Hello everyone and welcome back to the world's best investing podcast. Today I have with me Max Marchione. He's the co-founder or founder — I'll let Max specify now — of Superpower, which is basically, so that you guys catch up to speed very quickly, it's essentially a standalone version of Hims Labs, except I know Superpower does a lot of things which Hims doesn't do and hasn't talked about doing just yet. So Max, thank you so much for coming on today. I can't wait to learn all about Superpower and learn a lot of things from you. I think the audience is going to love listening to you today. So, thank you so much for coming on.
Antonio, excited to be here. I love talking about this space. I have a lot of opinions around where the future is going, and a lot of uncertainties. It's so hard to predict what is going to happen, because there are all sorts of different players with different incentives and complex variables, but that's part of the fun.
Amazing. So let's dig into it. I think we should maybe start with a brief introduction of your story, which I think everyone's going to find really inspiring — how you came around to focusing on the healthcare problem and what you guys do at Superpower.
Yeah, totally. So, Max, co-founder of Superpower. I was born in Australia, hence the funny accent. Mostly grew up there, and lived in Italy for a little bit as well, which is where I guess ethnically my family is from. And if I look at what was the impetus for health actually mattering for me, I think part of it was from age 8 to 18, I went through this 10-year period of misdiagnosis. And I'm not a lone story. Dozens of people go through a period where doctors could not answer their questions. But at least for me, that meant that it would take me 3 hours to get to sleep every night. I had chronic migraines, chronic sinusitis, and I tried everything. Saw 10 plus doctors, was told to medicate for life, had surgery, and nothing worked. Right?
And when this happens, you start to question the health system. And every doctor I would see would say my problem was their specialty. You see the allergist, it's allergic. You see the CBT-I sleep person, it's psychological. You see the ENT, it's structural, and you need to chop stuff out of your nose. And everyone had just one siloed part of what it meant to be healthy in their head. So I think that was kind of one dominant theme of my childhood. And then the other really dominant theme was this belief that if we improve our health, we improve every single part of our lives, right? Optimal health means that we can do more, we can create more, we can be better, we can be smart, we can be more energetic. And for as long as I remember, I've used health that way. I used a Gen One Oura Ring. It was this big fat device when I was 15 years old. I remember convincing a pharmacist to illegally give me a CGM. All sorts of different things I was experimenting with.
Anyway, fast forward a little bit. I turn 18. I solved my health problem by finding someone I call a 10X doctor, one of these genius doctors that is at the frontier. And it made me realize there's this massive gap between the frontier of medicine — what a select few have access to, right, billionaire or biohacker level care — and what most people have access to. And I believe for as long as that gap fundamentally exists, someone or some company has to come along and close it. And where we'll get to a few years from now ideally is an AI that delivers medicine far better than any human or health system ever really could. So I moved to the US around 3 years ago to start Superpower. And the key idea behind what we're doing is: what does it look like to start a new healthcare system? That's a big lofty goal. I think the existing healthcare system is good when you're sick, is good at surgery, is very bad at preventing you getting sick, and is very bad at actually enhancing and optimizing human life. You can't go and say to it, 'I want to be more energetic, or look younger, or feel better, or be smarter.' It doesn't grapple with those questions. So we want to build a health system capable of grappling with those questions. And that starts with the lab testing, right? We show people way more than they've typically ever seen with their primary care doctor. It's a really, really special experience. And then we try to provide full-stack care, far more like a high-end concierge clinic but at a far lower price.
Fascinating. So I can really relate with what you described from age 8 to 18, because I went through something quite similar over the past 5 years, and it's been a massive adventure to fix that, and that's sort of what brought me to the whole space, Hims, and ultimately to you today. So I think it's great that you've managed to transmute that pain into what looks frankly like a great company. So today, give us an idea of the operations you guys have right now. What sort of scale do you have? What sort of specialties do you have, if any? What is the healthcare experience that you're bringing already, and to what scale roughly?
