The biggest US health insurer has a $600 million VC arm that places bets on the future of healthcare
- Optum Ventures is a $600 million venture fund associated with UnitedHealth Group.
- The fund launched in 2017 and has a focus on digital health, a spokesman confirmed to Insider.
- Here are the 18 biggest investments Optum Ventures has participated in over the last few years.
Like other industry giants, UnitedHealth Group wants to back startups that hope to turn the healthcare industry on its head.
To get in early, UnitedHealth created Optum Ventures, a corporate venture fund that operates as a separate entity from the biggest health insurer in the US. The $600 million fund was created in 2017 just as digital health startups were becoming hot investments across Silicon Valley's traditional venture-capital ecosystem.
In the first half of 2021 alone, Optum Ventures was the single most active corporate investor, according to a July CB Insights report. According to Pitchbook data, the fund regularly participates in multiple funding rounds for its portfolio companies, upping its stake with each successive round.
To date, Optum Ventures has participated in blockbuster funding rounds for at-home testing startup LetsGetChecked and at-home urgent care startup DispatchHealth, both of which have raised over $200 million according to Pitchbook data. An Optum spokesman in August 2020 declined to specify how much Optum Ventures contributed to each funding round but confirmed the firm's participation in the deals.
Several investors have told Insider that it's not a surprise to see so many incumbents battling it out for deals given the current environment: many insurers or hospital systems need to add tools such as telehealth or new ways to manage chronic diseases as the coronavirus-induced lockdowns continue to drag on. The easiest way to accomplish that goal, investors said, was to partner with a startup already specializing in those areas instead of attempting to create those services in-house.
UnitedHealth is a $390 billion healthcare company that operates a health insurer and a pharmacy-benefits manager, runs urgent-care clinics and surgery centers, and provides technology and consulting services to hospitals and other healthcare firms. Optum Ventures is overseen by Larry Renfro, who is also vice chairman of UnitedHealth.
Here are the top 18 deals Optum Ventures, UnitedHealthcare's $600 million venture fund, has participated in since it was created. The startups are listed by the size of the deals that Optum Ventures participated in, from smallest to largest.
This article was initially published in August 2020 and has been updated to include Optum Ventures' more recent investment activity in the first half of 2021.
Lumeon - $29.49 million
What it does: Boston and UK-based Lumeon is a digital health startup that tracks patient care through its software. The startup's tools can help different doctors coordinate treatment across different areas, such as primary care and urgent care offices.
Funding summary: Optum Ventures co-led Lumeon's most recent funding round, a $29.49 million Series D, together with Endeavour Vision on August 11. It had not previously invested in the company, according to Pitchbook data.
RubiconMD - $31.8 million
What it does: RubiconMD is a startup that allows physicians to virtually consult specialists through its software. According to the company, this helps lower the cost of care while improving access to specialists in high-need areas.
Funding summary: Optum Ventures co-led RubiconMD's $13.8 million Series B funding round with HLM Venture Partners in April 2018. It reinvested in the startup's $18 million Series C funding round in March 2020, according to Pitchbook data.
Digital Diagnostics - $33 million
What it does: Digital Diagnostics, formerly known as IDx, makes software to better identify and treat specific conditions using artificial intelligence. It started by focusing on diagnosing diabetes by scanning patients' retinas but recently entered the dermatology space by acquiring 3Derm Systems on August 21, 2020.
Funding summary: Optum Ventures invested in the Iowa-based startup in its first institutional funding round in September 2018. The startup raised $33 million in the Series A after relying on angel funding for several years, according to Pitchbook data. It is unclear if Optum Ventures also participated in its $12.5 million Series B on June 8.
Apervita - $39.06 million
What it does: Chicago-based Apervita makes software that allows insurers and doctors to quickly share information for reimbursements and clinical data. The health IT startup merged with Boston-based Qcentive, another health IT startup, in August 2019.
