Investors are betting that telemedicine’s increased popularity during the coronavirus pandemic will continue after the outbreak is over.
The latest example is Thirty Madison, a startup that offers online health portals for treatment of hair loss, migraines, and acid reflux. It said on Thursday that it had raised $47 million from the venture capital arm of health product giant Johnson & Johnson along with investment firms Polaris Partners (which led the round), Maveron, and Northzone.
The investment marks a major investment in telemedicine by Johnson & Johnson’s venture capital arm. Stacy Feld, the Johnson & Johnson investment head of west North America, Australia, and New Zealand, said in an email that the investment into Thirty Madison “aligns to our overall strategy, which is to bring new health care products and solutions to the people who need them most.”
She added that the investment “reflects the broader trend of individuals seeking personalized, on-demand solutions for their chronic health care needs.” In addition, she said that “COVID-19 has accelerated certain changes in the way health care is delivered, for example, via telemedicine” and that she believes it’s not a fad.
Indeed, telehealth services are gaining a huge following during the coronavirus pandemic as both doctors and patients try to limit their exposure to the virus.
Companies offering telehealth services like Thirty Madison, founded in 2017, face a huge amount of competition from services like Teledoc, MDLive, and American Well. Many companies involved have much longer track records and deeper pockets.
Thirty Madison CEO Steven Gutentag said the startup is trying to differentiate itself from rivals by focusing on specific chronic disorders rather than offering more general services, like virtual doctor visits. Its service connects patients through portals for specific ailments with physicians, schedules virtual appointments, and orders their medications.
Amy Schulman, managing partner of Polaris Partners and a new Thirty Madison board member, said that online health services were already gaining momentum before COVID-19 because young adults are used to conducting much of their lives online.
“There’s a generation of people who will do things online that were unthinkable to my generation,” said Schulman, who once ran the consumer business for pharmaceutical giant Pfizer.
Thirty Madison makes money by selling medications and treatments through the site.
Gutentag acknowledged that patients could get their medications from elsewhere rather than his company’s health portals. But he said that one-stop for health care services makes its sites more appealing to use. He’s hoping that with many people trying online health care services for the first time because of the coronavirus, his startup’s services will stand out.
“We’ve been building toward this moment for the last three years and we’re in a position to capitalize on it,” said Gutentag.
He added that there are no current plans to license the startup’s technology so that others can create their own health portals. But he left the door open to doing so in the future.
Overall, Thirty Madison has raised a total of $70 million since its founding. It declined to comment about its valuation in its latest funding round.