In another sign of the growing VC interest in healthcare technology companies, data warehousing and analytics software company, Health Catalyst, has raised another $41 million in funding.
Firms including Sequoia Capital, Norwest Venture Partners, Kaiser Permanente Ventures, Sorenson Capital, CHV Capital and Partners Healthcare doubled down on their commitment to Health Catalyst with the new financing.
Health Catalyst plans to invest $50 million in product development over the next 24 months, including production of a slew of what it calls “content-driven clinical applications”, according to a statement from the company.
Chief executive Dan Burton called data warehousing and analytics tools “foundational” to the success of healthcare organizations under new payment models.
The Salt Lake City-based company said its bookings had increased fivefold year-over-year and that it expects to see positive cash flows during the calendar year.
Customers using the company’s software include: Crystal Run Healthcare, a New York-based healthcare group; Kaiser Permanente, whose venture group was an investor in Health Catalyst’s $41 million Series B round last year; Memorial Hospital in Gulfport, Miss.; and the Bay Area nonprofit NorthBay Healthcare.
Venture investors are backing companies developing information technology for the healthcare industry, as healthcare providers and insurers grapple with the overhaul of the entire industry mandated by the Affordable Care Act.
There’s no argument from venture investors that healthcare is a big opportunity. In 2013, investors spent over $1.9 billion in 195 deals with commitments over $2 million, according to a report from early stage investment firm Rock Health.
Funding was up 39% from 2012 and 119% from 2011, the Rock Health report said.
Photo via Flickr user Josh McGinn