In-Home Caregiving Startup Homage Lands $1.2M in Seed Funding
The Singapore-based company moved beyond angel investing to secure funding for further development of its platform as well as expansion of its team.
[The] $1.2 million [of] seed round [funding comes from] venture capital firms...Golden Gate Ventures, 500 Startups, and SeedPlus.
[Homage is] the brainchild of Y-Combinator Alumni Gillian Tee, Lily Phang, and Tong Duong, [and] aims to “fundamentally” change home-based caregiving for the elderly....[by making] the process quick, effective and affordable.
The shortage of quality caregivers is even more acute in Singapore and Asia so the founders hope to establish their proof of concept in this burgeoning market.
[F]amilies struggle to find in-home solutions they can trust. The process is time-consuming, costly, and most of all, deeply stressful.
Homage will invest the capital to fuel product development and scale operations to fulfill the rising local demand....The platform also serves as an enabler for micro-entrepreneurship, as it offers specialized training for both aspiring and experienced care professionals. The professionals are then hand-picked to work and provide services through Homage.
This way, the founding team, believes they will be contributing their bit in creating opportunities for individuals who are looking for a rewarding career with a flexible work schedule.
The company claims to have delivered more than 10,000 hours of caregiving services.
Breg Enters the Increasingly Crowded Virtual Rehab Field
With providers moving toward bundled payments and "value-based system" in healthcare, costly post-surgical services like physical therapy are finding themselves on the chopping block. One consequence is an accelerated move toward virtual rehabilitation. And companies like Breg who have developing products to enable this remote care are set to capitalize on their foresight.
“We are actively moving toward online physical therapy programs and our goal is to eliminate physical therapy for hips, only use in knees when we need it …,” said Richard Iorio, a hip and knee surgeon at NYU Langone Medical Center, at a panel discussion on orthopedic bundled payments last week at AAOS.
At the recently-concluded annual meeting of the American Academy of Orthpaedic Surgeons (AAOS), Breg executives were showing off a new sensor-device [called Flex] connected to a mobile app that can guide patients through their daily exercise routine following orthopedic surgery.
This is the first time the company has forayed into the digital health, Internet of Things space, confirmed Brad Lee, president and CEO, in a booth interview [with MedCity News] last week where demos of the Breg Flex system were being presented.
Breg's Flex is certainly not the only virtual rehab provider in the space. Differentiators among them are what device they require (smartphone vs. console), whether they offer clinical decision support and therefore require FDA clearance and how well they integrate with electronic health records.
[Flex includes a] chargeable Bluetooth wireless sensor, worn by patients to track progress with prescribed PT exercises with a companion mobile app.
The sensor and app work in concert to record range-of-motion that is key to better clinical outcomes. The data is also shared in real time with providers such that clinicians can tweak exercise protocols. The interactive patient app has a virtual avatar that guides patients through exercises. The system can also collect patient-reported outcomes that are key to getting reimbursed for certain orthopedic procedures such as joint replacement under bundled care programs.
...Flex also works with the electronic medical record of a practice or a hospital [and] is FDA-exempt because it simply monitors and tracks and does not offer clinical decision support.
Competitors include Reflexion Health's Vera and RespondWell, recently acquired by Zimmer-Biomet, an Indiana-based company that currently holds the largest market share of hip and knee replacements.
Reflexion Health’s Vera virtual rehab program...uses the Microsoft Kinect gaming console and the Vera avatar to guide patients through their at-home exercise regimen. The system received FDA clearance in 2015.
....RespondWell virtual rehab program...is...not FDA-cleared.
...Jintronics and Reflexion Health use the Kinect platform thereby tying joint replacement patients to a console or a TV to do their daily rehab. All Breg Flex needs is a cell phone, or tablet and a sensor-device. In other words, patients can be out and about, and still get their rehab done.
[T]he virtual rehab space is getting crowded with several companies vying to win. But Breg’s CEO shrugged it off. “There is a huge market and there will be a lot of good players in the space,” he said.
Photo: Breg Inc.
Gates Foundation Vets Raise $200M for New Biotech and Digital Health Fund
There’s a newcomer to the digital health and biotech investment worlds. The two founders of Biomatics Capital come with a strong pedigree, having worked for the Bill & Melinda Gates Foundation.
Boris Nikolic and Julie Sunderland, who (respectively) were the chief adviser for science and technology to Bill Gates at the Foundation and the director of programming investments, picked up $200 million for the venture fund that they formed last year.
