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CAIRO—Amr El-Tayeb wanted to be up front about the risks of surgery. But he also had to make clear to his patient’s mother: They had no other option. Reda, who was seven years old, had a recurrent benign tumor in his brain.
“Your son is alive now,” El-Tayeb told her. “But he might not be at the end of this surgery.”
El-Tayeb was then a mid-senior resident in neurosurgery at the University Hospital in Cairo. The surgery on Reda turned out to be a turning point in El-Tayeb’s life. From it, he learned the mindset that has helped him build one of Egypt’s most promising new companies, Smart Medical Services.
The 10-year-old 160-employee company manages medical programs for self-insured companies, with more than 65,000 subscribers, and provides software for health insurers. It also offers a basic medical plan, Sehaty, directly to Egyptians who might not be able to otherwise afford health insurance. Sehaty has 80,000 subscribers who pay 250 Egyptian pounds a year, about $15, for a family of five.
Contrary to the millions often invested to get American startups to size, Smart Medical Services has received only $250,000 from HiM Angels and $1.2 million from the Egyptian American Enterprise Fund. It's profitable for now, with an eye toward expansion in Egypt and East Africa. With a platform that can handle 1 million subscribers, it's poised to become one of the most important health care software companies in the region.
El-Tayeb founded the company in 2009. From the beginning, he recognized the scale of the problem in Egypt: 50-60 million Egyptians lack health care services. Software was the only way he saw to meaningfully tackle that problem.
The Surgery
Many entrepreneurs are motivated by a personal experience like the one El-Tayeb had with Reda. Emotions move us more powerfully than thought, and the memory of an emotion can become a touchstone that drives a whole life. But as El-Tayeb told the story of the surgery to me in a restaurant in Cairo, it became more than a motivation, though that’s part of the tale.
He scheduled the surgery for later in the week after he talked to Reda’s mother and admitted the little boy to the 60-patient ward.
“He was playing football,” he remembers; the brain tumor wasn’t yet affecting him, though it soon would, if they did nothing. “You know those kids, mischievous but polite. The mom was a widow, but her brothers were always with her.”
The operating room was crowded with nurses, specialists, surgeons, and anesthesiologists, because everyone knew the surgery would be complicated.
Fifteen years ago, the operating theaters in Cairo University Hospital hadn’t yet been renovated. With 3,000 beds, the hospital is free for everyone. The team gathered under the lights in the windowless room. From the beginning, they knew blood loss would be the biggest danger, so they had prepared accessible units.
“But in children, they can’t loose that much blood," said El-Tayeb. "Suddenly, his heart stopped."
The team stopped the bleeding and started CPR. “But the defibrillator in the room doesn’t work,” he remembered. “I think at that point, everyone was doing their best. They are thinking, 'This is a human being.’ But they are also thinking, ‘People don’t come back from CPR for this long.’”
“We could have called it.”
Eltayed went down to the emergency room to get another defibrillator. The staff wanted him to fill out paperwork: He grabbed it and ran back up to the operating room. The hospital docked him a day’s pay later.
With the working defibrillator, the doctors were able to start Reda’s heart. But the CPR had lasted for 40 minutes; people don’t generally survive after 15 minutes. They finished the surgery, knowing the chances that Reda would live and live without brain damage, were slim.
“It was so quiet,” El-Tayeb remembered. “We were all sure he was not going to recover.”
Then, Reda started to wake up.
The team hovered by his bed watching the vital signs, asking each other whether they were seeing what they thought they were seeing. El-Tayeb spent the night.
“Then, by the next day, he was almost fully conscious. Though he wasn’t moving his left side, he recognized his mother and he recognized me.”
By the end of the week, the boy was out of bed, walking with a limp.
Eventually, Reda recovered fully. He’s now in his early 20s, still a miracle that drives El-Tayeb forward. Five years later, El-Tayeb founded Smart Medical Services, with a combination of revenue-generating managed care services in the b-to-b market, and a consumer business aimed at people like Reda’s family. He still keeps in touch with Reda, who is now getting married.
“When something like this happens, you start believing anything in the world can happen,” El-Tayeb said.
Cairo, 2018
The key question in growing a company of any size — 160 employees is already pretty big — is how you establish and maintain a company culture. As he’s built the company, he has come back to the lessons of Reda’s surgery.
“Of course, being passionate helps,” he says. “But emotions are different from one person to another.” If you’re going to translate the passion that saved Reda’s life into a company culture, how would you do it?
• You need perspective. Will you be prepared for failure, and know in your heart that you can recover from it? That enables you to act even when the environment around you looks bleak. The doctors and nurses kept working, even when they new Reda probably wouldn’t wake up. Perspective is the grown-up concept for what high-school teachers call grit. A few people are born with it, but as a leader, it’s an argument for hiring for experience, training and for people who take on tough challenges.
El-Tayeb says the longer you work at something you’re passionate about, the more the happy stories will build up, giving you the surety you need to go into situations where you might not win.
• You need a mindset. “We went Into the surgery that day not intent on doing our jobs. We went in with the intent of saving a life.” That is crucial, and it applies in hundreds of ways for companies. In 2014, El-Tayeb got an acquisition offer. But the company hadn’t yet created enough value; his intent was to provide medical care for Egyptians who didn’t have it.
• You need a culture. Mindset alone doesn’t help if you don’t have a culture that supports problem-solving. Reda wouldn’t have survived if El-Tayeb hadn’t gone for the other defibrillator. You need systems that encourage people to make the best of what they have and look for other options. El-Tayeb’s hospital didn’t support his decision to go outside the rules to get the defibrillator, but he had been trained by other doctors. Once he realized that there was another option — another defibrillator — he realized that was the next step.
In between the time I interviewed El-Tayeb in November, and now, the company added 20 employees. In all the company’s markets, there is lots of room to grow. About 30% of the people who work at Smart Medical Services are in software-related jobs — it was 30 out of 130 in November. The company has gone through two periods of fast growth, the first in 2012-2013, and the second one in 2017-2018, after it introduced a web-based system with a capacity of more than 1 million subscribers.
Despite the social mission, it’s a for-profit company. For a problem of the scale that El-Tayeb wants to solve, the for-profit structure, with its potential of fast-growth, is crucial.
Among big companies in Egypt, about 50% have no management of their employees’ health care. There is room to save money if Smart Medical Services can help them track illnesses like diabetes and high blood pressure, and maternity care and childbirth. The health care insurance companies that are also beginning to grow in Egypt are another potential market.
The product closest to El-Tayeb’s heart, Sehaty, offers families access to a call-in center that helps them access doctors in Smart Medical Services’ network, online health information, and consultations with doctors.
As for El-Tayeb, he still goes to the clinic in the afternoons. Seeing people struggle and sometimes die, even as you struggle to help them, is a regular exercise in humility for a doctor and a successful entrepreneur. “It keeps your feet on the ground,” he says.
