All is well at Amwell, literally. The company has closed a Series C financing, raising a whopping $194 million across two tranches.
The Boston-based telehealth company said it will use significant parts of the funds to expand its investment in technology and services that make it easy, convenient and effective for doctors and patients to connect securely at scale.
Amwell said many early investors and strategic partners participated in this round, including Allianz X and Takeda. The Series C fundraising was done in two tranches, the first of which was in March when Amwell raised $60 million in equity. In the second tranche, the company raised $134 million in equity.
COVID-19 inspires telehealth growth
As is the case with many telehealth companies, Amwell, formerly known as American Well, is benefitting from an uptick in users across its platform, thanks to the COVID-19 pandemic. The federal government has eased a number of telehealth regulations and this has been beneficial for Amwell.
In a statement, Amwell said that, as a result of these developments, it had recently facilitated as many as 45,000 telehealth visits per day across the Amwell Platform. In addition, the number of active providers, clinicians who have completed at least one visit in the past year, has risen significantly.
With the massive uptick in telehealth visits in the past few months, Amwell wants to use the funding from the latest fundraise to ensure that its platform is able to successfully accommodate the massive growth.
Ido Schoenberg, the Chief Executive Officer of Amwell said the “past two months had accelerated telehealth by more than two years. We intend to build upon this momentum to transform healthcare with digital care delivery.“
Schoenberg said health care was increasingly moving online and that this had inspired the timing of the latest fundraising.
“Currently the market is very kind to companies like us. We don’t know how long it will last, and it’s possible the window for any type of funding might not be available quite soon,” said Schoenberg.
Nazim Cetin, CEO of Allianz X, said that, having been an investor and partner to Amwell since early 2018, “Allianz is excited to see the company emerge as a digital healthcare leader in the U.S.”
Karl Hick, Chief Digital and Information Officer at Takeda said: “Takeda is investing in digital transformation across our business and building key technology partnerships. Patient journeys will be transformed through new settings of care as we emerge from COVID-19. Amwell has developed a highly scalable and agile technology platform that we believe can directly improve patient access and outcomes.”
Amwell, which was founded in 2006, said it powers telehealth solutions for over 240 health systems comprising 2,000 hospitals and 55 health plan partners with over 36,000 employers, reaching over 150 million lives.
Before this latest fund raise, the company had raised $517 million since it was founded.
The Business Insider website explained that what made Amwell’s Series C fundraising impressive was that it was way above the average funding round for digital health startups in 2019, which capped off at about $20 million.
Telehealth startups record impressive funding rounds
A number of telehealth startups have had impressive fundraising rounds in the past few months. Telehealth is probably the health industry’s biggest beneficiary of global lockdowns and social distancing protocols. It is projected that virtual health consultations are going to top 1 billion this year.
Recently, Medici raised $24 million in Series B financing. The company said it will use the money to accelerate its growth and the impact it has on its approach to patient care, especially now during the coronavirus outbreak but also in the future with its unknown protocols for best health practices.
The global telemedicine market is expected to grow to $130.5 billion by 2025, a massive increase from the estimated $38.3 billion valuation last year.
A study by Rock Health found that digital health startups began 2020 very strongly, raising a record $3.1 billion over 107 deals in the first quarter of the year.
You can read our ultimate guide to telemedicine here.