EXCLUSIVE – First Published 8/29/2013 – 1:35 AM (EST)
ZocDoc is a service that helps people gain access to health professionals that accept their current insurance. We think ZocDoc is a great organization and the core function of the service is extremely helpful. Aside from just researching doctors though, the site also makes it easy for individuals to check appointment availability, book their appointments and actually fill out required paperwork ahead of time. ZocDoc also has a Spanish-language version of the website, toll-free customer support and the representatives, who answer the phones, are knowledgeable, friendly and eager to help.
All of these perks essentially mean that ZocDoc’s services make things a lot more convenient for consumers.
What recently caught our attention about ZocDoc is that the domain, HealthMarketplace.com, now redirects to their website, ZocDoc.com. We checked the registration records and it seems that the domain is now registered to ZocDoc under the name of an employee at the company. According to the domain registration records, it seems as though the domain was sold by the previous owner right around January 18, 2013, at which time it went into private registration, meaning that the record does not disclose the domain owner, which is almost like having an unlisted phone number. Then, on May 10th, the domain was taken out of private registration and was publicly listed in the name of the ZocDoc employee, just like it is presently.
Screen shots of the registration record are available at the end of this article.
What we are wondering is what exactly ZocDoc has planned for this domain considering they already have a great looking, informational section within their site, which details the state and federal health exchange/marketplace. Check it out.
What’s Up ZocDoc? Really, it is not as if the domain receives a lot of traffic, we checked it doesn’t.
Honestly, we would not be surprised one bit if ZocDoc ended up becoming one of the next web-based insurance brokers to be approved to work in the federal exchange. Can they do that? Sure, but first they would likely have to acquire a health insurance brokerage that is already licensed to do business in the federal exchange states, or at least in theory.
Why would they do that? Well for one big reason, it would generate a lot of additional revenue for ZocDoc! Cha-ching!
Another interesting question is whether this possible new venture into the federal exchange as a broker would be a conflict of interest for ZocDoc? The quick answer is – – kind of, sort of – – but ultimately, not really. The Affordable Care Act limits the amount of profit brokers can make when they place consumers into insurance plans and overall transparency is going to become more commonplace as a result. For these reasons, at the end of the day, ZocDoc members should not really care if ZocDoc decides to expand its services. The company will provide consumers with easy access to even more information regarding their options under ObamaCare and even more access to other health insurance providers. Insurance companies for the most part wouldn’t really care, they just want the business. Who will mind, well other brokers of course. That said, no conflict there because ZocDoc isn’t working with them anyway.
In our opinion, there will be a real battle, moving forward, from some of the larger players in the insurance brokerage space to book as much of the business (people), who will be coming into the health insurance industry for the first time under the new requirements of ObamaCare as quickly as possible.
Aside from the fact that ZocDoc bought a new domain, what else makes us think that they may be switching gears a bit? Well, they did just put themselves in a position where they now have an additional $55 million at their disposal. More specifically they filed a document with the SEC that says they have drawn $2M in capital from a convertible debt note of $55M in total. All this disposable cash means that should ZocDoc want to buy a brokerage company, be it a relatively modest one, they could do so and not break a sweat.
What has the company got planned for that cash? Depending on what journalist the CEO and Co-Founder Cyrus Massoumi spoke to after the SEC filing was announced and then reported on, you could have a variety of answers. All have one thing in common, they’re super vague.
On the topic of why raise the money, Massoumi has said the following;
“We don’t need the money, we don’t plan to use it, it’s basically sitting in the bank collecting dust.” – TechCrunch
On the topic of whom invested and why, he declined to reveal their names but did say;
“Strategic investors we believe will help the business as we scale up.” – Gigaom
According to reports, the company is profitable in most of its markets and to date, it has raised $95 million from a truly impressive list of A List investors such as; Khosla Ventures, Yuri Milner (DST Global), Marc Benioff, Ron Conway, Jason Finger, Founders Fund and that mildly successful guy named Jeff Bezos.
Should ZocDoc need more capital, these investors, should any one of them simply scratch behind their ear, it would produce a couple million for some special project that ZocDoc might want to take on. We don’t believe that this is insiders taking money off of the table either, because that’s the kind of thing that usually will be disclosed early and often.
If we are right about these potential plans for the money, would ZocDoc’s entrance into the web-based brokerage business be potentially bad news for other companies in the business? Hell yes, if you are a competing, online health insurance brokerage company this would definitely be disconcerting news. A serious competitor with something that’s disruptive in so many ways entering the space would be especially bad for eHealth, which is considered by most to be dominating the online health insurance industry. eHealth made waves recently when it was announced that it had signed an agreement with the federal government to book business direct on their behalf.
