VCs Investing To Heal U.S. Healthcare

The U.S. healthcare system is sick, but increasingly early stage investors are spending money on new technology companies they believe can help provide a cure.

Earlier this week, Greylock Partners, one of the investors behind Facebook and LinkedIn, and the Russian billionaire technology investor Yuri Milner put together a $1.2 million round alongside a group of co-investors to back First Opinion – a consumer facing service selling a way to text message doctors anytime of day or night.

Greylock and Milner join a growing roster of technology investors focused on healthcare in recent years. The number of companies raising money from investors for the first or second time has skyrocketed since the passage of the Affordable Care Act, according to data from CrunchBase.

In 2010, the year in which President Obama signed the ACA into law, there were only 17 seed- and Series A-stage healthcare-focused software and application development companies which had raised money from investors. By the end of last year, that number jumped to 89 companies tackling problems specifically related to the healthcare industry, according to CrunchBase metrics.