Verily, short for Verily Life Sciences, is a biotech organization that focuses on helping people through the study of life science and healthcare. Through various means of collecting, formulating, and applying data, the former subsidiary of Google X is turning a profit by revamping the healthcare industry through research and advanced technology.
This article is all about breaking down exactly how Verily makes its money. That’s a unique question, given that Google-backed Ventures often have an entirely different business model.
Verily makes money by way of research grants, joint ventures, and initiatives through collaborations with various experts such as scientists, researchers, designers, pharmaceutical and medical device companies who pay to use, and partner with, the platform.
Business Model of Verily
Verily’s proven business model empowers health providers to innovate, save lives, and improve the quality of healthcare. Their business model is grounded in the convergence of healthcare, digital technology, and data science, creating integrated solutions to improve the quality of care for patients with chronic conditions.
Currently, the company is very clear that we’re not trying to make money off hardware or devices, their business model is based on software, data and services.
The company prides itself on its dedication to help transform the way it detects, treats, and manages diseases, as well as improves health for all.
Through their innovative research and technology, collaborative efforts, and community-building projects, Verily has built a reputation for itself within the industry as a solution-based platform.
Collaboration
As part of a great effort to fight against the debilitating effects of diabetes, Verily partnered with Novartis’ eye care division, Alcon.
This is to help develop a Smart Lens that aims to detect and monitor glucose levels in individuals living with diabetes by placing sensors in their contact lenses. This could help them better manage the disease and afford a better quality of life.
In addition to this, the partnership brought about a contact lens that has powerful potential to aid in the management of presbyopia, as well as another lens that may allow for improved eyesight following cataract surgery.
Verily plans to gain continuous strides in their collaborations to help those with diabetes. According to the company, this includes “working closely with Dexcom to develop miniaturized continuous glucose monitors and with Onduo, our joint venture with Sanofi, to integrate continuous sensing into the care paradigm for people living with Type 2 diabetes”.
Another of many collaborations, Verily’s Project Baseline partnered with the American Heart Association to launch Research Goes Red. Research Goes Red is an initiative that allows for more women participants in research studies on heart disease.
Although cardiovascular disease accounts for one-third of deaths in women annually, it is still commonly considered “a man’s disease”, pointing to the importance and necessity of the initiative.
An extension of the American Heart Association’s long-standing movement Go Red for Women, women are encouraged to contribute in a number of ways that are most comfortable to them including participating in focus groups or simply filling out a survey.
This collaboration provides the tools and resources necessary to women so that they may contribute to the study of what most affects them.
Innovation
Liftware Labs joined Verily in 2014 to work on creating a number of utensil attachments and handles designed to improve the eating experience of those with limited mobility and/or hand tremors.
Introducing Liftware Steady, an electronic attachment with a built-in motion-detecting sensor and tiny computer. As the motion sensor detects hand tremors, the computer directs the attachment to oppose the movement of said tremors by moving in the opposite direction, thus maintaining a stable utensil for easier, less messy eating.
Developed in tandem with Liftware Steady is Liftware Level, an electronic handle designed for those who struggle with limited mobility. Level uses sensors to detect motion in three dimensions. Using advanced technology, the sensor identifies changes in intended hand movement and adjusts itself accordingly in order to remain level while eating.
Thanks to Verily and Liftware Labs, those suffering feelings of frustration and shame while eating can now feel confident in their new abilities with their state-of-the-art devices.
Verily also partnered with Pampers to create a highly complex baby monitoring system for new and seasoned parents. This system, called Lumi, uses video monitoring and activity sensors to compile valuable data that provides insight into a baby’s developmental progress. Now parents can feel supported and confident in the decisions that they make for their child, having gained a greater perspective of their development by simply launching the Lumi app.
Community
Verily strongly believes in community.
According to their website, the foundation for what the company does is to make it so that preventative care can “help people live happier, healthier lives. And lower the cost of healthcare for everyone.
Key to this is both better information served at the right time, and better access to care, especially in vulnerable populations.” They commit themselves to help better the global population through their platform.
The company curates a strong sense of community by encouraging normal, everyday people to join them in their efforts. The Baseline Covid-19 Research Project, for example, asks for participants to aid in the fight against the Covid-19 virus.
For example, positive testing participants can safely provide samples to the Baseline Antibody Team in order to further research and understanding of the immune response to the virus.
This also assists in determining national infection and immunity rates, important factors to consider when deciding when it’s safe to reopen communities, and how. Thus, participants are a largely important part of the project and an even more important aid in the efforts to combat Covid-19 across the globe.
Additionally, Verily provides opportunities for career advancement, creating a research internship program for aspiring researchers to begin making small waves in the industry. Tasked with examining how social status determines health, three of Verily’s interns received rave reviews of their exemplary work and effort.
According to a blog posted on Verily’s website, Julia King, Zoe Covington-Towner, and UX Research Assistant Atalanta von der Schulenburg explored the great disparity in maternal medical care with regards to race, with special attention given to the high mortality rate of black mothers.
Megan Mariotti, the nurse practitioner of Clinical Delivery Innovation Lead, was thoroughly impressed with their work, a great reflection of Verily’s marked investment in their budding talent.
