Power

Monday's plan to become the operating system for work

A new "Apps Framework" will allow third-party developers to start building their own apps on top of Monday.

Monday Work OS

Monday was originally a project management tool, but it's now becoming an operating system for work.

Image: Monday

For a while, Roy Mann and Eran Zinman just wanted to build a good project management tool. The two Israeli techies co-founded Monday.com (Mann is the CEO and Zinman the CTO) to fix what they perceived as a universal problem with productivity tools: They all make you work a certain way. "You find one that supposedly solves your problem," Zinman said, "and then your team needs to adopt and use the software, and then you outgrow it or you change the structure of your team or the way you work, and then you need to move on to the next software and the next software."

Their goal was to build a tool that worked for all parts of a company — from tech-head engineers to fusty finance folks, tiny teams to company-wide installations. So they built a modular tool that starts as a prettier-looking spreadsheet but ultimately can become a store of information and tasks that can be organized and used in countless ways. You want a Gantt chart? You got a Gantt chart. The tool starts and seems simple, but comes with plenty of power and customization. It's working for people: More than 100,000 organizations around the world now use the product, and Monday's now reportedly valued at $2.7 billion.

The Monday team has always thought of the iPhone as a useful metaphor for their product. "It's very simple to start using," Mann said, "and it's not more complex because there are 2 million apps in the App Store. It's just more versatile. You see the options, but you don't have to use them." Everyone's iPhone can work differently, which is exactly what they hope for Monday.

Actually, the more they worked on Monday, the more Mann and Zinman thought about the iPhone. To really stretch the metaphor: What's the iPhone for work? There are plenty of tools for plenty of jobs, but nothing that brings them all together in one usable place. Over time, that's what Monday decided it wanted to be.

Monday co-founders Roy Mann and Eran Zinman. Monday co-founders Roy Mann (left) and Eran Zinman.Photo: Courtesy of Monday

Monday's been testing a new feature called the Apps Framework for the last few months and is launching it publicly Tuesday. It gives third-party developers access to build their own apps on top of Monday, without needing to do much coding or build their own productivity tool from scratch. "Basically, people can add their own integrations, add their own automations, create specific views for any specific industry," Zinman said. Rather than working in a dozen apps and tabs, everything could be inside Monday.Instead of being an app, Monday wants to become a platform.

Of course, every business tool seems to want to be a platform. It's one of the billion-dollar questions being asked in tech right now: Where do you work? Not at what company do you work, or in what location. But when you actually sit down to do work, where do you go? The answer, in many cases, is pure chaos. Okta found in a study that the average company uses 88 software tools, and that number is growing quickly over time. (Already, 1 in 10 companies uses more than 200.) Work happens in CRMs, inboxes, project-management tools, customer-service queues and many other places.

Monday is one of a number of companies hoping to bring that all together. Airtable, Notion, Coda, Basecamp, Asana, ClickUp, Jira, Trello and others are all vying to be the first place you go when it's time to get to work. Each has a slightly different way of describing it: It's the home base, the dashboard, the infrastructure, the back end, the foundation, the source of truth, the place of record. The Monday co-founders like to call it the operating system: The Work OS. "An operating system for a personal computer is what runs the computer," Zinman said. "We want to be that tool for businesses, the backbone for everything."

Whatever you want to call it, there's plenty of competition. (One easy way to tell: Search for, say, Asana on Google, and you get two or three ads for competing products before getting to the results.) ClickUp recently raised $35 million to pursue a similar goal, and CEO Zeb Evans told TechCrunch it plans to become "a highly flexible interface that allows for teams of all sizes and types to work on it." Likewise, Michael Pryor, the head of Trello at Atlassian, told me that he's focused on integrating other apps into Trello. "You don't build an app without an API anymore," he said. "So the ability to integrate with all these apps is front and center for us."

Building an API for integrating with other apps is simple enough. Monday's asking developers to go further: to treat it like a platform, to build and maintain Monday apps like they do for Windows or Android. But Mann and Zinman are hoping that the tools are simple enough, and Monday is popular enough, that developers will jump on board.