Funding summary: Apervita was another early investment for Optum Ventures. It participated in its September 2017 $16.5 million Series A with Graphene Ventures, Illinois Ventures, and Bootstrap Venture Partners. And Optum Ventures also participated in the following round, a $22.56 million deal, in October 2019, according to Pitchbook data.
AKASA - $60 million
What it does: Bay Area-based AKASA makes payments software for healthcare companies. The software uses predictive technology that analyzes historical payments data and uses that to reduce manual input data from hospital administrative staff.
Funding summary: Optum Ventures participated in AKASA's $60 million Series B round on March 23. Bond Capital led the round, which valued the company at $250 million, with participation from Andreessen Horowitz, Costanoa Ventures, and Refactor Capital, according to Pitchbook data.
Groups Recover Together - $60.2 million
What it does: Groups Recover Together treats patients experiencing opioid use disorder with a combination of medication and group therapy with the goal of creating a supportive community that also keeps patients accountable in recovery. It operates clinics in 12 states with the goal of expanding to 17 by the end of 2021.
Funding summary: Optum Ventures participated in the company's $60.2 million Series C round on May 21. Oak HC/FT led the round, which also included Kaiser Permanente Ventures, Transformation Capital Partners, RRE Ventures, and Bessemer Venture Partners, according to Pitchbook data.
Buoy Health - $64.2 million
What it does: Buoy Health created a virtual assistant that uses artificial intelligence to help doctors better triage patients quickly. People can use the software to diagnose themselves before heading to a doctor's office or urgent care clinic, which helps cut the cost of care by saving doctors time.
Funding summary: Optum Ventures first invested in Buoy Health in August 2017 through its $6.7 million Series A funding round, according to Pitchbook data. It also participated in the following round, a $20 million Series B, in October 2019, and again in its November Series C that clocked in at $37.5 million. Pitchbook estimates that Buoy Health is now valued at $191.5 million.
Vesta Healthcare - $65 million
What it does: Vesta Healthcare is a senior care company that builds software for clinicians and other care providers. The software enables care coordination among different groups of providers and shares information with insurance plans to help track costs.
Funding summary: Vesta Healthcare raised $65 million in funding on April 6 in a deal led by Deerfield Management. Optum Ventures participated in the round, which also included Kaiser Permanente Ventures, CareCentrix, Nationwide Ventures, Epstein partners, K2 HealthVentures, Generator Ventures, Lux Capital Management, and Oak HC/FT, according to Pitchbook data.
Brightline - $72 million
What it does: Palo Alto-based Brightline is a pediatrics behavioral health startup. Its app and website offer resources and education for behavioral health conditions for children, their parents, and other care providers or educators using telehealth. It also offers speech therapy for children.
Funding summary: Brightline raised $72 million in Series B venture funding and debt financing announced in June. GV, formerly known as Google Ventures, led the round that valued Brightline at $220 million, according to Pitchbook data. Optum Ventures participated in the round along with 7wire Ventures and Gaingels.
Truepill - $75 million
What it does: Truepill got its start as a digital pharmacy startup that delivers prescription medication directly to patients' homes. It partners with healthcare organizations directly, marking the biggest difference between the startup and Amazon-owned PillPack. It has since expanded into at-home testing and virtual care.
Funding summary: Optum Ventures participated in Truepill's Series B on December 17, 2019. According to Pitchbook data, the $25 million round did not include a lead investor but included Trusted Insight and Initialized Capital Management as additional participants.
In September, Truepill said it had raised an additional $75 million in a round led by Oak HC/FT, a round in which Optum participated. In total, Truepill has raised $114 million.
Somatus - $75 million
What it does: Somatus focuses on diagnosing and treating kidney disease. It works closely with doctors and insurers to catch chronic kidney disease early, which it says helps cut treatment and hospitalization costs in the long term.