With one company already on its roster, the venture firm hopes to add 15-20 more in the near future.
Biomatics will boost firms in the big data-driven digital health and genomics space. It's already invested in AiCure, a company that uses smartphones to see whether or not patients are taking their medications. "It's our goal to seek out radically innovative solutions—the outliers," said Sunderland in a statement.
The outfit plans to pour about $5 million to $10 million in initial funding into 15 or 20 companies (that figure could rise to $20 million for particularly promising firms).
Echo Health Ventures Aims to Fix Today’s “Broken” Digital Health Venture Model
The data is in: digital health funding saw its highest levels ever in 2016. The question is--what does it indicate? One possible interpretation is that 2016 marks the turning point when generalist tech investors see enough signs that consumers are ready for the digital health revolution that they are in turn ready and willing to put capital behind good--or potentially good--ideas.
But there’s another theory that lies behind the recent launch of Echo Health Ventures, formed in November 2016, as a strategic collaboration between Cambia Health Solutions and Mosaic Health Solutions. Erica Garvin at HIT Consultant Media argues that, although the raw dollar numbers in digital health are indeed ramping up, the high failure rate of startups in this sector indicates that there is a fundamental flaw in the investment model.
Today’s digital health venture model is broken. That statement seems bold and contradictory to the fervor and flourish of funding that has poured into the space recently. However, most health-tech startups are predicted to fail within the first two years of operation—why?
In 2014, venture funding in digital health smashed records surpassing $4.1 billion; equally impressive was 2015’s total of $4.5 billion. As the ball dropped on 2016, so did those numbers; however, the space still saw $4.3 billion by the year’s end. Even more telling is the $6.5 billion in investments projected for stand-out digital health organizations by 2017. It’s clear there is at least enthusiasm for digital tech in healthcare, so what’s tripping up the promising startup?
Startups in general are certainly risky--90 fail, according to Fortune. But Matthew Karls of Echo Health Ventures believes digital health is unique in that the real problem lies in the lack of long-term commitment and collaboration from investors. It's a flaw EHV hopes to solve.
The top reason for [startup failure in general], according to 42 percent of startups polled by CB Insights, is a lack of market need for their product—but is that what’s happening in digital health?
“In healthcare, we often see early-stage companies struggle to convert pilots to commercial contracts and grow their top line, despite having secured an impressive base of early pilot partners and clients,” Karls said. “Many companies see rapid early growth, only to suddenly see the momentum stall and growth plateau, and it isn’t clear why…[At least part of the reason is that] this wave of funding has been driven by a herd of generalist and tech investors drawn by the extreme dysfunction in the healthcare system”.
The mantra for many of these generalist tech investors is quick return on investment, which can work in other sectors, but often fails in healthcare according to Karls, because of the complex “layers of process, regulations, and policies”.
Startups are stalling out before building their momentum because they need deeper insights from investors, which they don’t have—not when it comes to doing business in healthcare.
“Enthusiasm and optimism are always necessary for success, in all venture sectors,” said Karls. “What’s lacking is that kind of excitement with an accompanied appreciation for the complexity and magnitude of the current forces in digital health. To put it bluntly, healthcare is harder.”
Given this understanding of the market, Echo Health Ventures has adopted what it calls a “Stage-Agnostic Strategy”.
Building new companies that leverage technological innovation to transform the health care system requires much more than sufficient capital. Over the years, specialized healthcare venture managers have brought patient risk capital and thoughtful, long-term strategic partnership with their portfolio companies. However, these venture capitalists are harder and harder to find.
Enter Echo Health Ventures, hoping to leverage the extensive resources from Cambia Health Solutions and Mosaic Health Solutions in order to magnify the impact it can create for new companies.
The company manages both companies’ existing portfolios as well as pursues new, stage-agnostic investments in healthcare innovation.
“The Echo model is fundamentally a deeper, more engaging experience than most [accelerators] can provide given the level of long-term, not cohort-based, capital and resource commitment.”
Matthew Karls closes with some advice to startup entrepreneurs.
[Do] not be discouraged but..be considerate and conscious about the importance of [your] moves. “Figure out what problems you can solve, understand everything that touches it, and build on your strengths. Find partners that will accelerate your growth or can provide the network and resources you need to succeed. Then, you can relentlessly focus on delivery,” he said.
What will separate the successful startups from those destined to fail is the willingness to disrupt healthcare; as we’ve heard before, creating solutions to fix broken processes is pointless. “Incumbents preach innovation but sit with dead weight to resist change,” said Karls. “Radically altering the system requires an understanding of it. Innovators must know how the gears work and build solutions that are far more than window dressing. Disruption in health care must happen from the inside out.”
