But that might be about to change, according to Jeff Tangney, a serial entrepreneur who founded Epocrates, the medical information company, and is currently running Doximity, a Facebook-style app for doctors that is growing fast, with more than one in six doctors already on the network.

VentureBeat had a chance to chat with Tangney about the future of investment in the medical space.

VentureBeat: We don’t hear all that much about investing in medicine.

Tangney: No, health tech hasn’t even really been recognized as a category until the last 10 years. There wasn’t really too much venture investment in health tech, but that’s changing. With the passing of the Affordable Care Act and the recognition that health care is 18 percent of the U.S. economy … some VCs have started looking in.

VentureBeat: What will national health care do for the space?

Tangney: The first changes of Obamacare haven’t really changed all that much yet – the biggest changes are still coming up. In 2014, the insurance exchanges start at a state level. Until then, there’s a lot of uncertainty … which actually favors the venture community.

The medical community is not quick to change over time – venture community is the only one that can react that fast. For example, we just raised a $17M round a few months ago.

VentureBeat: What’s hard about investing in health care?

Tangney: Well, you see a lot of folks sitting on their hands due to regulation.

For example, it’s illegal for a doctor to send an email about a patient. It’s illegal to send an SMS. And the internet really isn’t used in healthcare. It’s a little like a third-world country … where they’re skipping PCs and going straight to smartphones.

Over time that will change.

VentureBeat: What is working … who’s getting VC in health?

Tangney: ZocDoc, HealthApp and CastLight are doing well. CastLight, which creates a very cool employer portal for lower health care costs, raised $100 million earlier this year.

ZocDoc, with does online scheduling, raised $70 million a few months before that. And PracticeFusion raised $34M round to help usher in electronic health records. We’ve raised $27 million at Doximity … so there’s easily $200 million raised in the last year.

VentureBeat: What do you see in the future?

Tangney: Investors who are focusing on health care are starting to place their bets … as soon as we get out of this regulatory uncertainty, things will start to move.

Most people don’t know it, but Sequoia’s biggest investment ever was in an urgent care center … MedExpress, about two or three years ago. They’re seeing this shift to insurance exchanges, where, instead of someone paying  $3,000 for treatment in a hospital, they’re getting essentially the same service for $1,000 in a small health care facility.

VentureBeat: How does the growing self-quantification movement fit into this?

Tangney: Well, I wear a Jawbone wristband, but the knock on Sand Hill Road is that no-one’s been able to turn it into a big business yet.

The question is: Where’s the cross-the-chasm product?

The hotbed of this is San Diego … QualComm has invested a lot, and West Wireless Institute has  put $500 million into quantification. They’re trying to come up with cool new technology that the U.S. can sell to the rest of the world … to the wealthy well.

I have a Sonos headband too. It’s really ugly, really geeky, and measures your sleep patterns. What I’ve learned is that to get a sleep score of 100, I need to be intimate with my wife first. [laughing]

Those are all cool things, but even Nike hasn’t been able to really crack this market yet.

photo credit: Viktor Hertz via photopin cc

Rather, it’s doctors.

More specifically, medical mistakes and errors resulting from miscommunication. That’s exactly what professional networking tool for doctors Doximity was founded to fix.

A social network with a low profile everywhere but the medical community, Doximity has now signed up 11 percent of all U.S. physicians. The network focuses on helping doctors communicate and work together in a secure environment to coordinate patient care better and faster.

“Doximity is the largest and only real-name identified and verified private physician communications platform,” founder and chief executive Jeff Tangney told VentureBeat. “Unlike traditional social media, Doximity enables doctors to securely discuss patient care in a private, closed, HIPAA-secure environment.”

That’s important, because the medical community is significantly siloed, making it difficult for specialists, doctors, and other health care professionals to coordinate client care. Digital technologies haven’t made enormous strides yet in medicine – as of 2009 only nine percent of hospitals had an electronic records system in place — and tools for secure, simple doctor-to-doctor communication aren’t yet ubiquitous.

Doximity is looking to change that.

Other companies such as Sermo, QuantiaMD, and DocBookMD are doing similar things, but Doximity views its primary competitor as old technology and old practice:

“Our real competitors are the pager and the fax machine and any other antiquated form of communication still used in medicine today,” according to Tangney.

Perhaps not surprisingly given those tools, miscommunication between care providers is the root cause of 65 percent of serious medical errors, according to the Joint Commission on Accreditation of Healthcare Organizations.

“Medicine is a team sport,” Tangney said in a statement. “Communication is just so vital.”

Source: Doximity

CEO Jeff Tangney

Doximity allows doctors to connect online as well as on the go with mobile apps for iPhone, iPad, or Android smartphones.

The company is backed by $10.8 million in venture capital from Emergence Capital Partners and InterWest Partners. Its chief executive, Jeff Tangney, previously founded Epocrates, a mobile medical data company. Doximity is based in San Mateo, California.

Image credit: ShutterStock