Roman raises $88 million and gets into smoking cessation business

Roman
founders Rob Schutz, Saman Rahmanian, and Zachariah Reitano, with
Thor.
Roman

• The startup behind men’s
  health company Roman now wants to help you quit
  smoking. 
• The new business, called Zero, provides nicotine gum, a
  prescription drug, and an app to track progress. 
• The company also raised an additional $88 million from
  investors including FirstMark Capital, SignalFire, General
  Catalyst and Alexis Ohanian’s Initialized Capital. 
• It’s part of a growing space of direct-to-consumer businesses
  that are changing patients’ relationships with their
  healthcare. 

A company which delivers Viagra to your door is now trying to
treat one of the root causes of erectile dysfunction. 

Since launching in November 2017, men’s health company Roman had
been connecting men to doctors to treat their erectile
dysfunction. Along the way, the team noticed that when some of
the men realized their health problem had to do with their
smoking habits, they started asking for tips on how to
quit. 

Tobacco use is the 
leading
cause of preventable death,
 and by some
estimates, 
it could
take as many as 30 tries
 to quit. 

And it’s not a uniquely male problem. An
estimated 37.8 million Americans — male and female — smoke
cigarettes, and
almost 70% of smokers in 2015 reported wanting to quit.
Rather than focusing just on helping Roman patients quit smoking,
the team decided to branch out to all smokers interested in
quitting.

“The way you speak to a
35-year-old person who might be struggling with ED is very
different from how you might want to speak to a 35 year-old man
or woman trying to quit smoking,” co-founder Zachariah Reitano
told Business Insider. 

Thus, a second service was born: Zero. The men’s health-focused
brand Roman and Zero both fall under the umbrella of Ro, which
powers the connections between patients, their doctors, and the
pharmacies that dispense the mediation. 

New York-based Ro said Tuesday that it’s also raised an
additional $88 million in a series A round led by FirstMark
Capital, along with SignalFire, Alexi Ohanian’s Initialized
Capital, General Catalyst, Slow Ventures, Sinai Ventures,
Torch Capital, BoxGroup, Tusk Ventures and undisclosed
angels. In total, the company’s raised $91.1 million. 

What Zero’s smoking cessation program includes: a
prescription, nicotine gum, and an app.
Courtesy Ro

Here’s how Ro’s smoking cessation program works

• Patients can go to Zero’s
  website and complete an online visit giving details
  about their medical history and smoking habits. That online visit
  costs $15, which gets refunded if they’re not deemed a good
  candidate.  
• That visit will get analyzed and sent to a physician, who can
  help determine what program might work best for a particular
  patient and can refer them to another doctor if they need
  in-person attention. 
• Ro then ships a kit that includes smoking cessation
  medication bupropion (known by the brand name Zyban), nicotine
  gum, and an app used to help track progress.
• Altogether, the system costs $129 a month but individual
  pieces of the kit can start at $42 a month. Ro doesn’t take
  insurance yet, so both Roman and Zero are paid in cash rather
  than through an insurer. 

Startups that have an approach of going directly to consumers
like Ro have been growing like crazy.

Since launching, Roman’s already facilitated one million
patient-doctor interactions, Reitano said. Startups spanning
everything from hair
loss to
birth control to
contacts have attracted tens of millions in venture
funding. Men’s health startup Hims,
which has so far raised $97 million, has
reportedly been seeking to raise an additional $100 million
as part of its move into women’s health. 

And the model has seen successes elsewhere outside the pharmacy
realm such as in the
clear aligners market. 

“It’s becoming the soup du jour,” said Eric Kim, a managing
partner at Goodwater Capital, who has invested in companies like
Simple Contacts and
at-home diagnostics company EverlyWell. Kim’s been investing
in direct-to-consumer healthcare companies since 2014, and what
appeals to him about the business is that because there isn’t a
physical component — real estate to manage, if you will — the
companies can focus on the consumer in a way that a
brick-and-mortar doctor’s office can’t. 

Ultimately, he sees this being a good entry point into
healthcare.

“What I think these direct to consumer businesses are good at
over time is being the tip of the spear in your care journey,”
Kim said.