AnswersNow founders Jeff Beck, left, and Adam Dreyfus. (Courtesy of AnswersNow)
An eight-figure capital raise is about to jumpstart a Richmond startup’s expansion plans into multiple states.
AnswersNow, which makes a software program to facilitate virtual therapy sessions for people with autism, this month closed on a $11 million equity capital raise it plans to use to take its product into new markets and increase its headcount.
CEO Jeff Beck said AnswersNow has North Carolina, Florida, Texas, Nebraska and New Mexico on its radar for expansion, though an exact timeline and sequencing of the rollout hasn’t been nailed down yet.
“We want to grow consciously and we know those three to five states will be our next markets,” he said. “We’ve opened a second state in Georgia and that’s gone really well and we’re looking at the landscape to see what opportunities there are.”
Beck said variables still at play that will determine the rollout include coordinating with insurers in each state to make coverage available and working out agreements with clinicians who would use AnswersNow in those states. Different states have different licensing requirements to be navigated as well.
AnswersNow rolled out its software in Virginia in 2020 and added Georgia about a year ago, Beck said.
Multi-state expansion has been on the AnswersNow to-do list for several years. Beck said those plans haven’t been fully realized yet in part because those first two states led to plenty of business.
“Through 2022 as business started to pick up steam, we decided to shelve new states because the two we had were going so well,” Beck said. “When we raised our seed round it was like, ‘let’s get in 10 states,’ and that just wasn’t necessary because we had the volume in Virginia and Georgia.”
Last year, the AnswersNow system, which connects patients with contracted behavioral therapists, was used for more than 10,000 hours of therapy, per a company news release.
In addition to market expansion, AnswersNow plans to expand its employee base, both in-house and its contractor ranks.
AnswersNow currently has 15 employees and plans to hire 20 to 25 more using the funding it recently acquired. Those new hires will include software developers, clinicians and others.
Beck said there are 40 contracted clinicians who are regularly using the AnswersNow system, and that the company would hope to bring on another 50 contracted clinicians.
The company generates revenue by way of insurance coverage payments for the therapy services. The company has yet to reach profitability, Beck said.
AnswersNow has raised $15 million from investors to date. The latest capital round was led by Left Lane Capital, a New York-based venture capital firm and first-time investor in the telehealth company.
Other investors included Richmond-based Blue Heron Capital, American Family Insurance Institute for Corporate and Social Impact, Difference Partners, and Lani Fritts, former CEO of California-based autism therapy provider Kadiant.
Beck said AnswersNow started to pitch investors for the raise in early September and closed on the round in late December. The $11 million is expected to carry the company for two years.
AnswersNow was founded by Beck and Adam Dreyfus in 2017. In its earlier days, the company offered a text message-based subscription service.
The company is based in Startup Virginia, a business incubator in Capital One’s Michael Wassmer Innovation Center in Shockoe Bottom. The center was formerly called the 1717 Innovation Center.
Beck said that the interest in telehealth generated by the coronavirus pandemic has maintained its momentum.
“Before the pandemic people had two options: bring your child to the clinic 20 to 30 hours a week or have someone come to your home 20 to 30 hours a week,” Beck said. “If anything, we have seen an increase in adoption of telehealth in the (autism therapy) world.”
Other locally based startups to recently net capital raises include transportation company HopDrive ($8 million round) and fringe benefits marketplace Fringe ($17 million round).
AnswersNow founders Jeff Beck, left, and Adam Dreyfus. (Courtesy of AnswersNow)
An eight-figure capital raise is about to jumpstart a Richmond startup’s expansion plans into multiple states.
AnswersNow, which makes a software program to facilitate virtual therapy sessions for people with autism, this month closed on a $11 million equity capital raise it plans to use to take its product into new markets and increase its headcount.
CEO Jeff Beck said AnswersNow has North Carolina, Florida, Texas, Nebraska and New Mexico on its radar for expansion, though an exact timeline and sequencing of the rollout hasn’t been nailed down yet.
“We want to grow consciously and we know those three to five states will be our next markets,” he said. “We’ve opened a second state in Georgia and that’s gone really well and we’re looking at the landscape to see what opportunities there are.”
Beck said variables still at play that will determine the rollout include coordinating with insurers in each state to make coverage available and working out agreements with clinicians who would use AnswersNow in those states. Different states have different licensing requirements to be navigated as well.
AnswersNow rolled out its software in Virginia in 2020 and added Georgia about a year ago, Beck said.
Multi-state expansion has been on the AnswersNow to-do list for several years. Beck said those plans haven’t been fully realized yet in part because those first two states led to plenty of business.
“Through 2022 as business started to pick up steam, we decided to shelve new states because the two we had were going so well,” Beck said. “When we raised our seed round it was like, ‘let’s get in 10 states,’ and that just wasn’t necessary because we had the volume in Virginia and Georgia.”
Last year, the AnswersNow system, which connects patients with contracted behavioral therapists, was used for more than 10,000 hours of therapy, per a company news release.
In addition to market expansion, AnswersNow plans to expand its employee base, both in-house and its contractor ranks.
AnswersNow currently has 15 employees and plans to hire 20 to 25 more using the funding it recently acquired. Those new hires will include software developers, clinicians and others.
Beck said there are 40 contracted clinicians who are regularly using the AnswersNow system, and that the company would hope to bring on another 50 contracted clinicians.
The company generates revenue by way of insurance coverage payments for the therapy services. The company has yet to reach profitability, Beck said.
AnswersNow has raised $15 million from investors to date. The latest capital round was led by Left Lane Capital, a New York-based venture capital firm and first-time investor in the telehealth company.
Other investors included Richmond-based Blue Heron Capital, American Family Insurance Institute for Corporate and Social Impact, Difference Partners, and Lani Fritts, former CEO of California-based autism therapy provider Kadiant.
Beck said AnswersNow started to pitch investors for the raise in early September and closed on the round in late December. The $11 million is expected to carry the company for two years.
AnswersNow was founded by Beck and Adam Dreyfus in 2017. In its earlier days, the company offered a text message-based subscription service.
The company is based in Startup Virginia, a business incubator in Capital One’s Michael Wassmer Innovation Center in Shockoe Bottom. The center was formerly called the 1717 Innovation Center.
Beck said that the interest in telehealth generated by the coronavirus pandemic has maintained its momentum.
“Before the pandemic people had two options: bring your child to the clinic 20 to 30 hours a week or have someone come to your home 20 to 30 hours a week,” Beck said. “If anything, we have seen an increase in adoption of telehealth in the (autism therapy) world.”
Other locally based startups to recently net capital raises include transportation company HopDrive ($8 million round) and fringe benefits marketplace Fringe ($17 million round).