So, we're around two years in. We removed the waitlist in August this year, and now we're adding thousands and thousands of new members a month. So we're growing pretty quickly. Most of our growth is still word of mouth, followed by paid, followed by SEO. And the way it starts is, for $199 a year, we'll say, 'Let's build a full profile of your body. Let's do a far, far better health check.' Right? Okay. And that means starting by testing over 100 plus blood biomarkers. That's three to five times more than you'd get with your annual physical. If you went to do that at a hospital or somewhere else, it might cost you several thousand. We're doing it for $199 as just part of the experience. And then we'll use that to start to be an input into what we call your digital twin, which is this digital simulation of the body, so that in time we can know how changing inputs changes outputs. And we'll add other data to that twin as well. We'll pull in your past medical records automatically from all the different EMRs. You can integrate wearables. You can upload all your past labs, and it visualizes where you really start becoming someone's home for health. If your family joins Superpower, the resolution of your twin increases. We offer gut microbiome testing, cancer testing, toxin testing. People can add all of that on. So that's the starting point: how do you have this complete health profile? And that's really important, because until we actually have the profile of your health, it's impossible to personalize health to the level of fidelity we want.
From there, the second part is saying: now that we have all of this data, how do we connect the dots to come up with insights that your doctor never had? And we give members this big kind of report which connects all of the dots, not all of the data. And we recently asked our members, how does this compare to your primary care doctor or your annual physical? And 93% said far better or life-changing, which is crazy because we're using 100% AI for this, no human in the loop. We used to have humans in the loop, and quality was worse than just using AI for this, and it's been non-trivial to build the AI capable of doing this. OpenAI itself is not good enough. So that's kind of part number two: how do we actually have that cognition or computational layer to tell you what to do? And the strong form interpretation of this is everyone just follows the algorithm. We're not there yet, but I think that's where we'll get — where the AI is so good at knowing what you should do that we just blindly follow it. The third part of what we do is the action layer. So we say, 'Okay, we've built your profile. We've connected your dots. Now, how do we make it easy to take action?' And that means bringing all the things that you would need to take action into one place. Obviously lifestyle recommendations, but then also supplements, future diagnostic tests, pharmaceuticals, and peptides.
Fascinating. So, for the cognition layer today, what are you guys using?
We use an ensemble of open source and, I guess, closed source models as well. We've built a separate memory architecture, which has been really non-trivial. OpenAI's ChatGPT memory is quite mediocre, so we've built a separate memory architecture, and then we've built a separate database of what we call clinical canon. And we've gone around the world trying to find doctors who are known for healing things that the average doctor cannot: the doctor who reverses autoimmune disease, who heals diabetes, who cures things that are incurable, so to speak. And we've tried to put their brains into code, and the AI draws from that database of clinical canon as well. And then probably the final component of it is weighting. The thing that all of these large models are very bad at is knowing priority, right? If you ask it what should I do, they give you a list of 50 things, and what that means is you don't actually follow it. So the actual ability for it to know how to weight and prioritize information has been non-trivial as well.
Got it. So then you guys have essentially created your own model, so to speak, and you are leaning on edge cases via doctors which you've identified as highly competent for things that can't be cured via traditional methods.
Yeah. For some things it depends, right? Like if we see someone has low vitamin D, that's an easy solution; we don't need something esoteric. If we see someone has immune markers that are going through the roof, high thyroid antibodies, really high CRP, latent EBV, etc., that's a little bit more complex. And to solve that problem, that's when we start to lean more on this knowledge base from the frontier rather than just the average information you'd find on the internet.
All right. So that's really interesting. So let's maybe take a little step back and give the audience some context. I think you explained your mission beautifully. Today I wrote a post explaining why I think that healthcare is going to change forever starting in 2026, because the existing healthcare industry is based on not knowing. Neither you as a patient nor your physician understand exactly what's happening inside your body. You don't know what's happening before a treatment or after. Now, with increasingly exhaustive and higher frequency biomarkers, we are moving towards the stage in which that situation fundamentally changes, and we just know exactly what's happening before, during, and after. And so people can become the CEO of their own health. So what is your view of the current state of the market? Where do you think it's headed? And what do you think are some of your most controversial opinions?