Funding summary: Optum Ventures first participated in the startup's $11 million Series B in April 2018, putting the company's pre-money valuation at $50 million. The fund later co-led a $64 million Series C with Longitude Capital and Deerfield Management in June 2020 that boosted the startup's pre-money valuation to $180 million, according to Pitchbook.
Vim - $95.06 million
What it does: Vim is a San Francisco and Tel Aviv-based digital health startup whose software helps match doctors and other care providers with patients using algorithmic models.
Funding summary: Vim was one of Optum Ventures' first investments when the fund participated in its Series B in November 2016. In addition to that $11 million deal, Optum Ventures has also co-led a $24 million round with Premera Blue Cross in September 2019, according to Pitchbook data, and again in its most recent $60 million round in April.
Caresyntax - $100 million
What it does: Caresyntax develops algorithms and software applications for robotic-assisted surgeries. It uses techniques such as artificial intelligence and analytics to help automate decisions for the surgical team, which in turn helps the teams' management of risk-bearing contracts.
Funding summary: Optum Ventures participated in Caresyntax's $100 million Series C on April 28. PFM Health Sciences led the round, which also included Intel Capital, Lauxera Capital Partners, IPF Partners, Rezayat Investments, Surgical Intelligence, Vesalius Biocapital Partners, Harmonix Fund, Societe Financiere de l'Arno, and Relyens, according to Pitchbook data.
Kaia Health - $109.16 million
What it does: Kaia Health is a digital chronic-care-management startup that specializes in physical therapy for back pain and COPD. Its technology uses computer vision to automatically prompt adjustments for patients dialed in virtually.
Funding summary: According to Pitchbook data, Optum Ventures led an early-stage venture funding round in June 2019 for $8.16 million. It co-led the larger Series B roughly a year later with Idinvest Partners and Capital 300 for $26 million. On April 21, it invested yet again in Kaia's $75 million Series C round.
Unite Us - $150 million
What it does: Unite Us makes software that connects healthcare providers with social services. The software allows both groups to simultaneously track patients' health and monitor other changes to external conditions, like changing homes, that could impact their overall health.
Funding summary: Optum Ventures participated in Unite Us' $150 million Series C round on March 16. ICONIQ Capital led the round, which valued Unite Us above $1.6 billion,the company said.
Mindstrong Health - $159.35 million
What it does: Mindstrong is a mental health startup that provides on-demand care for patients experiencing severe mental illness. At the end of 2019, it hired several executives from top-tier tech companies to expand its product offerings, according to a TechCrunch report.
Funding summary: Back in February 2017, Optum Ventures joined the first round of outside financing for Mindstrong, a $14.35 million Series A. The fund again invested in its $45 million Series B in 2018, and in its May 2020 Series C for $100 million, according to Pitchbook data.
DispatchHealth - $168.8 million
What it does: DispatchHealth is an on-demand urgent care startup that sends certified care providers to patients' homes. The house-call model has benefited significantly from the coronavirus pandemic that has turned cautious Americans away from potentially dangerous waiting rooms, and the startup raised its most recent round after seeing increased growth.
Funding summary: Optum Ventures participated in the startup's $33 million Series B funding round in June 2019, and later co-led its Series C that closed in June 2020 for $135.8 million, according to Pitchbook data. In March, Dispatch raised $200 million in a round Optum Ventures didn't take part in. That round valued Dispatch at $1.7 billion.
LetsGetChecked - $269 million
What it does: LetsGetChecked is an at-home self-testing startup that lets its customers test for a range of conditions using a proprietary sample kit. The startup's founder, Peter Foley, started the company after developing testicular cancer when he was 16, which went undiagnosed for months.
Funding summary: Optum Ventures co-led LetsGetChecked's Series A in 2018 with Qiming Venture Partners. After participating in that $12 million round, Optum Ventures participated in the next three deals: a $30 million Series B in May 2019, $71 million Series C in May 2020, and its most recent $150 million Series D on May 28, according to Pitchbook data.
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