By: Timothy Hay | January 27, 2014 (Featured on Dow Jones)
Doctors use some of the most sophisticated machines the world has ever produced when it comes to saving lives, from magnetic resonance imaging machines to laser-based surgical tools to implantable gadgets with microchips built in. But they use pagers and fax machines when they communicate with one another, as e-mailing and texting have been deemed too risky when it comes to sensitive information about patients.
A number of startups are trying to bring doctors and nurses into the modern age of mobile communications, which means promising a secure network that can deliver clinical information to smartphones and tablets.
One such company, Santa Monica, Calif.-based TigerText Inc ., has raised a $21 million Series B round to broaden its list of customers and add features to its program that will make it more of a one-stop-shop for medical professionals, the company said.
The company offers an application for iOS and Android devices that are meant to be downloaded by hospital administrators, Chief Executive Brad Brooks said. The administrator, who pays TigerText a subscription fee, then asks hospital staff to join the network.
The network–which also includes nurses and other staff–is a secure communications channel that lets health-care workers text-message one another during the workday.
The Series B was provided by new investor Shasta Ventures, joined by newcomers OrbiMed Advisors, Reed Elsevier Ventures and Telus Ventures, Mr. Brooks said. Existing investors Easton Capital, New Leaf Ventures and New Science Ventures joined in the funding, he added.
The company previously raised $12.5 million in various funding events, Mr. Brooks said. The valuation was not disclosed.
Sean Flynn, a partner with lead investor Shasta Ventures, said that TigerText has “Found the recipe for customer acquisition, and the cost of acquiring new customers and is ready to throw fuel on the fire.”
“There can be a leader in this space, and TigerText is making a play to become the dominant player,” Mr. Flynn said.
The company’s app-based system–which does not require a hardware installation–is in use in 3,000 facilities today, the CEO said.
Helping doctors communicate in a more modern fashion is a hot area of health-related information technology, and TigerText will face rivals that range from established telecom providers to startups with software-based systems.
One particularly fierce rival will likely be secure-communications provider Doximity Inc., a startup with more than $27 million in backing from Morgenthaler, Emergence Capital, and InterWest Partners. The company calls itself a “vertical social network” for doctors, and recently announced it has more than 250,000 active users.
TigerText will differentiate by having a network that is also open to nurses and medical assistants, meaning it can be more useful for matters of daily workflow, the CEO said.
Quantia Inc., a startup offering a cloud-based system that lets doctors securely communicate with other players involved in health-care delivery–like insurance companies and pharmacies–is backed by Safeguard Scientifics and Fuse Capital.
Telus Ventures, which is a new investor in TigerText and is the investment division of Canadian telecom Telus Corp., previously invested in Get Real Health Inc., another startup offering a communications network for doctors, information from the firm said.