A lot in there. Okay. So, current state of the market: there are, call it, five companies who all want to be health super apps, and we're all taking a slightly different path to get there. There's Hims, there's Oura, there's Whoop, there's Blueprint, and there's us. And all of us have similar visions in the limit, which is saying what does it look like to be the one place people go to to start their health journey? How does AI perform more and more of the cognitive layer? And how do we have this closed loop between diagnostic and therapeutic? All of these companies take very different paths there. If I look at Hims, the path is basically the e-commerce or the CPG path: pick a SKU for which you can acquire users very effectively and cheaply via paid ads. In time, add a little bit more brand, largely for awareness and to decrease CAC. And in time, hope that you can cross-sell, right? Hope that, okay, someone might come to you for ED, but then they buy a GLP-1 through you. That strategy is a good short-term strategy, but it's also challenging because you don't necessarily own the idea of being someone's home for health in someone's mind. People today still don't go to Hims thinking Hims is healthcare. People go to Hims thinking I need my dick pill, I need my testosterone...
Right. And the other challenge with the Hims strategy is that there's no lifestyle brand. Hims ships you things in anonymous cardboard boxes. That sums up the nature of the brand. If a Hims box arrives, you want to hide that. And that's really tricky. And then probably the final area where Hims struggles is the technology layer, right? They started out as e-commerce; now they need to build technology. Now, that said, Hims' strategy could be the dominant strategy. And the reason it could be the dominant strategy is that strategy is the fastest to revenue and gross profit. And now you can spend that gross profit on building technology, on building into a lifestyle brand, on becoming a home for health. So that's Hims' path.
We're slightly more at the opposite end of the spectrum. We came out of the gate saying, let's start by having a lot all at once. Let's start by having this feeling of completeness. Let's start with this experience where when members join, they're like, 'Wow, this feels like my home for health. This feels like a replacement for my doctor.' Our number one growth channel is word of mouth. That can't really be true of Hims. People aren't saying, 'I got these dick pills,' right? People are saying, 'Wow, I'm now in control of my health with Superpower.' We started as a lifestyle brand, right? We have hoodies that went viral — healthiesthoodie.com. They sold out in a few minutes. People relisted them on Grailed and eBay for a few thousand. And that's a lifestyle brand. That's a movement. And then we started with technology. To date, we have a tiny amount of people on the marketing team, like four, and like 20 people on the engineering team. And the engineers are like former Teal fellows, former Y Combinator founders, etc. So we do a good job of technology. And this could be a really good strategy for us. It's product first and technology forward. But it has a lot of challenges, which is that we get to revenue a little bit slower, we get to gross profit a little bit slower, we don't have that short-term growth curve that comes from selling ED pills on the internet. So, and that's just us too. Then we have the rest of all the companies as well. That's the market. I can go to the contrarian beliefs, but maybe you want to play with this. Up to you.
What I think is really interesting is that when I first came across Superpower, what I felt is that you guys are longevity native. So it's obvious to me that it's a longevity place even as a prospective customer. I'm in Spain right now, so I actually couldn't access the app, but the branding is obviously longevity native, which, when you tell people that know about Hims, have seen the brand in action and stuff, about the longevity thesis, they sort of can't believe it, because they think it's an ED company, for example. So I'm wondering — I understand your strategy now. Obviously, you can answer whatever you want. I'm not sure what you can or cannot talk about, but what is your strategy to scale over the next 5 years? And how do you plan to compete with — I mean, I think the reality today is that Hims has, in this space, a relatively large amount of resources. So how do you guys — I'm assuming you're smaller, maybe I'm wrong about that — how do you guys plan to compete, I guess is the question.
Yeah, I feel like this is the classic battle of can the incumbent get innovation before the startup can get distribution, right? We have innovation in the sense that we actually feel like a home for health. We deliver care with technology. We have crazy levels of customer love. People don't stop talking about us. The AI is incredible. People come to us for one thing and they use us for many more. We actually act more as a platform than Hims does. In other words, we have what looks a little bit closer to innovation, and that's because we started in a different era. We started when telehealth was already established. We started when AI was a thing, right? We started post-ChatGPT, and that means you build the company a little bit differently. Now what we have to do is we have to get scale very quickly, because if we don't get distribution and scale, Hims is going to have supply side economies of scale, or other companies are going to have supply side economies of scale, and that makes it very hard for us to compete, right? So that's what we have to do, which is get to scale. And if I look at how we get to scale, it's improve product, improve marketing, right? And maybe there are adjacent products and adjacent wedges into the ecosystem, but it's in short: improve product, improve marketing. What Hims has to do is they have to get to innovation, they have to start doing a lot of the things we're doing, they have to be more of a platform, they have to be a more complete experience, they have to feel like a lifestyle brand that people are proud of. And this is the classic kind of debacle.