While the Apps Framework has been in beta, internal and external teams have been building the first set of apps. KPMG built an app for automatically processing and submitting an invoice just by taking a picture of it. Mann helped build a 3D globe view for anything location-based, so you can look through real estate listings by spinning the globe. Zinman worked with a team on a card-flipping view, sort of like flash cards for your data. In all, there are about 100 apps already available, and Monday's hoping more are coming quickly.

Both Mann and Zinman are careful to not overhype this launch, though. Even when they work, these things tend to grow slowly. "I think the first few apps on the iPhone were pretty lame," Zinman said. Monday's prepared for many of its early apps to be the business tool equivalent of flashlight and fart apps. But eventually, they hope, they'll get the business tool equivalent of Uber and Instagram, which took the available features and built something entirely new.

At first, developers won't be able to make money from their Monday apps. Monday hopes they'll build anyway because they can tap into all the other tools available on the platform and find new users there, too. Companies might even build for themselves. One challenge for every business tool is that while many companies have some things in common — they all use Salesforce, Outlook or Gmail, Slack or Teams — each seems to also have a subset of old or unique tools. And if you solve half a company's information problems, you haven't really solved anything. "We want to connect that legacy software and everything," Mann said, but they're doing so by helping companies solve their own weird workflow problems.

One challenge for Monday will be figuring out where its product ends and its platform begins. It's a slippery slope from integrating a video chat tool to deciding the best solution is to ditch the API and just build yourself a Zoom competitor. Monday's approach, so far, seems to be to try and build the basics and leave the power-user stuff to others. "We have our own form system," Zinman said, "but our mentality is we don't want to build the best form on the planet." They'd rather spend the time deeply integrating with SurveyMonkey or Typeform. Same goes for whiteboard apps, in which users might start with Monday's tools but graduate to Miro when they need more. And because all those other tools can also live in Monday, they might be easier for teams to add to their stack. It gets back to that initial simplicity of the product: Monday wants to make it easy to get started, then get out of the way as users get more sophisticated.

There's one part of the iPhone metaphor that doesn't track, Mann and Zinman admit. On a phone, apps mostly live side by side but don't intermingle, but on Monday, they're hoping to throw every app and every feature into one endlessly rearrangeable set. "It's building blocks," Mann said. "Building blocks can be connected in a hundred different ways." What those ways will be, they don't know, and they're slightly nervous about that but mostly OK with it. "We don't know what our customers are going to build," Mann said, "and they don't know what the users are going to do with it." Everyone's just going to keep building blocks and hope people keep finding new ways to put them together. If they do, Monday might become the first place millions of people go when they get to work, wherever and whenever that is.

Image: Yuanxin

Yuanxin Technology doesn't hide its ambition. In the first line of its prospectus, the company says its mission is to be the "first choice for patients' healthcare and medication needs in China." But the road to winning the crowded China health tech race is a long one for this Tencent- and Sequoia-backed startup, even with a recent valuation of $4 billion, according to Chinese publication Lieyunwang. Here's everything you need to know about Yuanxin Technology's forthcoming IPO on the Hong Kong Stock Exchange.

What does Yuanxin do?

There are many ways startups can crack open the health care market in China, and Yuanxin has focused on one: prescription drugs. According to its prospectus, sales of prescription drugs outside hospitals account for only 23% of the total healthcare market in China, whereas that number is 70.2% in the United States.

Yuanxin started with physical stores. Since 2015, it has opened 217 pharmacies immediately outside Chinese hospitals. "A pharmacy has to be on the main road where a patient exits the hospital. It needs to be highly accessible," Yuanxin founder He Tao told Chinese media in August. Then, patients are encouraged to refill their prescriptions on Yuanxin's online platforms and to follow up with telehealth services instead of returning to a hospital.

From there, Yuanxin has built a large product portfolio that offers online doctor visits, pharmacies and private insurance plans. It also works with enterprise clients, designing office automation and prescription management systems for hospitals and selling digital ads for big pharma.

