Hadi Chaudhry and Stephen Snyder are Chief Executive Officer and Chief Strategy Officer, respectively, at CareCloud Inc, a technology-enabled, cloud-based solutions company that helps clients streamline clinical workflows and increase patient satisfaction. Over 40,000 providers count on CareCloud Inc. to improve patient care while reducing operating costs and administrative burden, CareCloud is listed on the Nasdaq under stock symbol MTBC.
CareCloud is an exceptional example of bootstrapping to financial success. In a sector where 11 out of 12 companies failed to achieve a profit as they adjusted to virtual patient care, CareCloud Health created an explosion of revenues that was only exceeded by its growth in earnings.
Between 2017 and 2021, CareCloud’s revenues grew at a 44 percent compound annual growth rate, from $31.8 million in 2017 to an estimated $135 to $138 million in 2021—representing 28 to 31 percent growth over 2020. Over the same five years, CareCloud’s EBITDA has grown at an astonishing 79 percent compound annual growth rate, from $2.3 million in 2017 to an estimated $22 to $25 million in 2021. Bottom-line earnings estimates for 2021 represent a 102 to 130 percent improvement over 2020.
And CareCloud accomplished this by securing capital from its shareholders, in the form of preferred stock, rather than from the capital markets.
Kristi Ross, co-CEO of tastytrade, asked Stephen Snyder how this growth engine came into being in an interview on their podcast Bootstrapping in America.
CareCloud’s Stunning Financial Success Rests on Unique Customer Service Solutions
Stephen Snyder related that CareCloud was started in 2001, when founder and current Executive Chairman Mahmud Haq could not find a business service provider and healthcare technology company that he felt could serve his wife’s new medical practice at the time. Mahmud Haq searched and searched, looking for a vendor, and ultimately felt there wasn’t anyone he felt comfortable recommending to his wife.
As Haq scoured the market to find a vendor to support his wife’s practice, he came to a couple of conclusions. One was that there was (and, of course, still is) a growing market for intuitive, easily implemented technology solutions that are robust, but are very approachable and usable for independent physicians and hospital-owned groups. Likewise, there was, and is, a need for business services that are integrated with healthcare IT.
Haq recognized that there was a tremendous business opportunity, and that the market was highly fragmented, and continues to be fragmented now. His solution was to create a company around technology that also provided business services, and to meet them in a way that would allow his company to support other vendors. The ability to support other vendors evolved into the ability to acquire other vendors with complementary strengths, lowering costs and increasing earnings, consolidating the market.
CareCloud’s Excellent Investor Relations Depend on Consistent Communication
CareCloud Inc., then operating as MTBC, had its IPO in 2014. Kristi Ross asked Stephen Snyder what is the biggest challenge with operating as a public company.
“Investors really need to understand what the overall vision of the company is,” Snyder said. “They need to understand how we are doing, understand where are going, how quickly we will get there, and the like.”
Investor relations is the exciting part of his job, Stephen Snyder said. “It’s a lot of fun being able to share our vision and being able to share those updates. But there’s no doubt about it. With a publicly traded company, there is a market lift that comes from the communication part of running the company.”
Stephen Snyder said that it was part of the initial thesis of the company, and the initial thesis of founder Mahmud Haq, that going public would give CareCloud the currency in the public shares that could be ultimately leveraged to continue their overall consolidation of the market. Going public gives CareCloud Health the ability to acquire companies that add to its technology, scale, and team.
How Cig Can your Company Grow By Bootstrapping?
CEO and President Hadi Chaudhry revealed that CareCloud has grown to roughly 4,000 employees internationally, who administer proprietary technology the company has developed over the last 20 years. In the modern, competitive makret, Choudhry says, it is very important to deliver cost-effective solutions. A global workforce enables CareCloud to create SaaS solutions at a fraction of the cost of a workforce based entirely in the United States.
Chaudhry said that CareCloud planned to become a global, publicly traded company from Day 1. The company developed procedures to ensure that the same workforce discipline that was possible in the private enterprise would be maintained after CareCloud’s IPO. Even though CareCloud was founded in 2001 and went public in 2014, it did not face as many challenges as many of its competitors in adjusting to SEC reporting requirements and the dynamics of acquiring and maintaining exceptionally talented staff.
The two main challenges facing CareCloud today, Chaudhry says, are to continue improving. Technology must be constantly upgraded. Staff must be trained, retained, and given opportunities to excel.
What’s in the Future for CareCloud?
Chaudhry and Snyder agree that the growth of healthcare is aimed at a continuing growth in automation coupled with an embrace of technology in every aspect of medical care. The development of technology, they say, ultimately enables providers to reduce cost and achieve financial stability—something that had been in doubt for many medical practices at the beignning of the pandemic.
New technology will help healthcare to reduce fraud, to reduce waste, and to reduce redundancy, Snyder says. Even more importantly, technology will empower doctors to deliver better results for their patients as data is integrated over different platforms. Technology will make it possible for healthcare providers, payers, and government to better gauge the quality of healthcare delivered for the public.
Laila Azzahra is a professional writer and blogger that loves to write about technology, business, entertainment, science, and health.