The South Asian Times

24 June 2018 02:53 AM

Rishi Shah latest self-made billionaire in Chicago


Houston:  Indian-American Rishi Shah, who quit college 10 years back to pursue entrepreneurial dreams, has become tech's newest billionaire. And his business partner, Shradha Agarwal, is close behind.

Their windfall came with a $600 million infusion of venture capital into Outcome Health, the Chicago health care tech company they founded in 2006. It's now valued at $5.6 billion.

Shah grew up in the Chicago suburb of Oak Brook, the son of a doctor who emigrated from India; his mother managed his father's medical practice. The initial idea for a company providing content to doctor's offices was inspired, Shah says in an interview to local media, by his sister.

"My sister has type 1 diabetes," Shah says. "If she gets on an insulin pump and she is able to achieve better blood sugar control and she is checking her blood sugar more effectively, the device manufacturer wins, the insulin manufacturer wins, the blood glucometer wins, the doctor wins, but the payor wins most of all. And she wins personally."

He attended Northwestern University as a transfer student, where he met a woman named Shradha Agarwal, now Outcome's president. Originally working on a campus magazine, they eventually founded a company called ContextMedia, out of Northwestern in 2008, funding it by taking loans that have over the years reached a combined $325 million instead of giving up equity. Knocking on doctor's office doors around the Chicago area, the two found little appetite for their idea.

Some doctors didn't see the value in digital education in their offices; others who did wanted to see revenue to feel comfortable committing to such a fledgling product. Without signing them, however, the entrepreneurs had no revenue with which to placate them. They eked out $1 million in revenue that first year. "Then we were off to the races," says Shah, doubling most years since. "We had to build a profitable business, or at least a break-even business, from scratch," says Shah. "We had no margin of error."

Outcome Health is not only the newest unicorn company, having earned the honor just last week, but it is also already valued in the top 30 on the list of roughly 200 non-public companies worth $1 billion. 

Update: 19 June, 2017