"That gave Matthew Gallagher breathing room to fix some shortcuts he had initially taken, like swapping out the before-and-after weight-loss photos for ones from real customers. Some photos on Medvi’s homepage remain A.I.-generated."
Cool, another scammy internet company preying on people's insecurities. Glad the NY Times spent the effort to tell us about it and didn't spend any time questioning this company [1].
Most of us should be honest and admit we're jealous of this guy.
He basically chose a sector where customers are desperate (weight-loss drugs), slapped a website and an interface for connecting with a drug prescription provider together, did effective marketing, and now his business generates millions a month in profit.
Like, there are a half dozen companies like his running around that essentially offer the same product and prices because they are all customer interfaces stop the same provider.
Just the other day I was downvoted and called out for suggesting that perverse incentives are hard to resist, yet here we are with the Times (apparently) showcasing another such instance.
In this case GLP1's clinical effects are widely understood though, so it is immaterial if an "artist's depiction" (artificial agent's depiction) is of a real person or purely hallucinated.
This is just like when Paypal got started and was basically operating their own bank. Good luck doing that without getting in trouble. This is selling pharmaceutical drugs over the internet. You're playing chicken with going to jail they just happened to get lucky.
I had a few people from my life send me this article because they know I've been a software engineer for 20 years and were thinking "wow, see you could do this too!". None of them noticed they were misleading customers. None of them knew the FDA sent them a warning. All of them thought this person was really smart for using AI to create a company on his own, no other humans involved.
So maybe the NY Times thought it was enough to make people question the ethics of the company to add a sentence or two of "AI-generated images/website", but in reality I think people read this as a positive solo entrepreneurship story and missed the ethical grey area and the fact that this indeed took thousands of unseen humans to build.
The opposite of an “A.I” company, he is reselling the services of another filled with humans. A great, profitable business, sure, a notable success, yes, but a 2-man billion dollar company made possible by A.I? No. Businesses like this have existed for decades and are vulnerable to their service providers stealing the business out from under them.
Well, this guy isn't training models in his basement—if that's what you're looking for?
I think the point of this article is that AI enables people to do so much more? Much of marketing is creating engaging content and AI allows people to create more than ever.
I’m struggling to see how anything he did is AI at all. Literally everything about his company is outsourced to an army of contracting firms. All this guy did was generate a marketing site that was filled with fraud.
While the service providers are experiencing massive growth they are happy to share. When growth plateaus they will go after every cost reduction, including squeezing out non-value added resellers. Especially those with warning letters from the FDA for making false claims, as noted below.
As a distributor your value add was always making me markets. Once made, those markets are now trivial to take direct unless there is some advantage to having a local take a risk on stock- holding. I have worked in distribution and seen Amazon refuse to deal with the distributor and go direct as soon as they see decent sales, for instance.
but this is the opposite right? they own the customer relationship. Amazon does the opposite. They control the customer relationship. Can the supplier raise prices possibly but so can they middle man. if they turn over the relationship to the provider then use bad business.
he's making 400M+, so not a big deal, the distribution leverage is massive and now it's time to pivot and add real value appart from the huge brand he has now, i.e. through a unique customer support or who knows what. anyways, after 400M, one can say he already won the game
So if I understand this correctly, Medvi is basically a frontend to white label telehealth services, with wildly successful targeting on an exact niche (GLP-1 served online).
So the 1.8B is effectively sales on a lead-generation opportunity where he gets to capture 20% of the sale (assuming that since his net profits are 16%), and then the backend guys do all the work and probably profit the remaining bit, assuming this line of business has ~50% margins, to these companies doing the actual work they're basically spending 20% on sales and marketing to Medvi. Because this is subscription-based, most of the costs are acquisition, and preventing churn (which is why he hired 7 contractors).
As another poster mentioned - basically this guy is dropshipping GLP1 with no moat, and my guess is that he was keeping quiet and making money till the market got saturated and now he gets to use his success as a puff piece to parlay into a bunch of other verticals like supplements, mealprep, and all that.
This guy's success is basically predicated upon him managing the branding and experience -- so good for him, but this is a middleman opportunity that is likely already going away due to me-toos (and that's why he's milking it one last time on NYT).
