, your heart rate activity, and we try to understand your symptoms.

29:13And it turns out lots of people are really interested in symptoms of people suffering from all sorts of diseases so that they can tell whether their therapies are making an impact or not so that they can tell whether they should create new medicines that are better than current therapies that help someone's experience of a disease improve. So that's what evidation does is we help people access that data, analyze it, and then measure it. Was that hard for you to explain it to mere mortals? No, because I have to explain it to my mom and that's, you know, she doesn't understand any of the jargon.

29:53But when you say things like data and analytics, is that still like a bit? It's still a little fuzzy for her. Although, you know, to your point about Cambridge Analytica, I think it did open everybody's eyes and ears to, oh, there's this thing going on in the background. And now, of course, with artificial intelligence in the news, like every day, I think people are a little bit more wise to those types of things. But it is true. My mom was the type of person where in college I would come home and say, I'm going to work in computers. And she was just like, what? What's a computer? So. Got it. Okay.

30:22So you did a really good job, by the way. I feel like even a mere mortal like myself understands what the business does. So I suppose the next question is founding team of four. How come? Like, where did you meet your co-founders? Like, is it challenging having that many? And how important has it been that everyone has a very clearly defined role? I'll start with the last question first. It's very important for everyone to have a clearly defined role so that the decision making is very clear in the group, who's responsible for what and who's accountable for what. And so it took us a little bit of time to perfect, you know, that we all had roles to play.

31:01But once we got into that zone of, okay, you're making decisions in data, you're making decisions in engineering, you're making decisions in selling, and I'm making decisions for the business, it became much, much smoother. The way that we all came together. So Mickey was part of Sense Network. So that was easy. We'd worked together for a long time. We've know how to work together. We loved each other. We're like sisters in many aspects. And so that was a natural and easy partnership. leadership. Along the way, I was a mentor at something called Techstars in New York City. And I met Alessio, who is one of these like brilliant 10X engineers, just the most brilliant engineer I've ever met.

31:42Like, honestly. How do you, how do you tell, how, how can you tell something like that? Is it just because what you're referring to is it's an engineer who can code, but you could also have a coffee with and not want to kill them. Is that what a 10X engineer is? But Alessio is that engineer as well. He's some sort of superhuman, honestly, where he can code and still carry like a lovely conversation with people and an engaging one. I mean, he's a rarity. He's a rare human, but he is also just a highly competent designer of systems and really can probably outcode almost anyone. He's the type of guy who stares at your code and says, well, you could have done it this other way in a third of the amount of code that you used and it would work better.

32:28And everyone just walks away like, oh, damn it. So he's just such a brilliant guy. And then he brought along his friend from, I think, high school. They were in the whatever the math Olympics are, the International Math Olympics. So Alessio is Italian. He grew up in Italy. Mickey was South African, grew up in South Africa. Alessia and Luca were mathletes together, and that's how they met and then became really close friends thereafter. And so he was like, can you fly down to Santa Barbara and convince Luca to join us? So I had to fly down to Santa Barbara and pitch Luca, our data scientists, to come and join us.

33:07And Luca eventually ended up joining us to make the foursome. And clear swim lanes are absolutely critical for harmonious co-founder relationships. What have you learned about being co-founders? Have you had any major disagreements, actually? And how have you worked to resolve those? Yeah, I mean, that's the thing I've learned is that healthy relationships have disagreements and some of them can be profound disagreements about things. And you get in a room and you work it out and you be committed to working it out. All four of the co-founders were with the business until last year, basically. So we were together for basically 10 years, which, you know, is unheard of in Silicon Valley, at least to have co-founders like stick around, like four co-founders stick along, stick around that long and still work successfully together.

33:59Two of my co-founders left the business last year to do other things, but Alessio and I are still, you know, at the business. But yeah, four co-founders with the business for over a decade because of commitment and because of, look, just a pact to work things out that we're going to have violent disagreements with each other, in fact. Like very big arguments, big, very big Italian arguments with lots of hand gestures and yelling and trying to shield the team as best we can from some of that dynamic that we were used to, but know that doesn't scale to the rest of the team. but then just committing to each other.

34:34Look, we're going to be honest with each other and we're going to work it out. And as the only American in that journey, or it certainly sounds like you're the only American. And I'm not really even American, right? I was born in South Korea. You're a South Dakota through and through. Don't let that bully shape you. Right, totally. I don't know what you see in the mirror, but I'm seeing a white man with a beard. So yeah. I just need a cowboy hat, right? Exactly. And then we'll be set. Okay, talk to me a little bit about your funding journey. Like, how did it all go down? I know I was trying to allude earlier, you know, what was your personal financial situation?

