Redesign Health Venture Chair James Quarles

Startups

Redesign Health Closes $65M to Launch Startups

Launching a healthcare company is hard. Launching dozens of them is even harder, but that’s exactly what Redesign Health is setting out to do with $65M in Series C funding.

Redesign isn’t a venture capital firm, although it’s funded more digital health startups than most VCs. It’s not an accelerator, yet it’s launched more early-stage companies in its four years of existence than post pure startup studios.

Then what is it? Good question. Redesign’s team consists of roughly 300 analysts that  “accelerate the healthcare innovation cycle” by researching sectors, identifying challenges, then assembling companies to pursue solutions.

• The “assembling companies” piece is every bit as hands-on as you might imagine. Redesign funds the initial product development, handles the branding, and even installs the leadership team.

• By bringing everything in-house, the idea is that Redesign can eliminate many of the barriers that healthcare founders usually face, allowing them to deliver outsized value… and shareholder returns.

Redesign takes an equity stake in every company it launches, a fact well-known to its Series C investors like CVS Ventures, General Catalyst, and UPMC Enterprises.

• Since 2018, Redesign has launched over 40 companies, including home-health startup MedArrive, cancer-care platform Jasper Health, and mental health company UpLift. 

• The latest funding will go toward Redesign’s own platform that helps its portfolio companies tackle repeatable processes, and innovation agreements with its Series C investors will ensure that they’re able to co-build companies using the technology.

The Takeaway

Healthcare startups have high upfront capital costs, steep inflection points between business stages, and difficulty recruiting the seasoned executives needed to reach scale. Although there isn’t a magic wand that can be waved to make those problems disappear, we’re guessing that Redesign’s startups see smoother sailing than most.

It’s a unique model that’s hard to put in a box (especially one the size of a DHW top story), but Redesign’s portfolio of already-launched startups and its eye-popping $1.7B valuation seem to suggest that it’s a model that’s working.

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The Wire

• Innovaccer State of VBC: New research from Innovaccer revealed a wide disconnect between how providers believe they’re being reimbursed and the models that health plans report their provider networks are actually working with. The State and Science of Value-Based Care report was developed via a Morning Consult panel of 75 healthcare executives, with only 4% of providers reporting the use of pure FFS models, despite payors citing double digit pure FFS use. If you’re at all curious about where we are along the transition to VBC, the report is a great spot to find some answers.

• TGH at Home: Tampa General Hospital just launched one of the more robust hospital-at-home programs that we’ve covered, which aims to treat CHF, COPD, and diabetes patients with a combination of twice-daily in-home visits, as-needed telehealth consults, and continuously transmitted vitals enabled by a Biobeat wearable. TGH at Home also incorporates a co-designed “TGH Virtual Health Kit powered by TytoCare,” a bespoke virtual care platform that lets clinicians perform thorough remote physical exams.

• LetsGetChecked Scores $20M: Home diagnostics company LetsGetChecked secured $20M in Series D-2 funding (adding to the $150M Series D it raised last year) to continue expanding services beyond at-home test kits. LetsGetChecked has recently made multiple acquisitions to broaden its scope, including Veritas Genetics and Veritas Intercontinental for genomics exposure and BioIQ for employer / payor market lab testing and health screening services.

• SDOH Factors Blocking Senior Care: Alignment Healthcare’s 2022 Social Threats to Aging Well in America survey gave a somber look into the SDOH factors preventing seniors from growing old comfortably. Maybe unsurprisingly, 22% of the 2.6k respondents said their biggest obstacle is the cost of medical care, while 21% reported struggling with loneliness. The full report is pretty extensive and worth skimming through if you work in the space.

• Trilliant Hospital Index: Trilliant Health launched a cool new AI-powered index for hospital benchmarking that creates peer comparison tables using intelligent modeling of quality, operations, market share, and finance metrics. If a picture’s worth a thousand words, the visualizer on Trilliant’s site is easily worth a million. We highly recommend finding your organization and playing around with the tool (it’s hiding about halfway down).

• Apree Health Rebrand: Value-based primary care provider Vera Whole Health is rebranding as Apree Health following its $370M acquisition of navigation company Castlight Health earlier this year. Apree Health will be helmed by its newly appointed CEO, former Cerner President Donald Trigg, who will work towards integrating Vera’s clinical network with Castlight’s technology to bring value-based care to the employer healthcare market.

• Kyruus Acquires Epion: Provider search and scheduling company Kyruus is acquiring Epion Health for an undisclosed sum as it looks to become an all-in-one platform for patient access and engagement solutions. The combined company will serve over 500 health systems with its wide suite of tools (provider search, data management, scheduling, pre-visit intake, collections), and Epion’s customers will now be able to syndicate provider profiles to attract new patients through search engines and health plan directories.

• Has Salesforce Cracked the Code? Modern Healthcare published an article mapping out a pretty optimistic outlook for Salesforce Health Cloud. Although the article leans a little fluffy in certain parts, it also presents some decent arguments. The pandemic made CRM tools like Health Cloud more important than ever as healthcare orgs begin guiding patients through specific care journeys in new settings, and it also buoyed Salesforce’s non-provider prospects as companies in other industries began using its tech to launch health and wellness campaigns.

• Apple Watch Health Features: The Apple Watch Series 8 was finally unveiled, adding some new health features to what could easily be considered the most popular consumer health wearable on the planet. The headline upgrade was a temperature sensor with the potential to help with everything from early disease detection to menstrual cycle tracking, while other improvements included a new Medications app and a AFib History feature. If any of our readers happen to spend their weekends running ultramarathons, Apple also topped off its lineup with some fancy new Ultra watches.

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