Relay Network, a Philadelphia-based secure-messaging company, received an additional $12 million in investor funding, bringing its total funding up to $28 million.
This figure includes a new “strategic” investment by Independence Health Group, the parent company of Independence Blue Cross, one of 12 Blues plans that are clients of Relay Network. Other customers include Citizens Bank and Direct Energy.
Relay Network said it expects to double its revenue in 2016 — just as it did in 2015 — though it did not disclose figures.
In an interview, Matt Gillin, Relay Network CEO and co-founder, described the company as a “five-year start-up solving problems all businesses are having.”
Healthcare and financial businesses using telephone-based, paper-based or e-mail communications are falling short of customer expectations. Their customers are looking for reliable electronic tools that are mobile and provide information in an interactive format that is actionable and personalized.
“That”s where we win,” Gillin said.
Secure messaging via an electronic health record’s patient portal is suffering from low patient adoption.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
“It’s a broken model,” Gillin said. “It’s a bad experience, hence, nobody uses them.”
Patient portals were included in health IT meaningful use requirements, but research released last year by health IT vendor athenahealth found that only about 29% of patients use them.
Similar to LinkedIn and Facebook, customers of Relay Network clients are “invited” to connect. If they accept, an individual connection channel is established through which companies push out customized communication, Gillin said.
Through the individual channel, customers are verified with “one or two bits of data instead of five or six” making the experience far less cumbersome than customers typically experience, according to Gillin. He added that about 40% of Relay Network’s business is with healthcare-related companies.
Gillin further described his client base as “businesses with high frequency of urgent communications with a high need for compliance and security.”
“For every client we’re working with–healthcare or financial–security is paramount,” Gillin said. “Every one of our clients puts us through an extensive security audit.”
He said Relay Network’s HIPAA compliant products use “best of breed security procedures,” though a basic approach involves limiting the type data it needs to hold on to.
The company spent the first years of its existence building up its capabilities rather than its marketing. It has no intention of starting small.
“We want to market to very large enterprises,” Gillin said, such as health insurance plans.
Though Independence Health Group made a significant undisclosed investment, Gillin said it just means the company has a financial stake in Relay Network, it does not have a governance role.
“The most important thing we’re seeing in healthcare is that there is a huge opportunity — and, quite frankly, a race — to deliver, a better experience to the customer,” Gillin said. “That’s where the battle lines have been drawn.” Blue Cross President and CEO Daniel Hilferty agreed.
“This is a strategic opportunity for Independence that demonstrates how critical the member experience is for us,” Hilferty said in a news release.
Other Relay Network investors include NewSpring Capital and First Round Capital.
Photo: Free Images/Mike Johnson
