Carm Huntress says he's happy for the tens of thousands of dollars that UCHealth has invested in his startup software company, which offers physicians point-of-care prescribing guidance.
But beyond financing growth, the Colorado-based system's partnership has provided RxRevu developers with invaluable feedback from the frontline emergency room physicians who use the software, Huntress said. And that's increased the startup's credibility among customers both current and potential.
“It's been a real point of validation,” Huntress said of the two-year partnership. Across the country, emerging health technology companies like RxRevu, Binary Fountain and Augmedix are finding it beneficial to hitch their wagons, at least in part, to hospital venture capital funds.
More health systems are starting venture capital funds focused on healthcare after seeing the returns enjoyed over the years by pioneers such as Ascension, Dignity Health and Cleveland Clinic, said Derek Baird, vice president at Chicago-based Avia, a national network of health system innovators that itself receives venture capital from health systems.
Conversely, tech companies increasingly are tapping into the capital, expertise and connections that these hospital-sponsored funds can bring, Baird said. “We're seeing even midsized regional health systems start eight- to nine-figure venture capital funds.”
Over each of the past three years, venture capital funding of digital health companies exceeded $4 billion, according to a recent study by Rock Health. The data show that more venture investment went into digital health firms during the first month of 2016 than all of 2011.
UCHealth contributed a chunk of the nearly $4.7 million RxRevu has raised since early 2014. Denver-based RxRevu's software helps busy clinicians pick the right prescription for patients.