The Rising Tide of Capital Investment

Virtually everyone has witnessed the contribution of lunar forces and the earth’s rotation to the rise and fall of tides.   The aging population, expanded healthcare coverage, increased risk assumption by providers and the shifting of financial responsibility to consumers, are exerting similar gravitational forces in the healthcare IT sector resulting in a “rising tide of capital investment”.   Recent examples from the week of July 28, 2014  include:

  • Censis Technologies: The Riverside Company has invested an undisclosed amount in Censis Technologies, a provider of SaaS-based surgical instrument tracking and workflow solutions for sterile processing departments of hospitals and ambulatory surgical centers.
  • LifeNexus:   Camden Partners, Cambia Health Solutions and Mosaic Health Solutions have made an undisclosed Series A investment in LifeNexus, which offers a mobile platform that delivers personalized health information and analytics to consumers and providers.
  • Lumeris: Camden Partners has invested approximately $71 million, along with existing and new investors, in Essence Group Holdings Corporation, parent of Lumeris, a provider of population health management solutions.
  • Proteus Digital:   Proteus Digital Health is creating a new category of products, services and data systems based on integrating medicines with mobile devices and cloud computing, and has raised an additional $52 million from new institutional investors in the second closing of its Series G financing, bringing its total fundraising in the series to over $172 million.
  • Qualifacts:   Great Hill Partners has made a control investment in Qualifacts Systems, a SaaS based EHR provider for the behavioral health and human services industries. The recapitalization will allow the company to accelerate product development, expand sales and marketing efforts, and identify strategic partnerships and possible acquisition opportunities.
  • XIFIN: GTCR has acquired XIFIN, a provider of cloud-based software and services to diagnostic service providers.

Firms that are smart enough to pursue capital collaborations when the tide is rising should be well positioned to withstand the predictable ebb and flow of the healthcare IT market.