With the pandemic accelerating the adoption of remote health care technology, a local startup has landed new funding to better serve health care systems big and small.
VitalTech, a Plano-based integrated digital health platform, has raised $3 million from Tech Mahindra, an India-based IT and business outsourcing services company with its U.S. headquarters in Plano, in exchange for about a 6 percent stake in the company.
“We absolutely want to be one of the leaders in digital health providing a virtual care platform to all the health systems large and small, to really enable the delivery of virtual health care to patients across the entire care continuum — wherever they need to be served,” Ernie Lanace, executive VP of sales and marketing at VitalTech, told NTX Inno. “I think if we do that, we’ll have satisfied our mission, which is to really better society and to help people across the entire spectrum of their wellbeing.”
Tech Mahindra also has the option to purchase an additional 8 percent stake in VitalTech for another $5 million.
VitalTech was launched originally as a biosensor company. Its platform connects to those wearable sensors to provide real-time patient monitoring to improve health outcomes and patient care.
“We started VitalTech because of a sick family member that the coordination of care wasn’t done very well. The family never had enough information. It seemed like between different providers, they weren’t sharing information very well,” Lanace said. “Our goal is to make health care frictionless, make it much, much better for the patient… to get a lot better quality of care and let the health system have the tools to treat patients more like customers in other industries.”
Lanace said the deal came about after the company’s partnership with AT&T, which is a strategic partner to Tech Mahindra. In 2017, Tech Mahindra acquired a majority stake in Florida-based health care consulting company HCI Group for nearly $90 million, and plans to incorporate VitalTech's platform to HCI’s services.
With the new funding, VitalTech plans to expand its go-to-market capabilities, hiring new sales, marketing and customer support staff. The company currently has about 40 employees, up five from earlier this year, following VitalTech’s acquisition of Pittsburgh-based senior engagement platform Breezie.
The new staff will help the company accommodate the growth it has seen during the pandemic, as many health systems look for remote care options. VitalTech was launched at the end of 2018, seeing about $400,000 in revenue its first year. This year, the company is on track to have between $3 million-$4 million in revenue, Lanace said.
“COVID has disrupted our physician business because independent physicians have been impacted,” Lanace said. “That’s accelerated our hospital and health system business because obviously we’ve definitely shown the world the move to virtual care is needed and real.”
One of the reasons Lanace attributes to VitalTech’s growth is the platform’s ability to serve patients across the entire continuum of care, without needing other add-ons or upgrades. The company’s tech has recently been used by some to monitor COVID-19 patients.
Since its launch, VitalTech has raised about $13 million. In 2019, the company landed an $8 million Series A round led by Concord Health Partners and Stanley Ventures, the investment arm of Stanley Black & Decker. Then in March, the company received about $2.2 million from the Ziegler Link•Age Funds, which helped VitalTech expand into the COVID monitoring space.
“We’re hoping to change health care, and I think we're succeeding but we have a long way to go,” Lanace said.
