Telemedicine has been growing for some time and is only now reaching its full potential. While it is generally used for physical medical needs, Aligned Telehealth is bringing it to the psychiatry ward as well. The company that serves through both digital and physical means is HIPAA compliant and looking to serve as many underserved populations as possible. With constant growth from the telemedicine field we are excited to see the progress to come.
La TechWatch spoke with CEO Nitin Nanda, MD about their latest round of funding and the general trajectory of the company.
Who were your investors and how much did you raise?
SV Life Sciences was the investor and they provided $12M in Series A financing. We had some earlier seed angel investors that partially exited their position with this round of financing.
Tell us about your product or service.
We provide psychiatric services to hospitals, nursing homes and other healthcare institutions where patients stay to get care. Additionally, we provide services to healthcare clinics and correctional institutions.
What inspired you to start the company?
As a Psychiatrist I saw the need for telemedicine services in psychiatry because of rising demand from patients and barriers to access caused by lack of insurance coverage and a shortage of providers. The company actually grew out of my private medical practice.
How is it different?
At its heart our company is just a psychiatric physician group providing services primarily to institutionalized patients. Not that different at all from many practice groups out there. The big difference is that I have developed some very deep relationships with hospital and nursing home clients in So Cal so this allowed me to develop a telepsych service offering which takes into account the need for on premise versus remote solutions.
What market you are targeting and how big is it?
We are targeting the acute inpatient psychiatry market for our traditional physician services offering and the psychiatric telehealth market for emergency departments, inpatient management, medical clinics and correctional patients. The market for psychiatric healthcare services is approximately $25B, the market for telehealth services is just under $1B now and expected to grow to $6B in the next five years.
What’s your business model?
We are a hybrid model group, meaning that we offer both telehealth and non-telehealth services as part of our offering to clients. Our biggest segment are acute care hospitals and nursing homes so there are many times we need to cover patient bed units where we need to have a physician on the ground due to patient acuity and overall management needs. The telehealth services can be deployed as a stand-alone service or an extension of our ‘boots on the ground’ operation. This allows us to match the right type of service offering to each client.
Why is Telehealth specifically an important area?
The Affordable Care Act created more demand for healthcare services by increasing the size of the insured population, the number of net physicians entering practice has not been able to keep up with this demand, especially in under-served areas and lower income areas. The ability to connect patients to a physician remotely is needed to help get patients the access they need to better manage their underlying health conditions.
What was the funding process like?
The process involved a lot of education about our business model with potential investors and patience so they could see how our initiatives impacted our bottom line.
What are the biggest challenges that you faced while raising capital?
The biggest challenge was handling large new deals where we did not have the all of the capital on-hand required to fund the start of these deals. While it was great that we closed the deal we also had to be wary about extending ourselves too far during the diligence process.
What factors about your business led your investors to write the check?
Our investors, like many other private equity firms, had an interest in telehealth. SV Life Sciences was particularly interested in us because we were a successful psychiatry group practice in the region and one of the firm’s managing partners is a former physician executive that built a large behavioral health company and sold it to United Healthcare.
What are the milestones you plan to achieve in the next six months?
We would like to refine our business development strategy and get more physicians interested in coming to work for us – the two most important factors we need to grow our company.
What advice can you offer companies in Los Angeles that do not have a fresh injection of capital in the bank?
Evaluate what your exact capital needs are and then find investors that understand what you are trying to do, and that have an interest in your space. There are a lot of investors out there looking for places to put their capital so make sure you have a good story that is backed up with a solid potential for financial performance.
Where do you see the company going now over the near term?
In the near term we will be gearing up for expansion and will be spending money on our operational and development infrastructure. Our long term goal is to position ourselves to play a major role in population health management and expanding our service offering into different medical specialties.
Do you think LA will land the Olympics in 2024?
I think so – we have a great city with a lot of the infrastructure already in place and a track record of being able to do it.