Rock Health News11/3/14

Onward and upward: Big news at Rock Health

Malay Gandhi

Today, we’re excited to announce that we have raised our third and largest seed fund. Funding was led by Bessemer Venture Partners and Kaiser Permanente Ventures, with participation from KPCB, Montreux Equity Partners, and Great Oaks Ventures.

Our core mission is unchanged—we support and fund the entrepreneurs who are working tirelessly to transform healthcare—and this new fund is part of that mission. Seed funding is a service for entrepreneurs, sitting alongside hands-on support from our team, deep access to a network of industry leaders, and membership in a burgeoning community of digital health entrepreneurs. With this fund, we set out to make the seed funding component of our full-service model even better, with two broad goals: (1) To make it easier for our companies to raise money now, in completing their seed round and (2) to make it easier in the future, on their next round.

On (1), effective immediately, we are significantly increasing our investment to up to $250,000 per company. With our confidence comes a belief that we should be putting more money into each company, and we know that increasing our check size (and selectivity) will be a stronger signal to seed co-investors. On (2), the lead investors in this fund represent the most active venture firms in digital health, with category-leading portfolios and a full commitment to investing in companies over the next decade. Every single one of the investors involved in our third fund shares our mission to make a massive impact in healthcare, and is committed to finding the companies that will deeply transform the industry.

Our portfolio is the result of screening thousands upon thousands of deals. We’re incredibly privileged to work with the brightest entrepreneurs in the space—representing companies that have collectively raised over $200M in just under three short years—and we are thrilled to continue that work with our third fund. We expect to review another thousand or more companies this year and in those that follow, while increasing our selectivity to around 1-2% from a historical 2-3% average.

Even with that type of selectivity we expect that our new fund will allow us to continue to be the most active seed investor in digital health, co-investing alongside leading firms and adding value to companies through our unparalleled services. While Rock Health headquarters are in San Francisco, our support and reach extends across the country—thirty percent of our portfolio companies are based outside the Bay Area, including Aptible in New York City, Wellframe, Reify Health, Neumitra, and Podimetrics in Boston, and Kit Check in our nation’s capital. With Rock Health founder and Managing Director Halle Tecco based in New York, in addition to Kaiser Permanente’s national footprint and Bessemer’s strong presence on the East Coast, Rock Health is fully committed to funding the best digital health companies from across the country. We hope you’ll join us and build something useful.