MyHealthDirect Raises $8M, Mum About Plans For Milwaukee Operations
MyHealthDirect, a healthcare scheduling software company founded nine years ago in the Milwaukee area, has raised $8 million to help it expand—but it’s unclear how much of that will involve the local office.
MyHealthDirect’s registered business address is still in Brookfield, WI, where it was born. But the location listed at the bottom of its website and in the dateline of last week’s press release announcing the $8 million funding round is Nashville, TN, where MyHealthDirect has had a presence since hiring Nashville-based CEO Tom Cox in 2012, CFO Susan Brownie tells Xconomy. Cox replaced MyHealthDirect founder Jay Mason, who remains on the company’s board.
Outside of a few remote workers, the company’s roughly 25 employees are currently split evenly between Brookfield and Nashville, and there are C-level staff in both cities, Brownie says. (She’s in Nashville.) At this point, MyHealthDirect isn’t branding either one as its headquarters, she says.
When asked where the Brookfield office fits in the company’s future strategy, she says “that’s something we’re still developing operational plans around.”
“Nashville has a lot of talent. We’ve grown the team here over the last year,” Brownie says. “But we also have a good base of very loyal, historic employees that are still in Wisconsin. They’re a big part of the team as well.”
There are certainly good arguments for locating a healthtech startup in either city. The Milwaukee region has several large hospital systems and a fledgling research and startup cluster near the Medical College of Wisconsin, plus the presence of leading electronic health records software provider Epic Systems in nearby Verona, WI. But Nashville has a thriving healthcare ecosystem of care providers, insurers, healthcare services companies, and healthtech companies that has been built up over the last three decades.
MyHealthDirect has been operating out of shared office space in Nashville, but plans to move into its own office there next month, Brownie says.
The new $8 million round includes equity financing from previous investors Chrysalis Ventures and Arboretum Ventures and a senior credit facility from new investor Ares Capital (NASDAQ: ARCC). MyHealthDirect has now snagged more than $21.8 million from investors, according to SEC documents.
The new money will go toward sales and marketing efforts, product development, and hiring another handful of people, Brownie says.
Mason founded MyHealthDirect initially to focus on connecting the underserved, who often go to the emergency room for primary care, with community healthcare providers.
Today, the company primarily makes white-label software that handles patient appointment scheduling and doctor referrals. For example, after a routine checkup that determines a patient might need some knee work done, a primary care doctor’s office could schedule an appointment for a patient with an orthopedic specialist before the patient leaves the office that day. No more writing down the orthopedist’s name and phone number on a card and handing it off to the patient to handle later, Brownie says.
“It kind of closes the transaction down and makes it a lot simpler, and frankly saves your time,” she says.
The company serves more than 100 hospitals and has more than 5,000 healthcare providers in its system. It currently books more than 1.7 million appointments annually, and this year anticipates doubling its rate of recurring revenue from subscription products versus last year, Brownie says. Perhaps more importantly, MyHealthDirect aims to be operating in the black by the end of the year or early 2015, she adds.
One of the challenges for MyHealthDirect is convincing customers to change the way they do things, which isn’t easy in an industry that can be “entrenched” at times, she says.
“Our customers are really looking for patient access solutions that help them to attract and retain patients,” Brownie says. “I think if you look at it from a provider standpoint, too, they’re looking for ways to introduce consumer-based tools that frankly a lot of industries use.”