by Jocelyn Kinsey, Principal, DFJ Growth
At DFJ Growth, we’ve been on the lookout for a comprehensive technology solution that can provide self-insured employers with improved visibility into their healthcare spend and a more efficient approach to managing the experience of employee participants. Collective Health is addressing both of these critical needs, and we are thrilled to announce our investment and partnership with Founders Ali Diab and Rajaie Batniji, and the entire Collective Health team as part of their Series E financing. This $205 million round includes a host of investors who all share the same “collective” vision, including SoftBank Vision Fund, Founders Fund, GV, NEA, PSP Investments, Sun Life, and others.
DIGITAL TRANSFORMATION IN HEALTHCARE
Over the last decade, we’ve seen many industries undergo a digital transformation that has improved productivity and efficiency. We’re now seeing this happen in healthcare. It started with the mandated adoption of electronic health records, which DFJ observed firsthand through Athenahealth. Since then, there’s been an increasing amount of data generated, creating opportunities to infuse sophisticated analytics and apply machine learning throughout healthcare.
Consumers have begun taking control of their own personal wellness, empowered to use technologies that help them learn about and manage their health, through personal genomics companies like Helix and wearables like the Apple Watch.
It is natural that employers need to respond by modernizing their approach to offer competitive, connected healthcare insurance programs that give employee participants more direct management of their healthcare.
PARTICIPATING IN THE MASSIVE EMPLOYER HEALTH INSURANCE INDUSTRY
Serial entrepreneur Ali Diab and physician / health economist Rajaie Batniji founded Collective Health with the mission to make it effortless to understand, navigate, and pay for care. To get the broadest reach, they decided to go after the employer health insurance market, which covers 155 million people and represents $1.2 trillion of annual healthcare spend in the US. This market has proven interesting, as an increasing percentage of midsize and larger enterprises shift to a self-funded insurance model and are faced with carrying the burden of increasing healthcare costs. These self-insured employers are positively incentivized to improve employee health and align with Collective Health’s mission.
A UNIFIED PLATFORM FOR MANAGING HEALTH INSURANCE
Collective Health is tackling a huge problem for employers and their employees. Today, employers deal with numerous disparate, error-prone, antiquated systems to administer and manage their health plans. Data is siloed, making it challenging for employers to assess gaps in care and performance of their health investment for their workforce. Benefits are fragmented for employees, leading to low utilization and understanding of care options.
Collective Health’s integrated and connected solution uses modern technology to tie everything together. They’ve digitized the full stack, building a robust product that combines claims processing, healthcare planning, data management, and patient advocacy.
Both employers and employees benefit from a single, intuitive system to access and navigate their health benefit plans and provider choices, resulting in higher engagement and reduced costs.
RAVE REVIEWS FROM EMPLOYERS AND EMPLOYEES
As we continued to hear glowing reviews from customers about their experience using Collective Health, we were increasingly convinced that we wanted to be part of its journey. Employees love the digital experience offered by Collective Health and how easy it is to understand and manage their own care. Employers enjoy streamlined operations and gaining control over their ever-increasing healthcare costs. All of these benefits have attracted blue chip customers like Pinterest, Red Bull, Uber, and Zendesk with more than 200,000 employee members and a slew of app providers to Collective Health’s open ecosystem.
DFJ Growth is thrilled to team up with Collective Health on this next phase of growth as they make healthcare dramatically more transparent, cost-effective, and accessible.