Marina del Rey-based Commons Clinic Inc., an outpatient clinic network offering care for spine, orthopedics and pain management, raised $19.5 million in Series A financing.
The funding, announced earlier this month, was led by Boston-based RA Capital Management with participation from existing investors Floating Point, also of Boston, and New York-based Courtside Ventures. Another new investor was Century City-based Time BioVentures.
This round of financing brings the total amount raised by Commons Clinic to $33.5 million.
The company plans to use the funds to deploy additional surgery centers along the Southern California coast.
Commons Clinic was founded in Marina del Rey in April 2021 as a musculoskeletal surgery and treatment center – part of a long-term trend of outpatient surgery centers. Besides surgeries, the clinic also offers post-operation physical therapy – all for a single price disclosed up front.
The company has since added two more clinics – one in Santa Monica and the other in Century City. It now has at least six full-time orthopedic surgeons and a total staff of 32.
Co-founder Nick Aubin, who is also chief executive, had spent several years as director of business development at doctor house call service Get Heal Inc., which does business as Heal, before leaving to strike out on his own.
“With Commons Clinic, I believe there is a once-in-a-generation opportunity to foundationally change how specialty care is delivered,” Aubin said in the funding announcement. He added that the clinic is part of what he termed “rebuilding the specialty care value chain” that had at one time been centered at hospitals.
This trend of outpatient surgery centers has been going on for decades, but has accelerated in recent years as hospitals have come under increasing financial pressures that have squeezed operating margins. This has prompted many specialty-care physician practices to set up independent surgery centers and clinics, with more leeway to set prices and serve market niches.
“We’ve been fortunate enough to quickly gain traction, adding six of LA’s top surgeons to our group (and) opening three clinics,” Aubin said.
Commons Clinic is also preparing to launch a partnership with a major health plan; details of that partnership will be announced in coming weeks, according to Aubin.
The company has gained traction with outside private investors, raising a seed round of $11 million late last year and then this latest $19.5 million.
“For over 10 years, I’ve been developing and implementing advanced bundled payment models and driving adoption of outcome-based provider contracts,” Mike Sherman, venture partner with lead investor RA Capital Management, said in the latest announcement. “I believe Commons Clinic is the first company to do it right, end to end,” he added.
As part of this round of financing, one executive each from RA Capital Management and Floating Point will be joining the board.
Commons Clinic chief executive Aubin said the company intends to use the $19.5 million to grow the number of surgery and treatment centers.
“We’re evaluating locations along the Southern California coast with outposts in San Diego, Orange County (Irvine), and Long Beach/Torrance,” he said.
These are all lucrative markets with potential patients willing and able to spend money on orthopedic and spinal procedures.
