Digital substance use disorder (SUD) provider Boulder Care has raised $35 million in a Series C round, bringing the company’s total raise to roughly $85 million.
Boulder plans to use the funds to deepen its presence in existing markets, expand into new markets, build out its clinical team and continue fostering partnerships, Boulder CEO Stephanie Strong told Addiction Treatment Business.
“The fundraising market being challenging is not news to anyone, but it’s true for digital health companies, for Series C stage companies, for founders who are focused on Medicaid or underserved populations,” Strong said. “It’s challenging, but this round was much easier than our prior rounds.”
Advance Venture Partners led the Series C round with meaningful participation from growth equity firm Stripes. Existing investors First Round Capital, Qiming Venture Partners and Laerdal Million Lives Fund, among others, also participated.
Portland, Oregon-based Boulder offers app-based outpatient care for opioid use disorder (OUD) and alcohol use disorder (AUD), including prescriptions for medications for addiction treatment (MAT). The company is 100% in-network and accepts many major insurance plans, including United Healthcare, Aetna, Cigna and Medicare.
Raising $36 million in its Series B round and $10.5 million in seed capital was “a big risk” for investors, Strong said.
“With a go-to-market strategy that’s replicable, it feels like we’ve now proven out the strategy enough to have a great foundation underneath us and much more investor support than ever before,” she said.
The company plans to expand into two new states in the next 12 months, targeting states that have expanded Medicaid environments where the company has existing partners.
Boulder will also likely triple its patient-facing workforce, including peer recovery specialists, case workers and leadership roles in the next year, Strong said.
The company aims to hire top talent in all 50 states while prioritizing local expertise by onboarding peer recovery specialists and community liaisons within the specific areas it serves. The community liaison positions will be filled by people well-versed in an area’s culture and available resources, enabling them to foster connections within the community.
Some of Boulder’s Series B funds went towards expanding the company’s value-based reimbursement arrangements. The company has had “remarkable” traction in its value-based business, Strong said.
Boulder doubled its value-based Medicaid arrangements in the last quarter, and a little more than half of Boulder’s overall business comes from value-based arrangements.
“Now that we’ve hit 100% of all eligible performance payments with our initial set of plans, we’re having really great success with referenceable customers, bringing us into new markets and building our reputation for clinical quality and performance on cost savings,” Strong said.
Coming to an agreement that both Boulder and new payers feel good about can take time, Strong said.
When partnering with a new payer, the company will sometimes start with fee-for-service, case rates or other alternative arrangements and then evolve into outcomes-based payment arrangements over time.
“The great thing about our customer base is that the same health plans are operating in 40 markets,” Strong said. “Once we are able to establish a working alternative payment arrangement in one market, it’s much easier for us to bring it into expanded states. Now we’re ready to do that with our Series C capital.”
Boulder partners with local providers and recovery community organizations. This strategy accounts for a significant amount of Boulder’s growth.
These partnerships also help protect Boulder from regulatory uncertainty. Pandemic-era telehealth flexibilities are set to expire at the end of 2024, but Boulder’s relationships with local providers ensure continuity of care for patients and a resilient business model.
While continuing to focus on partnerships with interdisciplinary providers, including community-based organizations and OB/GYN services, Boulder plans to strengthen its technology stack.
Administrative and compliance work are deterrents for clinicians who are otherwise willing and able to provide SUD care, Strong said. Streamlining technology and leveraging AI can mitigate these barriers and make team-based care possible.
The company’s current technology system includes a “pop-in clinic” offering where patients can wait in a queue to see a clinician or peer in as little as 40 minutes.
In her long-term vision for Boulder, Strong says she hopes the company will become the most trusted name in addiction medicine.
“We at Boulder have an opportunity to not just treat this drug crisis but to get at the underlying causes of addiction and help people recover from trauma, build stronger relationships, get back into work for housing and get the good health care and preventive services they need to thrive,” she said.