Got it. Well, I assume — I've seen you posting on X about peptides many times. So what do you think is going to happen to this category? Are you guys big on that already? Do you have any plans for peptides?
I think peptides are going to be one of the biggest consumer categories of the next two to three years. Right now one in seven Americans has tried a GLP-1. I think by the end of the year potentially one in three Americans has tried a GLP-1, which is an astronomically high number, ahead of predictions. But what I see around me, the behavior I see around me, tends to be a leading indicator of where the world is going. And 6 months ago, no one wanted to try it. Today I just got back from a brunch where I brought a nasal GLP-1 for people to try. 20 people at this founders' brunch tried a GLP-1, right? It's like becoming normal. It's becoming acceptable, and it's becoming something you do even if you're not overweight, right? It's becoming something you can microdose, you can do for inflammation, you can do for longevity, you can do for focus. So GLP-1s are obviously the most famous or well known of all the different peptides. Now just as GLP-1s are a miracle drug, quote unquote, for weight loss, we have miracle drugs for many other things: for cognition, for memory, for energy, for sleep, for healing. And I think we'll see many of them start to become mainstream as well.
Some of them will continue to be patented. I think most future classes of GLP-1s will be owned by Eli Lilly and Novo. Hims is making a really, really big bet on compounding. Not because it's risky in the short term — it's actually short-term not that risky. I think they made the right decision. It's risky in the long term, because the GLP-1s we have today are not that exciting compared to the ones we're going to have in 2 years' time. And the ones we have in two years' time will almost definitely be patented by pharma with patents that are defensible. So I think that's where we go with GLP-1s: they'll continue to be the biggest category within this class of peptides. We're going to see several of the other, what we call today illegal peptides, start to become legal. I suspect by the end of the year BPC-157, CGC-IPA, potentially thymosin alpha 1, GHK-Cu — the copper peptide for skin — all move from category 2 to category 3. And that means that people are allowed to sell them online. And it means that compounders have less stringent laws around when and how they're allowed to compound them. And what this means is we're going to see consumer companies pop up that try to act as brands and distribution layers on top of these compounds. Hims is probably the best placed company to do really, really well in that market.
From there, we're going to see a long tail of other innovation. We're going to see new peptides emerge, like Stealth Biosciences owns SS-31. They're sending cease and desists to everyone selling that right now. SS-31 is one of those mitochondrial peptides for longevity and energy. And we're seeing all sorts of companies introduce new delivery mechanisms. I said we're testing a nasal spray. I'm testing a patch with micro-needles. So we'll see this long tail of other innovation in the world of peptides. And then probably the final thing is we'll see more research into peptides, right? These small proteins seem to be reasonably safe because of how they modulate the signaling of the cell rather than introducing the effect directly. They seem to be quite easy to deliver as well. And there are all sorts of peptides that are going to start seeing far more funding behind them, even in the absence of a patent for a disease indication in the classical pharma approach. So I think peptides are going to be a mega category. Hims is really well placed to win. We'll see how it pans out.
Right. So definitely a lot to unpack there. I want to start by asking you: why do you think some peptides are going to see a lot of funding around them even though people won't be able to patent them? That really caught my attention.
Yeah. So I think that just because something is naturally occurring in the body doesn't mean you can or can't patent it, right? What matters is the extent to which you introduce genuine IP and research and innovation to allow that thing to be delivered and have the desired effect, right? GLP-1s have been around since, what, 2006. But pharma companies have changed how they're delivered, how they're absorbed, the size of the effect, the duration of the effect, the side effect profile. And as a result, many of these new classes of GLP-1s are going to have defensible patents. It's almost unequivocal. Other peptides are actually quite simple amino acid chains. Take BPC-157. It's far easier to manufacture and deliver. It's been around for a long time, and therefore it's not going to be something that is patented. Many of the peptides that are in research stages at the moment look more like complex GLP-1s than they look like BPC-157, and therefore they will be able to be patented.