Isn't it capitalism? Adobe fucks you, Microsoft will "upgrade" your Office^W Copilot 365 license to 25-seats(1) if you don't notice, Tesla promises self-driving but drives you into the back of the trucks (what, you didn't read the disclaimer?), even the "leader of the free world" is now a crypto-huckster selling you bibles with his name on it... and is killing civilians in the Middle East and making profit by saying "Oh I'll stop soon!".
at least the 3-card Monty guy is dealing with you one on one. These companies hire lobbyist to make the illegal, immoral sh*t legal. Easy to keep winning the game when you write the rules.
The in person businesses selling them don't do much more thorough consultations in my experience, although at least they try to track your muscle mass and be sure you're not losing too much there.
The whole business model probably just comes down to high demand over supply and traditional primary care doctors not being ready to keep up with prescribing it, though? It's a temporary gap being filled in. I wonder how long it can last.
It seems Nowadays for new businesses, lawsuits, maybe even a stint in prison with a 1 million presidential pardon at the end, is all incorporated into a business cost line, in a VC investment funds planning...
It has become a bit of a pest in Germany since weed was legalized. Every other method of distribution is either inconvenient, like growing it yourself, or borderline difficult to establish, like the social clubs. Now, you just pay 10 euros, fill out an online form, and receive a prescription.
I’m not against legalization, quite the opposite but these empty promises that weed is a "cure" for anxiety, depression, and other mental illnesses are dangerous. Advertising it this way without a proper medical examination or proper follow ups is wrong. People are going to get hurt because of it and like this fellow here they started to do other drugs like GLP-1, Viagra and ofc peptides as well.
The best way to legalize it would be through licensed vendors. We shouldn’t force people who just want to smoke to jump through hoops or fake an illness. This kind of approach is exactly how you end up with messy laws like in the US, where everything relies on precedent instead of being clearly written into the code.
When laws aren't solid, they can be overturned by simply adding an addendum to a medical distribution law and make it unobtainable again rather than repealing the legalization itself. It is the classic conservative playbook (btw we see the CDU pushing for exactly this) and it is definitely not something that should be encouraged. So yes it's definitely not the "right" way.
You said it yourself, people are just paying the 10 euro for the prescription to avoid the hassle of growing themseleves or establishing/becoming part of a social club. It's a loophole that works, I doubt those people actually think that it is curing their illnesses.
For sure some do, and for some it really helps (although those people could get medical marijuana even before "legalization"). Speaking anecdotally, all the people I know buying weed from pharmacies just say they have "back pain" or "sleep issues" to get the prescription because it's way easier and quicker to find than any other way.
Just because a law is bad doesn't mean breaking it is a good thing. The laws against gambling are bad, but that's because they're too loose, not because they're too strict. Breaking those laws to gamble doesn't make gambling a good thing.
On one hand this is so impressive. On the other it seems like a company selling drugs or medical services using misleading/generated photos and reviews is not great and extremely risky.
This must largely be going into testing and generating marketing content? I am extremely curious about his processes.
Amazing - an acquaintance of ours when we lived in Germany a couple of years ago had a similar idea. But she found that telemedicine + prescription drugs (and possibly advertising law) are among the most regulated areas in a country already known for its red tape.
I didn't follow up what became of her startup idea, but there's no way she could have ever gotten it off the ground in just two months, like the guy from the article and his brother. More like two years...
This was quite a popular business in the US during covid. I had someone prescribe benzos after a 15 minute call where they didn’t seem to be paying attention. I believe they’re shut down down due to legal issues
I think there's a place for it, there are services that help people access things naltrexone and baclofen for alcohol addiction or finasteride for hair loss and probably many other potentially life-changing scripts that can sometimes be difficult to access even by those who need them. Its a lot easier to get a dr to continue a prescription than to initiate it if you dont have a great dr who listens and works with you
Interesting baseline of how much AI can help with the profitability of a business:
> By the end of last year, Medvi had reached $401 million in annual sales and amassed 250,000 customers. It produced 16.2 percent in net profit, or $65 million, with spending going to the fees for telehealth platforms, marketing and then software. Hims, by contrast, had a net profit of 5.5 percent last year.
