Congratulations to iF client, Medstack for their recent announcement of a successful seed round.
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MedStack, a Toronto-based compliance solution for healthcare apps, has raised a $2.4 million oversubscribed seed round led by Telus Ventures, with participation from ScaleUP Ventures and Panache Ventures.
Existing investor Ontario Centres of Excellence and several previous angel investors also participated in the round. Telus Ventures and ScaleUP are joining the company’s board with this round of investment.
“Entrepreneurs bringing apps to healthcare are doing important work in technology, often inspired by their own personal experiences to make health management and care delivery smarter and better,” said MedStack CEO Balaji Gopalan. “For too long, developers have struggled because of the challenges of onboarding to the industry’s stringent requirements and proving compliance over time, while maintaining technological creative freedom. We’ve solved that.”
MedStack aims to enable the adoption of digital innovation in healthcare, by allowing entrepreneurs to build healthcare applications, which can be difficult to navigate since hospitals have complex onboarding processes. The company’s focus is to help developers meet privacy compliance requirements through automation. Those systems standardize data protection elements for Canadian, US, European and Asian health data privacy legislation across public cloud vendors and technology stacks, to generate security policies and compliance monitoring.
Some of the companies MedStack has assisted include Maple, a SaaS company that allows people to access a doctor 24/7 by text or video, and CareTeam, a healthcare-grade team collaboration platform. In May 2018, MedStack announced a self-service active compliance system for healthcare app companies, that would bring infrastructure security, privacy training, and administrative policies into an integrated platform.
Telus itself has recently been focused on the healthcare scene. One of Telus Ventures’ main focus areas for investments is healthtech and Telus also acquired Telus Health, formerly known as Emergis, in 2007. Similarly to MedStack, Telus Health has built a platform of solutions for various players in the healthcare industry. Gopalan said the foundation of the partnership with Telus was a mutual understanding that the future of digital healthcare will involve engaging a network of health care providers in a centralized way, in order to bring innovations to market.
“[Telus’s] understanding aligns to what we concluded, which is the future of health care requires a central data system that supports a network of applications that can make health care work better,” said Gopalan. “We realized we can operationalize better by enabling more entrepreneurs to realize the opportunity in healthcare. Telus feels the same way.”
MedStack founders, Gopalan and CTO Simon Woodside, created this solution with the input of other digital health startups through programs including Dreamit Health, the Creative Destruction Lab and 500 Startups. Over 50 companies now run their apps integrated with MedStack’s healthcare compliance platform.
“We are uniquely positioned as a corporate venture capital fund to invest in companies like MedStack that are helping to empower health start-ups to succeed and scale,” said Rich Osborn, managing partner of Telus Ventures. “Our investment goes beyond capital as we leverage our breadth of expertise to support companies in their growth trajectory building networks within the health and developer communities and uncovering new opportunities with other emerging businesses.”
Gopalan said the funds from this raise will be used for channel development for the recently-launched MedStack Control, a system that brings infrastructure control and more flexibility for client companies. The funding will also be used to expand the engineering, sales and support teams, and be put towards earning additional third-party security certifications. MedStack’s current team of 10 is also projected to expand with the new funding its product and technology teams.
This story has been updated to reflect that MedStack also works with global health data privacy legislation, in Canada, US, Europe and Asia.