Right. That's very interesting. My view personally is that long term I think miniaturized peptide synthesizers are going to be mainstream, like today we have printers. I don't have the exact numbers right now, but I do suspect that it's only a tiny, tiny fraction of all potential industrial attention that has actually touched peptides. So for example the ones I'm buying, I'm bringing them from Dubai, and they're quite expensive. They're really high quality, so I'm super happy to pay for them. But I realize that as soon as you put actual proper industrial resources behind it, the cost of these things is going to trend to zero. So at the moment I'm sort of looking at this space as a little bit of a winner-takes-all kind of thing. It's not exactly going to be one, but I do agree with you that broadly I think there's going to be a handful of winners.
So the one thing that I think is — when you were saying the risk of doing GLP-1 compounding now is that you don't get access to the innovations that are coming down the line — I also suspect that the inverse is true, which is if you don't have access to the network as one of these peptide innovators, so to speak, your innovation is going to be cut short. Say by the year 2028, 2027, it's going to be hard, because once you have all of this exhaustive data, you can really figure out what sequence of amino acids to print in order to really fix problems for any specific customer. So to me, I think that, adding to what you said at the beginning of the podcast, this is highly uncertain, and then I see just a massive disruption happening, which I think a lot of main players in the industry seem quite unaware of. I don't know, what are your thoughts on that?
Yeah, so I guess there are like three threads in there: one, supply chain; two, manufacturing; and then three, market structure. On the supply chain side, everything is from China. Eli Lilly's and Novo's pharmaceuticals are from China. Now, sometimes they're compounded onshore, but the actual raw ingredients — what's called API in the compounding pharmacy world — is from China. When people talk about having a Chinese peptide dealer, the supply chain typically actually looks like: manufacturer in China, Chinese-speaking, no contact with the outside world, works with a distributor in China, which people call a Chinese peptide company, which sells to a compounding pharmacy in the US, which compounds it — like they will sell the raw amino acids or potentially the active, already pre-formulated, to the compounding pharmacy in the US, who produces it, who sells to the peptide company, research use only company, and for the illegal peptides, who sell to the consumers. That's kind of the supply chain. Now, the catch: if you go deep enough back down the supply chain, you kind of end up in China every time, because China just produces the raw ingredients, the actual amino acids, at a price that's far lower than anywhere else, at a really high purity, right? Big pharma uses China, right? And I think people kind of lose sight of this. And you can say 'manufactured onshore' if your intermediate good is manufactured onshore, but the raw ingredients are often from China. It's kind of like saying, 'Oh, we made this aluminium table onshore or this iron table onshore.' But it's like, 'Yeah, but where did the iron come from?' Maybe a mine in Australia. Maybe like that, but in this case, it's coming from China. So that's kind of how I think about the nature of the supply chain here. And then this argument about Chinese or American or Dubai or — it doesn't matter. It's all Chinese all the way down.
The second thing is devices manufacturing, peptide synthesizers. So, let's get speculative. In a speculative world, the way I see it working is people buy their amino acids, they put it into one of these machines at home, they get their peptide synthesized. The amino acids get smashed together and then they stick to each other. You get your peptide synthesized. You maybe have a mini LC-MS or some sort of purity testing device at home as well. You test it. Maybe it goes into a pen with multiple cartridges, and you just inject, and you can inject three peptides in one or four peptides in one. That's like a highly speculative future, but I think we potentially get somewhere like that. Again, speculative, hard to say with any high degree of probability.
On the third thing, market structure: I'll just say it's very hard to predict. My hypothesis is that we will see...
Concentration to the players that have massive scale. Um, I think that owning the compounding pharmacy is probably a good strategy here. Um, I do think brand will matter. Um, I don't think it's going to be like a cheapest-price-wins-all dynamic. Um, but again, it's hard to say. It's just so hard to say. We just don't know, there's so many unknowns. Like we don't even know what the next 20 peptides are going to look like, who's going to own them, whether they're going to be patented. We'll see.