I’d argue this is more of an extreme outlier than a baseline. While it shows the 'ceiling' of what a hyper-lean AI-enabled team can do in a white-hot market (GLP-1s), it’s hard to call $200M+ revenue per employee a 'baseline' for any industry. It’s a remarkable anomaly. A dream of every vibe coder like myself, but not a realistic target for most.
What is this platonic ideal of a vibe code business that doesn't rely on some outside vendor to create value? If all you're offering is something for a niche (CRM just for car repair business), that's getting cloned yesterday. Unless your value is locked behind some moat, like hiring licensed doctors, you won't survive, and even then.
Just pointing out a business that is fundamentally about doctors prescribing and delivering compounded GLP-1 is not something "agents" will whip up for you, nor is it a one-man business.
My one-man business uses AWS and a bank and some vendors. AWS and the bank and my vendors have many people working there. Is it still a one man business?
help me understand this. This guy is dropshipping glp-1's from a company that has a network(?) of trusted vendors which they get from the big pharma companies. And now he's doing the dropshipping thing of building a brand
I'm highly suspicious of these revenue claims because how is he doing any of the marketing? Tiktok bans you if you post ugc content saying anything about peptides. FB doesn't allow medicine to be marketed nor does google. If he's dropshipping how is he doing the marketing?
And that’s the problem. You find the same traits they claim that made them successful by those who failed.
Cherrypicking the winners creates a false reasoning of success.
"That gave Matthew Gallagher breathing room to fix some shortcuts he had initially taken, like swapping out the before-and-after weight-loss photos for ones from real customers. Some photos on Medvi’s homepage remain A.I.-generated."
Cool, another scammy internet company preying on people's insecurities. Glad the NY Times spent the effort to tell us about it and didn't spend any time questioning this company [1].
[1] https://www.fda.gov/inspections-compliance-enforcement-and-c...
In the US, the culture is to celebrate success and wealth. Not how you achieved them.
Yes and look how well that's working out for most
Most of us should be honest and admit we're jealous of this guy.
He basically chose a sector where customers are desperate (weight-loss drugs), slapped a website and an interface for connecting with a drug prescription provider together, did effective marketing, and now his business generates millions a month in profit.
Like, there are a half dozen companies like his running around that essentially offer the same product and prices because they are all customer interfaces stop the same provider.
Speak for yourself. My skin crawls.
Do not universalize your temptation to graft
Just the other day I was downvoted and called out for suggesting that perverse incentives are hard to resist, yet here we are with the Times (apparently) showcasing another such instance.
In this case GLP1's clinical effects are widely understood though, so it is immaterial if an "artist's depiction" (artificial agent's depiction) is of a real person or purely hallucinated.
https://news.ycombinator.com/item?id=47581021
> In this case GLP1's clinical effects are widely understood though
When injected. One of the products this scam company was selling is oral Tirzepatide pills, which don't do anything.
This is just like when Paypal got started and was basically operating their own bank. Good luck doing that without getting in trouble. This is selling pharmaceutical drugs over the internet. You're playing chicken with going to jail they just happened to get lucky.
Yeah, I didn't mean it as a positive thing..
“working out for most” is socialism ;)
Anyone else notice how these days "socialism" means "functional UX on your civ"?
I’m pretty sure the writer included this and other details precisely so that readers would understand the ethics of this company.
> I’m pretty sure the writer included this and other details precisely so that readers would understand the ethics of this company.
Maybe, but it felt like this was meant to support the idea that the company is scrappy / under construction.
I had a few people from my life send me this article because they know I've been a software engineer for 20 years and were thinking "wow, see you could do this too!". None of them noticed they were misleading customers. None of them knew the FDA sent them a warning. All of them thought this person was really smart for using AI to create a company on his own, no other humans involved.
So maybe the NY Times thought it was enough to make people question the ethics of the company to add a sentence or two of "AI-generated images/website", but in reality I think people read this as a positive solo entrepreneurship story and missed the ethical grey area and the fact that this indeed took thousands of unseen humans to build.
