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Thryve  (http://thryveinside.com), is developing personalized microbiome health services for direct-to-consumer market (B2C) and a microbiome data platform for the enterprise market (B2B). 

Opportunity Highlights:

• Notable investors.Unilever Ventures ($500M strategic VC arm of Unilever, a global consumer goods company with $160B market cap and potential acquirer), PivotNorth Capital (firm led by Tim Connors, former Partner @Sequoia Capital, U.S. Venture Partners), Joyance Partners, Shanda, and a major strategic distribution partner (#1 Health & Beauty reseller on Amazon, Walmart, and Ebay) who has also committed to sizable minimum annual sales in 2020 ($3M+) and 2021 ($9M+). 
• Revenue and Traction. Thryve first launched in Q2’18 and quickly amassed $230K in early revenue. The company’s personalized offering launched in Q4’18 and has since booked $1M+ in total revenue and 15% month-over-month growth. Thryve users are really happy, as evidenced by the fact that 55% remain subscribed after 6 months, an incredibly high retention rate for this type of product. 
• Business model. Thryve’s model can be broken down into 2 phases: 1) a data-driven, clinical quality, personalized consumer product that meets/exceeds consumer needs without overpromising and leads to massive aggregation of clean, rich patient data 2) partnering with researchers across academia, Pharma, food, and chemical industries to share/analyze/apply this data to further the science and drive meaningful advances for patients.
• Clinical focus. Thryve’s focus on clinical-grade data and quality control is already paying off. The company has inked 2 deals and has 23+ partnership opportunities in its pipeline (nearly all inbound requests) with household names such as: Roche, Merck, Nestle, Unilever, Bayer, GNC, United Healthcare Group, Pfizer, DuPont, etc.

A Note from Bioverge

Before diving in, we wanted to address the nascency of the consumer microbiome and pre/probiotic spaces. Both are littered with baseless claims, pseudoscience, aggressive marketing tactics and, as a result, have muddied the waters, created stigmas and an air of uncertainty for consumers and investors alike. 

While we’re incredibly excited about the microbiome, its fundamental role in regulating many critical processes in our bodies and its potential to improve health when targeted, we remain very cautious about the early science and the ability of today’s approaches to effectively affect change on a person’s microbiome and meaningfully impact one’s health today. 

It is with this mindset, of warranted skepticism and detailed scrutiny, that we conducted our review of Thryve. While we cannot definitively say that Thryve’s early product line, strategic approach, and vision are going to lead to the undisputed clinical validation in the future that everyone in the consumer and scientific space is looking and hoping for, upon a detailed  review, we have reached a level of confidence that the company understands the limits of the science today, and is taking the deliberate and strategic steps necessary to position themselves to be a legitimate player with the unique ability to bridge its consumer work with the needs of industry and the research community by providing value to both sides of the equation, with all associated advances flowing through to patients.

We’ve recapped our review below to give you a foundation for review of the company as well as the fields of the microbiome and probiotics.

Background

The gut microbiome consists of densely populated microorganisms that colonize the human gastrointestinal tract, such as: bacteria, fungi, Archaea, protozoa, and viruses. It is estimated that ~100 trillion microbes are present in the human gut. To put this in perspective - it is estimated that the entire human body is composed of only ~40 trillion cells, which raises the question - who is really playing host to whom? 

It’s taken some time for the scientific community to reach consensus on this topic, and there still exists a myriad of unvalidated claims, but today what everyone can agree on is that the microbiome plays a significant role in how our bodies ultimately regulate metabolism and our immune response. 

Microbiome compositions, and specifically those that are unbalanced or lack diversity of bacterial species, have been linked to a variety of chronic diseases (e.g. IBS/D, Constipation, Autoimmunity, Eczema, Acne, Diabetes, weight gain, Metabolic Syndrome, liver disease, heart disease, Alzheimer’s, and even mental health). These findings suggest that microbiomes that are rich in diversity and well-balanced create an ecosystem that is more robust against environmental influences. In fact, having the right gut bacteria has been clinically linked to a long list of health benefits, including improved digestion, weight loss, reduced risk of disease, enhanced immune function, and healthier skin. 

With these positive signals in hand, the scientific community has been focused on dissecting the composition and inner workings of the microbiome so that we can better understand it and determine methods to affect change and improve our health. To this end, research in the microbiome space has exploded (+40% year-over-year)!

While there is a heritable component to determining the composition of your microbiome, factors such as diet, exposure to therapeutics, pesticides, and various environmental conditions are the main determinants. 

