ZocDoc, the company that makes a web-centric platform for booking health appointments, has drawn on $2 million of a new $55 million convertible debt note.
In a phone call this afternoon, ZocDoc CEO Cyrus Massoumi said that the debt note is being provided by a "handful of folks." He declined to provide further details on the entities involved.
However, Massoumi is keen to stress that the debt is not being taken on out of necessity. "We don't need the money, we don't plan to use it, it's basically sitting in the bank collecting dust," he said. So why did ZocDoc secure it at all?
"It is on incredibly company-favorable terms," he said. "I don't believe that companies should ever raise money when they 'need it'."
Indeed, it doesn't seem like ZocDoc should be desperate for new funds at the moment. Since it was founded five years ago, ZocDoc has taken on some $95 million in venture capital from investors including such heavyweights as Khosla Ventures, Goldman Sachs, DST Global, and others.
The new debt note comes at a solid point in ZocDoc's growth, Massoumi said: ZocDoc has now passed 1,000 procedure types on the service. This is a nice bit of news for the company, which when it launched way back in 2007 at the TechCrunch 40 conference (the earliest iteration of what is now known as Disrupt) was criticized for being something that people would book minor appointments on, but not major things like heart surgeries. "Now, we have people booking appointments for heart surgeries and butt rashes," Massoumi joked.
The new infusion of funding will be a nice thing to have set away as ZocDoc continues to angle for more growth. Massoumi says that ZocDoc recently expanded its New York headquarters, and now has more than 400 employees on its payroll. Its platform is live in more than 1800 cities, and the "vast majority" of the regions in which it operates are profitable for the company, he said.
This past fall I had the pleasure of sitting down with Massoumi at our TechCrunch TV studio to talk a bit more about the app's growth over the years and his overall outlook on capital raises. Check that out below:
Founded in 2007 with a mission of improving access to healthcare, ZocDoc is the most convenient, free way to find a nearby health practitioner who accepts your insurance and instantly book an appointment online. The service, used by more than 2.5 million patients/month, currently serves 40 percent of the U.S. population across 1,800+ cities. With the service, patients avoid the hassle of waiting on hold, searching for a good doctor or wondering whether a doctor takes a particular insurance. Participating...
Cyrus Massoumi is founder and CEO of ZocDoc, which he created in 2007 after rupturing an eardrum. Massoumi struggled for four painful days to find a doctor, and became convinced that a better healthcare system is possible. He has extensive experience in the healthcare-technology nexus, web commerce and management. Prior to ZocDoc, Massoumi served as an Engagement Manager at the global management consulting firm McKinsey & Company, where he focused on healthcare and technology. Massoumi's four-year tenure at McKinsey &...
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