35:06But other than obviously giving me your social security number, your screenshots of your bank account, I guess I'm more interested, like, how much have you guys raised over what time period? What is the company valuation now? How do you think of these things as well, like in terms of milestones? Yeah, so the company has raised a lot of capital. I think at latest, it's probably around$250 million with the largest round being the round we did towards the tail of COVID for$150 million, a growth round led by OMERS and B Capital. So the company's raised a lot of capital. The last rounds were definitely easier than the first rounds, but I wouldn't say that any round was, you know, particularly a slam dunk.

35:51We had an unusual idea. We had an unusual thesis. And we passed our hat around a lot of venture capitalists who were just confused, honestly. Like part of it was perhaps my storytelling is terrible. And perhaps some of it was just it was a weird looking business and nobody knew how we were going to scale. I think that's like an important thing is people felt like, oh, we can make some early traction, but nobody knew how this thing was going to ever scale. And it wasn't obvious, I think, to any of us how it was going to scale in the end. And so it was really hard. We probably spoke to like 90 or 100 VCs on every single round except for the most recent round.

36:35And the most recent round was in a time where a lot of these funds had money they had to put to work and were basically writing checks like very freely and writing checks at anything that looks remotely like a winner at a very high valuation. But the rounds before that, when health tech was getting underway, was just very difficult. 2012 was 2013 was just really hard for us to get our story across in a compelling way. so I was not one of these well-connected entrepreneurs in the valley who could just call up a couple friends and all of a sudden you had like a 10 million dollar 20 million dollar round together no I had to go out and like beg for money uh multiple times it's interesting perspective wise isn't it because obviously in the valley and in San Francisco people's perspective of such things it's just so wildly different you know I I remember talking to a friend in Europe and you know talking about how we've raised money at heights you know we've raised four or five million quid and they were like cool that makes sense and I spoke to a friend in San Francisco that we've raised four million quid and I told him how we were doing he was like that's insane you've done that on a bootstrapped company and I was like we're not bootstrapped we've raised money he's like that is bootstrapped and we had this like argument where I was like I what are you talking about?

37:52Like this is not semantics. You either, cause Kindling Media, the company we're talking through right now, Secret Leaders, we never raised any money. It's a profitable company. It's growing. That's a bootstrapped company. I know the difference. And I couldn't believe I was having this conversation with this person. It was a bit like, you know, telling me black is white or something. I like, I don't understand. I've raised money externally from other people. It's not bootstrap. But yeah, in San Francisco, maybe the actual concept of bootstrap does not exist. Like Less than 10 million, you're bootstrap.

38:21Well done. You're a miracle. It's true. Yeah, it's weird. No, it's very different here. Your company now is a unicorn, right? It is. Yeah, it is the last round. And I'm noticing some discomfort or embarrassment or shame. I just think it's a meaningless. Must be hard for you, Christine. It feels like a meaningless milestone to me. I just don't care about it. I get why people care about it. I just don't care about it. I am obsessed with, you know, you've made a business where you took 4 million quid and you turn it into a profitable enterprise. And sure, maybe someday you'll want to raise a little bit more to like fuel growth or accelerate your growth path.

38:57But I'm in the zone where, gosh, we've made a lot of investment to grow or create asset value, I should say. And now I just want to get this thing to profitability as fast as I can. And that's going to be a more meaningful milestone because it means you own your own destiny in many ways than, I don't know, some arbitrary number that an investor might've assigned to you back in a certain period of time. So I totally get it. And actually it's funny because this is how recently we became profitable at heights that you just said that. And I was about to interrupt being like, we're not profitable. Don't worry.

39:29But actually in the last month we hit 10 million, 10 million and got profitable in the same month, which was very nice and surprising because it wasn't actually forecast. So it was like for the first time ever in startup land, some decisions that we've been making have actually been working, which is highly uncomfortable because I don't really know what's doing in those situations. But not just a humble brag, because I'm obviously proud of that. It's actually like great. I'm still coming to terms with what it even feels like. But I am so interested now in, so where I'm at psychologically is sort of the same as you, but obviously further down the, like the funding part of it would, the whole point of that much money is to help accelerate full stop.

