Optum Ventures Extorts Truepill: Founders Thrown Out with Exactly $0 to Show

VC bros are getting more creative in extorting startup founders. It's illegal, and it has to stop.

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Hope everyone had an awesome Labor Day! 🎉 Whether you spent it with family or, like me, found something that brings you joy—like a nice bike ride—I hope it was a great one. 😊

Here in the New York area, it was a glorious day—sunny and in the 70s. Perfect.

I didn’t want to spoil your Labor Day, so instead, I’m here to spoil your day after Labor Day. 😊

Apologies in advance for yet another tale from the digital health dumpster fire. I promise I’ll spice things up soon. 😉

But no one’s calling out the ‘VC bros’ for their extortion racket, so here I am, doing the dirty work.

This story is truly fascinating. And while we don’t know all the details yet, one thing is obvious—it’s a masterclass in why you should be wary of market operators, especially the VC bros, who aren’t just indifferent to your interests but are often working against them.

You’d expect this level of extortion in a banana republic, not in a country that claims to have the most advanced rule of law. Absolutely unbelievable.

Never forget this: As a founder and innovator, you start with 100% ownership of your ideas and inventions. The moment you let the VC bros in, you’re on a fast track to losing it ALL.

VC bros have been taking a beating for the past decade with their mediocre investment performance. So now they’re pulling out all the stops, diving deep into their bag of legal and accounting tricks. Enter Larry Renfro, the puppet master behind Optum Ventures, and Robert Kraft’s golf buddy. Larry and his fellow VC bros have perfected a new art form: kicking startup founders to the curb and taking over their companies. It’s not just ruthless. It’s the latest ‘innovation’ in venture capital.

By the way, isn’t it interesting how these healthcare behemoths have so much cash lying around, they can’t help but blow it on stuff completely unrelated to healthcare? UnitedHealth has gone full Wall Street with Optum Bank and Optum Ventures, while Northwell Health has decided to play Hollywood with Northwell Studios.

Truepill’s tale is a textbook case of venture capital treachery. Picture this: the original founders, the visionaries who built the company from the ground up, get diluted to absolute zero—completely erased—thanks to some slick accounting tricks and dubious legal loopholes. The final insult? A sale to a startup that’s in even worse shape than Truepill, all orchestrated to boot the founders and employees out of their own creation. It’s the VC equivalent of getting mugged and then handed the bill for the privilege.

Once again, founders and retail investors are left holding the bag while VC bros cash in by ‘flipping the house.’ And in yet another predictable twist, Optum, Optum Ventures, and their parent UnitedHealth emerge unscathed, pulling off their “smart” investing strategy like clockwork. Surprise, surprise.

Admittedly, we don’t have all the details. A lot of what I’m laying out here is based on the best information I can piece together, mixed with some financial deduction and a bit of ‘mosaic theory’—i.e., building a story from a bunch of fragmented bits. I genuinely hope we get the full picture one day because this could be one of the biggest lessons the industry has to learn.

But even with what we do know, there are just so many damn questions. And most of those wouldn’t even exist if the Truepill “acquisition” wasn’t shrouded in the secrecy of a private transaction. Who the hell knows the truth?

How many more victims of venture capital do we need before the industry wakes up and admits the truth? Venture capital is to startups what PBMs are to pharmacies—a bloodthirsty middleman sucking out all the value while contributing nothing to the economy. Yet, they’re the ones collecting all the rent.

But let’s rewind and start from the beginning…

Let me give you a sneak peek at the roadmap for the article:

1. Truepill: The Mirror We Can’t Look Away From as Startup Founders. It’s Us... All of Us.

2. The Meteoric Rise of Truepill: From Startup to Unicorn

3. Truepill’s Bitter Pill: Mounting Challenges

4. Larry Renfro and the Optum-Kraft Nexus: A Cozy Relationship with High Stakes

5. Marked-to-Market Valuation: The VC Trick That Pulled Truepill Down

6. The LetsGetChecked Acquisition: A Deal Riddled with Conflict of Interest

7. The Ethical Quagmire: Conflict of Interest, Breaches, and Negligence

8. The Aftermath: Founders Left with Nothing, Industry Left with a Warning

9. Lessons for Startup Founders: Navigating the VC Minefield

10. The Call to Action: Protecting Founders from VC Vultures

11. Conclusion: The True Cost of Venture Capital

1. Truepill: The Mirror We Can’t Look Away From as Startup Founders. It’s Us... All of Us.

Truepill, once hailed as the Amazon Web Services of pharmacies, had it all. A brilliant founder story, an innovative platform, and the buzz of being a billion-dollar unicorn in the health tech space. Sid Viswanathan and Umar Afridi had the vision to create a seamless pharmacy API and fulfillment service that could support the rapidly growing telehealth market. Truepill was more than a company. It was the backbone for telehealth giants like Hims, Nurx, and even Mark Cuban’s Cost Plus Drugs. But as we’ve seen time and again in the VC-driven rollercoaster that is Silicon Valley, the journey from billion-dollar unicorn to bargain-bin acquisition is often as predictable as it is tragic.

In the cutthroat world of digital health, Truepill stands as a testament to how quickly fortunes can turn. Founded in 2016 by Viswanathan and Afridi, Truepill emerged as a revolutionary force in the healthcare industry, poised to change how pharmacies operate in the digital age. The company’s mission was nothing short of audacious: to create an API-driven platform that could streamline pharmacy operations and integrate seamlessly with the burgeoning telehealth industry. For a time, it seemed that Truepill was on the verge of fulfilling its mission, attracting high-profile clients and racking up impressive valuations.

But, as the story often goes in the land of venture capital, the narrative of success unraveled just as quickly as it had been spun. Behind the scenes, forces were at play that would ultimately lead to the downfall of Truepill, culminating in a controversial acquisition by LetsGetChecked for a fraction of the company’s peak valuation. At the center of this drama were Optum Ventures and its enigmatic leader, Larry Renfro, whose web of connections and financial maneuvers played a critical role in Truepill’s downfall.

This article explores the rise and fall of Truepill, the cozy relationship between Larry Renfro and Robert Kraft, the mechanisms of venture capital that led to the company’s devaluation, and the ethical quagmire that ensued. It is a cautionary tale for entrepreneurs and a wake-up call for the digital health industry.