There is a growing body of scientific literature and evidence demonstrating that we can modify the composition of our gut microbiome and improve our state of health through the ingestion of probiotics, which are mixtures of live bacteria and yeasts that can be included in a variety of products, including foods, dietary supplements, or drugs. Once introduced to the microbiome, these new bacteria can play a number of roles, such as helping our bodies better digest food, destroy disease-causing cells, or produce missing nutrients. 

The Thryve Platform

Thryve Phase 1 - Direct-to-Consumer

Thryve uses data analytics to create personalized supplement and food regimens for individuals with chronic disease. Sadly, this group represents 45% of Americans today, and accounts for 7-out-of-10 deaths, 75% of total U.S. health spending, and $1T in annual economic impact.

Step 1: sequencing of the gut microbiome of its users using a simple at-home collection kit that is mailed back to the Thryve lab for analysis and an individualized report on the state of their microbiome.

Step 2: generation of a personalized supplement and food regimens to help replenish each user’s microbiome. The company blends probiotics from a catalog of 30+ strains and additional vitamins, minerals, and prebiotics are included based on a patient’s background and microbiome testing results.

To enable this, Thryve has developed a AI-driven data engine that utilizes natural language processing (NLP) technology to digitally upload, aggregate, review, organize, and prioritize the academic research and literature available on the microbiome. This engine allows Thryve to map out the inner workings of the microbiome as well as the state of research in the space, enabling Thryve to detail what types of supplements/drugs/foods have repeatedly been shown to have meaningful impacts on the microbiome and lead to positive health outcomes in patients with distinct characteristics.

Consumers are able to subscribe to their personalized supplement regimens and receive them on a monthly basis. Premium users can opt into regular testing of their microbiomes to monitor changes. All users are encouraged to re-test annually. 

Additional info on Thryve’s product spec: https://docsend.com/view/u3ps4mh

Total Addressable Markets(TAM): DNA Testing ($7B), Health Tracking ($19B), Online Consumer Packaged Goods (CPG, $58B)

Thryve Phase 2 - Enterprise Level Sales

The consumer phase for Thryve is a means to an even larger opportunity and one that its competitors are actively forgoing by taking shortcuts on the science, manufacturing, quality control, and marketing, in order to generate profits at their users’ expense. 

From Thryve’s perspective, applying rigor and immediate value for consumers today will lead to massive, unparalleled dataset and the ability to share/analyze/apply this data set with major industry players in the food, chemical, drug, and healthcare industries to further the science and lead to exciting advances for patients - benefits that they can return to their users and other patients over time. Industry players are already pursuing partnership with Thryve for access to de-identified microbiome patient data, and the preclinical and clinical testing of new products and therapeutics.

Total Addressable Markets (TAM): Supplement Discovery ($133B), Drug Discovery ($713B), Health Insurance ($1.7T)

The Science

A great deal of research has been done on probiotics to-date with promising results to show for it. With that said, much remains to be explored regarding the extent to which they’re helpful and safe for various health conditions. 

Short of proclaiming outright clinical validation, detailed below is some background on the microbiome space and a few examples of the promise probiotics have shown for a variety of health purposes:

Microbiome links to health outcomes:

• The gut microbiome interacts with the immune system, providing signals to promote the maturation of immune cells and the normal development of immune functions (Adv. Immunol. 2010). Source: https://www.sciencedirect.com/science/article/pii/B9780123813008000083
• Changes in the Gut Microbiota Associated with Disease Relative to Healthy Subjects (Table 1, Cell 2012). Source: https://www.sciencedirect.com/science/article/pii/S0092867412001043#bib24
• People who are obese or have metabolic syndromes (diabetes) have different microbiome composition that those who are lean (Nature 2006). Source: https://www.ncbi.nlm.nih.gov/pubmed/17183309
• Mice shifting from a high-fat/high-sugar “Western” diet from a low-fat, plant-rich diet can change the microbiome composition within 1 day (Sci. Trans. Med. (2009). Source: https://doi.org/10.1126/scitranslmed.3000322
• Microbiome sample transplanted from lean animals can make obese animals lose weight and improve insulin sensitivity (Clin Microbiol Infect 2013) (Proc Nutr Soc. 2014). Sources: https://www.ncbi.nlm.nih.gov/pubmed/23452229,https://www.ncbi.nlm.nih.gov/pubmed/24495527
• 90% of our body’s serotonin supply is actually created in our digestive tracts, which is a compelling link of the microbiome to the nervous system (Cell 2015). Source: https://authors.library.caltech.edu/56514/5/nihms669675.pdf
• The microbiome can also interact with drugs and influence the way our bodies perceive drugs (Dialogues Clin. Neurosci 2011) Source: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3139398/. This is a big deal. Startups and major Pharma are closely studying how drug therapeutics are processed in the gut because it appears they are absorbed in different ways depending on the bacteria composition present, highly likely affecting the total number of patients that respond to a given treatment and the potency of that response. Being able to understand and adjust this could mean better results for patients. 