Right. That's very interesting. So, I actually have a bit of a question for you which might get me into trouble when I post this video. I'm not sure what the orientation of the YouTube algorithm is to date, but you know this problem that I've been dealing with, that I think I've successfully dealt with over the past five years. I don't know if I can say this word. It's called long co. I'm not going to say it again just in case the algorithm doesn't like it. Okay. But you know, like whenever I go somewhere I just can't shut up about these things. So I start telling people about all the stuff I'm passionate about, the stuff I research. One of them is this thing. A lot of people are facing this problem. And what I've seen is that not many, if any, of these companies like Hims or anyone are directly approaching this issue, and this issue is fixable, but there's millions of people worldwide that are suffering from it. So, I'm just thinking out loud here, but maybe you guys have thought about this, but addressing that issue specifically, I think could be an amazing marketing experiment. Have you guys thought about that? Have you tried it?
Maybe. Yeah. So, today there are dozens of point solutions that try to build a complete experience to solve one of these problems. Um, over time, we'll bring more and more of those point solutions in house. I think because the ethos of Superpower was not how do we sell something on the internet, but it was we've experienced and seen the frontier of medicine. We want to make that accessible to everyone. We love these ideas, right? Like this is part of why we're here, to bring what we think is actual high-quality care to many people. And I think that high-quality care tends to have the biggest impact on areas that are very poorly understood and of great detriment to many people. And I think LC is one such area. So no plans in the immediate horizon to do it, but yeah, we want to make sure we build the system capable of doing it in the long term.
So are you guys, I don't know if you can answer this, but would you guys be on a trajectory right now to rival Hims in terms of scale? So currently your approach is sort of generic lifestyle longevity native brand. Is that enough right now to take you there, or is there something else on the road map maybe?
Oh, we're not at Hims scale yet. Hims is what, like a $6 billion company at the moment. Six to eight. We're not a unicorn yet. We probably will be this year. And it just depends on how well we execute. Like we know what we have to do. The market size is there. The product is there. Now we just have to execute really well on go-to-market.
Interesting. So, how are you doing that? If I can ask, I'm not sure what I can ask or not. I've never actually interviewed a startup founder on the channel just yet. So, I don't know. I'm sort of rolling with it here.
Yeah. The way I kind of think of marketing is, first, the product you're selling, right? The product you sell and the way you position it is one of the most important choices you make in terms of determining what can grow. And our core product today, the like health check plus a plan that works, it's like annual membership, is a pretty fast-growing product, but it's not a GLP-1 level fast-growing product. It's a better starting point because we have stronger retention and we act more as a platform, but it doesn't have the like insane growth curve of GLP-1s. So the first thing is product selection. We have to continue asking this question of do we want to continue doubling down on this as the wedge into Superpower or do we want to explore other wedges into Superpower? And there's a handful we can experiment with. We could decide GLP-1s are a wedge. We could decide an AI chat's a wedge. We could decide an open ecosystem where you can buy anything as a wedge. We're not planning to do any of them yet. But the important question we must ask is do we slightly change the way someone enters the ecosystem? That's the first thing.
The second thing is we think about what are all the different marketing channels, which ones have the most scalable input-output equations. Right? Word of mouth is a great channel, but word of mouth is only good if you have some sort of other growth engine. You can't all of a sudden grow 10x in a month by just ramping up word of mouth. You just can't. It's not possible. So then we look at what are all of the other engines, and probably three that are quite interesting for us right now. One, SEO. SEO is great because if you get enough backlinks, it's very hard for others to compete. And it's free once you've set it up. There's the opex cost, but then it's free. There's no marginal cap. The second for us is paid ads, paid marketing. This is what Hims is best at. It's probably what we're worst at at the moment. I suspect a lot of our growth in the next 12 months is going to come from getting good at paid ads fast. It wasn't a focus until 3 weeks ago. Now it's a really big focus for us. And then the third channel for us is B2B. I think one thing that's true for Hims is it's going to be quite hard to sell B2B because they're seen as this kind of tacky quick fix company. We're seen as this company that actually tries to provide far higher quality healthcare at a far lower cost. So B2B is a channel that's ramping up for us as well, and we're going to execute well against all of them.
