Scaling to $500M in Revenue: ModMed CEO Daniel Cane (Part 7)

Sramana Mitra: In a fifteen-year span, the early venture guys are trying to go to $100 million in revenue and commensurate valuation in five to seven years. So, if they want to cash out the fact that you’re staying private in 15 years, that means that there is going to be some amount of change in ownership and that’s reasonable.

Do you want to go public or do you want to stay private?

Daniel Cane: I like staying private. I took my last company, Blackboard, public. Back then, once you surpassed $100 million in revenue, going public was the natural step. But today, private markets have plenty of capital.

We could go public if there was a strong business reason—like needing liquidity for significant M&A—but being a public company comes with added overhead. We run a really tight ship, but see us staying private longer because private equity is much easier to manage than a public shareholder.

Sramana Mitra: Great. Well, wonderful. Is there anything else you’d like to share?

Daniel Cane: It’s such a fun journey. It’s fun to do the startup, scale up, and then get a company to where it’s having a real impact on health care like we have or in any industry. But health care and my last industry education, they feel good. In these industries, we need a lot of entrepreneurs to go in with crazy ideas and be disruptive in a good way, because a five trillion dollar system has a lot of opportunities for efficiency.

Sramana Mitra: I would say that what you are doing is not crazy ideas. It’s actually really good execution of very sensible common-sense ideas that deliver tremendous amounts of efficiency. Healthcare doesn’t need crazy ideas. It’s just such a terribly inefficient system in America that if you can just tighten things up there and just kind of introduce modern technology and digitization, you get tremendous wins. That’s what you’re doing, really.

Daniel Cane: That’s true, but the downside is healthcare is so heavily regulated, with incredibly high barriers and the stakes are literally life and death. You need to know what you’re doing. Fortunately, we have an amazing team of over 4,000 people, including employees and contractors, focused at ModMed.

Sramana Mitra: Where is the center of gravity of your workforce?

Daniel Cane: Our headquarters is in Boca Raton, Florida, with about 700 people. We also have 200 people in Hyderabad, India, and offices in Santiago, Chile, and Berlin, Germany.

Sramana Mitra: That still leaves thousands unaccounted for.

Daniel Cane: True. The pandemic shifted things. Everyone went virtual, and we didn’t give up our offices, but we started hiring people wherever they lived. Now, many of our employees don’t live near an office. Those who are close to one come in, and the rest work remotely.

Sramana Mitra:  Very good. Well, great catching up. Thank you for sharing your updates and we look forward to doing the story.

Daniel Cane: Great. It’s wonderful to talk with you again.

Sramana Mitra: Bye, Dan.

This segment is part 7 in the series : Scaling to $500M in Revenue: ModMed CEO Daniel Cane
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