The opposite of an “A.I” company, he is reselling the services of another filled with humans. A great, profitable business, sure, a notable success, yes, but a 2-man billion dollar company made possible by A.I? No. Businesses like this have existed for decades and are vulnerable to their service providers stealing the business out from under them.
Well, this guy isn't training models in his basement—if that's what you're looking for?
I think the point of this article is that AI enables people to do so much more? Much of marketing is creating engaging content and AI allows people to create more than ever.
Seems that a motivated person with the right skillset could have done this with traditional tools. A WordPress site, a copywriter of Fivver etc.
I’m struggling to see how anything he did is AI at all. Literally everything about his company is outsourced to an army of contracting firms. All this guy did was generate a marketing site that was filled with fraud.
A very astute comment.
While the service providers are experiencing massive growth they are happy to share. When growth plateaus they will go after every cost reduction, including squeezing out non-value added resellers. Especially those with warning letters from the FDA for making false claims, as noted below.
As a distributor your value add was always making me markets. Once made, those markets are now trivial to take direct unless there is some advantage to having a local take a risk on stock- holding. I have worked in distribution and seen Amazon refuse to deal with the distributor and go direct as soon as they see decent sales, for instance.
but this is the opposite right? they own the customer relationship. Amazon does the opposite. They control the customer relationship. Can the supplier raise prices possibly but so can they middle man. if they turn over the relationship to the provider then use bad business.
he's making 400M+, so not a big deal, the distribution leverage is massive and now it's time to pivot and add real value appart from the huge brand he has now, i.e. through a unique customer support or who knows what. anyways, after 400M, one can say he already won the game
So if I understand this correctly, Medvi is basically a frontend to white label telehealth services, with wildly successful targeting on an exact niche (GLP-1 served online).
So the 1.8B is effectively sales on a lead-generation opportunity where he gets to capture 20% of the sale (assuming that since his net profits are 16%), and then the backend guys do all the work and probably profit the remaining bit, assuming this line of business has ~50% margins, to these companies doing the actual work they're basically spending 20% on sales and marketing to Medvi. Because this is subscription-based, most of the costs are acquisition, and preventing churn (which is why he hired 7 contractors).
As another poster mentioned - basically this guy is dropshipping GLP1 with no moat, and my guess is that he was keeping quiet and making money till the market got saturated and now he gets to use his success as a puff piece to parlay into a bunch of other verticals like supplements, mealprep, and all that.
This guy's success is basically predicated upon him managing the branding and experience -- so good for him, but this is a middleman opportunity that is likely already going away due to me-toos (and that's why he's milking it one last time on NYT).
Bingo. Couldn't have explained it better myself.
Looks like they are selling GLP-1 prescriptions online, with online consultations.
This is borderline illegal.
Seems like that’s basically what entrepreneurship is now
Isn't it capitalism? Adobe fucks you, Microsoft will "upgrade" your Office^W Copilot 365 license to 25-seats(1) if you don't notice, Tesla promises self-driving but drives you into the back of the trucks (what, you didn't read the disclaimer?), even the "leader of the free world" is now a crypto-huckster selling you bibles with his name on it... and is killing civilians in the Middle East and making profit by saying "Oh I'll stop soon!".
(1) https://news.ycombinator.com/item?id=47474827
Not capitalism in the way many of us capitalists think it should be practiced. https://en.wikipedia.org/wiki/The_Theory_of_Moral_Sentiments
Isn't this the same no true scotsman argument as "true communism, as Marx envisioned, has never been put to practice"?
Absolutely.
The beauty of capitalism is that you can just not use Adobe, Microsoft or drive Tesla. Blaming Trump on capitalism is also quite a stretch.
So the beauty of capitalism is billion dollar companies are free to try to scam you, because you're also free to avoid them?
Maybe I should just stand on the street and be a 3-card-monty...
at least the 3-card Monty guy is dealing with you one on one. These companies hire lobbyist to make the illegal, immoral sh*t legal. Easy to keep winning the game when you write the rules.
Eliminating capitalism will not eliminate people trying to scam you or take advantage of you.
