Earlier this week we learned that Zocdoc, a health tech company founded 14 years ago (yes, 14 years), has raised $150 million in private equity money from Francisco Partners. Over 14 years and 10 rounds, ZocDoc has raised more than $375 million. That is a long road. For this company, like others, the pandemic has been a windfall. We can remember Zocdoc presenting at conferences in the late 2000s and thinking back then what a good idea it was.
Zocdoc sits at the heart of local search. It allows would-be patients to search for providers who accept their insurance near their location. Zocdoc isn’t limited to medical doctors. The platform also has dentists. And just like so many local search platforms, Zocdoc includes ratings and reviews so that patients can check out a specific doctor before they choose to make an appointment.
As the pandemic forced patients and doctors to shift to virtual visits, Zocdoc made the quick pivot to become not just a search and scheduling platform but also a telehealth tool. And in keeping with the challenges of the current pandemic, the company also launched Zocdoc Vaccine Scheduler. A great idea that will bear more fruit for patients and the company once sufficient volumes of vaccine become available.
Like many personal service businesses, filling appointment calendars is paramount for running a successful practice. Zocdoc understood this a long time ago when it first got into the space offering a calendaring and booking platform.
Zocdoc isn’t alone in the space. PatientPop, a Santa Monica, CA-based start-up raised $50 million in August of 2020. That round added to its prior total of $75 million. PatientPop is helping medical practices modernize.
Think of PatientPop as a marketing technology provider for medical practices and Zocdoc as the appointment platform for medical practices. In many ways, where Zocdoc is patient-facing and is much like a local search platform, PatientPop is a marketing agency for medical practices. That point was clarified last year when a number of Hubspot executives accepted board and operating positions at the company.
These two companies, and many others, are certainly playing in a large sandbox. According to The Business Research Company, the global telemedicine market was worth nearly $49.9 billion in 2019. It grew at a compound annual growth rate (CAGR) of 22.5% for 2015-19. The market is expected to grow to $194.05 billion by 2023 at a remarkable rate of 40.4%.
Here’s what Zocdoc CEO Oliver Kharraz said about the company’s trend lines and future.
“The last year has demonstrated that Zocdoc is poised to have a transformative impact on healthcare in this country. From our rapid expansion into telehealth to our efforts in helping cities and health systems distribute vaccines, our work remains focused on giving power to the patient.“
We tend to think the next 14 years will be every bit as challenging as the last 14 years. But also quite different. In the past, Zocdoc needed to be an evangelist within the medical community to encourage practices to adopt new technologies. Going forward, given the market explosion that is happening, Zocdoc will have to be really, really good at execution and operations to compete with existing operators and new entrants.