BetterNight Raises $52.6M to Improve Sleep for Over 100,000 Patients with Digital Care Platform

Recently, VCBeat learned that virtual care platform BetterNight announced the completion of a $33 million Series C financing round. The round was led by NewSpring, with existing investors HCAP Partners and Hamilton Lane participating through Impact Fund II and other accounts managed by the firm. The proceeds from this financing will be used to provide comprehensive care for patients with sleep disorders, ranging from consultation and diagnosis to treatment and long-term coaching.

BetterNight, founded in 2018 and headquartered in San Diego, California, integrates clinically validated sleep assessment systems, CBT-i solutions, and a telehealth-based sleep apnea platform. The company is committed to enhancing patient adherence and satisfaction while improving physical health outcomes at a lower cost per unit. To date, BetterNight has treated over 100,000 patients and secured $52.6 million in funding.

BetterNight's Historical Financing Rounds

Data Source: Crunchbase

We spend approximately one-third of our lives sleeping. However, the 2019 report “Obstructive Sleep Apnea and the Global Economic Burden,” published in The Lancet Respiratory Medicine, indicates that sleep apnea, as a severe sleep disorder, affects more than 30 million people in the United States and over 1 billion people worldwide. Sleep apnea is caused by the temporary relaxation of throat muscles that obstruct the upper airway, leading to repeated pauses and resumptions of breathing throughout the night, accompanied by characteristic gasping and loud snoring.

Meanwhile, the report “Innovative Medical Devices: Special Topic on the Sleep and Respiratory Care Industry—The Snowballing Effect of Major Chronic Diseases and the Emergence of a Multi-Billion-Dollar Market,” issued by the Research and Development Center of Southwest Securities, points out that the diagnosis rate of obstructive sleep apnea (OSA) in the United States is 20%, meaning that at least 20% of Americans are affected by sleep apnea. Obstructive sleep apnea (OSA) is the most common form of sleep apnea; however, OSA is often accompanied by comorbidities such as cardiovascular disease, hypertension, and diabetes, resulting in 85% of patients being unaware of their condition.

Given the significant impact, large patient population, and diagnostic challenges associated with obstructive sleep apnea, the market’s ceiling remains difficult to reach in the short term. BetterNight has also entered this space.

BetterNight honors the foundations of sleep medicine by designing a home sleep testing workflow. In this workflow, the company’s software platform collects data via therapeutic devices to support sleep management. It also provides sleep health assessments, telemedicine-based consultations, and home diagnostic studies to facilitate better clinical decision-making.

All of the above services are delivered digitally. Compared to the average four-month duration of traditional therapies, BetterNight’s digital counseling and treatment program requires only 10 days. Patients no longer need to endure lengthy appointment wait times or shuttle between multiple specialists. This reflects BetterNight’s mission: to positively impact the lives of patients with sleep disorders by simplifying the complex journey from diagnosis to treatment.

In addition to the patient side, BetterNight also collaborates with physicians, health systems, clinics, and health plans across the United States to help them reduce healthcare expenditures for patients and improve management efficiency.

For example, the American Dental Association recommends that all dentists screen their patients for sleep-related breathing disorders. Consequently, BetterNight’s streamlined service enables linkage between telemedicine physician consultations and home sleep testing for dental patients, facilitating timely and standardized treatment.

Furthermore, in the United States, sleep issues affect nearly 40% of employees, leading to increased healthcare expenditures for employers. Despite this, both employees and employers often overlook sleep-related problems. To address this, BetterNight offers an employer-focused solution that enhances employee productivity while reducing employers’ medical costs.

BetterNight also provides clinics with specialized virtual care solutions, helping their patients improve sleep and overall health while reducing medical costs.

Dave French is the founder and CEO of BetterNight. He graduated from the University of Missouri with a Bachelor of Science in Business Administration. Prior to joining Sleep Data Services, LLC., the parent company of BetterNight, Dave co-founded Star Medical, a national durable medical equipment provider specializing in respiratory care products, where he served as CEO and President. In August 2011, Dave joined Sleep Data Services, LLC. as CEO, and he founded BetterNight on January 1, 2018.

Founder & CEO Dave French

Image source: BetterNight official website

Bretton Lane, President of BetterNight, has over 14 years of experience in sleep medicine.Bretton previously worked at Pacific Sleep Medicine. During this period, she directly managed thousands of sleep studies as a clinician and oversaw tens of thousands of sleep studies as General Manager. In 2010, Bretton joined BetterNight. Leveraging her experience, she introduced a sleep care management service focused on improving patient outcomes and providing population health metrics to clients.