The in person businesses selling them don't do much more thorough consultations in my experience, although at least they try to track your muscle mass and be sure you're not losing too much there.
The whole business model probably just comes down to high demand over supply and traditional primary care doctors not being ready to keep up with prescribing it, though? It's a temporary gap being filled in. I wonder how long it can last.
It seems Nowadays for new businesses, lawsuits, maybe even a stint in prison with a 1 million presidential pardon at the end, is all incorporated into a business cost line, in a VC investment funds planning...
They were already warned by the FDA: https://www.fda.gov/inspections-compliance-enforcement-and-c...
It has become a bit of a pest in Germany since weed was legalized. Every other method of distribution is either inconvenient, like growing it yourself, or borderline difficult to establish, like the social clubs. Now, you just pay 10 euros, fill out an online form, and receive a prescription. I’m not against legalization, quite the opposite but these empty promises that weed is a "cure" for anxiety, depression, and other mental illnesses are dangerous. Advertising it this way without a proper medical examination or proper follow ups is wrong. People are going to get hurt because of it and like this fellow here they started to do other drugs like GLP-1, Viagra and ofc peptides as well.
No, it sounds like you're against legalization.
How so?
They legalized it, but not the "right" way, according to you.
The best way to legalize it would be through licensed vendors. We shouldn’t force people who just want to smoke to jump through hoops or fake an illness. This kind of approach is exactly how you end up with messy laws like in the US, where everything relies on precedent instead of being clearly written into the code. When laws aren't solid, they can be overturned by simply adding an addendum to a medical distribution law and make it unobtainable again rather than repealing the legalization itself. It is the classic conservative playbook (btw we see the CDU pushing for exactly this) and it is definitely not something that should be encouraged. So yes it's definitely not the "right" way.
You said it yourself, people are just paying the 10 euro for the prescription to avoid the hassle of growing themseleves or establishing/becoming part of a social club. It's a loophole that works, I doubt those people actually think that it is curing their illnesses.
Some definitely do believe it’s a cure for their illness.
For sure some do, and for some it really helps (although those people could get medical marijuana even before "legalization"). Speaking anecdotally, all the people I know buying weed from pharmacies just say they have "back pain" or "sleep issues" to get the prescription because it's way easier and quicker to find than any other way.
This was the same criticism levied against AirBnB, Uber, cryptocurrency, prediction markets, sports betting apps, etc.
The border of legal and illegal is a good place to make money and change.
Yes doing illegal things and getting away with it is a great way to make money.
Some laws represent moral truths and some laws represent the attempt of a prior generation's upper class to protect that wealth.
The willingess to break a bad law is a sign of a good person.
Just because a law is bad doesn't mean breaking it is a good thing. The laws against gambling are bad, but that's because they're too loose, not because they're too strict. Breaking those laws to gamble doesn't make gambling a good thing.
Yeah illegally running a cab is basically the same thing as being Rosa Parks.
Correct. While ride-sharing services aren't perfect, they have significantly reduced rates of service refusals and long-wait times based on race.
By that argument, start a company selling fentanyl because there will be demand for it?
Sorry, but your implied argument is flawed.
You might have to hold my hand on how you got there.
My actual argument was the ride-sharing addressed systemic racism that yellow cab companies did not, that is a good thing.
What net good would fentanyl do to society? If it exists, then yes, sell it. Clean, reliable fentanyl might be a good thing, I don't know.
> hold my hand
The fentanyl using part of society thinks it is great. There you go.
So it's legal?
A lot of shitty behavior is legal. That doesn't mean that we should accept it if it happens.
Decency exists for a reason.
On one hand this is so impressive. On the other it seems like a company selling drugs or medical services using misleading/generated photos and reviews is not great and extremely risky.
This must largely be going into testing and generating marketing content? I am extremely curious about his processes.
>> " I am extremely curious about his processes."
Yes - to be applied in less nefarious and dubious ways.
Amazing - an acquaintance of ours when we lived in Germany a couple of years ago had a similar idea. But she found that telemedicine + prescription drugs (and possibly advertising law) are among the most regulated areas in a country already known for its red tape.
