Clover Health Inc. raised $160 million from private investors, suggesting the sector is still a favorite among venture capitalists betting on startups that are using an information-driven approach to address the health insurance market.
Clover’s model combines data with preventative care and it competes against traditional providers as well as startups, like Oscar Health Insurance Corp. The company will use the cash to continue improving its technology and expand to new markets, it said in a statement late last week.
Greenoaks Capital led the round, pushing Clover’s total outside funding to $285 million, according the health information technology company announced. A spokeswoman for Clover declined to comment on its valuation.
Insurance startups raised a record $2.65 billion in 2015, according to research firm CB Insights. And despite a slowdown in total venture activity, that heady pace has continued in 2016, with 45 insurance deals totaling $650 million in funding, the researcher said.
Founded in 2012 and based in San Francisco, Clover Health aims to offer better and more affordable healthcare for consumers. Its technology pulls disparate data, including lab results and prescriptions, to identify potential health risks of its customers. If something is amiss, Clover intervenes with its own team of nurse practitioners and social workers.
Clover Health believes its market edge comes from its use of sophisticated analytics and custom software to direct its clinical staff to proactively fill gaps in the care of members. “We have a proven model we're scaling out,” says co-founder Vivek Garipalli. “We're focusing on elderly and low-income patients that stand to benefit from our model the most. This puts us in a position to make a major dent in healthcare expense in the United States and reverse an unsustainable, decades-long spending trend.”
Greenoaks Capital partner Benny Peretz joins the Clover board, according to a statement from Clover Health. Previous investors, including Sequoia Capital and First Round Capital, participated in the round.
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