6 Billion-Dollar Telehealth Companies to Watch

One of the big challenges over the last year or so – aside from deciding when it was safe to get a haircut again – is teasing out the ephemeral from the existential when it comes to investing in the stock market. We’ve referred to this as the remote connectivity investment thesis. Basically, investors are left to wonder if the pandemic bump that pumped up stocks like Zoom (ZM) and Teladoc (TDOC) has true staying power. Here’s how these assets have performed since the very first information about The Rona was made public on December 31st, 2019.

  • TDOC +77%
  • ZM +325%
  • Nasdaq +46%

While tech stocks come plummeting back to earth, there’s still plenty of premium priced into some names. Given the growth of telehealth and video conference calls, some of that is certainly deserved.

Today, we want to look at how telehealth is taking off, and how that might affect the leading telehealth stock which we happen to be holding in The Nanalyze Tech Stock Portfolio.

Telehealth is Teeing Off

So, are we ready to unplug the remote connectivity investment thesis as yet another temporary trend like Cabbage Patch Kids, Dutch tulips, and Dogecoin? In the case of telehealth, definitely not yet. Remember that telehealth is more than just virtual doctor visits. The definition broadly includes everything from remote patient monitoring to AI chatbots. The Centers for Medicare and Medicaid Services have greatly expanded telehealth reimbursements to include dozens of services (at least temporarily), as even the government recognizes that it can save money by keeping people out of hospitals and emergency rooms.

Telehealth applications
Credit: Maryville University

As Teladoc’s stock continues to slide, it’s likely the movement of tech stocks as a whole that’s causing it (and some ARK effect), not a sudden disinterest in telehealth. In fact, all signs suggest that the digitization of medical services is really only beginning. And that doesn’t even include optimistic forecasts like the one from McKinsey & Company, which projects that up to $250 billion of current U.S. healthcare spending could be virtualized. 

Future spending for telehealth.
Credit: McKinsey & Company

Those kinds of dollars are attracting players like Amazon (AMZN) and Walmart (WMT) to hang their own virtual shingles. The latter, for example, just announced this month it would require MeMD, a telehealth company based in Scottsdale, Arizona, as a bolt on to the retail giant’s Walmart Health division. In our recent article on Biofourmis, an AI healthcare startup that offers a range of remote patient monitoring solutions, we noted that investments into private telehealth companies have reached record highs in each of the last three quarters. There’s so much money flooding into private equity that CB Insights, in its State Of Healthcare Q1’21 Report, noted that six telehealth startups joined the unicorn club so far this year. 

Telehealth unicorns
Credit: CB Insights

Let’s dive into these well-funded, highly valued companies.

Musculoskeletal Telehealth Clinic

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At the top of the heap is San Francisco-based Hinge Health, a musculoskeletal telehealth startup founded in 2015. The company raised a monster $300 million Series D in January, bringing total disclosed funding to about $426 million. The huge infusion of cash boosted the company’s valuation to $3 billion. The startup employs a B2B model for businesses and health plans, with a customer base of more than 300 clients including companies like Boeing (BA), Salesforce (CRM), and US Foods (USFD). Hinge Health offers members access to physical therapists, physicians, and health coaches across a variety of programs, from preventive exercise classes to post-surgery PT. Users wear sensors to guide exercise therapy to receive real-time feedback. Hinge Health recently acquired another San Francisco startup, Enso, which has developed a bioelectronic medical device that delivers electrical stimulation to ease pain. Clinical trials have shown that the electroceutical reduced pain by 56%.

Telehealth physical therapy
Work it! Credit: Hinge Health

Hinge Health has some impressive clinical data of its own to justify its shiny new valuation. In a 2020 study, researchers from the University of California San Francisco and Stanford tracked more than 10,000 people and found that each Hinge Health participant reported an average 69% reduction in pain (the equivalent of four times more pain reduction than opioids without the debilitating addiction), as well as a 58% reduction in depression and anxiety. And unlike those of us who commit to a gym membership in January before switching to a Netflix membership in March, Hinge Health participants stick with the program – 70% continued to do their exercise therapy on their own two years later. Other studies have shown that telehealth users avoided surgery about 66% of the time, and Hinge Health participants who do go under the knife cost insurers 56% less compared to 30% more for non-participants.

Update 10/28/2021: Hinge Health has raised $400 million in Series E funding at a $6.2 billion valuation to be funneled into technology and product development. This brings the company’s total funding to $1 billion to date.

In-Home Healthcare

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For an example of just how broadly the term “telehealth” can be applied there is Denver, Colorado-based DispatchHealth. The company has raised $417 million, including a $200 million Series D in March, less than a year after hauling in a $135.8 million Series C. The company now carries a valuation of $1.7 billion for what is essentially a mobile urgent care service. (Just because your startup uses an app that doesn’t make it a technology company, btw.) One of the key investors in DispatchHealth is the third largest healthcare insurance company in the United States, Humana. The two teamed up earlier this year to provide in-home healthcare to Humana’s insured members, starting in Denver and Tacoma, Washington.