She recalls, “Julia, Atalanta, and Zoe approached this project with great intellectual curiosity and a passion to determine how to break down an enormous issue in healthcare and contribute meaningfully to Verily’s effort to better understand and address social determinants of health”.
How Does Verily Make Money?
Verily makes money by partnering with scientific researchers and medical device and pharmaceutical companies.
For example, the company boasts a large platform of valuable tools and resources that researchers and other experts need to facilitate their testing, and to make breakthroughs in science and healthcare.
Therefore they use Verily’s program and advanced capabilities to create a proactive healthcare system in exchange for research grants, their time and commitment, and patient’s recorded data.
Similarly, medical device and pharmaceutical companies utilize the organization’s healthcare platform, data, and software to develop therapies that combat and manage diseases.
In exchange, Verily is paid for these developments.
According to a report from Nanalyze, Dexcom, a diabetes company, paid more than $250 million in stock to Verily Life Sciences. This is in addition to another $280 million contingent upon certain milestones being passed as the trajectory for the commercialization of the company’s glucose-monitoring device is still pending.
Advanced Software
Verily’s commitment to partnerships not only builds their rapport and reputation but also their profit margins.
Following the emergence of the Covid-19 pandemic, the company sprung into action, making a concerted effort to develop software for the testing of viruses for the government as well as employers.
Doing so put Verily on the map, drawing a number of willing partnerships, thus increasing revenue. Among others, it found an immediate partner in the State of California, who paid Verily $49.6 billion to use its software.
Verily Funding, Valuation, and Revenue
In its first funding round in 2017, Verily raised $800 billion in capital thanks to investor Temasek, followed by a whopping $1 billion from Silver Lake in its second round.
In its third and latest investment round, the platform received $700 million from internal and external investors including the previous Temasek and Silver Lake.
This calculates Verily’s total funding to be $2.5 billion to date.
Using this capital, the company planned to expand business especially considering research efforts and creating break-throughs regarding the prevailing Covid-19 pandemic. And according to a report from CNBC, Verily said that in addition to this, it would “also use the funds to “progress” several of its life sciences programs including surgery, pathology, and immunology.”
Leading up to this, Verily helped earn a quarterly revenue of $178 million alongside the “Other Bets”, a division of other organizations under parent company Alphabet. This figure is up from the previous year’s $155 million, however also up in operating losses at $1.10 billion in comparison to the year prior at $941 million.
| Year | Revenue |
|---|---|
| 2021 | $235 million (estimated) |
| 2020 | $175 million |
Is Verily Profitable?
Investors have long wondered whether Verily is profitable? Verily, the life sciences business of Alphabet is profitable and cash-flow positive on a stand-alone basis. It is self-sufficient and making a profit without taking into account non-cash expenses.
Whether the platform can stand the test of time remains unclear. While the company has had a great many successes, it has also seen a number of setbacks as well. Still, Verily moves forward, and so do their profits.
Although the company operates on a cash basis, which could indicate a potentially slow burn, they are also cash positive, according to a report by Vox, “meaning they’re booking sales faster than they’re spending money, which is most certainly a positive.”
For example, in 2018, Verily announced its partnership with the Michael J. Fox Foundation for Parkinson’s Research: the Parkinson’s Progression Markers Initiative (PPMI) to shed light on Parkinson’s disease, a neurological disorder affecting over 10 million people worldwide.
By providing their Verily Study Watch, a ground-breaking, wearable device with data capturing capabilities, the goal was to further the knowledge and understanding of the deadly disease, thus allowing for better detection, management, quality of life, and ultimately a cure.
Based on a scale designed to measure the severity and advancement of the disease, commonly referred to as the Movement Disorders Society Unified Parkinson’s Disease Rating Scale, the watch was to evaluate the motor abilities affected by Parkinson’s disease.
In addition, Verily created an assessment system to be incorporated into the watch that would measure and record progress.
Unfortunately, this system was denied approval by the FDA, which cited that the tool’s way of measurement “cannot be directly interpreted as meaningful to patients”. This, however, did not stop the company from continuing in its efforts. The smartwatch system is currently being used in clinical trials.
Aside from these drawbacks, there are critics who have less than high hopes for the company. Current and former employees have taken to the media to share their disappointment with the company and its leadership, drawing attention to a possibly faulty foundation under company CEO Andrew Conrad.
A number of them chose to leave the company in search of other fulfilling positions at Google, some have left to join competitors. Technology analyst Rob Enderle notes that “‘if they are getting off the roller coaster before it gets to the first dip,’ something looks seriously wrong”.
Conclusion: How Does Verily Make Money?
To wrap it up, we’ve talked about how Verily makes money, its products and services, the companies’ culture, and its business model. We discussed how Verily produces healthcare technology to help prevent diseases and improve the quality of healthcare worldwide.
Verily is going down a good path by trying to create new solutions that can make a large impact on health care, and we hope they continue on this path because it will surely pay off in the long run.
Thanks for getting this far. It was great to be able to provide insight into various revenue streams Verily uses to make money.
The company is backed by Google which means it has a lot of resources available to it including ample funding and some of the best talents in the world.
Thanks for spending your time reading this post. If you liked reading it, don’t forget to share it with your friends!