Alto Pharmacy’s $200 Million Series E Deck –


We cover a lot of health startups here at, and you know where it’s really hard to get any kind of excitement? An online pharmacy that has raised another round of financing.

Do not get me wrong, Alto Pharmacy raising a Series E is impressive, as is raising $200 million. But realistically, those companies often don’t get on my radar: They’re too big to be startups and haven’t had a liquidity event (i.e., an IPO, an acquisition, or a bankruptcy), so there’s not a lot of news out there.

“Company disrupted an existing industry with a new business model, been doing well for a while and now raising more money to do more of the same except more” is hard to tell a compelling story. Especially when that – albeit with slightly smaller numbers – was also the story in 2017. And in 2020, when the company has a Series D. of $250 million raised.

I know that sounds a little bland to someone who writes about businesses for a living, but I mean listen to the founder’s quote the company’s press release about this fundraiser:

“For the past seven years, we’ve been laser focused on building solutions to the fundamental problems facing the broken pharmacy industry. We are so proud of the progress the team has made, quietly cementing our position as the market leader in the fast-growing digital pharmacy market,” said Alto co-founder Jamie Karraker. “We are excited that this new funding will enable us to continue to define this evolving industry and help even more patients get the care they deserve.”

That’s a lot of words to say, well… Yes: The company has disrupted an existing industry with a new business model, has been doing well for a while and is now raising $200 million to do more of the same, except more.

This is the slide-deck equivalent of a stand-up comedian peering into the spotlight on a stage and ‘pharmacies, amirite?’ mumbles.

In the fast-moving, sexy world of fledgling startups, it’s often hard to forget that there’s a middle ground. Some companies quickly leave for billions of dollars. Some crash and burn in a procession of lawsuits. But as reporters, we’re doing ourselves (and our readers) a disservice: There are a huge number of companies grinding their way to success to the bone, customer by customer, stat by stat, market by market. Let’s face it, not many companies attract five rounds of institutional growth financing, with an investment worth half a billion dollars increased along the way.

When you’re making that many rounds and so many years later, you better have some incredible tricks up your sleeve, solid stats, and some plans for what to do next to get the business where it needs to be. It seems that Alto did – it told the world about the $200 million fundraiser in January this year. Then, on June 30, the company announced it has a new CEO in the form of ex-Amazon exec and 25-year-old GM veteran Alicia Boler Davis.

After reading all this, I was curious how a company tells the above story in the form of a pitch deck to investors. And, perhaps most notably, which parts of the story? do not show on the pitch deck.

We’re looking for more unique pitch decks to break down, so if you’d like to submit your own pitch decks, here’s how.

Slides in this deck

  1. cover slip
  2. Summary of traction and statistics
  3. Cover Slide — Business Overview
  4. “Today’s pharmacy experience is very inefficient” — Problem slide
  5. “Pharmacy is the largest consumer industry still offline” – Opportunity slide
  6. “Current experience is broken for patients and caregivers” – Problem Dia
  7. “The Alto experience solves that” – Solution slide
  8. “Alto Patient Value Proposition” — Value Proposition Slide
  9. “Alto Provider Value Proposition” — Value Proposition slide
  10. “With an end-to-end software platform for next-generation pharma” — Product slide
  11. “Alto offers a differentiated approach” — Competition slide
  12. “Alto Uniquely Aligns the Wider Healthcare Ecosystem” — Market Context slide
  13. Cover slide — Commercial and growth strategy
  14. Income Traction Slider
  15. “Our Growth Strategy” – Go-to-market slide
  16. “Alto Scales Fast and Efficiently” – Regional Deployment Slide
  17. “Alto’s provider-driven GTM movement drives patient engagement, enabling wallet and margin expansion” — Slide with marketing strategy
  18. “Alto Expansion Opportunities Are Attractive and Significant” – Adjacent Growth Strategy Slide
  19. Coverslip — Operations Overview
  20. “The pharmacy is in the middle of a complex and confusing supply chain” — Operational chart slide
  21. closing slide

The company has removed three slides from the deck it sent me and some numbers in the deck have been redacted. Two of the removed slides were screenshots of product demos, and the last contained financially sensitive content.

Three things to love

There is a lot of incredibly smooth data and presentations in this 21-slide game, with some huge wins along the way. Here are three of my favorites:

Hit them with data

[Slide 2] Get started right away. Image Credits: Alto Pharmacy (Opens in a new window)

Traction is everything – that’s true for any startup, but it becomes more and more important the longer the company has been around. Reaching those milestones, growing that growth – it’s the name of the game. Alto doesn’t mess around and plunges straight into a five point summary of why the investors should show them the money. Honestly, this slide is an award-winning list of achievements.

Doubling the ARR year over year is amazing growth that will have any investor asking, “How and can you do it again?” “Positive contribution margin per order” is financially speaking for “if we sell more of this stuff, we make more money.” The company also shows that the figure was negative in 2019. That means the company lost more money in 2019 as it fulfilled more orders. In the intervening three years, it reversed that and set an even more favorable target for next year.

The geo-expansion model is very interesting; if the company can convince me later in the pitch that it has done 11 geo-deployments and now has a roadmap for conquering new markets, that could mark the company as a relatively safe bet for a startup.

Read between the lines and go beyond the business language: the company is growing incredibly fast and has fantastically satisfied customers. It’s raising money out there because its operating and R&D costs are high enough that it’s generally running at a loss. But if it is able to streamline marketing and customer acquisition, it can become a profitable business. And look! It has a way of rolling out to new markets easily and quickly.

It’s an incredibly good summary of an impressive company, and as an investor (if I were investing in the late growth phase), I’d be pretty excited about the next 55 minutes of my life.

‘Adult market ripe for disruption’

[Slide 5] Let’s go. Image Credits: Alto Pharmacy
(Opens in a new window)

This slide tells two incredible stories, both related to market size and opportunity. For starters, as an industry, medicine is bigger than Uber and all food delivery services combined. The other is this: food delivery and ride-hailing and travel have all gone online, and you can probably think of a dozen unicorn exits in each of those categories. If I were the CEO, I would jump up and down at this point, pointing to that 1% number and insinuating strongly along the lines of, “How bad do we have to be not to be successful in this market?”

Based on the company’s performance to date and the sheer size of the market – unless there are some major red flags that pop up later in this pitch, this is starting to look more and more like a pretty safe investment with a huge opportunity. There’s a class of VCs out there who are completely focused on pushing startups from “doing good” to IPO, and I wouldn’t be surprised at all if we saw one from Alto in the near future.

Also, folks, this is how you create a market size slide. It’s done so well.

Let’s traumatize the reader a bit

[Slide 6] This is the slide-deck equivalent of a stand-up comedian standing on stage, peering into the spotlight, muttering “pharmacies, amirite?” Image Credits: Alto Pharmacy(Opens in a new window)

The best storytelling trick in the how-to-pitch playbook is to make it come alive. And in the US, with its untoldly complicated healthcare system, the above diagram is painfully familiar. Getting a prescription from your doctor to getting your hands on the drug can be a Sisyphean task of frustration and murderous rage. By capitalizing on that experience and then waving a magic wand to make it all better, you are tickling the empathy bot in your investors.

You can guess exactly once what Slide 7 is.

Oh okay then, because you asked so sweetly:

It’s a storytelling trick that’s as old as marketing itself: create a painful problem that the audience can identify with, and then sell the problem to that same problem in the next scene.

It’s so simple, but Alto does a fantastic job here.

In the rest of this teardown, we’ll take a look at three things Alto Pharmacy could have improved or done differently, along with the full pitch deck!


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