Telehealth startup Wheel has raised a $150 million series C round, the largest funding for an Austin company so far this year.
The company has now raised $216 million since launching in 2018, with the latest injection cementing its place among the buzziest startups operating in the Texas capital. Wheel has created a virtual health care marketplace, connecting patients with companies and clinicians across the care spectrum. Services facilitated by Wheel include telehealth, lab testing and remote patient monitoring — using smart devices to help a diabetic patient virtually calibrate an insulin sensor, for example.
Wheel, which operates legally as Wheel Health Inc., saw exponential user growth in the back half of 2021. The company helped facilitate 1.3 million patient visits in 2021 and expects to triple that figure in 2022.
In the fourth quarter of 2021, Wheel saw "two times the amount of patients than we did in all of 2020," said Michelle Davey, Wheel's co-founder and CEO. The company has also roughly doubled the size of its client portfolio, and is now "serving some of the largest enterprises in health care today," she added. The company is seeing existing customers expand their relationship with Wheel — Davey said the startup's top accounts grew by 350% over the past year.
The user growth is also driving employee growth at the company, which had just 15 employees when it announced a $13.9 million series A round in January 2020. It is now up to around 200 employees, Davey said. The hybrid-remote company expects to double its headcount in 2022, though Davey said it was not clear how many of those new hires will be based out of Austin. Wheel is current hiring for dozens of roles, according to its jobs page.
The series C raise is a testament to how far Wheel has come since 2018. The company initially faced headwinds when attempting to convince investors that "virtual care was going to happen," Davey said. The Covid-19 pandemic drastically increased demand for telehealth services, shining a light on the kind of virtual care infrastructure Wheel was proposing.
"In this round, in particular, we weren't having to solve those same issues of convincing the world that virtual first care was needed — and that the infrastructure and the entire workforce that powers it needed to be there," Davey said.
The startup's latest funding round was co-led by Tiger Global and Lightspeed Venture Partners; the former is a new investor, while the latter led Wheel's $50 million series B in May 2021. Joining the series C were new investors Coatue and Salesforce Ventures, plus previous investors CRV, Tusk Venture Partners and Silverton Partners. The company declined to provide an updated valuation after the $150 million round.
The $150 million round begs questions about a potential exit. Davey said Wheel is "just continuing to focus on what's right in front of us" by continuing to innovate and build.
"What I'm focused on is, 'How do we enable this next transition of virtual care?' We're so much in the very beginning of this, and so we're really kind of at the forefront of that innovation," she said.
While the Great Resignation has left many companies scrambling to keep employees in the fold, the labor trend has proved beneficial for Wheel, which offers clinicians and other health care workers an avenue to work virtually during the pandemic. Wheel's clinician network grew more than 60% in 2021, and the startup retained more than 90% of the clinicians who were already operating on its marketplace.
Wheel has 21,000 square feet of office space at 2330 S. Lamar Blvd., which serves as a hub for the whole company. HPI Real Estate Services & Investments was the company's broker.
Other major venture capital deals announced so far this year include Atmosphere raising $100 million in equity and debt financing and Tecovas bringing in $56 million.
Get ABJ's latest list of local venture capital firms here, and see the list of angel investors here. A list of local startup incubators can be found here.