40:12And so for me to build a bigger business would take longer, but where I'd love to get to is to try and not raise any more money and to continue growing this like off profits, like, you know, back in the old, ye oldie days where there was business anyway, and startups weren't startups. There was ye oldie business. So I understand exactly where you're coming from, from your mindset shift. I think there's like two things I'd love to explore. One is obviously being a unicorn is an exceptional achievement one way or another, but also what's interesting about it is where it signals to the market two things.

40:47One, you're obviously in a league of your own as an entrepreneur as well. So, you know, you're suddenly, there's a much smaller pool of people that have ever achieved that full stop. So I'm imagining your ability to open doors, connect with certain people and stuff, you know, there's a sort of appreciation of what it takes to get there. And also in your case, like it's over a decade of building, you know, that stuff is impressive, right? Like actual staying power, you know, there's the whole timing the market and time in the market. Time in the market is a phenomenal game of survivability and you've done all of that and more.

41:23The other side of it that's interesting about being a unicorn, I imagine in your space, is trust. It's hard to trust health businesses and as much as we want to move inside or outside what, you know, I would define as the health matrix, so fixed healthcare systems that generally people get sick in and then recover from within and then complain about how fucking destroyed the healthcare systems are. Doesn't matter whether in the UK or the USA, it's the same story versus having more agency for your health and more data and more awareness about the things, the inputs that go into your health and how you can stay healthy.

41:59However, you know, one way or another, being a successful business, being a unicorn company is going to help penetrate that kind of trust. That's just a simple fact for a consumer. So I'm wondering how being a unicorn is like helping you think about your ability to execute towards your goals on that side. And my counter question is, has it put a lot of pressure on you to think about, yeah, okay, we're worth a billion dollars. How are we really, what do we need to do to really be worth a billion dollars. Like how much revenue do we need to make and what time and shit? Like that's hard. Those are the two sides I'd love to just explore.

42:36Yeah. I think on the trust and credibility front, ironically, the unicorn status has not made as much as an impact of like what's on your balance sheet. Some of the deals we do with larger companies, they request to see our balance sheet to make sure we have staying power through some of the projects that we do with them. And so So they kind of don't care about the valuation as much as they care about, hey, do you have enough cash on your balance sheet? Do you have enough staying power to do an important deal with us? So from a customer trust perspective, that's been more important. From a consumer perception, I think most consumers on our consumer app could care less, honestly.

43:21I don't think it registers with them. They just want an experience that matters and the rest is detail. And part of it is because the consumer population we've cultivated on our app are, are very, they're not quantified selfers. They're not, you know, following the tech news every single day. These are, most of them are like my mom and dad. Most of them are kind of all over America, just living their daily lives and not caring about, not being able to care about much more than that. Like, honestly, from a, from an access to, you know, from like part of building a business is always about networking.

43:56So from an access to other people that could meaningfully help the business, I would say that's helped some, you know, making sure that, you know, you get the most out of your investors, making sure that your investors are credible, making sure that they can help you into some of those rooms. And sure, maybe there's some measuring going on in those rooms of have you, are you a tiny company? Are you like a growing concern I should pay attention to? I think that type of thing does help, I'm sure. and I've been able to form relationships with people that is true in rarefied errors, entrepreneurs in the space that's been meaningfully impactful and helpful to me to get advice for running my company, to get access to talent, to do all those things that you need to do running a company.

44:41So there is some benefit to it. As to the latter part of your question, the pressure, in ways, like, is the trade-off worth it? It is true that I wake up some days in a cold sweat of, well, how do I make sure I get a multiple on the last, right? It's not enough to just be at the last and work your way up to grow, you know, because every valuation is a forward valuation. It's a mark of hope in a way of what you might do and the business you might build. So there's that pressure. But then it's also even worse because you're like, I don't just have to make that. I have to make a multiple of that.

45:18And so it does affect, for me, I take those obligations very seriously. And it does affect the decision making on a day-to-day basis. The best advice I got about that is to not let it affect your decisions on a day-to-day basis. You just have to keep your eyes on the prize, which is get to build, make sure this is your last round of capital, build the business in a certain way, and own your own destiny. Is that the plan? That is the plan. Yeah, that is the plan. and own your own destiny and then, you know, build, just build a real great business. But it's hard not to wake up some days and just think through, do I need to take more risk?

