Scaling to $500M in Revenue: ModMed CEO Daniel Cane (Part 6)

Sramana Mitra: That means architecturally, you’re going to put a recording and transcription agent on the iPad, this is not happening on the cloud, right?

Daniel Cane: Right. There are several reasons for this approach. First and foremost, it’s about performance and latency. By keeping everything on the device, we’re minimizing the amount of information leaving the iPad, which enhances security. The application operates transiently, generating a temporary transcript.

Doctors generally don’t want a recording of everything that happens or even a full transcript. They only want what they’ve reviewed and signed off on to be included in the medical record. Creating excessive or unnecessary information in medical records can introduce complications, whether those details are helpful or problematic.

Sramana Mitra: You’re not storing the entire recording or the transcript of the recording. You’re recording, you’re transcribing, and you’re categorizing or decoding unstructured data or structured data, and then putting that in the cloud storage.

Daniel Cane: Once the data is automatically mapped to structured formats, doctors on the iPad are presented with a reconciliation screen. This screen ensures that everything—medications, allergies, and other details—appears clearly for review. Doctors can confirm or adjust the information, essentially going through a “yes, yes, yes, no” process. Once they hit “done,” the finalized data is entered into the medical record, bearing their signature of approval.

We’ve put a lot of thought into making this process efficient and scalable, and we’re really excited about the outcome.

Sramana Mitra: And this is new. It’s not out there yet?

Daniel Cane: No, it’ll be out in Q1.

Sramana Mitra: Okay, cool. Great. Now I’m going to switch questioning to where you are performance-wise from a financials point of view, and you can disclose whatever you feel comfortable disclosing, but where are you? What metrics are you sharing?

Daniel Cane: I’m 5’11, about 190, Virgo. That’s a joke. You didn’t laugh! I thought that was funny. It was funnier in my head when you can disclose whatever metrics you want.

We’re a privately held company. I can give you general terms on where we are, because we don’t need to report. When you’re a startup, you want to kind of brag on your success because you are going to go out and get more rounds of financing. But then you realize the bigger you get, the more of kind of a potential target you are.

So, we’ve gotten big – north of $500 million big. We’ve gotten large and successful, we’ve gotten more profitable, and we’re super healthy. We’ve been adjusted EBITDA positive for ten years. We have really good, healthy gross margins.

Sramana Mitra: How much money have you raised in the whole fifteen year span?

Daniel Cane: The last round was $231 million from Warburg Pincus about six years ago. And that was mostly a recap. I’ve talked to some people who think that that all went either to ModMed’s balance sheet or to my bank account. Nothing could be further from the truth.

Sramana Mitra: You gave exit to some of the shareholders.

Daniel Cane: Yes, we exited the venture guys. It created some liquidity for some of the earlier investors, but most decided that they weren’t done and wanted to ride it. So, we raised friends and family and then we raised venture and then we raised private equity, which recapped out some of the early investors in the venture – Summit Partners. Great team. They rolled some and their role is going to be worth more than their whole initial cashout, which is great. But when you do early stage venture and you get a win, you take it.

This segment is part 6 in the series : Scaling to $500M in Revenue: ModMed CEO Daniel Cane
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