PHOENIX, May 28, 2015 /PRNewswire/ -- ClearDATA announced today the close of an over-subscribed $25 million Series C funding round with contributions from Heritage Group, HLM Venture Partners and Flare Capital Partners, along with existing investors Norwest Venture Partners, Merck Global Health Innovation Fund and Excel Venture Management. The investment will be used to maximize the cloud company's growth in the market for health information technology cloud computing, supporting its fourth consecutive year of 100+% YOY subscription revenue growth.
"Security breaches, HIPAA and compliance regulations, and data itself are amassing at levels that quickly outgrow the average existing health IT infrastructure," said Darin Brannan, CEO, ClearDATA. "Healthcare organizations recognize the need for a purpose-built healthcare exclusive provider to properly address these issues—and so do investors. We are excited to continue our momentum in the healthcare cloud market, which this new funding further accelerates."
Capitalizing on healthcare's changing landscape
A number of factors are fueling investor interest, including industry analyst forecasts that the US cloud computing market will grow at a healthy rate of 20-30 percent each year for the next five years. In a report published October 2014, Frost & Sullivan estimates the total US healthcare cloud market revenue at $900 million. ClearDATA projects IT cloud penetration in the US healthcare industry will grow to 50% in the next four to five years, representing approximately $6.5 billion of a $13 billion market for multi-cloud computing and managed services.
ClearDATA's own upward trajectory mirrors the health IT cloud's rapid market dominance. As an example, over the past year, ClearDATA was named North American Healthcare Cloud Leader for 2014 by Frost & Sullivan, acquired several marquee customers, achieved Common Security Framework Certified status from the Health Information Trust Alliance (HITRUST), and opened new offices in San Francisco and San Antonio. The company is also introducing major new products to address multi-cloud workloads such as its Healthcare Managed Services on Amazon Web Services, providing enhanced healthcare specialization, security and compliance, and manageability.
Solving key market problems
Healthcare IT infrastructure is aged, fragmented, and not built to house and manage large scale data sets—and internal IT staff are stretched too thin to keep at bay today's constant onslaught of data breaches. ClearDATA solves this problem by modernizing and managing infrastructure with its HealthDATA™ Cloud and SaaS HIT Cloud Management platform. In the process, ClearDATA secures and protects patient health information in a HIPAA-compliant environment for data interoperability, aggregation and access. ClearDATA's ongoing development of its SaaS HIT Cloud Management Platform aims to simplify the management of complex IT infrastructures by providing a single interface to manage and monitor resources in real-time across multiple platforms. This enables healthcare organizations to benefit from greater transparency, enhanced application and network security, and industry-leading compliance.
Partnering with influential investors
"We set out to align ourselves with value investors that have decades of relationships and strategic LPs (limited partners) in healthcare to contribute alongside their capital," said Aaron Barfoot, CFO, ClearDATA. "We believe we have unbeatable financial sponsors who have a long-term view of continuing to help us build a market-leading company in our category."
This latest round of financing was led by the healthcare technology industry's leading venture capital firms—Heritage Group, HLM Venture Partners and Flare Capital Partners—all of whom have deep ties with the country's largest and most influential network of healthcare providers, payers and other healthcare entities.
There are now over 30 major healthcare brands indirectly supporting ClearDATA via these new strategic healthcare venture capital firms, examples include: Intermountain Healthcare, Cardinal Health, Memorial Hermann, LifePoint Health, Health Care Service Corporation (HCSC), UnityPoint Health, Trinity Health (Livonia, MI), Tenet Health, Community Health Systems, and more.
HLM partner Marty Felsenthal, who will be joining the ClearDATA board, said, "Our strategic investors have a high degree of interest in ClearDATA. They recognize the benefits of cost reduction and enhanced security that a dedicated healthcare cloud solutions vendor can provide, particularly as more and more data in healthcare is created and analyzed so healthcare organizations can position themselves for success in a value-based reimbursement environment."
ClearDATA is exclusive to healthcare and is the industry leader in cloud computing, platform and information security services. More than 320,000 healthcare practitioners rely on ClearDATA's secure, HIPAA-compliant, HITRUST CSF-certified cloud, HealthDATA™ infrastructure and SaaS HIT Cloud Management platform to store, manage, protect and share their patient health information and critical applications. For more information, call (888) 899-2066 or visit www.cleardata.com.
About Heritage Group
Heritage Group is a Nashville-based, healthcare-exclusive venture capital firm with over 25 years of experience financing and operating healthcare companies at all stages. Created by a diverse group of the nation's leading healthcare services firms, the Heritage Healthcare Innovation Fund is a $167M strategic initiative focused on investments in businesses that improve the delivery of healthcare services. The unique structure of our Fund provides an opportunity for our strategic partners to collaborate on new ideas, to promote companies that have proven value and to participate in their commercial success.
About HLM Venture Partners
HLM Venture Partners with offices in Boston and San Francisco, is a leading healthcare-only venture capital firm providing capital to emerging companies focused on healthcare services, healthcare information technology and medical devices. HLM has over $400 million of venture capital under management and works with the leading growth companies that are improving the quality of healthcare while reducing overall costs. In addition to traditional financial sponsors, HLM invests on behalf of some of the nation's largest and most influential health plans, hospital systems, pharmacy chains, and healthcare foundations. These investors collectively provide insurance to more than 100 million Americans, operate more than 12,000 hospital beds, and fill prescriptions for approximately 100 million Americans.
About Flare Capital Partners
Flare Capital Partners, previously Foundation Medical Partners, is a team of proven healthcare-only technology venture capital investors known for their unparalleled strategic industry resources, insight and total commitment to the success of entrepreneurs. Flare Capital Partners specializes in investments in healthcare technology innovation providing leadership, support, and strategic resources at every phase of a company's development. The firm manages approximately $400 million and is based in Boston.
About Merck Global Health Innovation Fund, LLC
Merck Global Health Innovation Fund, LLC (GHIF) invests in emerging companies that deliver breakthrough health care solutions, which advance Merck's mission to discover, develop and provide innovative products and services that save and improve lives. For more information, visit www.merck.com/ghi.
About Excel Venture Management
Excel Venture Management builds companies that apply transformative technologies to solve problems in healthcare and beyond. The Excel investment portfolio is balanced across healthcare IT and services, diagnostics, and medical devices, plus life science platforms. Example investments include Tetraphase (TTPH), Aileron, Aventura, Cleveland HeartLab, Qstream, ShapeUp and Synthetic Genomics.
About Norwest Venture Partners
Norwest Venture Partners (NVP) is a global, multi-stage venture capital and growth equity investment firm that has partnered with entrepreneurs to build great businesses for more than 50 years. The firm manages approximately $5 billion in capital and has funded more than 550 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, please visit www.nvp.com Follow NVP on Twitter @NorwestVP
Amendola Communications for ClearDATA
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