45:59Do I need to, you know, throw Hail Mary because I feel behind. And I think that type of thinking can get you into trouble. Yeah. I find it so interesting. Obviously toy with it a lot. Like when this happened to us last month, I was like, it's interesting to go to two, two psychologies. One is, I mean, we could raise like quite easily now because like a good business. But at the same time, like the flip side of that is I now I now feel like and I think it's true, but I don't want to be overly confident because I don't think can happen. But I feel like, well, all my investors will make money now.

46:30You know, as a fact, the exit valuations on my business right now exceed the highest price anyone ever invested in my business. So whatever happened, I go to a little investor entrepreneur heaven or wherever we go when we've been good boys and girls. The doghouse, the good version of the doghouse, the kennel. So, you know, there's that, right? Which is so interesting because you like play on these two sides of psychology, which is like, I'm super ambitious. I want more. And also like, I also want to like do good by the people who trusted me. And like, there's just always going to be that tension, I imagine.

47:04So where, like for you, where are you at? like you're, you built a billion dollar company on paper, but what does like an amazing exit look like to you? Have you thought through, was it even part of your pitch? Was it part of your like investment round? We have to like say, this is the next deck of corn. No, it was so gauche to talk about your exit plan. And you know, when, when we were out raising that large round, it was so gauche, you don't do that. You just go, we're just focused on building a business. Like, you know, there's all these like, uh, yeah, it goes up here. Have you not seen a chart.

47:37Let me just get Microsoft Paint up for you and show you what this looks like. Just up and to the right. So, no, that wasn't part of our pitch. That wasn't, I'm sure my investors considered it when they were thinking through it. But most of my investors, I would say the vast majority of my investors are great. They want to, I've stated it over and over, we want to build a big, meaningful business in the space. And they've been on board and have not put undue pressure on, we should look for an exit here. We should, you know, go IPO or this or, you know, none of that. They've been very supportive of, hey, let's go for building a big, meaningful business in the space, which is kind of what I wanted to do.

48:19Okay. So that's a very good, broad political answer. Totally. Right. It's very diplomatic. Gave me no answer whatsoever, but well done. done. Yeah. Very good. Yeah. We will not exit to Google. We wouldn't dare do that. Or would we? Okay. What does the future look like? When someone says, what is the future of the business look like? Obviously, if you're woo woo, that's called manifestation. And if you're a classy entrepreneur like yourself, it's called a business plan. So what does your business plan say? Where are you going? You know, I I'm obsessed with getting cashflow positive. Honestly, I'm just very obsessed with it.

48:52Very, we have a plan. We got to stick to the plan. We got to execute the plan And I'm very much about owning our own destiny in that regard. The reason I started this business was to put more power back to the people, so to speak, make sure people understood their everyday symptoms and trajectories so they could have these conversations with physicians so they could get the care they needed in the moment they needed it. And it sounds woo-woo, but I'm very, very mission-driven about it. I very much want to accomplish that for a broad swath of people. And I want it to be a compelling experience.

49:24and I want people to actually use it. And so we're getting close to cracking that code. And I really want to see that through. Yeah, because it's interesting, right? After a decade, or I imagine even after five years, but I guess the point is after a period of time, you invested all your shares. It's not really about the money at that point. Like you just like become so mission driven. You're like, you know, I'm just stuck making sure that this thing actually happens. Otherwise, what was the point? And I definitely get that sense from you. Yeah, 100%. Do you share any figures around where revenue is at the moment or numbers of users?

49:58Any interesting things other than Unicorn? Yeah, that's a good question. We don't share revenue numbers, so I'll steer away from that. But I can share some statistics about the consumers on the app. Yeah, I'd love to, please. Now, mind you, the app has been running a long time. I used to write checks to people on my kitchen table. It's a rewards app. Lots of people sign up because the headlines on this are get rewarded for doing the healthy the things you're probably already doing. And so we gave people real rewards in the beginning. This wasn't some BSE type app where you got coupons that some advertiser shilled at you because you like Under Armour stuff and you probably need to buy some for a workout.

50:33This is like hard, cold cash. And I remember having these arguments at the very beginning of the company, like, no, we should pay hard, cold cash, even if it's small amounts. But if people want to buy a six pack of beer after they've earned it, like we don't judge. We don't. It's a very non-judgmental app. We don't judge you for your weight gain or loss. We judge you for do you weigh in every day. It doesn't sound very Lutheran, Christine. It's not very Lutheran. It is the exact opposite of Lutheran in many ways. They shan't judge. You've changed. The app will kind of feel far from the tree. You know, so over time, there's been 5 million signups to the app.

