Korys and Newpharma: partners in simplicity and entrepreneurship
Pharmacist: it may be one of the oldest professions in the world, but the digital revolution has still made an impact on the sector. The online pharmacy Newpharma has been setting the pace of transition across the whole (para)pharmacy industry. On the eve of this revolution, we spoke to Jérôme Gobbesso, CEO and co-founder of Newpharma, the fast-growing company from Liège.
Newpharma is the proud market leader in Belgium for the online sale of non-prescription medications. The idea arose during a discussion in an online forum – how could it be any different?
‘Co-founder Mike Vandenhooft and myself bumped into each other answering a remarkable question posted by a visionary pharmacist from the region: “Who wants to join me in starting an online pharmacy?”’ recalls Jérôme. ‘The responses from his fellow pharmacists were brutally honest. “You’re dreaming”, “That will never work”, and so forth. But as Mike and myself are not afraid of a little bit of a challenge, we jumped onboard.’ (Smiles)
On the eve of the transformation
Today, the classic pharmacist faces tremendous challenges. Jérôme sees three already: ‘As magistral preparations only make up 1% of the turnover of a pharmacy, the margins are under pressure. Plus, large-scale retailers and supermarkets around the globe are stepping into (para)pharmacy. On top of that, the online pharmacies in Belgium’s neighbouring countries are knocking on the door. Competitors are no longer just aiming at local communities, but at everyone in a radius of hundreds of kilometres.
Belgium is longing for a new vision, based on digitisation, specialisation and scale increase.
‘Put simply, a thousand or so small-scale pharmacies will be facing a large-scale challenge in the coming years. Belgium is longing for a new vision, based on digitisation, specialisation and scale increase. And that is what led to our online pharmacy.’
Searching for the best parents
A lot of people associate the online sale of medication with strange messages from dubious characters or push-mails championing aphrodisiacs. But Newpharma pharmacists are committed to quality service, sending 2.000 emails with personal advice to clients every day. With their focus on customer service and driven online marketing, the company from Liège is growing steadily.
This was not always the case. At the end of 2017, they found themselves at a crossroads. ‘At a certain moment, you reach the limits of your growth. In the first few years, we financed everything ourselves. And that worked nicely, with turnover increasing tenfold. We have 37.000 products in stock, warehouses delivering to us 17 times a day and we have a good 200 people on the books. But on the other hand, we saw the dominant online pharmacies in Europe evolve into even greater powerhouses. The question inevitably had to come up: are we the best parents for our little baby?’
Korys is a “family office” with an entrepreneurial mentality.
In the search for a financial and strategic partner, Newpharma felt the famous ‘click’ at the first meeting with Korys.
‘Korys is a “family office” with an entrepreneurial mentality. We were speaking the same language from day one. In addition, we shared almost exactly the same values. We function in a simple, sober, efficient, pragmatic and human way. A euro is a euro. I still remember the legendary words of someone from the Korys delegation when they visited our warehouse for the first time: “I feel the spirit that reigned at the Colruyt Group in the 1980s.”(Laughs)
A new warehouse
Anyone who strolls through the Newpharma complex will feel these values at every step. There are no unnecessarily complex machines, fancy interiors or pompous slogans on the wall. The decoration is sober, employees passionate and the workflow is efficient in its simplicity. And – would you believe it? – the CEO has a shipping container for an office.
However, the winds of change are blowing: the online pharmacy is on the verge of a growth spurt. ‘We are investing in online marketing, logistics and automation. Opposite our warehouse, there’s a brand-new, 2.7-hectare complex being built. It will give us breathing room in which to carry out our strategy. In the competitive European landscape, we want to be the front runner in a number of specific markets. On one hand we will do this by increasing our market share in our current regions (Belgium, France, Switzerland and the Netherlands). And on the other, by tapping into new markets in Southern Europe.’
Korys is helping Newpharma to put its growth strategy into practice. Jérôme appreciates the availability and versatility of Dries Colpaert, who is representing Korys as chairperson of the Board of Directors.
The first thing we did was draw up our strategy together with Korys.
And the progress is tangible according to Jérôme: ‘The first thing we did was draw up our strategy together with Korys. This highlighted two concrete actions for us to take. We strengthened our management team. We also developed an ingenious reporting system, in line with the principles of “corporate governance”.
As chairperson of the board of directors, Dries Colpaert (Senior Advisor at Korys) is in contact with the Newpharma CEOs on an almost daily basis. ‘I spend at least 15 hours a week working for our Liège-based portfolio company,’ estimates Dries. ‘Newpharma has an interface with our “Conscious Consumer” and “Life Sciences” ecosystems. Looking at the company from a financial perspective, I have to admire them. Contrary to plenty of other hyped-up companies in the e-commerce industry, the team from Liège has successfully attained strong returns. You can only do that if you are efficiently organised, work hard and keep an eye on costs.’
Another factor making this investment special is that Korys (as the investment company for the Colruyt family) invested together with Colruyt Group. ‘A co-investment like this occurs quite rarely, but in this case, it was a logical step,’ explains Dries. ‘This opened a lot of doors for Newpharma. They can turn to the highly experienced Colruyt Group back-office for all kinds of advice. Setting up a new building is a complex challenge for a growing company, while Colruyt Group has a department that basically specialises in doing just that.’