Since launching in 2013, DispatchHealth has delivered care to more than 220,000 patients in the home and claims to have saved more than $227 million in medical costs. The company claims that it is on pace to expand to 100 markets and reach $2 billion in savings by 2023 after its big Series D. It spent some of that cash by acquiring Professional Portable X-Ray, a mobile imaging provider, last month. The ability to offer clinical-level care in the home is certainly becoming more feasible as medical devices like handheld ultrasounds become more widely available and used.

AI Healthcare Chatbot

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We’re already familiar with New Yawk startup K Health after our recent article on nine leading telehealth startups, so we’ll keep this one short. Founded in 2016, the company has raised a total of $271 million after a $132 million Series E in January that raised its valuation to $1.5 billion. Rather than consult Dr. Google, users can use the K Health AI-powered app to diagnose problems. The app is free, and it only costs $19 to talk to a real doctor or $9 for a monthly plan. In one of the company’s latest moves, it partnered with low-cost wireless carrier Boost Mobile, which will offer free telehealth services through K Health to its highest-tiered customers.

Big Data

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Another company stretching the definition of telehealth is Innovaccer. Founded in 2014, the San Francisco-based startup has raised about $229 million for a valuation of $1.3 billion. Its $105 million Series D was led by Tiger Global Management, a 20-year-old private equity investment firm that has raised more than $23 billion across eight funds over the last 10 years. The firm also led both Series D rounds for both Hinge Health and DispatchHealth, so the guys and gals at Tiger Global are certainly bullish on the telehealth and virtual care theme. 

And so what exactly does the company do? “Innovaccer connects healthcare data across a myriad of systems and settings, delivering unified patient records and actionable insights that result in better patient outcomes and lower costs.” In other words, the company’s Data Activation Platform breaks down data silos, enabling doctors to see the big picture for each patient. Algorithms are baked into the solution to provide insights and predict potential health problems. It sounds similar to what other AI healthcare startups are doing to optimize hospital operations. For example, in one case study, a sprawling healthcare network of more than 3,600 providers was looking for ways to create a holistic system to manage 200,000 patients across 36 hospitals and 15 different payer contracts. Long story short: Innovaccer accomplished the following:

The company recently launched what it calls Innovaccer Health Cloud, which combines its existing platform and applications with new digital tools to further simplify patient care and save its customers more money.


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Perhaps no other area of healthcare is more adaptable to the telehealth model than psychiatry and mental well-being. After all, you don’t need a Fitbit to talk about your mommy issues. Last month, we wrote about a new mental telehealth stock and a couple of well-funded meditation apps. And while we’ve covered a bunch of telepsychiatry startups in the past, we just discovered San Francisco-based Modern Health. Founded in 2017, the company has raised about $167 million, most of it coming in a quick series of rounds over the last 18 months. The last was a $74 million Series D in February, just a couple of months after a $51 million Series C in December. Some of the deep-pocketed venture capital firms behind the company include Kleiner Perkins and Founders Fund.

Mental health funding
Credit: Crunchbase

The company employs a B2B model so that employers can offer mental telehealth services to their employees. Users download the app and complete a quick assessment. Modern Health crunches the data and creates a personalized program, which can be a mishmash of therapy, life coaching, and even meditation. The company claims its digital mental health platform is effective, citing one study that demonstrated 47% of members beginning with depression-related symptoms experienced clinical improvements.

Telehealth Research

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Imagine convincing millions of people to download your app and then hand over their personal data to you for fun and profit? While that’s the unstated business model of many software companies, Evidation out of Silicon Valley is more upfront about the health data it reaps from the millions of people who download its Achievement app. Founded in 2012, the startup has raised $259 million, including a $153 million Series E in March led by healthcare provider and insurer Kaiser Permanente. The company is now valued at $1 billion.

Evidation Achievement platform.
Credit: Evidation

On one side, Evidation offers a consumer-facing app that connects to about 20 different wearables such as Apple Watch and Fitbit, or fitness- and food-tracking platforms. Users get points by completing various fitness goals or answering questions about themselves. For every 1,000 points generated, guinea pigs users get $10. On the flip side are pharmaceutical and biotech companies, universities, and even big tech companies that are interested in the data for controlling all human behavior research and health programs. Evidation claims it has conducted more than 100 real-world studies across various therapeutic areas, from heart health to constipation and everything stuck in between.


Investors long a telehealth stock like Teladoc should be encouraged by the rapid digitization of healthcare – and acutely aware of the competition. The company’s first-quarter revenue in 2021 was up 151% from a year ago to $453.7 million, while net losses also jumped significantly, from about $30 million to $200 million. However, most of those losses were associated with the Livongo Health merger, so while the company will continue to bleed cash throughout 2021, we expect the rest of the year to be a little less bloody. Investors in the telehealth theme should be prepared for new publicly traded entrants, with companies like Hinge Health reportedly eyeing an IPO in the next couple of years.


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