Taking the temperature on digital health investments in Europe, as Push Doctor announce their £20m funding round

We are delighted to announce that our portfolio company Push Doctor has raised a £20m Series B funding round, led by new investor Accelerated Digital Ventures, Draper Esprit, Oxford Capital and Seventure. We first invested in Push Doctor in late 2015, and we’re thrilled to continue supporting the company.

Push Doctor is the latest of a number European digital health companies to have closed a significant fundraising round. The map below features companies that are tackling the challenges of primary healthcare provision, all of which have raised at least €15m/£13m to support their growth.

Some of these companies are using technology to facilitate connections between patients and doctors. Others are claiming to augment or replace healthcare with technology (e.g. Babylon Health’s “AI” diagnosis platform). What they have in common is that they are using technology to rethink access to primary healthcare, and in doing so have attracted significant attention from investors. This hints at strong underlying growth and a large perceived market opportunity.

Why is there an opportunity in European consumer digital health?

Consumers are poorly served by many of today’s healthcare incumbents in Europe, which are set up to provide reactive care. In other words, services are only access when an individual presents a diagnosable illness, and each health episode is treated as a discrete event. Healthcare systems have been slow to adopt a patient-centric view of healthcare, and are not configured to provide preventative care to patients (i.e. caring for healthy patients to prevent them from ever developing an illness) which is widely understood to be more cost effective and to lead to better outcomes.
In addition to providing antiquated models of care, accessing incumbent healthcare systems can be an inefficient process. For instance, average wait times to see an NHS GP are now 13 days (according to a Pulse survey), with the worst inefficiencies concentrated in certain geographic areas.

Digital solutions can help to solve this problem by aggregating larger volumes of supply and demand and enabling care to be provided remotely.
Consumer adoption of wearables and the adoption of digital and connected devices by the healthcare industry has led to an explosion of health data. Digitally brokered access to primary care allows patients to harness this data, interpret it effectively and use it to inform their care in the long term. Adopting digital solutions and using large volumes of data is the best chance we have of disentangling the complex web of causes and effects that constitutes a patient’s health, and to enable long term, preventative care, all ultimately leading to better patient outcomes.

…and why Push Doctor?

When we first invested in Push Doctor in 2015, it was one of several UK early stage digital health companies, none of which had significant traction. However we were impressed by the ambition and focus of the founders, Eren Ozagir and Matt Elcock. While still very early stage, they had the best product in the market (in terms of reliability and speed to accessing a doctor) and extremely high customer satisfaction scores to match. We also agreed with their vision for how best to tackle the emerging digital health opportunity: by using technology to facilitate (rather than replace) doctor-patient interaction, and by going direct to consumer (rather than via third parties like employers or insurers).

With venture investments, we believe people and products win in the short to medium term, and markets win in the long term. We believe in the digital health market opportunity for the reasons outlined above. We remain impressed with what Eren and Matt have built, and are grateful to join them on their journey. Despite the challenges of building a business in a heavily-regulated market, they have achieved rapid growth. Push Doctor is now Europe’s largest digital health service by consultation volume. It has a strong consumer brand focused on wellness and lifestyle, and it is using technology to deliver a high-quality customer experience, rather than as an end in itself. Push Doctor’s marketplace model and focus on speed of access to care (most patients can see a doctor within six minutes) is empowering patients to take control of their healthcare.

This manifests itself most prominently in the 19 lives Push Doctor has been able to save with timely intervention and medical advice. We have been investing in healthcare since 1999, but no company we have been involved with has had such an immediate, appreciable and commendable impact on people’s lives as Push Doctor. We look forward to working with the Push Doctor team as they continue to deliver on the promise of digital health for the industry in UK and Europe.

Estimated reading time: 2 min

 

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

  1. You could lose all the money you invest
    1. If the business you invest in fails, you are likely to lose 100% of the money you invested. Most start-up businesses fail.
  2. You are unlikely to be protected if something goes wrong
    1. Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here.
    2. Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm, FOS may be able to consider it. Learn more about FOS protection here.
  3. You won’t get your money back quickly
    1. Even if the business you invest in is successful, it may take several years to get your money back. You are unlikely to be able to sell your investment early.
    2. The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.
    3. If you are investing in a start-up business, you should not expect to get your money back through dividends. Start-up businesses rarely pay these.
  4. Don’t put all your eggs in one basket
    1. Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.
    2. A good rule of thumb is not to invest more than 10% of your money in high-risk investments. https://www.fca.org.uk/investsmart/5-questions-ask-you-invest
  5. The value of your investment can be reduced
    1. The percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.
    2. These new shares could have additional rights that your shares don’t have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.

 

If you are interested in learning more about how to protect yourself, visit the FCA’s website here.