Yuanxin's Financials

Yuanxin's annual revenues have been steadily growing from $127 million in 2018 to $365 million in 2019 and $561 million in 2020. In each of those three years, over 97% of revenue came from "out-of-hospital comprehensive patient services," which include the company's physical pharmacies and telehealth services. More specifically, approximately 83% of its retail sales derived from prescription drugs.

But the company hasn't made a profit. Yuanxin's annual losses grew from $17 million in 2018 to $26 million in 2019 and $48 million in 2020. The losses are moderate considering the ever-growing revenues, but cast doubt on whether the company can become profitable any time soon. Apart from the cost of drug supplies, the biggest spend is marketing and sales.

What's next for Yuanxin

There are still abundant opportunities in the prescription drug market. In 2020, China's National Medical Products Administration started to explore lifting the ban on selling prescription drugs online. Although it's unclear when the change will take place, it looks like more purely-online platforms will be able to write prescriptions in the future. With its established market presence, Yuanxin is likely one of the players that can benefit greatly from such a policy change.

The enterprise and health insurance businesses of Yuanxin are still fairly small (accounting for less than 3% of annual revenue), but this is where the company sees an opportunity for future growth. Yuanxin is particularly hoping to power its growth with data and artificial intelligence. It boasts a database of 14 million prescriptions accumulated over years, and the company says the data can be used in many ways: designing private insurance plans, training doctors and offering chronic disease management services. The company says it currently employs 509 people on its R&D team, including 437 software engineers and 22 data engineers and scientists.

What Could Go Wrong?

The COVID-19 pandemic has helped sell the story of digital health care, but Yuanxin isn't the only company benefiting from this opportunity. 2020 has seen a slew of Chinese health tech companies rise. They either completed their IPO process before Yuanxin (like JD, Alibaba and Ping An's healthcare subsidiaries) or are close to it (WeDoctor and DXY). In this crowded sector, Yuanxin faces competition from both companies with Big Tech parent companies behind them and startups that have their own specialized advantages.

Like each of its competitors, Yuanxin needs to be careful with how it processes patient data — some of the most sensitive personal data online. Recent Chinese legislation around personal data has made it clear that it will be increasingly difficult to monetize user data. In the prospectus, Yuanxin elaborately explained how it anonymizes data and prevents data from being leaked or hacked, but it also admitted that it cannot foresee what future policies will be introduced.

Who Gets Rich

  • Yuanxin's founder and CEO He Tao and SVP He Weizhuang own 29.82% of the company's shares through a jointly controlled company. (It's unclear whether He Tao and He Weizhuang are related.)
  • Tencent owns 19.55% of the shares.
  • Sequoia owns 16.21% of the shares.
  • Other major investors include Qiming, Starquest Capital and Kunling, which respectively own 7.12%, 6.51% and 5.32% of the shares.

What People Are Saying

  • "The demands of patients, hospitals, insurance companies, pharmacies and pharmaceutical companies are all different. How to meet each individual demand and find a core profit model is the key to Yuanxin Technology's future growth." — Xu Yuchen, insurance industry analyst and member of China Association of Actuaries, in Chinese publication Lanjinger.
  • "The window of opportunity caused by the pandemic, as well as the high valuations of those companies that have gone public, brings hope to other medical services companies…[But] the window of opportunity is closing and the potential of Internet healthcare is yet to be explored with new ideas. Therefore, traditional, asset-heavy healthcare companies need to take this opportunity and go public as soon as possible." —Wang Hang, founder and CEO of online healthcare platform Haodf, in state media China.com.

Zeyi Yang
Zeyi Yang is a reporter with Protocol | China. Previously, he worked as a reporting fellow for the digital magazine Rest of World, covering the intersection of technology and culture in China and neighboring countries. He has also contributed to the South China Morning Post, Nikkei Asia, Columbia Journalism Review, among other publications. In his spare time, Zeyi co-founded a Mandarin podcast that tells LGBTQ stories in China. He has been playing Pokemon for 14 years and has a weird favorite pick.

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