investor stories

Why we invested in Gentem, a payments platform startup

Hustle Fund receives around 1,000 applications each month from founders looking for funding for their startups.

Of those, we invest into about 7 (on average). So, how do we decide which companies to invest in, and which aren't a good fit?

Simple – by using our 5-pillar evaluation process. This system helps us look at 5 key factors of a business:

  1. team
  2. problem
  3. solution
  4. market
  5. traction

It's one thing to talk about this system in theory, but far more useful to see it in action. So today we're going to talk about why we invested in a company called Gentem

We'll go through each pillar and explain how we thought about each one as it relates to this particular startup.

You can read more of these "why we said yes" articles about other Hustle Fund portfolio companies right here.

First – what is Gentem?

Gentem is a software company that helps doctors with the reimbursement process. Doesn't sound like a sexy industry, but stay with me.

Here's a glimpse into how the healthcare system in the United States works. Patients go in to see their doctors for an exam or procedure. Most patients have private insurance that covers the bulk of the cost.

Once the appointment is over, the doctor sends a claim to the insurance company with information on what procedures were done. Then the insurance company reviews the claim, and reimburses the doctor for the charges.

Hopefully. It doesn't always go smoothly, which is why Gentem exists. More on that in the "problem" section below.

The Team

The medical industry is notoriously hard to break into. The teams running doctors' offices don't have much time to read cold emails and review potential business opportunities.

Plus, doctors tend to want to connect with other doctors... not sales reps for new SaaS businesses.

That's why we were so excited to see that Gentem's founder had a medical background. Fisayo Ositelu went to medical school with the intention of pursuing a medical career. During his time there, he saw first-hand the administrative burden facing doctors. Fisayo left the medical field to pursue his MBA, then gained invaluable years of experience working at NerdWallet and in private equity.

Fisayo had the right background and unique ability to connect with his users. Combine that with his co-founder's – Manny Akintayo – technical expertise and this seemed like an ideal team to solve this problem.

Speaking of which...

The Problem

Let's talk about the problem of billing in the medical field.

Many patients in the U.S. have private insurance that covers some percentage of their doctor visits. So the patient sees the doctor, gets some kind of procedure (exam, vaccine, etc), and leaves. After they leave, the doctor sends a claim to the insurance provider explaining what procedures were done (and why). These procedures are coded specifically so that all doctors are using the same codes for each procedure.

Like this:

- Physical exam: 2040F

- Vaccine administration: 90471

- Tonsillectomy: 42820

The insurance provider then looks at the claim, determines what's eligible for reimbursement, and sends the reimbursement to the doctor. The problem is that this process takes a while. And in the meantime, the doctor has overhead costs: rent, equipment, staff salaries, etc.

The other problem is that claims don't always get approved right away. Sometimes claims get rejected, and then the doctor goes back and forth with the insurance company for a while to try and get it resolved. See, the doctor doesn't want her patients to be charged out-of-pocket too much, otherwise they might find a different doctor.

The whole thing is a big fat hassle for doctors. And that's what Gentem founder Fisayo saw during his time in the medical field.

The Solution

Fisayo and Manny set out to build a solution to solve this problem. Their platform does a few things. First, it automates the workflow so the claims get submitted faster.

Second, it run an analysis to predict which claims are more likely to get accepted and which claims are more likely to get rejected by the insurance company. Yeah. Pretty cool.

Here's the other thing. Before Gentem, doctors didn't want to – and didn't have time to – deal with the administrative burden of handling claims and billing. So they outsourced this role to a medical billing staffer or outside contractor.

So the other reason that this solution was so attractive to our investment team was because of the cost savings to the doctor. Since Gentem automates much of the administrative burden, doctors are spending less money on medical billers.

The Market

The U.S. healthcare industry is massive. It makes up around 18% of the country's GDP. So we knew that the addressable market wasn't gonna be a problem.

Would doctors pay for this? We believed so. Gentem was a platform that would help its users save time, save money, and get paid faster. It seemed like a no-brainer for doctors.

The thing that the Gentem founders needed to figure out was: which segment of the healthcare market to go after? Since they're using AI, they needed to train the tech on specific fields so that the predictions would be successful.


At the time Hustle Fund invested, Gentem had no traction. Like, none.

Lead investor (from the Hustle Fund team) Shiyan Koh believed in the team, saw a big problem, loved the solution, and had no qualms about the market. And since we're a pre-seed fund, traction isn't a dealbreaker.

That said, we always want to see evidence that the founders are doing something to move the business forward. And that's what Shiyan saw. The founders were talking to potential customers, getting insights into which fields might be most receptive to the tech early on, and building the platform.

How Gentem is doing now

The company has certainly evolved since we invested. Learnings came in fast, and co-founders Fisayo and Manny adjusted to make space for those learnings.

For example... early on they had planned to offer advance payments to doctors, for a fee. And while this was an attractive revenue channel to early investors, the Gentem team discovered that this feature wasn't scalable. The amount of capital required to make those advance payments was unmanageable.

They also learned quickly that they could lower their CAC by partnering with an electronic health records business (EHR). This partnership benefitted everyone:

  • the EHR business had another product to offer its clients
  • Gentem was able to essentially outsource its customer acquisition, and acquire customers at a lower cost

And, as we had hoped, after testing with a bunch of different customer segments, Gentem narrowed down its focus to a specific field: mental health providers.

These days, Gentem is seeing an uptick in all the right things: customer acquisition, revenue growth, and retention.

This isn't a perfect system

We make plenty of investments using this 5-pillar system into companies that don't survive, or companies that pivot so hard the company becomes unrecognizable.

But sometimes the system works. And Gentem seems to be one of them.