Better President Bretton Lane

Image source: BetterNight official website

Meanwhile, BetterNight brings together polysomnography technicians, respiratory therapists, cognitive behavioral therapy counselors, and top-tier data analysts to achieve its ultimate goal: helping people lead more fulfilling, healthier, and more comfortable lives through consistent deep sleep at night.

Today, BetterNight has been providing positive airway pressure (PAP) services for over a decade, maintaining Joint Commission accreditation for more than ten years. Relying on a team of over 100 experienced sleep health professionals to meet patient needs, the company serves more than 22,000 patients annually.

In terms of commercial scenario selection, BetterNight collaborates directly with the transportation and high-risk industries, providing online consultation, diagnosis, and treatment services at their greatest convenience.

For example, drivers can consult directly with physicians via smartphone or laptop for 10–15 minutes to determine whether they need to undergo sleep apnea testing. If testing is required, BetterNight will deliver a sleep apnea testing device to a location convenient for the driver, along with chain-of-custody equipment. The driver only needs to wear the testing device for one night and return it the next day. If the driver’s sleep apnea test result is positive, therapeutic equipment will be delivered to them.

Throughout the process, drivers will receive continuous guidance and support, with all necessary reports provided. This approach has minimal impact on their daily lives and work, significantly saving their time.

The recurring waves of the pandemic have exerted varying degrees of impact and restrictions on clinical treatment and medical consultations. Therefore, it is crucial to develop safe and innovative approaches to meet patients’ sleep health needs. Seizing this opportunity, BetterNight partnered with Itamar Medical in April 2020 to jointly provide home-based virtual care sleep solutions for referred patients, facilitating the diagnosis and treatment of sleep apnea. Itamar Medical is a medical technology company focused on the development and commercialization of non-invasive medical devices, solutions, and digital health platforms to aid in the diagnosis of respiratory sleep disorders.

Itamar Medical's Products and Services

Image source: Itamar Medical official website

This agreement aims to fundamentally streamline the process by which physicians, both sleep specialists and non-sleep specialists (such as cardiologists), refer patients for sleep apnea testing using WatchPAT technology through the Itamar Medical and BetterNight platforms. The platform provides a comprehensive care pathway, including testing, medical consultation, continuous positive airway pressure (CPAP) therapy, billing, and reimbursement channels. This agreement increases patient access to WatchPAT testing without the need to leave home, while providing physicians—primarily cardiologists—and their patients with information and interventions to manage sleep apnea and improve health outcomes.

In a report titled “Innovative Medical Devices: Special Topic on the Sleep and Respiratory Care Industry—The Snowballing Effect of Major Chronic Diseases, with a Multi-Billion-Dollar Market Emerging,” released in September 2022 by the Research and Development Center of Southwest Securities, it was stated that there are currently nearly 1 billion OSA patients worldwide, with over 170 million patients in China.

However, the diagnosis rate of OSA in China is extremely low. Patients often fail to associate typical symptoms of OSA, such as daytime sleepiness and fatigue, with sleep-related breathing disorders, resulting in low public awareness of the condition. According to statistics from the Chinese Sleep Research Society, the diagnosis and treatment rate for OSA in China is less than 1%, far lower than the 20% diagnosis rate in the United States.

Comparison of OSA Diagnosis Rates Between the Two Countries

Image source: Southwest Securities

Ventilation masks, as the primary consumables requiring regular replacement in sleep therapy and care, accounted for RMB 190 million in the Chinese domestic market in 2020, representing 15.4% of the total domestic equipment market—significantly lower than the global proportion of 59.8%. This disparity is mainly attributed to low awareness of mask replacement and limited willingness to pay among Chinese consumers, indicating substantial room for future growth. It is projected that by 2030, the domestic market for home non-invasive ventilators and masks will reach RMB 10.17 billion, signaling the emergence of a multi-billion yuan market.

Currently, companies in China that specialize in the field of sleep apnea include BetterNight and Zhaoguan Technology. Notably, in June 2020, BetterNight launched China’s first medical-grade wearable device—the BetterNight Snoring Monitor 1.0—and established the country’s first three-tier collaborative snoring screening center. Zhaoguan Technology integrates sleep breathing monitoring with elderly care supervision. Leveraging core technologies such as advanced AI, bio-radar sensing, medical health detection, and big data, the company independently develops and manufactures wireless sleep breathing monitors and smart elderly care supervision systems.

As awareness of the health complications caused by sleep disorders continues to grow, the sleep care industry is rapidly expanding, and the time is ripe for disruption. Sleep is the champion’s true breakfast. In the future, we expect China’s domestic industry to provide more and better “breakfast” options for patients with sleep apnea.