Venture Capital News: Health Catalyst Nabs $100M
SILICON SLOPES, UT, Health Catalyst, a leader in next-generation data, analytics and improvement, announced the closing of a Series F equity and debt funding round
The round was led by OrbiMed, a leading healthcare public and private market investment firm. This equity and debt funding will provide Health Catalyst with access to up to $100 million in capital. Several existing investors including Sequoia Capital, Norwest Venture Partners, Sands Capital Ventures, UPMC Enterprises and Kaiser Permanente Ventures also contributed to the financing, which lifts Health Catalyst's value above $1 billion.
Proceeds from the financing will support continued expansion of Health Catalyst's technology and services offerings for healthcare transformation. The company is on a mission to unleash data as a catalyst for massive, sustained clinical, financial and operational improvements in the performance of healthcare organizations. In support of that mission, the Health Catalyst Data Operating System (DOS) is the foundation upon which the company has built an expanding library of analytics applications, supported by world-class services.
"As more healthcare organizations are coming to understand, the future of healthcare will rely on the broad and more effective use of their vast stores of data," said Health Catalyst CEO Dan Burton. "This additional capital will enable us to continue developing the technology and expertise necessary to offer health systems a path to systematically use data to analyze their performance, and then work to make measurable improvement in clinical, financial and operational areas. It will also help to support our expansion, already underway, into the life sciences and international markets."
2018: A Breakthrough Year
The market's rising valuation of Health Catalyst as a leader in data, analytics and improvement was secured through the company's strong performance in 2018. During the year, Health Catalyst experienced over 65% growth in its annual recurring revenue, over 50% growth in revenues, and over 80% growth in its gross profits. The company also added sixteen new health system customers in 2018, more than in any previous year in the company's 10-year history. Health Catalyst also added over 200 team members in 2018, to end the year with nearly 750 team members throughout the US. Also during the year, Health Catalyst's customers realized over 250 documented clinical, financial and operational improvements, by far the most of any year in the company's history.
The company's strong business performance in 2018 was mirrored by the high ratings it received from industry analysts, whose findings were based on surveys of Health Catalyst customers. Industry bellwether KLAS Research awarded Health Catalyst its "Best in KLAS" ranking for Business Intelligence, marking the second year in a row that Health Catalyst has been recognized by KLAS as the top-performing solution in the category for its ability to help turn raw data into clear insights that drive improved clinical, financial and operational performance. KLAS also named Health Catalyst to its exclusive "A-List" of Healthcare IT companies that combine high customer satisfaction with high rates of customer retention, in its April 2018 report, Decision Insights 2018: National Trends & Best Practices. And in December, KLAS ranked Health Catalyst second overall in its report on population health management vendors, Population Health Management 2018, Part 1.
On the product development front, Health Catalyst released several new applications in 2018 including Touchstone, a breakthrough analytics application featuring next-generation benchmarking and prioritization capabilities powered by Artificial Intelligence to supercharge healthcare improvement initiatives; and the Patient Safety Monitor Suite: Surveillance Module, the industry's first comprehensive patient safety application to use predictive and text analytics combined with concurrent clinician review of data to monitor, detect, predict and prevent threats to patient safety before harm can occur.
The year also saw Health Catalyst add significant new capabilities, talent and customers with its acquisition of Medicity, one of the nation's largest population health management companies with solutions for health information exchange (HIE), business intelligence, and provider and patient engagement. Medicity added to the Health Catalyst customer base more than 50 clients, including state and regional HIEs, large employers, health plans, health systems and providers in physician groups and extended care facilities. The combination is empowering connected communities with the insights required to improve healthcare outcomes, control costs, and advance population health management.
Long recognized as a "best place to work" by top healthcare and technology publications, Health Catalyst continued to add to its world-class leadership team in 2018 with several significant new hires. These included William Caldwell, M.D., former Senior Vice President of Clinical Integration at Novant Health; Jason Jones, formerly a senior analytics leader at Kaiser Permanente; Cathy R. Menkiena, former Senior Director of EHR Solutions at Encore Health Resources, an emids company; Ryan Smith, former Chief Information Officer (CIO) at Banner Health; Elia Stupka, formerly a bioinformatics leader at Dana-Farber Cancer Institute, and Director of Computational Biology and Genomics at Boehringer Ingelheim Pharma; and Steven Vance, former regional Chief Financial Officer and Compliance Officer at Intermountain Healthcare.
Also joining Health Catalyst in 2018, as strategic advisors, were healthcare luminaries Brent James, M.D., a global leader in bringing quality improvement science and methods to clinical care and the first Chief Quality Officer of Intermountain Healthcare; Eric Topol, M.D., Executive Vice President and Professor of Molecular Medicine at The Scripps Research Institute, and the Founder and Director of the Scripps Translational Science Institute; and Timothy Zoph, the former Senior Vice President of Administration and CIO at Northwestern Medicine in Chicago. Dr. James is also an investor in this latest round of financing.
OrbiMed is a leading investment firm dedicated exclusively to the healthcare sector, with approximately $13 billion in assets under management. OrbiMed invests across the spectrum of healthcare companies worldwide, from venture capital start-ups to large multinational companies. OrbiMed manages a series of private equity funds, public equity funds, royalty and credit funds and other investment vehicles.
About Health Catalyst
Health Catalyst is a next-generation data, analytics, and decision-support company, committed to being a catalyst for massive, sustained improvements in healthcare outcomes. We are the leaders in a new era of advanced predictive analytics for population health and value-based care with a suite of machine learning-driven solutions, decades of outcomes improvement expertise, and an unparalleled ability to unleash and integrate data from across the healthcare ecosystem. Our Health Catalyst Data Operating System (DOS)-a next-generation data warehouse and application development platform powered by data from more than 100 million patients, and encompassing over 1 trillion facts-helps improve quality, add efficiency and lower costs for organizations ranging from the largest US health system to forward-thinking physician practices. Our technology and professional services can help you keep patients engaged and healthy in their homes, communities, and workplaces, and we can help you optimize care delivery to those patients when it becomes necessary. We are grateful to be recognized by Fortune, Gallup, Glassdoor, Modern Healthcare and a host of others as a Best Place to Work in technology and healthcare. Visit www.healthcatalyst.com and follow us on Twitter, LinkedIn and Facebook.
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