Probiotics-specific: 

• Analysis of 313 trials and 46,000 participants “showed substantial evidence for beneficial effects of probiotic supplementation in preventing diarrhea, colitis, acute upper respiratory tract infections, pulmonary exacerbations in children with cystic fibrosis, and eczema in children. Probiotics also seem to improve cardiometabolic parameters and reduced serum concentration of C reactive protein in patients with type 2 diabetes”Role of the gut microbiota in nutrition and health (BMJ 2018). Source: https://www.bmj.com/content/361/bmj.k2179
• A review of 45 studies suggests that “probiotic supplementation in healthy adults can lead to transient improvement in gut microbiota concentration of supplement-specific bacteria. Evidence also supports the role of probiotics in improving immune system responses, stool consistency, bowel movement, and vaginal lactobacilli concentration.” A review of probiotic supplementation in healthy adults: helpful or hype? (Our J Clin Nutr. 2019). Source: https://www.ncbi.nlm.nih.gov/pubmed/29581563
• “There is high-quality evidence that probiotics are effective for acute infectious diarrhea, antibiotic-associated diarrhea, Clostridium difficile- associated diarrhea, hepatic encephalopathy, ulcerative colitis, irritable bowel syndrome, functional gastrointestinal disorders, and necrotizing enterocolitis.” (Am Fam Physician 2017). Source: https://www.aafp.org/afp/2017/0801/p170.html
• In a study of 12,000 participants, probiotics were associated with a statistically significant reduction in antibiotic-associated diarrhea (JAMA 2012). Source: https://www.ncbi.nlm.nih.gov/pubmed/22570464
• In a study of 4,000 participants, probiotics reduced the incidence of Clostridium difficile-associated diarrhea or C. difficile infection by 66%. (Ann Intern Med 2012) Source: https://www.ncbi.nlm.nih.gov/pubmed/23362517
• A Review of the Role of Microbiome in Obesity and Anti-obesity Properties of Probiotic Supplements:
  • “The gut microbiome is one of the influencing environmental factors involved in the initiation of obesity mainly by disturbing the food intake and energy balance.”
  • “The gut microbiome can be positively altered by the supplementation of probiotics, a group of beneficial microbes that confers health benefits.”
  • “Probiotic intervention has been recognized for the treatment or betterment of several ill-health conditions, such as diarrhea, allergy, gastrointestinal disorders, and metabolic syndromes. Supplementation also slow down aging-associated health issues”
  • Analysis of 25 clinical trials with a total of 1,900 obese subjects revealed that probiotic supplementation effectively reduced body weight. A second analysis of fifteen clinical trial studies with 957 subjects revealed that the intervention of probiotic supplementation for 3 to 12 weeks significantly reduced the body weight and fat mass in obese subjects compared to placebo.
  • (BioMed Research International, 2019). Source: https://doi.org/10.1155/2019/3291367
• Specific probiotic strains can aid weight loss. A study of 210 people with obesity, demonstrated that taking probiotic Lactobacillus gasseri daily resulted in an 8.5% loss of belly fat over 12 weeks. And they gained it all back within 4 weeks when they stopped taking the probiotic. (Br J Nutr 2013). Source: https://www.ncbi.nlm.nih.gov/pubmed/2361489

Thryve Internal Research 

In addition to academic literature, Thryve understands the role it must play in publicly validating its products and science. To this end, the company completed an internal study of 100 patients using its platform. The study measured individual health improvement scores (subjective, self-reported), tests of bacteria diversity in the microbiome (objective, standardized). As the study was small, did not control for all variables, and involved self-reporting, we view the following data only as positive signals, rather than fully-validated clinical results:

• Health Improvement Scores: up 14% (before and after Thryve-use)
• Simpson Microbiome Diversity: up 8%
• Constipated patients reporting daily bowel movements: up 50% (80 patient sub-group, self-reported)
• Presence of known pathogens (harmful bacteria, gammaprotoeobacteria): down 13%
• See more Thryve data: https://docsend.com/view/pqqbhs4

Company Progress

Phase 1 - Direct-to-Consumer:

Thryve first launched in Q2’18 and quickly amassed $230k in early revenue. The company’s current offering set launched in Q4’18 and has since booked $1M+ in total revenue and 15% month-over-month growth. 

Thryve users are really happy, as evidenced by the fact that 55% remain subscribed after 6 months, an incredibly high retention rate for this type of product.

