Health Catalyst said Monday it raised $70 million in Series E funding co-led by Norwest Venture Partners and UPMC. MultiCare Health System and OSF Healthcare also took part as well as new investor Leerink Capital and existing investors Sequoia Capital, Sands Capital, Kaiser Permanente Ventures, CHV Capital (an Indiana UniversityHealth Company), Partners HealthCare, EPIC Venture Partners, Leavitt Equity Partners, and Tenaya Capital. Salt Lake City-based Health Catalyst is a healthcare data warehousing company.
SALT LAKE CITY, Feb. 29, 2016 /PRNewswire/ — Health Catalyst, a leader in healthcare data warehousing, analytics and outcomes improvement, announced the closing of a $70 million Series E funding round. The capital raise was co-led by Norwest Venture Partners, the lead investor in three previous rounds, and UPMC, a world-renowned healthcare provider and insurer that is also a Health Catalyst customer.
Two additional existing customers of Health Catalyst – MultiCare Health System and OSF Healthcare – also contributed to the funding round, continuing Health Catalyst’s successful model of investment by customers. Other contributors to the round were new investor Leerink Capital and existing investors Sequoia Capital, Sands Capital, Kaiser Permanente Ventures, CHV Capital (an Indiana UniversityHealth Company), Partners HealthCare, EPIC Venture Partners, Leavitt Equity Partners, and Tenaya Capital.
“We are pleased to join Health Catalyst as a customer, an innovation partner, and now as an investor,” said Tal Heppenstall, Executive Vice President and Treasurer of UPMC, and President of UPMC Enterprises, the venture capital and commercialization arm of UPMC. “This investment is a signal of our strong commitment to Health Catalyst, and to our mission of improving healthcare by supporting and developing market-leading companies and innovations.”
Proceeds from the financing will support a significant expansion of Health Catalyst’s outcomes improvement solutions for healthcare organizations.
“Amid a very challenging capital environment, we are honored to have been oversubscribed for this latest round of financing at an increased valuation relative to our most recent round, continuing a trend that we have been fortunate to experience throughout our history,” said Health Catalyst CEO Dan Burton. “We are grateful that new investors UPMC, MultiCare, OSF and Leerink, as well as our existing investors, have provided us with the opportunity to continue to grow and expand.”
Burton added, “As our customers have come to depend on us for data warehousing and analytics to drive outcomes improvement, they are also asking more of us. This new financing will help us to meet that request by expanding the breadth and depth of the solutions we provide for managing the cost and quality of care across whole populations of patients. We anticipate that this is the company’s last round of capital as a private company as we expect to be cash-flow sustainable by the fourth quarter of 2016.”
Accelerating product evolution
The arrival of new value-based reimbursement models is requiring providers to adopt new models of care centering on more proactive management of the highest-risk populations of patients. In response, Health Catalyst is evolving from an offline data aggregator and analysis company to a real-time data production and decision support company, integrating the knowledge derived from its unmatched data content and analytics into the decision workflow of clients and their patients, anywhere and on any device. This year, Health Catalyst expects to release new solutions for activity-based costing, care management, and real-time clinical decision support.
“Our new products, funded by this round, will enable better, faster decisions, from the population level to the individual patient level,” said Burton.
2015: A breakthrough year
The market’s rising valuation of Health Catalyst as a leader in healthcare outcomes improvement was secured by the company’s stellar performance in 2015. During the year, Health Catalyst experienced significant expansion in the number of patients served by its customers to over 65 million, doubled its bookings backlog, doubled its revenue, nearly doubled its customer footprint and increased the number of team members nationwide from approximately 230 to over 400.
Also in 2015, Health Catalyst grew the number of published outcomes improvement case studies to 61, reflecting the depth of its partnership with customers. In addition, Health Catalyst acquired important intellectual property from customers including Allina Health, Partners HealthCare, and UPMC to help catalyze outcomes improvement for healthcare organizations across the country.
About Norwest Venture Partners
Norwest Venture Partners (NVP) is a multi-stage investment firm that has partnered with entrepreneurs to build great businesses for more than 50 years. The firm manages more than $3.7 billion in capital and has funded over 500 companies since inception. Headquartered in Palo Alto, Calif., NVP has subsidiaries in Mumbai and Bengaluru, India and Herzelia, Israel. NVP makes early- to late-stage venture and growth equity investments across a wide range of sectors including: technology, information services, business services, financial services, consumer products/services and healthcare. For more information visit: www.nvp.com.
A world-renowned health care provider and insurer, Pittsburgh-based UPMC is inventing new models of patient-centered, cost-effective, accountable care. It provides more than $888 million a year in benefits to its communities, including more care to the region’s most vulnerable citizens than any other health care institution. The largest nongovernmental employer in Pennsylvania, UPMC integrates 60,000 employees, more than 20 hospitals, more than 500 doctors’ offices and outpatient sites, a 2.9-million-member health insurance division, and international and commercial operations. Affiliated with the University of Pittsburgh Schools of the Health Sciences, UPMC ranks No. 13 in the prestigious U.S. News & World Report annual Honor Roll of America’s Best Hospitals. For more information, go to UPMC.com.
About Health Catalyst
Health Catalyst is a mission-driven data warehousing, analytics and outcomes-improvement company that helps healthcare organizations of all sizes perform the clinical, financial, and operational reporting and analysis needed for population health andaccountable care. Our proven enterprise data warehouse (EDW) and analytics platform helps improve quality, add efficiency and lower costs in support of more than 65 million patients for organizations ranging from the largest US health system to forward-thinking physician practices. For more information, visit https://www.healthcatalyst.com, and follow us on Twitter, LinkedIn and Facebook.