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Launching Oak HC/FT II – Our View from the Room Where It Happens

By Oak HC/FT Co-Founders Annie Lamont, Andrew Adams, and Tricia Kemp

The art of the trade

How the sausage gets made

We just assume that it happens

But no one else is in

The room where it happens.*

Here’s our view from the room where Oak HC/FT II happens:

A couple months ago, we began raising our second fund to further our efforts around partnering with promising tech-enabled Healthcare and FinTech companies. Today, we’re announcing the launch of this $600 million fund to continue supporting leading entrepreneurs with their attack on quality issues, inefficiencies, and poor customer experiences that persist across the multi-trillion-dollar Healthcare and Financial Services markets.

Instead of waiting for elected leaders in Washington to advance legislation around these two important sectors, we’re working with the most promising private enterprises to tackle the biggest issues head on –high drug costs, treating patients with complex medical conditions, modernizing payment systems and insurance frameworks, and reducing financial fraud/waste/abuse. Complexity is an understatement in Healthcare and FinTech, but challenge ignites the spark of so many opportunities. We’re confident our approach and the strategies of our companies will prevail regardless of political agenda or regulation.

When we founded Oak HC/FT three years ago, our mission was to build on our 15 years of experience and partner with world-class entrepreneurs using technology and data to tackle complex problems in Healthcare and Financial Services. That’s exactly what we achieved with our first fund, having backed leading companies like Aspire Health, Hometeam, and VillageMD that are improving medical care and reducing spending; Quartet Health, US HealthVest, and Axial that are better managing high-cost populations; Limeade, LDI, and Maestro Health that are improving health and spending for employers; Feedzai that uses machine-learning to reduce financial fraud; Poynt, Urjanet, and FastPay that are streamlining payment data and processing; and Trov and Insureon that are modernizing insurance delivery. With our second fund, we will continue searching across the United States and Europe to identify attractive opportunities that advance our mission in these sectors.

In addition to working with great entrepreneurs, we’ve also been fortunate to partner with talented colleagues. Since closing our first fund in 2014, we’ve assembled an amazing team of professionals to provide unparalleled support to our companies. In Healthcare, we added Dr. Zeke Emanuel, Nancy Brown, and Chris Price who all bring peerless industry expertise. That talent has been matched on our FinTech team with Anil Aggarwal, Jonathan Weiner, and Michael Heller. Add-in our long-time Technology Partner, David Black, and our next generation of professionals in Matt, Vig, Oivind, Jack, and Andy, and it’s tough for any entrepreneur to find a team better equipped to scale Healthcare and FinTech businesses and solve problems.

We are also fortunate to have assembled an exceptional group of investors – many long-time supporters of our strategy and a few new relationships that offer fresh perspectives and strategic insights.

In short, we’re bent on building strong teams and great companies. It is especially rewarding to see the businesses we’ve worked with in the past continue their growth – either as public companies or as innovation engines for larger companies, as evidenced by our recent exit, Core Informatics.

Creating Oak HC/FT and growing the firm has been an absolute blast. There is nothing better than waking up every morning to work with our unmatched team and exceptional entrepreneurs – all passionate about improving Healthcare and Financial Services. Building a portfolio and helping our companies and investors succeed will always be an adventure. We are excited to continue this journey, and we are grateful to our investors for their support with today’s Oak HC/FT II fund launch.

 

*Lyrics from “The Room Where It Happens” by Lin-Manuel Miranda © 2015.

Newsroom

NVCA Honors Leaders of Venture Industry at Leadership Gala (Annie Lamont, Excellence in Healthcare Innovation Award Winner)

This originally appeared on NVCA’s website on March 8, 2017 
 
MENLO PARK, CA – The National Venture Capital Association (NVCA) today honored leaders of the venture capital industry at the annual NVCA Leadership Gala for their significant contributions to advance innovation, strengthen the industry and promote entrepreneurship.  In addition to the Lifetime Achievement in Venture Capital Award, Outstanding Service Award and American Spirit Award, NVCA added three new categories to the lineup this year, including the Rising Star Award, the Excellence in Healthcare Innovation Award and the Venture Firm of the Year Award.

