[Corrected 7/19/11, 5:45 pm. See below.] Last month, Beverly, MA-based Eliza took in its first-ever outside investment, with an undisclosed equity financing from Parthenon Capital Partners, a private equity firm with offices in Boston and San Francisco.
Founded in 1999, Eliza offers speech recognition technology that powers automated phone calls to patients on behalf of accountable care organizations, employers, and hospitals, to cull qualitative information on patient health and offer actionable steps for improving wellness. [An earlier version of this paragraph incorrectly stated Eliza was founded in 2002. We regret the error.]
This whole time Eliza has been keeping a low profile and bootstrapping as it built out its technology to serve more customers, in the meantime accruing data from more than 450 million interactions with patients, says Eliza co-founder and president Alexandra Drane.
Things have started to heat up in the last couple of years surrounding national health reform, Drane told me when I caught up on the phone with her and fellow co-founder and CEO Lucas Merrow last week. “We started to consider a financial partner to help the organization go through opportunities for inorganic growth,” Drane says. “There may be an opportunity for us to think differently, more aggressively, in more intense ways in some areas.”
Eliza still has every intention of focusing on healthcare, but it’s looking to use the financing to build out new capabilities based on needs that have been revealed from the data in patient calls. The Eliza technology is designed to help patients tackle things like diabetes and high blood pressure that are already classified as health problems, but other issues that aren’t as concretely defined have come up in loads of calls with patients, Drane says. Patients talk to the system about issues like caring for elderly parents or financial stress, for example, that have interfered with patients’ ability to care for themselves properly, Drane says.
“Our hypothesis is understanding, A, how to establish a relationship with somebody to help them to understand issues, and B, that these issues in and of themselves have health consequences,” she says. “That is a big focuse for us right now at Eliza. It all relates to having the most accurate pictures of who people are and what they care about.”
Eliza could potentially be eyeing other acquisitions in the healthcare sector, as well as increasing its headcount, which is now at about 170 people, Merrow says. “We already planned on doing some pretty strong hiring prior to the investment. As part of this we’ll be beefing up,” he says.
Ultimately, the company hopes to get its technology in the hands of many more firms focusing on healthcare. Things are just beginning on this front, both Drane and Merrow say.
“A lot of customers don’t use this technology yet,” Merrow says. “It’s still an early lifecycle for what we do. We definitely needed expertise and capital to help us address that.”