ZocDoc has one key advantage over eHealth though: an audience of 2.5 million people, who rely on it to help them find great doctors who offer the best possible experience, even though, lets be honest, very few people actually enjoy going to the doctor. That’s kind of the point of what ZocDoc does; they make the research, appointment setting, paperwork and the generally tedious nature of going to the doctor a lot less stressful. Now, imagine if they are able to take that same approach and apply it to finding insurance…. That, dear readers, is exactly why eHealth should be concerned.
Considering the that fact that the health insurance industry is shifting and changing so dramatically under ObamaCare, and because the pricing side of the equation is going to be less important to this younger generation, one could certainly make the argument that consumers, especially ones coming into the health marketplace as a result of the ACA, are going to be much more interested in ZocDoc and their expanded and proven services than eHealth if price isn’t a real consideration. Which again based on the constraints placed under the ACA, it shouldn’t be.
One other interesting thing to note is that in a Harris Interactive survey commissioned on ZocDoc’s behalf, it was determined that 54% of the consumer group know as generation Y, (ages 18 to 34) found the process of dealing with healthcare very frustrating. More than half were so put off by the entire process that they preferred to just deal with their healthcare needs later. Which in case you’re not keeping score, is why a service that takes something that’s such a pain in the ass and to an extent turns it into kind of a breeze (we’ll skip over any potential proctology and or flatulence related jokes, opps, we didn’t) will be really attractive to young people.
Why is that so important to point out? Well, this demographic will be the focus of many company’s marketing campaigns and is widely considered to be the key and or cornerstone to making ObamaCare a success, or so a lot of insurance companies, the current administration and or the health insurance industry in general has expressed. ZocDoc, with their cool and innovative apps that help impatient generation Y (youngsters) bypass the reception desk and packed waiting rooms, has something specific that will help bring them into the marketplace, convenience.
Here at FreeObamaCareGuide.com, we totally subscribe to the less is more approach. Meaning we don’t expect people, especially those who are 18 to 34, to spend more than 30 minutes of their free time researching things. While our guide is expanding, growing and will continue to do so, we purposely have brought the core concepts of ACA, which weighs in at a hefty 1,100+ pages, down to a relatively svelte 25 page PDF.
So what could possibly help eHealth at this point? We are not really sure, they are to an extent a one-trick-pony, granted a very well connected and well established pony.
$55 million, should ZocDoc decide to tap that available pool of capital, could buy them a brokerage presence in all 50 states and no doubt a considerable revenue stream to boot.
eHealth on the other hand (or anyone else for that matter) is going to find it very difficult, nay impossible, to acquire 2.5 million active consumers / members for the same price.
Coming back to what brought us to this speculative conclusion in the first place. ZocDoc doesn’t really need that domain, so why go out an acquire HealthMarketplace.com if you’re not going to use it for something in particular?
We should point out, that there’s a nugget of info found deep within the Terms of Service of a contest they’re running. This one off contest could very well be what they could be using the domain for. Or at least for now, ZocDoc will say that is why they acquired the domain.
If that turns out to be the case, and they say, the URL is just for this contest, well we just don’t totally buy it. Right now, domains like InsuranceMarketplace.com and others related to the ACA, ObamaCare and or health insurance in general are on fire right now. Prices and demand are extremely high and while we don’t know what they paid for the domain, it seems a bit of a stretch to go out and acquire this very valuable domain simply for the purposes of running a contest. Which, again we have to point out, they’re not currently doing, it just re-directs to the home page.
Something else that is of interest about the contest, ZocDoc wants you to first submit your email, then you get sent an email which takes you to a form that then asks you for you name, age, sex and (this is important) zip code. Here’s the exact verbiage below from their entry form.
“How to Enter: During the Promotion Period, visit www.HealthMarketplace.com and follow the links and instructions to enter your email address; a subsequent email will be sent to you where you will enter your date of birth, gender, and ZIP code (“Demographic Information”) and the email address of a friend (all of the foregoing in this sentence collectively, an “Action”). For each Action you complete, you will gain one (1) entry into the Promotion”
Wait a second, this is a points based contest? You want people to give you their friends email as a way to increase their odds of winning? Well this certainly seems like a great viral campaign and an excellent way to spin-off an entirely new site and service that is focused around bringing young people into the health marketplace for the first time….
Hot damn, we just high fived ourselves!
So in closing we say this; we like the ZocDoc, we like what they’re doing and anyone that can potentially “Keyser Söze” the online health insurance industry, while still doing right by the consumer, well you have our respect.
Please note, this is all speculation.
Granted phenomenal, insightful and well researched speculation, but speculation none-the-less.
(Original Whois from January 2012)
(May 10th 2013 First Day Of Public ZocDoc Ownership)