Irrespective of which side of the aisle you sit on, we can all agree that healthcare, in its current state, is broken. Entrepreneurs and startups are lining up to bring innovation to the forefront to mend this broken system. One such example is VirtualHealth. The NYC startup ingests a full spectrum of patient data providing continuous, uniform, and complete access for health plans and providers. The company’s has developed population health management (PHM) platform that shifts the healthcare paradigm from one of a transactional and fragmented nature to one that is based on value and results.
AlleyWatch sits down with CEO and Founder Adam Sabloff to discuss the company, its origin, how it plans to disrupt healthcare, and its most recent round of funding.
Who were your investors and how much did you raise?
VirtualHealth closed a $7 million round of financing led by Edison Partners. This investment follows our Series A round in May 2016, also led by Edison.
Tell us about your product or service.
VirtualHealth is the first comprehensive cloud-based population health management solution purpose-built for value-based care. Our highly interoperable, flexible platform allows healthcare organizations to achieve enhanced outcomes while maximizing efficiency, improving transparency, and lowering costs.
While I was working on the Ritz Carlton Residences in Baltimore in the mid-2000’s, I recognized that the seniors and chronically ill residing in our firm’s numerous developments were not receiving holistic, proactive and patient-centric care. After the loss of a family member to a late-stage diagnosis, I launched VirtualHealth to pursue my vision of a better healthcare delivery system for everyone.
How is it different?
Most care management solutions lack easy integration, which creates data silos and significant gaps in taking care of patients. Unlike other platforms, VirtualHealth provides its clients with tools to better manage patient populations, such as telehealth and transportation services. We have a multi-portal access so the care team, provider, patient, and caregiver are collaborating and improving long-term outcomes. All these functionalities eliminate the need for our clients to use multiple vendors.
We were recently listed by Black Book Research as one of the Top 50 Disruptive Health IT Companies and recognized by Frost & Sullivan for its Population Health Management Product Leadership award.
What is the thinking around value-based care? Your target market is known as slow to adopt new technology. How do you combat this as you scale?
Implementing value-based healthcare is a challenge. Care teams are incentivized to understand the full extent of a patient’s conditions, to create comprehensive care plans, and to promote patient self-care through education and compliance. However, this requires technology that can aggregate data from various sources, support collaborative workflows, and identify next best actions for each patient.
What market are you are targeting and how big is it?
VirtualHealth targets the Care Management and Population Health Management Markets. The Health Information Technology (HIT) market is projected to reach $280B by 2021 from $134B today. Within the HIT market, the Care Management and Population Health Management markets are set to reach $58B by 2021 from $21B today, making it one of the fastest growing sectors in the U.S.
What’s your business model?
VirtualHealth licenses its SaaS-based platform to risk bearing managed care organizations moving towards value-based payment models resulting by the massive policy shifts over the last decade.
What was the funding process like?
Starting a company and raising early stage capital can be challenging in that raising funds usually requires a prototype but in order to build the prototype you need funds, so there’s definitely a bit of a balancing act. After you’ve successfully traversed through the first round with great partners by your side like Edison Partners and a terrific team like ours, the process goes much more smoothly.
What are the biggest challenges that you faced while raising capital?
We had an enormous amount of interest from other investors in joining this round in addition to Edison Partners leading the round, so we had to balance our priorities between multiple investors.
What factors about your business led your investors to write the check?
Edison Partners values our platform’s ability to overcome ineffective value-based care management approaches that make it a challenge to achieve operational and regulatory success. They recognized the tremendous opportunity to scale within a growing market as more organizations seek to minimize costs while increasing quality of care.
What are the milestones you plan to achieve in the next six months?
We are looking to continue growing our revenues, headcount, and member lives managed by triple digit percentages, and we’ve already closed contracts that will allow us to achieve these metrics. To support this growth, we are excited to be moving to new offices in the heart of Silicon Alley at the end of this year.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Our SVP of Finance, Tomer Benami would say to be smart about timing. Keep a close eye on your runway and monthly burn while focusing on the business activities that will reduce burn and expand runway. Start your raise process sooner than later.
Where do you see the company going now over the near term?
In the near future, we are planning to further develop our product with multiple R&D efforts as well as exponentially grow the team to support new clients.
What’s your favorite restaurant in the city?
Taralluci a Vino. It’s the only place I can go for breakfast, lunch, and dinner in the same day. In fact, sometimes I do!