Navigating Challenges: The Rise and Struggles of JT Garwood and Jack Miller’s Bttn

Navigating Challenges: The Rise and Struggles of JT Garwood and Jack Miller’s Bttn

In the world of medical supply startups, JT Garwood and Jack Miller embarked on a journey to disrupt the industry with Bttn. The vision was grand — a “one-stop shop” for healthcare workers, offering everything from N95 masks to wheelchairs seamlessly. Yet, despite the initial optimism and a $26.5 million fundraising round that valued the startup at $110 million, Bttn has found itself grappling with challenges that have made its disruptive ambitions harder to realize.

The genesis of Bttn was marked by ambition, as Forbes Under 30 alumni Garwood and Miller sought to revolutionize the healthcare supply chain. However, two years into its existence, Bttn faced the harsh reality of customer loyalty to established distributors, strains in the supply chain, and a shifting landscape of investor support. The $30 million revenue projection for 2022 fell short, with Bttn reporting $22 million, a 27% deficit. The workforce saw a significant reduction, dwindling to 30 employees, indicating the startup’s uphill battle for survival.

At the core of Bttn’s business model lies a unique approach — instead of owning warehouses or inventory, it partners with established medical supply distributors across the country. Garwood asserts that these distributors, including industry giants like McKesson Corp., Cardinal Health, and Henry Schein, fill Bttn’s orders, positioning them not only as competitors but also as partners. However, the success of this model hinges on the assumption that customers won’t shy away from an additional middleman, especially when they have the option to purchase directly from distributors they trust.

Former Bttn employees shed light on the challenges faced by the startup. Chris Henderson, a former account executive, highlights the difficulty of convincing customers to switch from their preferred longtime suppliers. The entrenched relationships between healthcare providers and their trusted distributors posed a formidable barrier for Bttn to overcome.

The startup’s fortunes may have been favorable during the pandemic, where the demand for masks, gloves, and Covid test kits skyrocketed. However, the subsequent shift in the $345 billion wholesale medical-supplies industry proved challenging, with established distributors holding significant sway. Gary Gereffi, a sociology professor at Duke University, notes that the dominant players in the medical supply industry are the distributors rather than the manufacturers.

Former employees like Henderson and Thomas Haupt, a former inside sales manager, point out operational inefficiencies within Bttn, including backorder issues, delayed shipments, and alleged encouragement to provide misleading shipping-time estimates to customers. Complaints about these challenges, coupled with a lack of transparency from senior management, created a challenging environment for conducting business.

Bttn’s attempt to address these issues includes a focus on pricing transparency through an online marketplace, allowing customers to compare prices from various brands. However, experts like Wally Hopp, a University of Michigan business professor, express skepticism about Bttn finding effective solutions to supply disruptions within the industry.

Despite the hurdles, Garwood remains optimistic about Bttn’s future, emphasizing the company’s commitment to fixing inefficiencies in the healthcare supply chain. The startup is attempting to weather the storm in an environment less conducive to startups, with global venture capital funding seeing a significant decline. However, Bttn has not raised additional capital since the 2022 fundraising round led by Tiger Global and currently has no plans to do so.

As Bttn navigates these challenges, the story of JT Garwood, Jack Miller, and their medical-supply startup unfolds as a tale of ambition, resilience, and the complex dynamics of disrupting a deeply entrenched industry. The journey ahead remains uncertain, with the startup striving to build the future of healthcare amid a crucible moment in an evolving landscape.

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