Co-founders of PharmEasy to Launch a New Consumer Business Together
The owners of API Holding, the company that operates PharmEasy, Dhaval Shah, Dharmil Sheth, and Hardhik Dedhia, are planning to launch a new consumer business. The managing director (MD) and CEO of PharmEasy, Siddharth Shah, has also made a personal investment in the new business. The creators have received additional funding from a few venture capitalists (VCs), who previously supported their business.
The founders also stated that they will no longer be involved in the day-to-day management of the e-pharmacy startup. For more than a year, this daily operational handover has been planned. With operational cash flow break-even in the most recent quarter, the founders are now happy that the business is doing well. According to a statement from Shah, Sheth, and Dedhia, certain outstanding leaders have now taken on the day-to-day duties of the brand as well.
Funders Holding up their Positions on the Board
The founders jointly said that they are still committed to the firm and will keep onto their shares for the long term for value creation, clearly outlining their respective perspectives on the ventures. Seth, Shah, and Dedhia will remain on the boards of API and Thyrocare. According to the statement, they would continue to be unwavering supporters of creating India's top healthcare organisation and place their faith in Siddharth Shah and his staff.
The other four founders are still involved with the company, according to a statement from PharmEasy. They remain board members and observers and align their ownership for the long term. They intend to become less involved in active daily executive duties.
Well Planned Move by Founders
The new team has reached operational cash flow break-even, which has pleased the founders, who have been working on this transition for a few quarters. According to Siddharth Shah's remark, the team is still doing a good job of handling all of its responsibilities. In March 2024, the founders informed Shah and the board that they wanted to launch their own business, according to media sources. The new business is unrelated to PharmEasy and operates in a non-competitive market.
One percent or less of the corporation is owned by each of the founders. In 2015, PharmEasy was founded. Nonetheless, the founders' overall ownership ranges from 10% to more. The business has raised $688 million in total. In 2021, $300 million was raised in the largest investment round. After great effort, the company managed to raise INR 1,300 crore from Manipal Group member Ranjan Pai in 2023. Pai's contribution is a component of the company's INR 3,500 crore rights issue fundraising campaign.
However, PharmEasy's valuation has significantly decreased in recent years from the $5.6 billion it brought in in 2021. Temasek, TPG, Prosus, B Capital, GSV, and Think Investments are some of the investors in PharmEasy.
Nitin Konde
