A newly profitable Toronto startup is looking to scale before generic weight-loss drugs hit Canada.
Felix Health has secured $53 million from the Canada Business Growth Fund (CBGF) and other existing investors as it seeks to balance newfound profitability with the growth of its personalized health care options for Canadians.
“We saw a big opportunity for us to continue to strengthen our leadership in the market.”
Growth financing, which is a roughly equal mix of equity and debt, has been a hot streak for the Toronto-based telemedicine platform. The company said it achieved profitability in July while managing 80 percent year-over-year growth and annual sales of C$150 million (monthly revenue times 12).
“We certainly weren't in a position where we needed to raise capital, but we saw a big opportunity for us to continue to expand our leadership in the market,” Felix CEO Kyle Zien said in an exclusive interview with BetaKit.
CBGF led the round with participation from the Business Development Bank of Canada's (BDC) Women in Technology Venture Fund, BMO Capital Partners, Scotiabank, Whitecap Venture Partners and H Venture Partners. Zien declined to share Felix's assessment but said the deal was a “significant step up.”
According to co-founder and COO Emma Stern, investors saw an opportunity to give Felix capital so it could be more “aggressive” in the market over the next few years. Dale Tingley, co-managing partner of CBGF, told BetaKit that the company's clear growth strategy and impressive leadership made the additional investment an “easy decision.”
Felix was founded in 2019 to address the healthcare needs of Canadians for common issues such as acne, contraception, erectile dysfunction and hair loss. It sells medications through a virtual platform that covers screenings, lab tests, prescriptions and drug delivery in all provinces except Quebec.
CONNECTED: Felix looks at the preventative health market with a new 'longevity' testing program
The company has since expanded into more than 20 categories, including mental health care, menopause and weight loss management, which Zien says are driving strong growth. Most recently he launched “longevity test platform for ongoing health monitoring using biomarker tests to meet the demand for preventive care. Part of this demand, the startup says, is driven by Canada's strained healthcare system, which is facing a shortage of primary care doctors.
Felix also joins a growing list of Canadian telehealth startups, such as Phoenix and Maple, that are making convenience and privacy part of their appeal, especially for stigmatized conditions. While Felix is currently direct-to-consumer and claims to have helped facilitate 1 million medical consultations, Stern said the company continues to explore other access options. Before this round, the startup had raised more than $30 million for its expansion.
Felix previously told BetaKit that there was a 100 percent increase in weight loss patients from January to August this year. Its program includes GLP-1 receptor agonist drugs such as Ozempic, which were originally developed to treat diabetes but have also demonstrated effectiveness in weight loss.
Stern said Felix wants “all of our operations scaled up and ready to go to market” when generic GLP-1 drugs hit Canadian shelves next year. Patent protection for the drug from Novo Nordisk, the maker of Ozempic, in Canada expires in early 2026.
Menopause care has been another driving force for Felix over the past eight to nine months, Stern said. Other Canadian technology companies such as June Health, CoralAnd Dialoguelaunched digital platforms to facilitate the management of menopausal symptoms. Stern said Felix's menopause care stands out because the platform can help patients meet their other health care needs in the same place.
Balancing profitability and growth, the company plans to use the funding to expand its team of more than 150 people and invest in some of its new categories, including menopause and weight management with GLP-1.
Zien said the team is also diversifying its marketing tactics by investing in “high-profile TV moments,” such as advertising during Blue Jays games. “We're expanding the space where you can experience the Felix platform,” he said.
Image provided Freepick
