Built To Enjoy: eClinicalWorks CEO Girish Navani (Part 6)

SM: What does the cost structure of the company look like?

GN: Our goals are different from those of most other companies. We are not focused only on profits. Our focus is on building a company that has a long-term, positive economic impact on both our customers and the people who work here. Over 90% of our employees are based in the United States. We are headquartered in Massachusetts, where we have about 550 employees. We also have offices in New York, Atlanta, and San Francisco, and a reasonably small office in Bombay. Our cost structure is really a pure American cost structure.

The real key to our success is recurring revenues. Our sales costs are less than 6%. We built the product on Java. It does not cost an arm and a leg to license the technologies we use, and that lets us sell our product for less. The most important part in any innovation-driven company is how you organize the company itself. At one of the companies I previously worked for, there were nine layers between someone who joined the company and the CEO.

When somebody joins our company today, there is no more than one person between me and that person. There is no hierarchy. Employees are broken up into teams, and all teams have a leader. Teams get together and collaborate. Smart people get together and find ways to solve hard problems. That is as much a part of our innovation as our product itself.

SM: Going forward, are you looking to keep this company private ?

GN: I think that is our goal, at least as long as I am tenured at the company. I don’t foresee leaving the company for at least 10 years. I would like to leave it a private company with no external investors and absolutely no thoughts whatsoever about Wall Street. I am having fun and take great pride in my freedom. There is no reason I would give that up.

We are a cash flow positive company. We have recurring revenues and no debt. We have a large customer base that is growing exponentially. We have 50% volume growth in 2009 over 2008 and expect that to continue. I have no reason to believe that we will change our corporate financing structure.

SM: What does the market landscape look like in electronic medical records for you right now? If you have 34,000 physicians using your system and there are about 500,000 in the United States, then you still have room to grow.

GN: Depending on the surveys you read, some say that the TAM is 20% penetrated and others say it is 26% penetrated. It is somewhere in that range. It still has about 70% to go.

SM: What is your market share position today?

GN: If you look at it from a 20% number, we have 34% of the market. If you look at it from a 30% adoption rate, then we have 16% to 17%. It is still significant because the market is fragmented. There are 150,000 independent doctors’ offices [in the country]. If I had to speculate, I would say it is anywhere from 17% to 22%.

This segment is part 6 in the series : Built To Enjoy: eClinicalWorks CEO Girish Navani
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