TJ Parker, former Amazon executive, is headed to venture capital firm Matrix to reignite his love of startups.
Parker was the CEO and co-founder of online pharmacy PillPack, which Amazon acquired in June 2018 for $753 million. Parker stayed on at Amazon for about four years before leaving last year. He said the experience was less enjoyable but as impactful as he expected.
“People are relatively predisposed to be happy and successful in specific environments,” Parker said. “For me, I’m so far on the extreme of [a] founder, startup [type of] guy.”
Parker joined Matrix as a general partner on June 1. He talked about what he learned after PillPack was acquired by Amazon, the message that digital health founders aren’t getting from investors and more. The interview has been edited for clarity and length.
Do you ever think about what would have happened if you had kept PillPack on its own for longer?
I have no regrets about the timing of when we decided to ultimately sell the company. Especially if you think about what has happened since, we had the opportunity to build [a] pharmacy on Amazon.com, which I think was the big opportunity. Amazon now is really the only big tech company actually delivering healthcare. We were a very critical part of that. I think it helped us see through the things we wanted to achieve, which were to make pharmacy more convenient for consumers [and to improve the] broader customer experience, the supply chain and a bunch of other stuff. I don’t know if that would have been feasible in the same time scale as an independent company. It would have been super capital intensive. We both had a great outcome financially for everyone involved — investors, employees and founders — but also I think we were able to achieve what we set out to achieve and that will continue well beyond our departure.
PillPack was acquired in 2018. Do you have any advice to your younger self?
A lot of the magic of PillPack was a bunch of naivety. It’s hard to imagine PillPack being what it became without all of the dynamics that were at play. I was 26 when I started the company, and deeply understood the pharmacy experience. I was a pharmacist, my parents owned a pharmacy…but I was wildly naive to the broader dynamics. So it’s a little hard in that context to want to give myself much advice. But we took money from primarily consumer investors, not healthcare investors, because we were trying to build a consumer business. That was generally successful, and I wouldn’t change that. But, there weren’t a generation of founders that have done both. That’s an interesting evolution. But it is hard to put myself back in that position because if I knew what I know now, I don’t think we’d ever start PillPack. There were a bunch of things that we came into very naive and that was part of the magic, to be totally honest.
How do you capture that magic again?
That’s part of the reason I’m moving to venture and not starting another company right now. I moved from naive to a pseudo-expert. I’m hoping to find founders that are able to have similar magic. I think they do need to deeply understand the customer problems they’re solving, but it’s hard to recreate that naivete. I’m excited to partner with founders who are able to similarly ride the line and don’t have all the baggage I have had operating in this space for more than a decade.
Was there space for that type of innovation at Amazon?
There was certainly a space to continue to build, but you are definitely building in the context of a very large company. And, for me personally, over time it became clear that wasn’t where I was going to be both successful and happy. I think I could have been successful, but you’re ultimately at a large company, and it has all the trappings of any large company. So again, I think I’m very bullish on what Amazon can and will build in healthcare. Obviously, I was fundamental to building that out. But personally, I wanted to get back to startups.
A lot of founders say investors aren’t patient enough and require faster financial results than healthcare allows. Do you agree?
PillPack is a pretty strong counterpoint to that narrative, right? We were five years from founding date to a billion dollar acquisition, five years from founding date to multiple hundreds of millions of revenue. Healthcare is harder than a lot of other categories, but I do think there are venture opportunities and returns available in healthcare. My intention is to build and work with founders who are building generational companies and that takes a long time no matter the category
What messages are digital health founders not getting right now?
The founders that get into the guts of healthcare and wrestle with the real complexities…[and] build elegant solutions will be successful. I think there has been a theme over the last decade of folks really playing around the fringes and perimeters of healthcare delivery. I hope folks can take all the lessons we’ve learned and those kinds of compelling experiences in places that are a bit simpler, and apply them to much more complicated moments in the healthcare journey.