51:10I think on a monthly basis right now, our MAUs or monthly average users There's over around 10 % of that, maybe just below 300 to 400 ,000 or so per month, you know, visit the app on quite a regular basis. It's fascinating to watch the behavior in the app. People come, I think, for the rewards like, oh, I'm intrigued. Do they actually pay? People don't believe us because what insane app would pay you to do some of these things? And so there's some building of trust that happens within the app to get people to believe us. But then we find people kind of like some of the points that they rack up, but really they start to get addicted to there's insight here.

51:50There's real education here. There's opportunity to participate in research here. There's other things than just the rewards. And that's why I'm sticking around. Yeah, interesting. You always need to like rebrand like the sort of Klarna buy now, pay later thing into sort of like the health now, die later or something. I feel like there's some kind of tagline that you can gamify into your experience that will seamlessly go into Apple products very nicely. Dan, so many ways to die and we only get one. Yeah. Yeah. What a shame. You should just integrate with the Darwin Awards or something and be their anti-sponsor.

52:26You started as a wellness brand, right? We did. And in fact, My Evitation is still kind of a wellness brand. You know, there's a research angle to it that's more pronounced now than it used to be, but you know, it's still, you know, know, kind of a wellness brand. And how do you like, I guess my question here is positioning, right? Positioning and messaging. Have you found that to be particularly challenging? Really hard. Yeah. Cause I find that hard and we actually have very quiet, a clear proposition. I still find it hard, but it is hard to try and be a wellness brand and be research and data led and all that stuff because it's kind of, you just said earlier, you know, we're not for the quantified self type person, but you are encouraging your average everyday person to become a quantified self person through the lens of engaging in a wellness brand.

53:10And that's an unusual journey for a lot of people. It is an unusual journey. It's just the future. I think everybody will get there. I mean, how will you do wellness in the future without some level of quantification and without some level of insight about what is happening in here? And so it's just, we're ahead of our time. Folks will bring folks along, folks will catch up, but it is the inevitable. And I I think Apple made this clear when they released one of their first algorithms. One was a fall detection algorithm. The second is this atrial fibrillation detector, essentially, or pre-screener.

53:46But that was the aha moment for many people. It's like, oh, this thing that I thought was just like a communication device on my wrist is actually monitoring me in the background and giving me really rich and useful information that I should pay attention to about my health. And so I think we shared some of the similar philosophical argument that Apple did, which is, gosh, health is a background, not a foreground process, that if people are leveraging things for getting stuff done in everyday life, we'll be able to monitor their health in everyday life, too, and prompt them to get help in the moments they need it.

54:28and we share very much the same philosophy around that idea and then the notion of it gosh but it has to be insanely private too yeah which is tricky right and that's probably why the last five years of all of apple's communication has been on privacy yeah i think it's very smart what is your best piece of advice for other entrepreneurs that are looking to make an impact and actually follow their passion you know i'm an enthusiast about these things i i tend to encourage people to just do it like their fear. Don't make fear-based decisions, make decisions based on what makes you fulfilled. People often let fear get in the way of a lot of the decisions they make.

55:09And those are the worst decisions you'll ever make. And so my only advice to people who want to jump in and follow their passion and do something impactful, look, entrepreneurship is not the only way to accomplish that. But if you believe that's the path for you, then the easiest thing is to stop talking and just do it. Amazing. I love it. I feel like you should submit that to Nike as an update for their branding. Totally. Right. Stop talking and just do it. I should wear my swoosh somewhere. Yeah. Christine, it's been an amazing pleasure speaking to you. Thank you so much for joining us. Thanks, Dan.

55:39Fun fact, Christine is one of over 50 unicorn founders I've interviewed. If you're new to Secret Leaders and overwhelmed by all the choice of our back catalog, check out my interview with MedMen founder Adam Bierman, another unicorn founder with an incredible story to tell, disrupting the marijuana industry. Slightly unusual. If you enjoyed this episode and found it useful, please write us a review and subscribe wherever you listen to your podcast. It makes a real difference and we genuinely love reading what you think. We read every single review. I've been your host, Dan Murray-Serta, and we'll be back next week with more lessons for entrepreneurs and leaders.

56:23This episode was produced by Alex Graham, Ruth Edwards, and Sol Harris, and all brought together by our head of podcast, Will Stollerman. See you next time.