The 2017 award recipients and winners include:

  • Lifetime Achievement in Venture Capital – Bill Draper, General Partner at Draper Richards
  • Outstanding Service Award – Ross Jaffe MD, Managing Director at Versant Ventures
  • American Spirit Award – Ray Leach, CEO at JumpStart Inc.
  • Rising Star Award – Kristina Shen, Vice President at Bessemer Venture Partners
  • Excellence in Healthcare Innovation – Annie Lamont, Managing Partner at Oak HC/FT
  • Venture Firm of the Year – Emergence Capital

About the Awards

Lifetime Achievement in Venture Capital Award

The Lifetime Achievement in Venture Capital Award was created to recognize venture professionals who have dedicated their professional lives to creating and building successful and highly competitive venture firms as well as portfolio companies that have made a significant contribution to the growth and success of the U.S. economy.  Recipients of the Lifetime Achievement Award were instrumental in the formation and growth of the venture capital industry and have consistently set high performance standards for the entire industry.

Previous recipients: Chuck Newhall, Mike Moritz, Mark Heesen, Arthur Rock, Sam Colella, Felda Hardymon, James Blair, Brook Byers, Jean Deleage, Anthony Evnin, Grant Heidrich, Jim Swartz, Bill Hambrecht, Sandy Robertson, Thomas Weisel, Edward Glassmeyer, Peter Crisp, Henry McCance, Paul Wythes, Lionel Pincus, Pitch Johnson, Richard Kramlich, Stanley Golder, Burton McMurtry, Reid Dennis, Peter Brooke, Thomas Perkins, Stanley Golder and David Morgenthaler.

Outstanding Service Award

The Outstanding Service Award was created to recognize the exceptional service of an NVCA Director or NVCA member who has committed an extraordinary amount of time, resources and dedication to Association efforts that in turn benefits the entire venture industry.  The dedication has raised the visibility of the industry to key legislators and regulators and helped to educate them regarding the pivotal role of venture capital to this economy.

Previous recipients: Diana Frazier, Josh Green, Kate Mitchell, Steve Frederick, Ted Schlein, Warburg Pincus, Jack Lasersohn, Sarah Reed, John Martinson, Robert Pavey, Rodney Goldstein, E. Roe Stamps, M. Kathleen Behrens, Steven Lazarus, Harry T. Rein, Patricia Cloherty, John Doerr and Christopher Brody.

American Spirit Award

The American Spirit Award was created to recognize NVCA members who have shown philanthropic leadership by applying business skills, knowledge, expertise and resources to make an outstanding contribution to society.

Previous recipients: Jeff Fagnan, Robin Richards Donohoe, William Sahlman, Peter Bancroft, Chuck Newhall, Joe Aragona, Ewing Marion Kauffman Foundation, John Doerr, Alan Patricof, William Bowes, Peter Wendell, Floyd Kvamme, William Draper III, Martin Koldyke and Gib Myers.

Rising Star Award

The Rising Star Award was created to recognize the next generation of venture capital professionals who are rising through ranks and establishing themselves as future standard bearers of the industry.  Recipients of the award have demonstrated a mastery of venture capital investing gleaned through a relatively short amount of time in the industry and are widely recognized by their peers and others as emerging leaders of the venture capital industry.

Previous Recipients: NA

Excellence in Healthcare Innovation Award

For over three decades, venture capital has been at the forefront of some of the greatest advancements in medicine, pushing the boundaries of medical innovation and spurring the creation of the biotechnology and medical device industries.  The Excellence in Healthcare Innovation Award was created to recognize those who have demonstrated a clear commitment to the advancement of healthcare innovation through their investment in and support of groundbreaking medical companies that are working on treatments and cures for the most deadly and costly diseases.

