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How tech workers are preparing to bug in for coronavirus

As the industry orders workers to stay home, some employees are already prepared, and others are scrambling.

How tech workers are preparing to bug in for coronavirus

From San Francisco to New York City, tech workers are adjusting to a new reality of remote work and scarce supplies.

Photo: Justin Sullivan/Getty Images

Robert Nelsen raided Costco at the end of January, long before the shelves began to empty. The panic over coronavirus had barely begun to alight in San Francisco, where the managing director and co-founder of venture firm Arch Venture Partners lives, but he wanted to be ready. Nelsen bought a Yamaha inverter generator to power areas of his home, six boxes of Cheerios, three boxes of Frosted Flakes, dozens of bottles of water, and six 1.75-liter bottles of Grey Goose Vodka — not to drink, but to disinfect.

Two months ago, Nelsen's comments might have seemed outlandish outside of "prepper" communities. Not anymore. Now, with tech companies across the industry asking employees to work from home, schools closing, and store shelves empty of essentials like toilet paper and high-alcohol disinfectant wipes, Nelsen's preparations look prescient.

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"It's just prudent to have enough supplies," Nelsen said. Since January, he's been ready to self-quarantine himself, his wife and children at home for several weeks should the need arise. "All the [epidemiologists and virologists] I know are really concerned, and if they had an elderly member in their household, or somebody at risk, they wouldn't be going out with their elderly mother to lunch in Mountain View. I mean, you'd have to be high."

By Monday, the situation everywhere in the U.S. was getting more serious, and the tech industry was bracing itself for huge interruptions — from supply chain shortages, to virtual conferences, to entire businesses threatened. Those in tech who hadn't yet stocked up on supplies were now scrambling to do so.

For 24-year-old Haley Walker, a senior product analyst at commercial real estate startup SquareFoot in New York, the sudden requirement to work from home came on Sunday, and she wasn't quite ready. "I have all of my work stuff that I need — my computer, a monitor, a whole setup here, because we've been told that this was a possibility for the past week — but one of the things that I neglected in my personal life was stocking up on essential items," she said. Like toilet paper. When she and her fiancé realized on Sunday they'd both be working from their Manhattan apartment the rest of the week, they went out looking for toilet paper and found that the big stores like Gristedes in their neighborhood were sold out.

"We ultimately found some toilet paper at a bodega nearby, but we're probably going to end up needing to order some more from Target or Amazon," she said. Where they'll put that in their small New York apartment is another cause for concern.

"My fiancé was saying we should order groceries for the next two weeks or three weeks, and I told him, 'Where are we going to put it?' We have nowhere to put all of this stuff. With something like toilet paper, you can throw it in the corner, but with food that is perishable, and even fruits and veggies, we can't just throw it on the floor," Walker said.

Some of her colleagues had already stocked up — buying extra tuna fish or cold medicine. Now that Walker is prepping, she doesn't know how much to buy for her home-bound time, because her company has asked people to stay home until further notice. It's up to her CEO to decide how long everyone will be home.

Sam Liang, CEO of AI transcription service Otter.ai, is one of the people in tech having to make decisions like that. For now, he's giving his employees the option of working from home. Liang's son, a senior at the prestigious Menlo School in Atherton, was home for part of last week after the private school closed its doors on March 4 to "deep clean" the campus because a staff member had interacted with a relative who contracted the virus. Menlo School resumed classes on Monday.

"The panic is a bit overblown, but it's always safe to be careful and have a plan, but no need to panic. As a business, though, we have to prepare for it," Liang said.

Last week, dating app Coffee Meets Bagel CEO Dawoon Kang held a company-wide meeting, reviewed the latest developments around COVID-19 and introduced new policies to the San Francisco-based company, strongly encouraging her 50 or so employees to work from home. She also suspended all nonessential business travel.

"We are very supportive of working remotely," Kang said. "Now is a great time to take advantage of this perk."

Others in tech like Ed Baker are taking preparations a step further. Baker, a former Uber vice president who moved to Cambridge, Massachusetts, in 2017 and became an angel investor in several startups (Lime, smart wristband maker Whoop, and health and wellness startup Playbook), has four children, ages 9, 7, 5, and 1. He's not taking any chances.

He recently canceled a trip to San Francisco, and another to New York last week. At his Cambridge home, Baker and his wife placed Post-It notes by the entrances alongside bottles of hand sanitizer, asking that every visitor use the latter before they enter. The Bakers also spoke to the schools their children attend about the possibility of home schooling should they decide to temporarily withdraw their three oldest kids. The couple plans on migrating their kids to GoPeer, an online tutoring service, if the home schooling scenario becomes a reality.

"We're mentally preparing to home quarantine," Baker said.

Like Nelsen, Baker has already stocked up on supplies for at least a month. He's also been trying to spread awareness. Over the last four weeks, the former Uber executive authored two Medium posts expressing concern around the government's efforts to screen for and contain COVID-19, citing Neil Ferguson, director of the MRC Centre for Global Infectious Disease Analysis at the Imperial College London, who contended in early February that outside of China, "we may be detecting only a quarter of all [COVID-19] infections." The steps he and his family are taking are in line with social isolation efforts that other countries, like Italy, Hong Kong and Singapore, have instituted on a large scale.

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In Seattle, dubiously nicknamed "America's coronavirus capital," Lucas Nivon, CEO and co-founder of Cyrus Biotechnology, has hunkered down at home with his wife, 2-year-old daughter, and several weeks' worth of provisions. They have instituted a strict "no visitors" policy. Nineteen people have died from the virus in Washington state so far. Nivon recently halted all company work travel and mandated that the 20 or so of the company's full-time employees work from home.

"I'm very concerned," Nivon said. "Right now, it's a question of can we in the U.S. take action? At least there's a recipe from countries like Singapore [such as increased screening and temperature tests, contact tracing, working from home]. So I am a little bit less concerned now after seeing the virus slowed in some countries, but I do have political or social concern that we actually do those things." Tech companies can send their employees home, and that is important, but can the U.S. scale up the larger response required to slow the virus on the whole? He worries.

"As long as everything doesn't devolve into 'herding us into a Superdome, Katrina-style' sort of dystopian horror where toilet paper and hand sanitizer are the new currency, I feel OK," said AI research scientist Julie Carpenter, who lives in San Francisco, when asked if she had enough provisions to get through staying at home

Walker echoed the same thing in New York: "People at my company seem to be adjusting to it really well," she said. "It's a little jolt to the system at first, but we've had all of our regularly scheduled meetings so nothing seems to be out of sorts. It's just my personal life that is out of sorts."

Until the virus is contained, tech folks, like those in many industries, will need to wait out the virus from the relative safety of their homes, Grey Goose Vodka and — hopefully — toilet paper and all.

"I would definitely minimize exposure," Nelsen said. "Just please, please, don't take your grandmother out to lunch."

Emily Dreyfuss contributed reporting.

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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