Doximity, the largest professional network for the healthcare industry in the U.S., has received a new prescription for future growth with $54 million in fresh financing from investors including T. Rowe Price and the venture capital firm DFJ.
The new round is further validation for the thesis that professionals in different industries benefit from targeted social networks. In the past four months investors have committed significant dollars to Wattpad, the creative writing social network; SpiceWorks, the social networking platform for programmers and developers; and the social network for lawyers, Avvo. In all, these companies have raised roughly $200 million since January.
And San Francisco-based Doximity is already in the pole position when it comes to penetration in the U.S. healthcare industry. The network counts roughly one in three doctors as members on the network (that’s more members than the American Medical Association), and is continuing to roll out new services.
The addition of big financial backers like T. Rowe Price and funds and accounts managed by Morgan Stanley Investment Management, which also participated in Doximity’s latest financing, means that this is probably the company’s last round before its initial public offering.
Doximity’s executives are mum about timing for its future financing plans, but company chief executive Jeff Tangney says that the company’s latest financing will be spent on new products and services and expanding its network of healthcare professionals. “We’re moving from 40% to 70% [enrollment] and expanding internationally,” says Tangney.
The company already generates revenue through its recruitment service, and has also added an education and certification component to its offerings for the medical community in recent months. That continuing education component is done through a partnership with the Cleveland Clinic which began roughly nine months ago.
Physicians can expect to see more partnerships with institutions like hospitals and health centers coming from Doximity later in the year. The company is working with two hospitals on the West Coast to do pilot programs that will help the institutions manage referrals, and integrate those referrals with the transfer of electronic health recrods. “We’re making it easier to refer patients into their hospital so a doctor can send patient information into someone like a surgeon and have that surgeon reply back,” Tangney says.
The company also plans to offer more medical education offerings and a program that Tangney called a “TurboTax for credentialing”. Secure communications are also critical for the medical profession, and Doximity has plans to add to its suite of messaging tools as well.
“It reminds me of a joke,” Tangney says of the current state of communications tools for physicians. “‘Who has pagers? Doctors and drug dealers have pagers.’ But actually the drug dealers have moved on.”
In all, Doximity has raised $81 million for its services as it has evolved from a social network to a service provider for communications, continuing education, recruitment and referrals in the medical community. Previous investors in the company include Emergence Capital Partners, InterWest Partners, and Morgenthaler Ventures.
“Think of social networks as a new operating system,” says Konstantin Guericke, the co-founder of LinkedIn who joined Doximity’s board of directors in 2012. “We’re all social animals, so that’s the new level of the operating system.”
And like an operating system, Doximity’s proliferation has created opportunities for other medical applications. The company’s application program interface is used by companies like Figure 1, the medical image management service DICOMgrid and itMD, another image sharing application.
“We’re trying to bring medical communication into the 21st century,” Tangney says.