Venture Firm of the Year Award

The Venture Firm of the Year Award was created to recognize venture capital firms for their significant contributions to advance the entrepreneurial ecosystem and generate returns for their investors.  Firms receiving the award are recognized for strong fund performance and high exit multiples for recent exits.

Previous Recipients: NA

Newsroom

Thermo Fisher Scientific Acquires Core Informatics, Provider of Leading Cloud-Based Scientific Data Platforms

WALTHAM, Mass. & BRANFORD, Conn.–(BUSINESS WIRE)–Thermo Fisher Scientific Inc., the world leader in serving science, today announced that it has acquired Core Informatics, which provides a leading cloud-based platform supporting scientific data management. Core’s offerings will significantly enhance Thermo Fisher’s existing informatics solutions and complement its cloud platform, which supports the company’s genetic analysis, qPCR and proteomics systems.

Core’s capabilities include laboratory information management systems (LIMS), electronic laboratory notebook (ELN) technologies and scientific data management solutions (SDMS). The business also offers an Application Marketplace to speed deployment and increase value for customers across a broad range of industries and scientific workflows. Core Informatics’ state-of-the-art laboratory data-management solutions are used by leading biopharma, genomics and other scientific and industrial organizations.

“The scientific community is rapidly adopting cloud-based laboratory and scientific data management capabilities,” said Thomas Loewald, senior vice president and chief commercial officer, Thermo Fisher Scientific. “Integrating the leading technologies of Core Informatics is part of our strategy to set the standard for digital science solutions, from life sciences discovery to applied markets and manufacturing.”

“We are thrilled to join the Thermo Fisher Scientific team to help accelerate the future of the digital lab,” said Josh Geballe, chief executive officer, Core Informatics. “We are excited to become part of the world leader in serving science and look forward to the additional benefits this will bring to our innovative clients and amazing team.”

About Core Informatics

Core Informatics partners with customers in biopharma, genomics, and other industries to deliver lab informatics solutions to derive more value and insight from their scientific data. Core Informatics provides the scalable and extensible Platform for Science that enables customers to quickly and easily build workflows to meet their specific needs and add capabilities as they grow. Based in Branford, Connecticut, Core Informatics has been recognized numerous times as one of the fastest growing private companies in the United States and as one of Connecticut’s best places to work. For more information, please visit http://www.coreinformatics.com

About Thermo Fisher Scientific

Thermo Fisher Scientific Inc. is the world leader in serving science, with revenues of $18 billion and more than 55,000 employees globally. Our mission is to enable our customers to make the world healthier, cleaner and safer. We help our customers accelerate life sciences research, solve complex analytical challenges, improve patient diagnostics and increase laboratory productivity. Through our premier brands – Thermo Scientific, Applied Biosystems, Invitrogen, Fisher Scientific and Unity Lab Services – we offer an unmatched combination of innovative technologies, purchasing convenience and comprehensive support. For more information, please visit www.thermofisher.com.

Newsroom

Urjanet Announces $20 Million in Series C Funding from Oak HC/FT

Oak HC/FT investment to drive international expansion and launch of new data applications for financial services organizations

Urjanet, the world-wide leader for utility data, today announced $20 million of new funding in a Series C round led by Oak HC/FT. Urjanet offers a data-as-a-service (DaaS) solution that provides line-item detail of cost and usage information from approximately 4,000 utilities in 30 countries. The data that Urjanet accesses from electric, gas, telco, water, and waste providers enables SMEs and multinational companies to automate their accounting and bill processing, manage energy costs, comply with energy reporting regulations, and monitor sustainability.

The round of funding comes as government agencies, such as the CFPB, as well as private financial institutions have recently made steps to explore programs to incorporate alternative sources of consumer payment data, such as utilities and rent, to make credit and lending decisions. The funding will enable Urjanet to expand its global network of utility providers as well as launch new data applications in the financial services industry that focus on alternative credit scoring and identity verification.