For Phase 1 - Marketing/distribution is a major factor, and in the case of Thryve, it is also a major advantage. How do you reach consumers? Per Thryve: there are only a limited number of traditional channels, in this particular order of effectiveness / scale: 

1. Direct Sales
2. Facebook/Instagram/Google/Social
3. Marketplaces (Amazon, Walmart, Ebay)
4. Influencers
5. Content (Blogs, Podcasting)

While anyone can post a Facebook ad, most paid channels are becoming saturated. The ones that are going to be effective in the long-term are non-traditional. For Thryve, that’s large distribution partnerships such as the exclusive partnership they just signed with the world’s #1 Health & Beauty reseller on Amazon, Walmart, and Ebay. To back up this strategic’s confidence in Thryve, the agreement commits to minimum annual sales figures ($3M+ in 2020, $9M+ in 2021) and the strategic company is also investing in this round.

Thryve was recently accepted to appear on a hit prime time television show that you would likely recognize (the episode is set to air in January or February next year). Filming took place this week (9/16) - Richard (CEO) can’t tell us how it went, but there is some strong potential strategic value here for investment and resources, in addition to the publicity. 

Phase 2 - Enterprise Level Sales:

In order to establish a stronger, evidence-based support for Thryve products, they are establishing strategic partnership initiatives in 3 areas:

1. Manufacturers of clinical-quality ingredients who can both provide exclusive formulas to Thryve, and have technical knowhow to produce unique strains and combinations
2. Experienced clinicians who have domain expertise, and can meaningfully speak about their experience with Thryve’s products
3. Academic partnerships to get buy-in within the scientific community (co-publishing results)

Thryve’s focus on clinical-grade data and quality control is already paying off. The company has 23+ opportunities in its pipeline (nearly all in-bound) with household names such as: Roche, Merck, Nestle, Unilever, Bayer, GNC, United Healthcare Group, Pfizer, DuPont, etc.

The 4 commercial deals that are furthest along:

• Major Chemical/probiotic company ($50B+ market cap) - paid study to obtain preclinical data on the efficacy of a new probiotic. The study has already been initiated, now into week 6, and will result in a white paper and case study co-publication.
• Global Chemical/Probiotic mfg company ($230B+ market cap) - finalizing a term sheet to conduct a 3-arm placebo controlled study that combines a new probiotic formula, Thryve’s kits, as well as other clinical data, and evaluates objective indicators for Digestion (IBS/D/C), Mental Health, Weight Management, Skin (Eczema), and Immunity (seasonal allergies). In addition to potentially adding a proprietary product to the Thryve registry, they expect that this study will set a new standard for others in the field.
• Global Skin Care Company ($27B market cap) - diligence stage - wants to work with Thryve to obtain preclinical data on targeting the microbiome for skin issues with the aim to co-publish results in a clinical journal. 
• Global Pharma/Medtech Company ($210B market cap) - diligence stage - approached with an interest in licensing Thryve’s liquid buffer technology (long-term, viable storage of microbiome samples) for a product they are developing. If a partnership is reached, the company would purchase the technology in wholesale volumes.

Additional Q&A with Richard (Thryve CEO)

Q: Probiotics are not regulated by the FDA and the mixes vary dramatically from pill-to-pill: where do you manufacture your product (i.e. in-house, CMO, etc.) and how do you ensure consistency from batch-to-batch?

A: We source the probiotic strains from Europe and Asia (mainly from Taiwan). We double test in manufacturing and bottling when it arrives in the states. 

(One comment on the FDA: the FDA does regulate certain aspects of dietary ingredients separately from pharmaceuticals, however enforcement can admittedly be lax. An example includes Good Manufacturing Practices (GMP) requirements and New Dietary Ingredient (NDI) filings. It is unfortunate that there are some manufacturers who do not choose to file these regulations and guidelines. However, Thryve carefully vets the quality of its suppliers, and uses ingredients that have safety and pre-clinical and/.or clinical data to support their use.)

Q: Please explain your QC to ensure each batch contains the exact ratio of bacterial stains you claim/believe it contains (i.e. do you sequence each batch?). 

A: We utilize PCR DNA testing and other culture methods to test each batch. Once that is done we get issued a stamped Certification of Analysis (COFA) through third-party labs.

Q: Having patients take samples at home and then shipping also lens itself to many opportunities to accidentally compromise the quality of the collection.  The analysis can pick up something that is not from the patient sample and provide an inaccurate reading. How do you think about and address this challenge today? How do you plan to improve this 10x in the future as good data science requires clean, uncompromised data?

