Doximity (NYSE:DOCS), an online networking platform for medical professionals, already has 80% of doctors in the U.S. using its platform. Where does it go next?
In this video from “Beat & Raise” on Motley Fool Live, recorded on Sept. 23, Fool.com contributors Taylor Carmichael and Brian Withers; along with tech, healthcare, and cannabis editor and analyst Olivia Zitkus; discuss Doximity’s next opportunity, and why it will be so hard for competitors to beat.
Olivia Zitkus: I’m curious, since Doximity has already looped in, 80% of doctors to its platform. How is it planning to upsell to these doctors? Is it going to bring in other types of providers or both? How is it going to continue growing if it eventually gets that close to a 100% which just seems close to?
Taylor Carmichael: Well, it’s like Facebook, that eventually you take over the whole world. Then your question, how do I grow once I take over the whole world? They’ve already taken over the United States of America, so the next stage obviously is Europe, Asia, South America, Africa, and Australia. The thing is, all of the doctors in the system, there can be competitors that are overseas, but they’re going to want to collaborate with American doctors, so they are going to want to be on Doximity’s website. Again, I think it’s game over for winning all these healthcare eyeballs, and really, part of their business model is upselling to doctors. But most of it is the doctors or the product that’s being sold to other people. If they gather a 100% of the doctors worldwide, which eventually it’s really going to happen. Then the business shifts to selling those eyeballs to pharmaceutical companies. They basically have monopoly like power, which is why the stock is so expensive right now.
Brian Withers: Yeah, Taylor, I would also relate it to like Pinterest where the doctors do get something out of being on the platform. This is a professional, one, allows them to collaborate, and two, it allows them to keep on the cutting edge of what’s going on in their space, and then in medicine and allows the pharmaceutical companies and whatnot. Although it is somewhat self-serving, they do provide key information about the latest drugs and things like that, so that allows the doctors to stay up to speed.
Carmichael: It’s free for doctors. It’s a freemium model, you provide it free, and then you up-sell from there. But yeah, it’s hard to compete against that network effect. You get the network in place and where do you go? You go where everybody else already is. It becomes just an impossible mission.
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