I didn't follow up what became of her startup idea, but there's no way she could have ever gotten it off the ground in just two months, like the guy from the article and his brother. More like two years...
This was quite a popular business in the US during covid. I had someone prescribe benzos after a 15 minute call where they didn’t seem to be paying attention. I believe they’re shut down down due to legal issues
I think there's a place for it, there are services that help people access things naltrexone and baclofen for alcohol addiction or finasteride for hair loss and probably many other potentially life-changing scripts that can sometimes be difficult to access even by those who need them. Its a lot easier to get a dr to continue a prescription than to initiate it if you dont have a great dr who listens and works with you
Interesting baseline of how much AI can help with the profitability of a business:
> By the end of last year, Medvi had reached $401 million in annual sales and amassed 250,000 customers. It produced 16.2 percent in net profit, or $65 million, with spending going to the fees for telehealth platforms, marketing and then software. Hims, by contrast, had a net profit of 5.5 percent last year.
I’d argue this is more of an extreme outlier than a baseline. While it shows the 'ceiling' of what a hyper-lean AI-enabled team can do in a white-hot market (GLP-1s), it’s hard to call $200M+ revenue per employee a 'baseline' for any industry. It’s a remarkable anomaly. A dream of every vibe coder like myself, but not a realistic target for most.
It also relies on many outsourced doctors, correct? In this particular case, this is not a great vibe code business example imho.
That's like saying Spotify wouldn't be a good example, because it outsourced music production to musicians and just not a meaningful point.
What is this platonic ideal of a vibe code business that doesn't rely on some outside vendor to create value? If all you're offering is something for a niche (CRM just for car repair business), that's getting cloned yesterday. Unless your value is locked behind some moat, like hiring licensed doctors, you won't survive, and even then.
Just pointing out a business that is fundamentally about doctors prescribing and delivering compounded GLP-1 is not something "agents" will whip up for you, nor is it a one-man business.
My one-man business uses AWS and a bank and some vendors. AWS and the bank and my vendors have many people working there. Is it still a one man business?
By doing false claims: https://www.fda.gov/inspections-compliance-enforcement-and-c...
The founder is impressive.
Truly, if you look over his website, you would not think this is a company that generates millions in profit a year.
He claims he has switched over from using AI-generated profits to real customer testimonials. That's a misrepresentation, if not a lie.
Most of the images still look like they have the unnatural fuzziness of AI images.
Website is also coded as one long-scrolling page, again suggesting this is a company who does not offer a unique product with value proposition.
Honestly, this is a company that looks like it succeeded only by optimizing employee head count and customer acquisition cost
And if that's what it takes to succeed, fair play.
The poor website quality struck me as well - and the images are clearly AI, everything is clearly AI. Yet the guy is doing $400m in sales.
Even the quiz flow to check eligibility is using old icons and just feels super spammy.
His ads must be crushing it, I guess?
help me understand this. This guy is dropshipping glp-1's from a company that has a network(?) of trusted vendors which they get from the big pharma companies. And now he's doing the dropshipping thing of building a brand
I'm highly suspicious of these revenue claims because how is he doing any of the marketing? Tiktok bans you if you post ugc content saying anything about peptides. FB doesn't allow medicine to be marketed nor does google. If he's dropshipping how is he doing the marketing?
It's in the article—he buys advertising on news sites. They claim to have verified his financials
Based on common AI sales to market cap ratios, this is a $50-$100B market cap company.
And that is what this article is, an attempt to get a business with a doubtful future valued as AI
The secret ingredient is fraud.
'...and some contractors'.
So not one person, not two, but many.
Survivorship bias
Technically, all journalism pieces on successful businesses are survivorship bias. No one writes and reads about the business that failed to find PMF.
And that’s the problem. You find the same traits they claim that made them successful by those who failed. Cherrypicking the winners creates a false reasoning of success.
Is it a problem? Bc I know there is survivorship bias and also still want to hear about the successes, so what is the problem then?
How many readers don’t know that? And how many fall for the false reasoning of those success stories?
You are assuming most readers are dumb. I do not have that assumption.