An expected capital infusion of $494 million from its IPO Thursday gives Doximity the means to pursue organic growth in the exploding telehealth space, the company’s finance chief told CFO Dive.

“We love to maintain a healthy amount of cash on the balance sheet in order to be opportunistic from a product perspective,” CFO Anna Bryson said. “So, we’re very focused on reinvesting in our product, which is the most important thing for us. We’re physicians first. It’s at the core of our mission, and we want to ensure we’ll continue to build features that physicians love and use.”

Doximity launched in 2010 as a software-as-a-service (SaaS) platform for doctors to meet virtually with patients, exchange referrals, and access the latest in scientific research and best practices.

The company was growing quickly prior to the pandemic, but it also benefited from the pandemic-fueled surge in digitalization in the healthcare industry, which has traditionally been a digital laggard compared to other industries.

“Health care is an industry that has long been very [under invested] in digital spend,” she said. “We think they did three years worth of shifting to digital this past year. I don’t think we expect to see the same acceleration next year, but we certainly expect it to continue to grow and we think our organic business will benefit from that significantly.”

Product upsells

One of the company’s key metrics is net revenue retention, and that’s been on a healthy trajectory, she said. It topped 130% growth in each of the last three years; last year it was 153%. 

“It’s just a testament to our customer base,” she said. “They’re continuing to purchase more with us. It’s not just renew but also upsell.”

The company offers three core products: doctor referrals, virtual patient consultations and an information service.

The referral network, which works through arrangements with dozens of health systems in the United States, is the company’s main driver, accounting for 80% of its revenue. 

“We work with [the health systems] in order to help them engender referrals,” she said. “We offer multiple modules for [doctors] to connect with key opinion leaders on our platform.”

The virtual patient consultations, while high-profile, generate less than 5% of revenue.

FP&A focus

Bryson joined the company in 2017 as its first financial planning executive.

“There wasn’t an FP&A function four years ago,” she said. “That strategic arm of the business was critical for [our] success, so I leaned in heavily, started focusing on the metrics, started looking at the business a lot closer, focusing on the white-space opportunities ahead of us and our team became more of a strategic business partner to the sales side that we had lacked before.”

The company tapped her as CFO in February with the aim of leveraging her planning experience as it pursues its growth plan post-IPO.

“When scaling the FP&A side, you really get a deep understanding of the business strategically and the key levers to pull,” she said. “As we embark on our public company journey, it made the most sense for [us] to have someone who’s been there. Healthcare is very … big and … difficult to grasp, so, the amount of time I’ve had to learn will be beneficial to the company.”

Doximity’s previous CFO, Yang Chao, was in the seat for eight months, from May 2020 to the end of the year. Chao’s background includes significant capital raising experience, including raising $1 billion in private and public equity and through convertible debt at process automation company Gogo. 

Bryson said she’s not planning any major organizational changes to the finance and accounting operations. In the past year, Doximity invested in getting both function areas up to speed for the IPO. 

“We invested really heavily in ensuring we have the right team to take us on this next stage of our journey,” she said. “We’ve built up the accounting and FP&A organizations pretty significantly. We already had a strong team but we added significant new hires to help us in this next stage.”