Orlando-based Azzly Inc. — whose software facilitates mental health and addiction treatment services in 30 states — is working to raise $3 million in investment capital, Orlando Inno learned from a July 8 U.S. Securities and Exchange Commission.
In addition, the firm plans to grow its geographic reach further by snagging more customers.
The company so far has raised about $1.1 million in an ongoing fundraising round that started last fallto boost its sales and marketing efforts and land more outpatient behavioral health care provider customers, founder and CEO Coletta Dorado told Orlando Inno.
Azzly enlisted the services of Brevard, North Carolina-based investment bank Carofin LLC to put together this fundraising round. Azzly so far has raised money from a network of high-net worth individuals as opposed to traditional venture capital firms, Dorado said.
The electronic medical records and patient care software firm, founded in 2009, continues to grow after the Covid-19 pandemic triggered a need for more mental health and addiction treatment services.
The company’s software makes it easier for patients and care providers to interact during treatment for addiction and mental health issues. The software allows for check-ins, scheduling treatment plans, medication management and more — all digitally.
Between April 2020 and July, Azzly hired nine employees and expanded its staff 41% to 31 people. The company plans to continue to hire full-time workers, as well as part-time interns from nearby universities, Dorado added.
Quarantining, remote work and stay-at-home orders caused by the Covid-19 pandemic have resulted in increased isolation for many people. In fact, 52% of behavioral health organizations saw an increase in demand for services in the first six months of the Covid-19 pandemic, according to a September report from the Washington, D.C.-based nonprofit National Council for Behavioral Health.
The health centers Azzly works with are growing as a result, Dorado said. ”All our existing customers have grown tremendously this past year.”
There has been a gap in the availability of digital services in behavioral health compared to other health care sectors, but that gap is closing quickly, said Mental Health Association of Central Florida CEO Marni Stahlman. Winning small and medium-sized practitioner customers, and making their services affordable for them, is key for Azzly since big companies increasingly are moving into the behavioral health services sector, Stahlman added.
Meanwhile, companies that serve the mental health space are popular among investors. Investments in these types of firms jumped 54% quarter-over-quarter to $852 million in the first quarter, according to market analysis firm CB Insights.
Of course, investment in mental health innovation was growing before this year, CB Insights reported. “Investor interest in mental health tech isn’t an entirely new phenomenon. It has steadily increased over the years, with 2020 marking a notable step up in funding. The space’s funding boom helped drive the digital health sector to an all-time high of $26.5 billion raised in 2020.”
Likewise, Carofin CEO Bruce Roberts told Orlando Inno that investors recognize the need for innovations that improve treatment in the behavioral health sector, which means there are plenty of investment dollars for companies in the industry to potentially tap. Azzly is in a particularly strong position for investment because its software has been in use long enough to prove its efficacy, Roberts said. "They crossed the threshold where there’s no guesswork about the functionality of the software."
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