Probably employees of various companies don't see you guys as something they should hide like ED pills, right?
It's like a cool thing you can flex to your friends on social media and stuff.
Oh yeah. We're like, for teams, we're creating like a biological age leaderboard, and we want teams being like, 'Oh, have you done your Superpower test yet? Where does your biological age rank?' And there's all sorts of fun healthy social elements to what we do.
That's a very interesting vector. So, right now, when you get the biomarkers, what treatments are you able to offer to customers? And are these vertically integrated in any way or do you just sort of source them from various providers?
We don't own any. We don't own labs. We don't own supplement manufacturing plants. Today when we get someone's results back, we can make most recommendations and fulfill them through Superpower. So we have any supplement you might want. We have most pharmaceuticals. We have all the legal peptides as well. And our view is we'll say to someone whenever they get the results back, we say here's what you should do. Do you want to do this? They choose whether they want to do it or not. And then we say, 'Here's a link to Amazon or somewhere else if you want to do that.' Right? Here's the link. And then here's the same price through Superpower. It's going to be 20% less. Like whatever you're getting somewhere else, we'll do 20% less. And again, the ethos here for us is not how do we make the maximum short-term margin. It's not how do we force someone to buy through us. It's how do we become someone's home for health that they trust, right? And how do they stay in the ecosystem? Because they know that we're not forcing stuff down their throats and they know that we're a cheaper price than Amazon, which is why we literally show them and buy from Amazon if you want.
Right. That's very interesting. So, the one thing that I'm quite interested in when it comes to the Hims thesis right now is applying what I call the Costco algorithm to the labs business. The Costco algorithm is this obsession that Costco has with delivering more value per dollar and just doing that to an extent that it doesn't really make sense to buy from anyone else for a growing volume of customers. Right? So the one thing that I've really picked up from what Hims is doing that I think is very underappreciated is firstly launching labs and then compounding on that to offer exhaustive biomarkers at a frequency and value-to-price ratio which is hard to match. Are you thinking about that at all when it comes to your labs? Or sort of what is your strategy long term in terms of improving the value you deliver with labs and for what cost do you do that?
Yeah, I think the Costco strategy is like very much at the core of what we're trying to do, which is basically saying how do we simultaneously have the lowest prices, the highest quality, and the highest access or the most convenience. And that's very hard to do if you just sell a SKU. You have e-commerce, LTV, CAC dynamics to work with. It's far easier if you're a platform, right? And a big part of our belief is getting to a world where we're vertically integrated. So we can actually say here's the cost plus 15% and that's the Superpower price. We're not there yet. We likely need hundreds of millions or billions of revenue first. But getting there is important because I don't think it's possible to have the long-term winning company without a strategy that looks like that, because there will be a company that decides to have that strategy.
Right. The company that has that strategy will win against the one that doesn't. Yeah. So that's, I think it's the primary avenue for someone to come and take the entire market, at least the top of the funnel, which is do labs to an extent in terms of the quality and the number of biomarkers and the frequency at a cost that no one else can compete with. If you do that, you take the market. So this is in your road map so to speak?
I don't think so. I used to think this. I think potentially the market structure there gets to a point in time where that's true. Right now, price is not a sensitive variable in buying decisions. In many respects, lowering price can actually be a worse decision today because people see you as worse or cheaper. And we have the lowest price in the market and it helps us a little bit. But I don't think that price is the most sensitive variable here. Now, that can change. I think when markets get very educated, that changes. But I think right now we run a reasonably intense price strategy, right? We're 199 for 100 plus blood biomarkers, that works okay. I don't think it's a holy grail strategy. I think the opposite strategy can also work really well, which is we're 499 for the same number of biomarkers. The reason why that strategy can work well is now you have four times more to spend on marketing, right? And having four times more to spend on marketing allows you to get to scale far faster. And if you get to scale far faster, now you can vertically integrate and change your cost structure and then you can underprice whilst maintaining margins. So it's interesting to see how things will unfold. I think in the limit prices trend towards cost plus 15 to 30%.
