Two South Florida early-stage companies — Modernizing Medicine and HealthCare.com — announced Tuesday they have attracted significant funding for their ventures.
Modernizing Medicine, the Boca Raton-based creator of the Electronic Medical Assistant, a cloud-based, specialty-specific electronic medical record system, announced Tuesday that it has closed on $15 million of an expected $20 million funding round. The latest funding comes from existing investors, led by Summit Partners and Pentland Group, many of whom are medical specialists who use EMA.
HealthCare.com, a Miami-based private online marketplace for insurance, announced it closed a Series A funding round of $7.5 million, led by Jeffrey H. Boyd, current chairman and former CEO of Priceline Group, and Robert J. Mylod, Priceline’s former vice chairman and CFO. Boyd will be joining HealthCare.com’s board.
Tuesday’s releases follow two other significant investments, putting South Florida on track for record year. Last month, Miami-based Technisys, a digital banking technology firm, announced it had raised $13 million, while Magic Leap, a stealth company in Dania Beach working on “cinematic reality,” said it had raised $542 million — one of the largest deals ever for an pre-revenue company and certainly the largest deal in Florida.
To be sure, the massive Magic Leap investment will catapult Florida into record territory for venture investment for the fourth quarter and year, but even without it, South Florida startups have drawn more funding this year than in the recent past. Sancilio, a South Florida biotech company, raised $20 million in the third quarter; Tyrogenix, another biotech company, raised $15 million in the second quarter. A number of startups, including SportsManias, Everypost, 71Lbs and AdMobilize, have received seed or Series A funding.
While the area has been able to point to fund-raising successes in recent years such as Open English, which raised more than $120 million, and CareCloud, which raised more than $55 million, this year’s activity is a sign that long-missing venture capital is finally being drawn to the region. Such investment is a key component to the region’s burgeoning technology and entrepreneurial ecosystem.
In another key development, Scout Ventures, a venture fund that invests in early-stage tech companies, announced recently it is locating an office in Miami, its first outside its New York City base. Other new funds and networks include Krillion Ventures, Thesis Ventures, the revamped AGP angel group and Keiretsu Forum. Supported by the Knight Foundation, new investor education programs are also being produced, including a series by AGP.
“South Florida has all of the ingredients you need to create and grow a successful technology business,” said Daniel Cane, co-founder and CEO of Modernizing Medicine.
Cane said the company will use its funding to “continue to do what we do — increase efficiency for doctors, improve patient outcomes and transform healthcare.” More than 4,000 providers spanning eight medical specialties, have adopted Modernizing Medicine’s EMA in their practices.
The fast-growing Modernizing Medicine, which generated $17.3 million in revenue last year and hired its 200th employee this fall, will also create at least 100 jobs in the next 12 to 18 months, said Cane, who previously co-founded Blackboard. And with the $15 million of this round already closed, that brings total VC funding to date to about $50 million for the company, founded in 2010.
Modernizing Medicine also was recently in the news as it was chosen one of the first handful of companies to partner with IBM's Watson, bringing Watson’s cognitive abilities to healthcare.
Modernizing Medicine is developing a Watson-powered app called schEMA — part of IBM’s $1 billion project to bring Watson to the masses.
HealthCare.com likes to describe itself as the “Kayak of healthcare,” so it’s signficant when the fund-raising round is led by key leaders of that brand, said Jose Vargas, co-founder of HealthCare.com and People Fund, which also partcipated in the fund-raising round. Priceline Group owns Priceline.com, Kayak, OpenTable and other consumer Internet brands.
The financing will be used to continue to expand HealthCare.com’s product offerings into other healthcare services, advance the technology and expand the team, said Vargas.
The funding announcement comes as the U.S. government’s Healthcare.gov begins its second year of enrolling patients under Obamacare. Vargas said HealthCare.com’s healthcare insurance comparison tool, released this fall, allows people to compare 75,000 state and federal exchange plans as well as off-exchange plans (though it will not include subsidies available through Healthcare.gov). “Going forward, we are going to be adding other comparison features into other products such as Medicare and dental insurance,” Vargas said.
HealthCare.com, founded in 2006, is a team of 45 people spread between Miami, Guatemala City, New York and Minneapolis.
Follow Nancy Dahlberg on Twitter @ndahlberg.