It was already well underway prior to COVID—the wave of innovation in health tech, that is, Fortune reports. But no one could have convinced so many people so quickly that visiting their doctor on the other end of a phone screen was a good idea.
Take April 2020, for instance. The number of patients doing virtual office visits or outpatient care rose by 78 times the levels in February, according to McKinsey.
COVID “advanced what normally would have taken 10 years of telehealth growth and collapsed it into six months,” says Todd Cozzens, co-founder and managing partner of Transformation Capital, a growth equity firm focused solely on health tech companies.
It’s proved an opportune time for Transformation Capital—whose predecessor entity was co-founded in 2016 by Cozzens, formerly with Sequoia Capital, and Jared Kesselheim, a former Bain Capital Ventures partner—to go back to market for its third fund. The firm closed it at $800 million, and the demand was off the charts, Cozzens says.
“We could have probably raised a much higher amount—you know, $1.5 billion if we had wanted to—but we learned at Bain and Sequoia that smaller, tighter funds do better,” he says, noting that when they were raising their first fund, which was $313 million in size, limited partners were skeptical of whether digital health was a big enough asset class. Read more.
