some thoughts on OTRK vs LVGO and why I exited OTRK and concentrated on LVGO
- OTRK is in the business of proactive management of behavioral health… they are primarily focused on addressing drug addiction AFAIK…
- their per member price is much higher (I believe ~$6K / member / year vs LVGO charges ~$1K for diabetes and half that for behavioral health…
ofcourse OTRK solves different problem… Their pitch is that they get an addict off fatal path… but that means their business model is to get may be one or two years revenue from a member and then member would fall off (presumably because member is off the bad path)… so while they are doing good for society, their revenue base is not quite SaaS like recurring from same client… where as LVGO diabetic members likely to stay on board certainly lot longer than 2 years…
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There was a short piece that got me to do a bit of dd…
what I found was that number of logos they showed in their investor pitch were reducing over a period of two years… turned out that they were showcasing big names too early when they just them for trial… and as some of those names dropped out after trial, you see that logo quietly gone… -
That led me to see that their revenue concentration is much higher among 5 customers with top customer is in 20% or 40% range (when I checked last)…
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They are growing at enormous rate from a much smaller base… and FCF is quite far for them…
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Most important is management - OTRK CEO Terren has his loud fans and louder detractors - he may not be a bad guy but he has been a wallstreet wolf… compare that to LVGO management and you will not think twice on where to put your money…