Linkwell Health today announced that it has raised $11 million in series C financing for its consumer engagement platform. Founded in 2007, Linkwell partners with health plans, consumer brands that want to be health conscious, grocery chains and drugstores to offer everyday consumers discounts, coupons and content to help them make healthier choices.
The round was led by WellPoint, one of the largest health benefits and managed care plan providers in the country. Linkwell’s existing investors, Spark Capital and HLM Venture Partners, also contributed to the raise, bringing total funding raised to date to $20 million.
When one considers the pervasiveness of obesity and diabetes in the U.S., it’s easy to see that there’s a problem. These health issues are some of the biggest contributors to the enormous healthcare costs in the U.S. today. Diabetes alone has a price tag of about $200 billion. Improving our overall health and wellness is difficult and can be costly (it’s something that Americans spend billions on every year), and people tend to let price, whether it be for food or exercise programs, dictate their healthy choices.
Like Rock Health startup, Zipongo, Linkwell wants to make it easier for Americans to make smarter purchasing decisions by giving them access to coupons and affordable health products via partnerships with big-name brands and over 22 insurance providers. In turn, the company provides its partners with marketing opportunities, connecting them with millions of consumers by way of email, their own mobile apps, direct mailings, websites and so on.
With its new funding in tow, Linkwell plans to expand its partnerships with providers and consumer brands, increase the reach of its platform and develop the diversification that will allow it to offer a cross-platform experience to its users. Health plans are already well-represented among the company’s partners, with Humana, Health Net and WellPoint already on board, but it still has a long way to go. Overall, people are frustrated and annoyed by health insurance providers, who have long been the bad guys of the industry. Models are changing, however, becoming more personalized and patient-centric, and insurance providers are trying to keep up. As a result, they’re eager to find better ways to connect with their customers.
Another coupon distribution service may not necessarily seem like the ticket into the heart of the consumer, but there’s no denying the growth of the digital couponing industry over the last few years. While no one likes to think of themselves as a coupon clipper, there’s no doubt discounts help reduce the friction around eating and living healthier. There are a lot of people who want to choose the “natural” or “organic” product in their grocery store but don’t because it’s that much more expensive. It also helps that Linkwell ties these healthy products and coupons into family and company health plans, taking some of the abrasiveness out of it by integrating the two.
Linkwell’s raise is also indicative of a larger trend in the digital health market, which, by the way, is booming. [See our recent coverage of Rock Health's year-end report.] Of the four big themes Rock Health identified in digital health financing in 2012, consumer engagement was the clear leader, with startups in this space raising over $237 million. Clearly, for those health investors who are active in this climate, helping consumers with healthcare-related purchases is top of mind and represents a big market opportunity going forward.
Linkwell has already succeeded in what can be the most difficult aspect of building a company in this space — creating a wide, multi-channel (and multi-player) distribution network. The other side, of course, is quality content and providing consumers with products and discounts on products that really matter to them. In the end, 20 percent off of organic chicken fingers can help chip away at the friction around making healthy decisions, but it’s just one piece of the health pie — So to speak.
For more, Linkwell at home here, intro video below: