Today on Health in 2 Point 00, we have more deals to cover continuing off of yesterday’s episode! Jess and I talk about Kaia Health raising $26 million in a B round led by Optum Ventures, RapidSOS gets $21 million for their emergency response tech, Abacus Insights raising $35 million, and Ready raising $48 million pairing home visits from EMTs and nurses with telehealth. In other news, Target is now offering free access to telehealth visits through CirrusMD, and Doximity is acquiring THMED (which is changing its name to Curative) to put together a database of doctors to improve healthcare staffing/recruitment. —Matthew Holt
On one hand, I’m glad to see these guys continue to raise money and continue their development.
On the other hand, I’m disappointed that we don’t have a better physician-centric social network. While they have been successful at signing up doctors, it seems (at least anecdotally) few are engaging with the network. I have connected with many of my classmates and some physicians I know on the network. I have never interacted with any of them through Doximity.
I think a lot of doctors will have a LinkedIn profile and Doximity profile. But the key is which part is really going to get ingrained in their lives.
The key question is—what value does Doximity provide over other, non-physician centric social networks? More plainly, what is going to make me open up Doximity on my iPhone instead of my favorite Twitter client?
The current answer to that question is: nothing.
In their smartphone app, the news feed features medical journal articles from the likes of NEJM, JAMA, Lancet, etc. It is unclear exactly how these are selected, but quite clear they are not tailored to my interests. Twitter, on the other hand, provides a constant stream of thoughts and articles related to my interests because of the people I’ve chosen to follow.
Doximity, known as the LinkedIn for doctors and a frequent Health 2.0 participant, raised $54 million in a Series C funding round led by T. Rowe Price and Draper Fisher Jurveston with participation from Morgan Stanley Investment Management.
Doximity claims more than 40% of US physicians as active users, and in January of this year announced that their physician network has grown to more than 250,000 members.
Doctors can use Doximity to collaborate on cases, further their careers, and stay up to date on specialty-specific news, but that’s not where they make their revenue.
“There are a lot of things we can do to make medical networking more efficient,” Doximity CEO Jeff Tangney told Health 2.0 when asked how the funds would be used.
“If you think about it, how would your life be different if you weren’t able to use email in your job? How out of touch would you be? That’s what it’s like to be a US physician. We see a lot of opportunity to improve the connectivity of physicians as a new business area.”
Like LinkedIn, Doximity is a recruiting tool for people looking to hire doctors. Tangney didn’t reveal all the numbers, but he did say that Doximity was cash flow positive in January for the first time. He also said that Doximity has 55 employees, somewhere around 200 hospital clients, and that a subscription to the recruiting product costs $12,000 per seat per year to send 50 messages per month.
With some back of the envelope math, and a guess of a burn of about $10-12 million a year, it figures out to about four subscribed seats per hospital. With about 5,000 hospitals in the US and some other revenue streams to pursue, it looks like Doximity has room to grow at a bare minimum.
Recently, the Wall Street Journal has been writing article after article about how Silicon Valley is suddenly as hot again as in 1995. And anyone driving into San Francisco these days will have views of the city obscured with big “we’re hiring” billboards from the Groupons, Zyngas, Rockyous, and whathaveyous of the world.
In the past healthcare innovation and startups/new value creation has proceeded independent of that tech-scene and it has been much slower, dominated by buying behavior from giant incumbents who thought NIH stood for Not In Healthcare. But as my colleague and Health 2.0 co-founder Matthew Holt likes to put it: change starts at the edges. And we have seen Health 2.0 start small at the edges with the growth of patient communities, followed by other models connecting patients, payers, and providers in new ways (e.g. American Well, athenahealth, Castlight).
On May 18 SDForum is organizing a one-day event highlighting the change that is afoot in mainstream healthcare as a result of the innovation from the edges reaching the shores (and more) of mainstream health and wellness industries.
I am introducing the first keynote speaker (Holly Potter from Kaiser Permanente) and moderating a panel on one of my favorite topics: how data and innovation in analytics can make treatment and wellness decisions better, and hence create value, for all involved. While 80% of presenting companies are young (from only a few months in existence to 5 years from initial funding), there are also some pioneering established companies (Kaiser Permanente, Safeway, PAMF) who will touch upon topics like:
- how ONC’s push for ‘data Liberacion’ is one of several forces helping to make health decisions more data-driven
- how mobile/unplatforms, cloud-computing, and innovative use of analytics create new opportunities to understand patient behavior and introduce new, smart interventions
- how chronic disease treatment is starting a transformation (funky billboards in LAX not withstanding, Lisa)
- how new entrepreneurial energy is being backed by more and more funding (Healthtap is one of the companies who recently received funding and who will be on the panel that I moderate, Doximity is another company that fits that bill)
Finally, while some companies in general tech or consumer markets seem to pursue growth without a business model, this event shows how companies in healthcare who get it right (e.g. Limeade), can grow fast, do good, and become financially viable businesses. Maybe one day the WSJ will report on the exciting IPO window of healthcare technology innovation companies for a change. In the meantime, come and see what the future will look like by hearing from those who are building it now.
Marco Smit is President of Health 2.0 Advisors, the market intelligence arm of the Health 2.0 family.