Telemedicine platform Musely receives over $360 million non-dilutive funding

Staff Report: PNN

Direct-to-consumer telemedicine platform Musely has received more than $360 million in non-dilutive funding. The funding comes from General Catalyst’s Customer Value Fund (CVF).

Musely provides treatment services mainly for skin, hair, and menopause-related conditions. The platform started in 2014 as a wellness community but transitioned into a prescription-based skincare service in 2019.

Co-founder and CEO Jack Jia said the company has been profitable for years and generating steady cash flow. Therefore, he was not interested in raising traditional venture capital or reducing ownership.

Unlike typical venture capital investment, this deal does not involve equity dilution. It is also not a conventional loan. Instead, it is a revenue-based financing model where investors receive a fixed portion of future revenue under agreed terms.

Although initially skeptical, Jia later found the model highly beneficial after evaluation. According to him, it is more efficient compared to traditional debt or equity financing.

Musely is currently growing at around 50% annually and has served over 1.2 million patients. However, customer acquisition in direct-to-consumer healthcare requires significant spending.

Jia said that scaling digital healthcare businesses often requires large capital, which sometimes matches revenue due to high marketing and operational costs.

The funding from General Catalyst will be used for customer growth, marketing, and sales expansion. It will help the company expand its market reach.

Musely has operated with relatively low funding for a long time. It raised only $20 million in 2014 and did not take any major equity funding afterward.

Currently, Musely provides asynchronous telemedicine services through board-certified dermatologists and gynecologists, offering prescription-based care. Analysts say such financing models are creating alternative pathways for digital health companies.