Our Favorite Few that Got Away — 2021 Edition
We had an incredibly productive 2021 at Health Velocity Capital: we hired four fantastic new teammates, we made new investments in four exciting companies, and we raised our newest fund to support and help build the next generation healthcare software and services innovators. During 2021, we evaluated more companies than in each of our respective years in the industry, and, as part of our annual end-of-year reflection, we wanted to highlight some of our favorite companies that raised capital (but not from us!). These are, we believe, great companies and for a variety of reasons the stars and moons did not align, but we are huge fans and rooting from the sidelines.
And for the avoidance of doubt, we’re more than thrilled about our 2021 partnerships — Prolucent, Torch Technologies, Hospital IQ, and Clever Care Health Plan. For those interested in learning more about them (and our other portfolio company partners), please visit https://healthvelocitycapital.com/companies.
Without further ado, a few of our favorite companies that “got away” in 2021:
SteadyMD enables healthcare services companies to operate in our new virtual-heavy world. The company builds clinician networks, handling all of the recruiting, credentialing, licensing, and regulatory-related items necessary to operate a compliant telehealth business.
We have been bullish on telehealth since Marty led Teladoc’s 2009 financing. Since that time, our team has made investments in our fair share telehealth business including MDLive (acquired by Cigna), Livongo (acquired by Teladoc), Lemonaid Health (acquired by 23andMe), Array Behavioral Health and Octave. It is safe to say that we’ve been through the ups and downs of the sector, and we understand the nuances of building a successful business in it. It is also safe to say that we agree with SteadyMD’s thesis — it is a headache to build and monitor a compliant, effective, properly credentialled, properly licensed virtual network.
Marty and Guy were introduced in 2016 (thanks to Ted Meisel!) when SteadyMD launched as a virtual concierge medical practice. The Health Velocity Capital team had always been impressed by Guy and team’s willingness to test their hypotheses and adjust their model based on market response. In 2020, SteadyMD tested a new hypothesis: unbundle telehealth. SteadyMD would provide the care network and their customers would focus their efforts on the rest (i.e. consumer acquisition / retention, payer contracting, clinical documentation) — digital health is hard enough.
While we’re not investors in SteadyMD, they work with a number of our portfolio companies, most notably Lemonaid Health. We are thrilled that Guy, his co-founder Yarone, and their team have partnered with a wonderful investor in Deena Shakir at Lux, and we’re excited to watch them continue their journey of powering telehealth across the country.
NOCD is a digital + telebehavioral health platform for severe mental illness, starting with Obsessive Compulsive Disorder. The company’s platform provides active peer feeds and peer support, educational content to help individuals identify with symptoms of OCD, comprehensive assessments to diagnose and track outcomes, self-help CBT, asynchronous chat, and virtual ERP (exposure and response prevention) therapy. When undiagnosed or mistreated, OCD can result in intrusive thoughts, extreme anxiety, depression, becoming housebound, thoughts of self-harm, etc. NOCD touts strong clinical outcomes –47% reduction of OCD severity, 40% reduction in comorbid depression, 50% reduction in ERP provider time per patient, 78% patient retention, and an active community with more than 100,000 individuals per month engaged in NOCD’s online community.
Similar to telehealth, the Health Velocity team has had robust thesis in behavioral health solutions with investments in companies such as Headspace Health (formerly Ginger), which offers the world’s most comprehensive digital mental health and wellbeing platform. We believe the tailwinds in the sector have grown stronger and steadier. More Americans are being diagnosed with behavioral health conditions (which has unfortunately accelerated due to the COVID-19 pandemic); perceived stigmas associated with discussing mental health challenges have lessened, and more and more individuals are actively seeking therapy; virtual care has proven to be an effective and sticky mode of care delivery that address the acute access issues our nation is experiencing; and importantly, payors and employers have recognized the strong tie between behavioral and physical health and are more willing to adequately reimburse for these services. We believe that condition-specific, age-specific and even gender-specific solutions will find ample demand in the market.
Since early 2019, each of the Health Velocity Capital partners was separately introduced to Stephen by a wonderful set of mutual connections (thanks to Dipa Talati, Solome Tibebu, Alyssa Jaffee, and Peter Christman!) — a good sign of a respected entrepreneur. We quickly recognized Stephen was a special entrepreneur driven by a deep passion through his personal experience with OCD. Stephen and team have done an incredible job of building nation-wide payor connectivity to power their patient acquisition funnel and building an engaging and compelling product to drive continued utilization and ultimately outcomes.
Stephen has also constructed one of the best investor syndicates in the sector: Chicago Ventures (a co-investor of ours at HealthJoy), 7wire Ventures (our co-investor at a predecessor firm at Livongo), Health Enterprise Partners (a co-investor of ours at Jvion) and newly added F-Prime and Kaiser Permanente Ventures (a co-investor of ours at Headspace Health). It is an understatement to say that scaling a healthcare business is hard. Having a group of deeply knowledgeable and networked investors working for you can be company-defining in this sector.
Uno Health enables government-sponsored health plans (MA, managed Medicaid, etc.) to engage, enroll and re-certify members eligible for state and federal financial assistance programs such as food stamps and utility assistance as well as unlock enhanced health plan choices (Medicare Savings Program, duals, D-SNPs). Uno Health’s software enrollment platform acts like ‘TurboTax’ such that it minimizes information and documentation requirements to complete multiple applications for specific member-eligible subsidy programs. Uno accomplishes the rare triple win of immediately benefitting members and payors while demonstrating a strong unit economic profile.
Saurabh and Anna were introduced through a mutual connection and met around Thanksgiving 2019. Anna and her co-founder Chloe had just raised seed capital, so she and Saurabh had agreed to touch base in a few months. “A few months” turned into two years, but Saurabh and Anna re-connected at HLTH in Boston and immediately (re)clicked. Through our diligence process, which included multiple Zooms, two (!) in-person meetings, and introductions to a variety of our health plan partners and friends, we couldn’t be more impressed by Anna, Chloe and their team.
While we don’t have the privilege of calling Uno Health a portfolio company partner, we are thrilled they will be working with some good friends (TBA soon!).
We’re excited to continue following SteadyMD, NOCD, and Uno Health on their incredible trajectory. There’s still a lot of company building left in front of them, but they are run by talented teams, supported by strong investors, and have a group of cheerleaders pulling for them.
Though these three made our list of the ones that got away this year, they represent a small subset of the incredible entrepreneurs aligned with our mission of helping to build successful companies contributing to a more affordable, sustainable, consumer-friendly healthcare system. If you are an entrepreneur building a business that is aligned with our mission, please feel free to reach out.
