Ottawa-based startup Health Wave today announced that it has raised a round of seed funding from accelerator Mercury Grove and local angel investors to help it scale its business, which provides a turn-key web-based dispensary for health professionals. The funding amount wasn’t disclosed, though sources have told BetaKit that it was in the $250,000 to $350,000 range. Founder and CEO Kyle Braatz said in an interview that the money will help the startup capitalize on the traction it’s already seen since launching its platform, which helps health professionals to sell natural health products.
For Braatz and his co-founder Brad Dyment, Health Wave began as a passion project that they pursued based on the success of an earlier venture, Simple Story Videos. “We grew Simple Story Videos very quickly, working with clients like VMware, Citrix and Shopify. But myself and my co-founder didn’t really have the passion for that line of business.” Since the startup was successful, the duo was able to put it in the capable hands of its employees and indulge their passion for entrepreneurship in an area closer to home.
Dyment’s wife is a naturopathic doctor (ND), so the team quickly realized there was an opportunity to capitalize on the growing market for naturopathic remedies and preventative medicine. Based on that idea, they launched Health Wave, starting in Canada with a focus exclusively on ND clients initially. Eventually, the plan is to open it up to other fields of health care, including chiropractors, personal trainers and more. Also, Health Wave intends to expand availability across the U.S. by September this year.
The Health Wave platform, which is available on the web and via an iPad app, allows naturopathic doctors and health professionals to set up their own online storefront quickly and easily, selecting from pre-filtered categories. When their clients and patients make purchases through their storefronts, Health Wave’s customers have the full retail amount credited to their account, and then Health Wave subtracts the wholesale amount as its cut afterwards. The startup has also secured partnerships to help it handle shipping and order fulfillment, taking any responsibility for sourcing and delivery out of the hands of the NDs using its platform.
“It’s like a virtualized consignment type of idea,” he said. “And then our software takes on the role of managing the perpetual nature of these products, the refills, etc, and when clients come back for an appointment, those kinds of things.” Health Wave’s app can also be set up in kiosk mode, letting health professionals create a virtual storefront in any size of office.
The market size is considerable, should Health Wave’s approach catch on. In the U.S., a 2009 study found that Americans spend $34 billion on alternative medicine per year, and that number has likely grown considerably since those results were gathered, as the spend on healthcare in general has also risen steadily. In terms of challenges, there have been some recent moves to increase regulation around the naturopathy and alternative medicine markets, including new rules in Alberta pertaining to self-regulation, and proposed legislation in Ontario some criticize as being too strict.
With Health Wave’s plans to expand into different verticals, and eventually maybe even to expand into beauty products (something Braatz said was on the table long-term), however, it should have its bases covered even in the face of a changing regulatory environment specific to naturopathy practitioners.