A: This is the unfortunate side of direct to consumer testing. That said, we have several mitigations in place now: 

• Bloom Filter - we remove potential overgrowths of bacteria during the bioinformatics process as to remove biases that may come from sample handling / collection / shipping. We utilize the algo from American Gut / Rob Knights Lab.
  
  
• Thryve’s Liquid Collection Buffer - By using non-antibiotic solutions we are able to keep bacterial cells in status without lysing them. This provides a more accurate samples during the extraction and sequencing process, thus cleaner data.
  
  
• Fisher Scientific’s Puritan™ PurFlock™ Ultra Flocked Swabs - We chose this specific swab due to its capabilities to soak up the sample and provide a high-quality sterile environment for fecal microbiota. We tested other swabs but they were not providing similar outputs. 

In the future, we hope to implement additional measures: 

• Non-subject Filters - Using machine learning we can hone in on specific demographic/location/age/gender/etc… of microbiome samples to outline each cohort and the respective ranges of their microbiome. If we see data that falls outside the ranges, that can flag our system that this sample may be compromised.
  
  
  • Elizabeth Bik Ph.D. was a previous uBiome scientist that flagged issues with the healthy range in ubiome’s clinical report as potentially be infants / pets due to the microbiome makeup. The founders ignored this and used it for diagnosis. Became a big problem. We would want to automate Elizabeth Bik.
    
    
• Toilet Paper Bias Filters - We would need to run a study on toilet paper to swab collection method to see how different types of toilet paper can affect the changes in the microbiome. If we can find patterns, then we can remove these biases for more accurate data.
  
  
• Toilet paper collection tube - provide a collection method of putting the entire toilet paper (w/o swab) into a preservation tube. That way no cross contamination of having to swab and stir. 

Q: There’s a lot of variance between geographies, ages, lifestyles, and ethnicities. How do you know what my baseline is to understand what my optimal microbiome should be?

A: We just released a feature where we tap into gender/age/geography for personalizing healthy average for the consumer. The new feature is called My Microbiome. We’ll continue to add new variables into our algorithm to provide an even deeper picture of healthy microbiome based on a user’s demographic. 

Q: Taking a step back, what do you feel are the top 3 reasons why Thryve could fail on its current trajectory? What is being done to mitigate associated and controllable risks and which are out of your control?

A: Regulatory - FBI and other bodies may start looking deeper into companies in our space. Granted, ubiome was shut down for insurance fraud, we are making sure to not go down that route until the right partnerships are in place and we have significant data to have a useful conversation. 

Market Education - One area we’ve run into is the education of the microbiome, gut health, and probiotics. Although it’s been trending, we’ve noticed the general public still requires more convincing. We want to build out a strong content strategy post Series A where we provide blogs, vlogs, podcasts around topics of health related to the microbiome. We’d also like to partner and sponsor gut health specific conferences / webinars to educate our passionate and engaged community of users. 

Not enough capital - If our competitors outraise us and utilize said capital to take mind / market share and become too noisy that could become an issue. Product trumps marketing without substance and are core team is focused on building an awesome and useful product for our customers. Their needs come first for our product driven team. As the CEO and Founder my background is in product + my own personal experience in health. None of the others have the same background and drive. 

Q: What strengths does the team currently have in regards to operations and consumer services? This is an operationally intensive business with the need to ship kits, run the tests in a timely manner and report back to patients and be ready to answer all their questions. How has this scaled for you thus far and how do you envision expanding/streamlining/paying for this as the business continues to grow?

A: We’ve spent the first year developing the infrastructure to support operations at scale. We built custom software for our lab partners to accurately scan and log kits that are received at the lab. 

Our construction of kits, probiotics, etc… require some manual labor, but we have the scale with the existing team once we decide to expand and also we utilize a portfolio company to hire a large team of manual labor within 12 hours. We also migrated to a warehouse 3 months ago that can support 100,000+ customers 

Our lab partners can sustain that type of growth with their sequencing machines and team on-site. Our probiotic manufacturers can easily handle that scale with some turnaround time (2-3 months).

That said, we may eventually move all fulfillment to a 3PL, we are working with Stephen Beard 15+ years in logistics and supply chain as a consultant right now, with potential to convert to full-time who is going to help us scale operations.

Q: How do you believe Shark Tank going to impact the business? What are your goals there? 

A: From my understanding, Shark Tank airing can help grow sales by 4-10x for the following 4 months. They also periodically show the episodes offseason who causes spikes in sales. 

Our goal is to get Anne Wojcicki from 23andMe (her expertise as the first founder to get a DNA testing company to $1B val) and Lori Greiner (queen of retail and QVC for distribution) to partner on a deal with us.