2016 Saw Record Funding Levels in Digital Health, Shift Toward Early-Stage Deals
In an article summary last month, we covered a story about long-time investors breaking into the digital health sector for the first time in 2016. A recent piece by CBInsights covers the story from another angle: total dollars invested in digital health startups.
The story, at first blush, is that the influx of capital is continuing to soar. But there are also some important caveats buried in the details, including that the spike is in early-stage deals only and that the total number of deals actually fell compared with 2015.
In 2016 investors continued to ramp up their deals to companies aiming to use digital solutions to remedy pain points in the healthcare system. Global equity funding to private digital health startups grew for the 7th straight year in 2016, hitting a high of $6.1B. While the large majority of rounds went to early-stage, seed and Series A companies, a few more mature companies also raised notable mega-rounds.
As mentioned above, the funding trends from 2009-2016 deserve a closer look, because while yearly total spending has been consistently climbing for these 8 years, quarterly data reveals that 2016 saw a 9.6% drop in total deals compared with 2015, with the sharp drop coming in Q3 and recovering slightly in Q4.
In 2016, equity funding to digital health companies saw a 3.2% increase from $5.9B in 2015 to nearly $6.1B in 2016. Deals, however, dropped 9.6% from a high of 1016 in 2015 to 918 in 2016.
On a quarterly basis, funding saw a 7.7% increase from $944M in Q3’16 to $1.02B in Q4’16. Deal flow, which fell from Q1-Q3’16, picked back up at the end of the year, hitting 250.
Although more and more investors are entering the digital health sector, many for the first time in 2016, the influx of capital seems focused exclusively on early-stage deals with a record 58% of global deal share going to them in 2016. (For an interesting perspective on how this bias is failing to produce successful startups, see this piece about Matthew Karls from Echo Health Ventures, who argues that digital health funding is broken).
Digital health is becoming an increasingly competitive sector, with a greater percentage of deals going to early-stage, seed and Series A rounds. Prior to 2011, early-stage funding occupied just under 50% of total deal share. But following the approval of the Affordable Care Act in 2010, funding to early-stage digital health companies in every following year has not dipped below 56% of total deal share.
Meanwhile, mid-stage deals (Series B and C) have been trending downwards from a high of 22% in 2009 to 12% in 2016. Since hitting a high of 11% in 2010, late-stage rounds (Series D and E+) have also trended down, settling at 4% in 2016.
Livongo Secures $52.5M, Looks to Expand Abroad and Beyond Diabetes
With this $52.5 million, Livongo Health will have raised a total of $140 million to date, much of it from the biggest names in digital health investing in the US, and this time, from some overseas funders as well.
Technology-enabled diabetes management company Livongo Health has raised $52.5 million in new funding in a round co-led by General Catalyst, an existing investor, and international investment company Kinnevik. Other investors included Microsoft Ventures, American Investment Holdings, and EDBI, a Singapore-based fund whose portfolio includes WellTok, GoBalto, and Sotera Wireless. All previous investors also participated in the round.
Having secured a large part of the US market share for diabetes management, Livongo Health will use the funding to expand into the international market as well as into other common, chronic conditions.
Livongo says its diabetes program is now used by four of the seven largest health plans in the US and two of the three largest pharmacy benefit managers, and covers more than 3 million lives.
The company plans to move beyond diabetes, starting with common comorbidities such as high blood pressure and high cholesterol, the company shared in a statement
Founded in fall 2014 by former Allscripts CEO Glen Tullman, Livongo has raised an impressive $140 million to date, including a $5 million strategic investment from Humana and backing from a who’s who of digital health backers including Merck Global Health Innovation Fund, Cowen Private Investments, Sapphire Ventures, Zaffre Investments, the investment arm of Blue Cross Blue Shield of Massachusetts, Wanxiang America Corporation, Kleiner Perkins Caufield & Byers (KPCB), and DFJ Venture.
Apple Lags Far Behind Amazon, Google in Smart-home Market
While Apple has been a market leader in smartphone sales for over a decade, they have yet to even offer a voice-controlled device specifically for the home that could compete with Amazon’s Alexa or Alphabet’s Google Home.
Consumer electronics giant Apple (AAPL) is "losing badly" in the nascent smart-home market, despite having arguably the best user experience with its HomeKit technology, Edison Investment Research analyst Richard Windsor said in a note Tuesday.
