Interview with Rodolfo Guarino, Co-Founder of Hippocrates Holding, the first Italian network of private pharmacies

Rodolfo Guarino is Co-Founder of Hippocrates Holding, the first Italian network of private pharmacies, created by taking advantage of a change of regulation related the ownership and administration of pharmacies.

Rodolfo began his career in investment banking at UBS, and then he worked in the private equity industry as Principal at The Carlyle Group.

Rodolfo graduated in Economics & Finance and in International Management at Bocconi University.

Q: You started your career in finance, and then, in 2018, you co-founded Hippocrates Holding, with the aim of creating the first Italian network of private pharmacies. Can you tell us how everything started?

Rodolfo: I have always thought that there are some professional experiences that are “schools of management”, where you learn technicalities, but also processes and methods to approach and perform a job. In my case, such experiences were investment banking and private equity.

In fact, starting from a very young age, I have myself taking responsibilities, and being exposed to senior managers and entrepreneurs in their most delicate entrepreneurial and personal moments, such as an organisational change or a generational transition. Investment banking and private equity are intense professional experiences, which give you great value added, and allow you to gain visibility and grow quickly.

With method, intensity and sacrifices, these types of career paths teach you that everything can be tackled, even when approaching something new, as it was for me and my partner Davide [Tavaniello] with Hippocrates.

I met Davide at UBS, we worked together, and together we cherished the dream of launching a new business; we wanted to be personally involved in a new initiative. Among various things, the opportunity to create a network of private pharmacies was what convinced us most, for its simplicity.

The opportunity was quite intuitive, as a consequence of the change of regulation for the pharmaceutical industry. In fact, our idea did not require to develop a new technology or a new product.

However, there were two key elements that, I believe, pushed us towards the pharmaceutical sector: a strategic one, and a more tactical one.

With the change of the law, a tragic scenario was reported in the newspapers: the very traditional Italian pharmacies located in cities and small towns had to adapt to a more “contemporary” business model. However, from a strategic point of view, it did not seem so obvious to us that the Italian pharmaceutical industry would consolidate following a new model. Instead, we saw the opportunity to create a network of pharmacies, with a focus on the “Italianness”, taking into consideration our territory, composed by a few large cities and small municipalities, and therefore somehow preserving the Italian tradition.

The tactical aspect lay in the real challenge of every new project, which is the execution. After all, we were just two boys aged 29 and 34, with two laptops, starting from scratch. For us, the execution consisted in acquiring pharmacies, and creating a company from scratch. Therefore, we chose the opportunity that we felt closest to our professional history, and we had the courage to pursue it. And now, I am proud to say that today Hippocrates employs 800 people, 45 of whom working for the holding company.

Q: Talking about execution, what were the key issues that you encountered in setting up and developing the project?

Rodolfo: I see three key issues in our project.

The first one is fundraising. We started in May 2018, thanks to a first capital increase of € 55 million, and, one year later, we raised another € 65 million, 70% of which from previous investors.

I think that what convinced our investors were: the simplicity of the idea; and our professional experience. As said before, thanks to our previous experience, we met people who appreciated our professional skills, and then decided to invest in the project. These are high standing and important partners for us, who certainly have many investment opportunities to assess.

The second issue was entering the market as “aliens”. In fact, neither Davide nor I had ever worked in the industry before. I believe that, as the best entrepreneurs do, when you need to deal with an issue, you have to go around it until it becomes an opportunity. So, in a world where the usual big names seemed to be the future, if you are able to bring a new story and a new vision, you are something different to listen to, with curiosity.

Moreover, for us, it was crucial to immediately involve the pharmacists in the process. And I am happy to say that many of the first pharmacists, who sold their pharmacies to us, still work in the Group. I believe that you earn your credibility with a lot of effort, and by saying something and then standing by your words.

The last issue is undoubtedly scaling the organisation. In less than two years, we grew from 0 to 800 employees. In an ambitious project like ours, I think it is essential to choose the right people. In a growing organisation, people are hired at different times: when the company is small, and every time the company gets bigger.

Therefore, the people you hire must be able to change their management style as the company grows; they usually are very involved in various operative activities when you are small, but then they need to become more structured and organised when you get bigger. Consequently, it is important to hire people able to define and implement processes and rules, which don’t make you lose the entrepreneurial spirit, and let the company scale.

This is an amazing challenge, which continues to put us out of our comfort zone, because as soon as we find the right balance, we acquire a certain number of new pharmacies.

Q: How many pharmacies do you have in your network? How many pharmacies are you planning to acquire in the near future?

Rodolfo: Today we have 130 pharmacies, and with today’s organisation, we are able to acquire between 70 and 100 pharmacies per year.

Our goal is to keep growing, we don’t have a target number of pharmacies that we want to acquire. The Italian market has about 20,000 pharmacies, and this gives us important room for growth. Therefore, until we find interesting opportunities, which strengthen our network and our presence in Italy (very important to me), we will continue to pursue the current strategy. It is certainly easier for us to grow today that we employ 45 people, compared to a year ago, when 10 people had to take care of everything.

Q: How is the business going, especially after the burst of Covid-19? How did you deal with the lockdown period?

Rodolfo: For a young company like ours, Covid-19 represented an operational challenge that was a baptism of fire.

Pharmacies were one of the few businesses that remained open during the lockdown period, respecting the usual opening hours, with great uncertainties, and with regulations that changed daily. Obviously, it was essential for us to ensure the best safety and health conditions for all our employees. We worked hard, it was a very busy period, but we are very happy of our job.

From a performance standpoint, ours is a resilient sector, with some dichotomies. Covid-19 brought “bad luck” to the pharmacies located in more central and tourist places, and “good luck” to the pharmacies located in metropolitan cities, towns and neighbourhoods. Therefore, being part of a Group like ours allows pharmacies to help each other.

Q: One last question. According to your experience, do you have any suggestions to people who would like to start a business in Italy?

Rodolfo: Personally, I strongly believe that starting the career in companies that are “schools of management” has an enormous value added.

I also believe that, based on my experience, nothing is achieved without sacrifice. For Hippocrates, we sacrificed almost everything to get to this point. I believe that the sacrifices you make need to be greater than your ambitions. For me, the difference can be made by working more than others. I don’t know other magic formulas.

Italy is certainly not an easy country for doing business, but I have to say that we feel sorry for ourselves too many times. If I look at successful Italian entrepreneurs, I see people who first work hard, and then navigate the critical issues of our country. Italy is probably not an easy country, but I think a lot can be done and achieved.


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