Zocdoc Announces $150 Million in Growth Financing from Francisco Partners
The financing comes amid the company’s transition to a profitable business model, accelerating growth, and a successful expansion into new virtual care and public health services
Zocdoc, the country’s leading digital healthcare marketplace, today announced $150 million in growth financing from Francisco Partners, a leading global investment firm that specializes in partnering with technology businesses. This follows a momentous year for the company, characterized by a successful transition to a profitable variable revenue model which has led to accelerating growth. Zocdoc grew revenue by more than 35% year-over-year before the pandemic, and had year-over-year growth in 2020 despite COVID-19’s disruption. Today, Zocdoc is profitable and on track to accelerate its pre-pandemic growth trajectory. The company will use the capital to further propel its rapid growth, deepening its investments in sales and marketing, and expanding the products available through its platform.
Zocdoc has long been the leader in online scheduling for in-person doctors’ appointments. However, as the pandemic dramatically accelerated the adoption of telehealth, Zocdoc rapidly adapted its marketplace. The company successfully expanded into telehealth, making it a rare digital health platform that supports hybrid care: both physical and virtual care services. By aggregating millions of in-person and video visit appointments across a nationwide provider network, Zocdoc is distinctly positioned to become the front door to healthcare.
Most recently, the company leveraged its core technology and 13 years of healthcare scheduling expertise to introduce Zocdoc Vaccine Scheduler. This new service is designed to help cities, states, and healthcare providers centralize and streamline vaccinations. The company is offering this new solution free of charge to help accelerate public health efforts. Zocdoc Vaccine Scheduler has already been adopted by the City of Chicago and health systems around the country to help fast-track vaccinations.
“Today, Zocdoc is the rarest type of private technology company: we are profitable with accelerating growth, and we are a business that does real good for the world,” said Oliver Kharraz, M.D., Zocdoc founder and CEO. “The last year has demonstrated that Zocdoc is poised to have a transformative impact on healthcare in this country. From our rapid expansion into telehealth to our efforts in helping cities and health systems distribute vaccines, our work remains focused on giving power to the patient. I have never been more proud of the Zocdoc team or more excited about our future.”
“Zocdoc is a remarkable company that is well positioned to be consumers’ one-stop-shop for all their healthcare needs, and we’re proud to work with them to fund their next chapter,” said Scott Eisenberg, Head of Credit and Structured Solutions at Francisco Partners. “We’ve been incredibly impressed by the pace of Zocdoc’s innovation and growth, as well as the company’s invaluable contributions to improving America’s healthcare system — including supporting the needs of patients amid the COVID-19 pandemic.”
The success of the company’s recent initiatives, along with its accelerating growth and profitability, has been built on the foundation of Zocdoc’s variable pricing model. Begun in 2018 and now largely complete, the transition from a flat subscription model to the current, fee-per-booking model has enabled the company to lower the barrier to entry for providers, dramatically accelerating the growth of providers on its platform. The company has grown its healthcare provider network by 50 percent in the first states that transitioned to its new model, and other states are following a similar trajectory.
This new model has also empowered Zocdoc to make deep and sustainable investments in product, technology, and marketing, which have helped fuel its expansion into telehealth, vaccine scheduling, and national television advertising. The company has quickly become one of the country’s largest telehealth platforms, with more than 10,000 providers offering nearly one million video visit appointments across 100 specialities. Further, Zocdoc’s telehealth approach aligns with patient preferences, enabling them to select nearby doctors — even for virtual visits — so that they can establish relationships with local physicians, should they choose to seek care in-person.