A telehealth startup managed to rake in $401 million in revenue its first full year. It did so with a tiny budget, just two employees, and a heavy dose of artificial intelligence.

From a Shoestring Budget to a Booming Business

Matthew Gallagher launched Medvi in September 2024 with only $20,000 and a handful of AI tools. What started as a bold experiment quickly became a serious contender in the crowded telehealth space. Gallagher didn’t raise any outside capital. Instead, he leaned on AI to build the business almost single-handedly.

His approach was unconventional. Gallagher treated every part of his business as a prompt, using AI platforms like ChatGPT, Claude, and Grok to code the platform. Creative assets came from Midjourney and Runway, while ElevenLabs handled voice communication. Custom AI agents connected his various systems, and a chatbot managed customer service inquiries.

The startup faced some early challenges. The chatbot initially made up drug prices and even claimed Medvi sold products it didn’t offer, like hair-loss drugs. Gallagher manually corrected these mistakes, iterating until the system ran smoothly.

Scaling Rapidly with Minimal Overhead

Industry watchers were surprised by Medvi’s results. In 2025, the startup served 250,000 customers and posted $401 million in revenue. It achieved a net profit margin of 16.2%, translating to $65 million in profit.

By comparison, established players like Hims & Hers generated $2.4 billion in revenue last year but at a slim 5.5% net margin and with more than 2,400 employees.

Gallagher’s headcount? Two. That’s right. Two people running a business on track to hit $1.8 billion in sales in 2026. This means Medvi is producing nearly three times the margin of much larger rivals with a tiny team and much less capital.

AI as a Competitive Edge in Telehealth

Industry insiders say Gallagher’s story isn’t a fluke. Kobie Fuller, a General Partner at Upfront Ventures, sees Medvi as an early example of a new wave of AI-powered startups that can do more with less. "Those folks that have those skills, it's kind of like their superpower," Fuller told the Times.

Others in the telehealth space have been impressed too. Jiten Chhabra of CareValidate said the speed and scale of Medvi’s growth made him wonder if Gallagher had a big team behind him. He didn’t. And Dr. Jon Lensing, CEO of OpenLoop, noted Gallagher was already sharing AI workflow tips back to his vendors.

In short, AI lets startups avoid expensive infrastructure costs. Medvi didn’t build a physician network or pharmacy relationships from scratch. Instead, it rented these through existing platforms, dramatically cutting costs and time to market.

Implications for Venture-Backed Telehealth Companies

Medvi’s success makes people wonder about the value and viability of traditional venture-backed telehealth plays, especially in the GLP-1 weight-loss drug market. Companies like Hims & Hers have spent years and hundreds of millions building infrastructure that Gallagher simply accessed as a service.

CareValidate and OpenLoop, the infrastructure providers powering Medvi’s operations, now look like major players in their own right. They could become acquisition targets or platform competitors, depending on which startups raise capital next.

That dynamic challenges the assumption that scale requires heavy upfront investment. Instead, it paints a picture of a leaner, AI-driven future where solo operators can disrupt industries once dominated by big teams and deep pockets.

Medvi’s growth hints that more telehealth startups might soon use AI to compete bigger. Gallagher’s $20,000 gamble is now a billion-dollar business in the making.