Apple is a "very distant third" in the smart-home market..., Windsor said. [They have] been rumored to be working on a home appliance that uses its Siri voice-response personal assistant. But so far Siri is mostly an application on Apple's iPhone smartphones.
Siri of course can be voice-activated, but research shows the power of the home devices is that a user can have both hands fully occupied with some other task and still activate it.
"Usage of both Alexa and Google Home show that over 60% of all usage is generated when the user's hands are busy with another task, [said Windsor.] “This makes the use case of Siri on a device that needs to be removed from the pocket not as easy or as intuitive as Alexa or Google Home."
Still, Apple has made advances that neither of the other two tech giants have achieved.
Apple had done a better job of integrating home devices so users can give a single command when doing things like going to bed, leaving the home or returning home, Windsor said.
"This makes it easy to turn off all the lights, lock up, turn down the heating, and so on with a single button press, which is something that neither of the other two have come close to offering," Windsor said.
But consumer preference for the voice-activated home device may mean they miscalculated market priorities. If Apple is going to enter this burgeoning market, they are going to have a lot of catching up to do.
Amazon's Alexa grabbed 88% of the intelligent home speaker market in the fourth quarter, Strategy Analytics said Tuesday. Alphabet came in second with 10% market share after launching its Google Home speaker in November, the research firm said.
Some 4.2 million intelligent home speakers were shipped worldwide in the fourth quarter, up nearly 600% year over year, Strategy Analytics said.
"Amazon has had a near two-year head start over its rivals and has done an excellent job of building out an ecosystem of compatible devices and services or skills," Strategy Analytics analyst David Watkins said in a statement. "However, Google is hot on Amazon's heels and the search giant should be able to significantly cut Amazon's lead over the coming year thanks to its superior AI platform and well-established technology-licensing model, which has proved successful through its Chromecast built-in program."
Today at SXSW: Workshop on Empathy in Design
The central mission of Longevity Network is to spur innovation in products and services for the 50+ market, with the belief that technology can improve or enable better, healthier living for this growing demographic in everything from aging in place to caregiver quality of life.
A workshop sponsored by Microsoft this afternoon at SXSW addresses a crucial tenet for this kind of innovation: developing empathy for diverse kinds of users.
Humans have been at the center of design practices for a long time. Although product makers and designers have always sought to understand their customers, they often miss an opportunity. By including a diverse set of people in the design process with a range of physical and cognitive abilities, we can start to understand how empathy and diversity fuel innovation. In this participatory session, we will explore important considerations and practical approaches to uncover universal human motivations, identify barriers and exclusion that impact participation, and glean insight from how people adapt.
The workshop promises to be interactive and is part of a larger initiative at Microsoft to encourage this kind of inclusivity in design innovation.
[Participants will] build off one another's experiences and stress test...ideas to evolve our thinking along the way. Come ready to participate and learn how this inclusive design practice can impact your work - even if you're not in the business of making products.
To learn more about Microsoft’s approach to inclusive design visit their webpage on inclusive design here.
This event is part of the Social Good Hub, a creative content venue curated and produced by SXSW Eco. See the full schedule of programming and special events here.
Trulia Co-founder Officially Launches Virta Health, a Telehealth Startup Aiming to Cure Type II Diabetes
Sami Inkinen, co-founder of online real estate platform Trulia, was drawn to trying to cure Type II Diabetes when he received a diagnosis of pre-diabetes “despite being an accomplished triathlon athlete”. His interest coincided Trulia’s acquisition for $2.5 billion.
Although the company was officially launched this week, Virta Health was formed in 2014. The company has received $37 million through seed and Series A rounds, according to Inkinen —Venrock led the $30 million Series A round and Obvious Ventures led the $7 million seed round. Other investors in the business include Allen & Company, Redmile Group, and PayPal and Affirm founder Max Levchin’s Scifi VC, the news release noted.
Inkinen, who is Virta Health’s CEO, [co-founded the company with] Dr. Stephen Phinney, a physician and scientist with 40 years of nutritional biochemistry experience, and Dr. Jeff Volek, a professor at Ohio State University with a background in researching the effects of nutrition and physical activity on health.
The telehealth company has not developed another app to manage Type II diabetes; they are interested in curing it without medication.
The digital health company, which refers to itself as an online specialty medical clinic, sets itself apart by attempting to cure Type 2 diabetes...Virta Health’s approach is designed to offer an alternative to bariatric surgery or additional medications, according to a company news release.