“We are excited to advance our mission to equip companies with the data they need to manage billing and payments, energy consumption and utility costs, and achieve sustainability goals,” said Sanjoy Malik, CEO of Urjanet, commenting on the investment round. “Oak HC/FT’s financing will enable us to broaden our reach to the world’s largest corporations and utility providers, as well as accelerate our launch of new applications using utility data as an alternative source for credit scoring and identity verification.”

Patricia Kemp, general partner at Oak HC/FT, added, “Urjanet is tackling a critical concern for many companies: managing their complex utility expenses and billing data. We look forward to working with Sanjoy and the Urjanet team, as they roll out their data service to new customers, and expand their reach into adjacent markets and financial services.”

Oak HC/FT is the premier venture growth-equity fund investing in Healthcare Information & Services (“HC”) and Financial Services Technology (“FT”). Urjanet is the 16th investment by Oak HC/FT since launching the inaugural $500 million fund in June 2014. The fund and its investors contain deep domain experience and are uniquely positioned to provide entrepreneurs and companies with strategic counsel, board-level participation, and access to an extensive network of industry leaders. Ms. Kemp will join the board of Urjanet.

Urjanet is based in Atlanta and was founded at ATDC (Advanced Technology Development Center). The technology was developed at the Georgia Institute of Technology through a research and funding partnership with the National Science Foundation and the Georgia Research Alliance (GRA). Investors include Grotech Ventures, and Correlation Ventures, Imlay Investments, and the GRA.

ABOUT URJANET

Urjanet’s mission is to provide the world with easy access to automated utility data. Our cloud-based platform connects directly to utilities to seamlessly acquire and normalize disparate utility bill and interval data. The process data is delivered directly to industry-leading business applications.

Public and private organizations across the world use Urjanet data to achieve sustainability goals and reduce energy consumption and cost. Urjanet is rapidly becoming the global standard for utility data and powers applications from the leading energy and sustainability providers.

Urjanet is a privately-held company headquartered in Atlanta, Georgia. For more information, visit www.urjanet.com

ABOUT OAK HC/FT

Oak HC/FT (http://oakhcft.com) is the premier venture growth-equity fund investing in Healthcare Information & Services (“HC”) and Financial Services Technology (“FT”). We are focused on driving transformation in these industries by providing entrepreneurs and companies with strategic counsel, board-level participation, business plan execution and access to our extensive network of industry leaders.

Contacts

Urjanet
Angela Sun, 508-982-2448
angela.sun@urjanet.com
or
Oak HC/FT
Erica Sunkin, 212-729-2126
erica.sunkin@edelman.com

Newsroom

WSJ: Stand Up for ObamaCare, CEOs

This article originally appeared in The Wall Street Journal on Jan. 3, 2017 7:08 p.m. ET 

By Annie Lamont and Ezekiel J. Emanuel

One company’s managers think repeal would raise its health-care costs by hundreds of millions.

America’s CEOs might not admit it in public, but the Affordable Care Act—aka ObamaCare—has been good for business. Company benefits managers have watched as the double-digit premium increases under President George W. Bush slowed to a crawl. Venture funding has flooded into health care, boosting startups and stimulating innovation. This is the progress President Obama is trying to preserve as he meets Wednesday with Democrats on Capitol Hill in a strategy session about how to protect the health law.

To take a single benchmark, look at families who receive insurance coverage through an employer. Between 2001 and 2008, their average premium jumped nearly 80%, according to annual survey data from the Kaiser Family Foundation and the Health Research and Educational Trust. Under President Obama, the increase was only 36%. This represents real money: If the Bush-era rate of inflation had continued through 2016, each of these families would be spending about $5,000 more on annual premiums. For employers, the savings open the door to hiring more workers or raising wages.

At the same time, investment in medicine has boomed. Between 2011 and 2015, venture funding for health care—including biotechnology and medical devices—totaled approximately $62 billion, according to figures from PitchBook. In the four years before the Affordable Care Act, the total was $47 billion. New companies are working to improve everything from primary care, to home palliative care, to the management of mental health. These innovations are now beginning to realize cost savings.

The Republican plan to repeal and replace the Affordable Care Act threatens to reignite health-care inflation. First, this approach produces significant uncertainty in the market. The GOP has promised immediate repeal, but the talk of what would replace the health law—and when—is vague. “I don’t want to set a time limit that this has to get done by this certain date,” Rep. Kevin McCarthy, the majority leader, said in late November.

It is easy to repeal ObamaCare’s subsidies and the mandate to buy insurance, since that can be done with only 51 Senate votes using the “reconciliation” procedure. But enacting a replacement is harder, maybe impossible, since it would require 60 Senate votes to overcome a filibuster. Insurance companies hate uncertainty and respond by raising rates to hedge their risk.

A second problem is “cost shifting.” If Republicans repeal and replace the Affordable Care Act, millions of Americans will probably lose their insurance. The replacement proposal offered by House Speaker Paul Ryan would lead to four million fewer insured people by 2026, according to a review by the Center for Health and Economy. Nine million could lose coverage under the replacement plan offered by Sen. Richard Burr, Sen. Orrin Hatch and Rep. Fred Upton, according to scholars from Rand Corp.

The bulk of these newly uninsured would be low-income Americans who can’t afford private coverage despite the tax credits built into Republican plans. But such people will still be treated when they get sick. Though they cannot pay for it, they will still receive care at hospitals, urgent-care outlets and doctors’ offices. These costs will be rolled into the line item “uncompensated care”—which is ultimately paid for by higher prices on everyone else.

The Affordable Care Act has helped minimize this cost shifting. Specifically, the law’s expansion of Medicaid cut hospitals’ uncompensated care by roughly a third from 2013 to 2014, according to a study in Health Affairs. At the University of Pennsylvania Health System, bad debt—the accounting term for bills that are written off when patients can’t pay them—decreased from 6.1% of revenue in 2014 to 3.9% last year. Taken nationally, a drop that size is worth nearly $25 billion a year.
The GOP’s plans will reverse these incentives. Republicans want to send Medicaid back to the states using block grants. More important, they want Washington’s contribution to Medicaid to grow more slowly than the actual costs. A 2014 analysis by the Bipartisan Policy Center estimated that Rep. Ryan’s plans to block-grant Medicaid would reduce federal funding for the program by $160 billion in 2022.

State legislators are likely to respond in two ways. They can tighten Medicaid eligibility to reduce the number of recipients, which will increase the ranks of the uninsured. Or they can cut the rates that Medicaid pays to hospitals and physicians, who would make up the difference by increasing prices on everyone else.

Critics of the Affordable Care Act argue that when previously uninsured people gain coverage through Medicaid, they tend to use expensive emergency-room services. But people who have just gotten coverage can’t be expected to become sophisticated health-care consumers overnight. The use of the ER suggests they have unmet medical needs. Over time they can be educated to develop standard relationships with physicians. Even factoring in this greater use of ERs, however, the per person costs of Medicaid have decreased since 2010 after adjusting for inflation.

Businesses know all this. In response to the GOP’s call to “repeal and replace” ObamaCare, one Fortune 100 company with hundreds of thousands of employees is developing two HR budgets. The first reflects the status quo. The second factors in the higher prices Americans will face if more people become uninsured. Although these estimates aren’t final, the company thinks its health-care costs could rise by tens of millions of dollars in a single year if the Affordable Care Act is repealed and replaced.

President Obama’s health law really has been good for business. Republicans’ plan to dismantle it will take the country back to an era of high health-care inflation. If only CEOs would say as much before it is too late.

Ms. Lamont is a managing partner of Oak HC/FT, a venture fund investing in health care and financial services. Dr. Emanuel is vice provost for global initiatives, as well as chairman of the Department of Medical Ethics and Health Policy, at the University of Pennsylvania.

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