How does it work? Through a series of interventions and advice, all offered through its interactive app.
The company helps patients lower their hemoglobin A1c levels and reduce or eliminate prescription medications through an interactive communication with a physician and online health coach supported by a mobile app. In addition to physicians and health coaches, users receive nutrition, guidance on changing their habits, biometric feedback, and peer support.
[In a recent 10-week study at Indiana University Health Arnett,...published in the Journal of Medical Internet Research, participants received educational content either through on-site weekly 90-minute group-based classes or in recorded form on the Web depending on what each participant wanted. The content included information such as how to manage carbohydrate restriction and still get enough protein in moderation, a tutorial on ketones and behavior change techniques.
Participants could communicate with online health coaches through texting for advice and problem-solving. They also received support from peers online. Their biometrics were remotely monitored on a daily basis. Participants reported their glucose levels online one to three times per day. A physician made medication changes when needed. Each week a care team and the principal investigator reviewed the medication status of each participant.
The 3 co-founders of the company presented early results from the study this week, and while not yet up to the standard of peer-reviewed, blind studies--they are promising.
The study [which] involved 262 participants with Type 2 diabetes varying in age from 21 to 65 years old] was sponsored by Virta and carried out by people with a financial connection to the business. Still, more than half of participants (56 percent) were able to lower their blood glucose to a non-diabetic range. The majority of patients (87 percent) reduced or completely eliminated insulin and also lost 5 percent of their weight, the release said.
More than 42 percent of study participants (112) were able to decrease their medications and another 21 were able to do away with them entirely.
Type 2 diabetes is an enormous healthcare issue in the U.S. and accounts for 90 percent of the 29 million diabetes cases in this country, according to data from the Centers for Disease Control. More than one-third of Americans or 86 million are deemed to be at risk for developing the chronic condition.
Photo: Virta Health physicians Caroline Roberts and Jeff Stanley
Survey: Patients Want Provider Access to Full Health Record, Including Data from Digital Health Devices
It is conventional wisdom that when confronted with a truly transformative technology, most people will first find it intrusive and undesirable, but then once they accept it, they move very quickly to dependence. Humana’s recent survey of patient behaviors and attitudes surrounding information sharing among their health providers and their now rapid adoption of digital health devices shows we are well on our way to dependence --if healthcare providers can keep up with patient expectations.
The report, by Transcend Insights, Humana’s population health management company, found that a vast majority of patients (97 percent) believe it is important for any health institution, regardless of type or location, to have access to their full medical history in order to deliver high-quality care.
When asked to rate factors that are most important to receiving personalized care, they listed having access to their own medical records (92 percent) and the ability for care providers to easily share and receive important information about their medical history — wherever they needed treatment (93 percent).
With patient attitudes so thoroughly aligned, says the study, the burden falls on healthcare providers to catch up and off “true interoperability”.
The survey suggests there is a significant gap between the level of information sharing that patients expect and what is possible today. True interoperability — effectively sharing medical information and communicating across many different health care information technology systems — has remained elusive, according to the survey.
“Despite advances in the use of electronic health records (EHRs), the industry continues to struggle with sharing health information and making patient data available across the healthcare system,” the survey said.
As proof, the report cites a recent interoperability study by the American Hospital Association, which shows only a quarter of all hospitals are able to functionally exchange (find, send, receive and use) clinical information with external providers. Further, a Journal of the American Medical Association study found that only 34.8 percent of specialists receive information about a patient from their referring primary care physician (PCP), even when the PCP attempts to share patient records.
Perhaps most striking is that patients believe their physicians and hospitals are better able to effectively share their records than they are in most cases.
When asked whether or not their doctors could easily share and access important information about their medical history – whenever or wherever they needed care — 72 percent of respondents to Transcend Insights survey said they believed that this is in fact happening. Unfortunately, due to ongoing setbacks in connecting the sprawling health care system, this type of open access to records is rare.
The survey found high adoption rates for digital health devices as well as a strong desire by patients for data collected by the devices to be accessible by their treating physician or hospital. Having a complete patient picture--from medical history to data from digital health devices--increases patient trust.
The survey also found that a majority of patients (64 percent) say that they use a digital device (including mobile apps) to manage their health and 71 percent believe it would be helpful for their doctor to have access to this information as part of their medical history.
Patients said they are more likely to completely trust the health care they receive from any medical professional when he or she has access to their full medical history (38 percent versus 27 percent).
Humana, Transcend Insights, patient engagement, survey, metrics