Philadelphiaâ€™s digital health start-ups receive $6m boost
December 20, 2016
Early stage digital health companies in Philadelphia are to get a boost through a $6m funding initiative. Ben Franklin Technology Partners of south-eastern Pennsylvania, Independence Health Group and Safeguard Scientifics have teamed up to foster healthcare IT innovation.
The $6m will be provided over a four-year period to grow technology-driven, early-stage healthcare start-ups.
Responding to a burgeoning economic vitality in digital health, Ben Franklin, IHG through a subsidiary, and Safeguard each intend to pledge $2m to launch the funding initiative and will identify, vet and allocate funds to augment the Philadelphia region's continued growth and development in digital health.
"Independence Health Group is committed to developing and supporting the next generation of digital health entrepreneurs and helping our region become a global centre for health care innovation," said Daniel Hilferty, president and CEO of IHG. "At our core is the belief that innovation is always knocking at the door. We want to champion healthcare entrepreneurship in our region and could not have found better partners for turning game-changing ideas into real world applications that will improve our members' well-being."
Through its subsidiaries, IHG serves nearly ten million people in 27 states and the District of Columbia, including 2.5 million in south-eastern Pennsylvania. In addition to a growing consumer business, it serves employer groups from small businesses to national corporations.
Each of the three companies will source new opportunities, extend guidance and support to the emerging seed-stage companies as they grow, and increase the impact of the capital committed to the companies and their communities. Start-up companies will receive funds based on the quality of their business model, the technology's viability and a strong vision from the management team.
Ben Franklin will lead the due diligence process and day-to-day fund management on potential opportunities. Ben Franklin is an early stage capital provider for the region's technology sectors. It is an initiative of the Pennsylvania Department of Community & Economic Development and is funded by the Ben Franklin Technology Development Authority.
"Joining with these leaders who bring domain knowledge and expertise strengthens greater Philadelphia's position to support one of its most thriving technology sectors," said Ben Franklin president and CEO RoseAnn Rosenthal. “Such a collaboration enhances and multiplies the quality of assessment, feedback and opportunity available to the region's digital health entrepreneurial talent, promoting developments to benefit our community while offering companies even more resources to start, stay and grow here.”
The three companies have demonstrated a commitment to healthcare innovation in the Philadelphia area, having previously announced their respective involvement in the Health Care Innovation Collaborative, which was initiated in 2015 by the Greater Philadelphia Chamber of Commerce's CEO Council for Growth.
Safeguard Scientifics, for example, provides capital and relevant expertise to fuel the growth of technology-driven businesses in healthcare, financial services and digital media. It targets companies that are capitalising on the next wave of enabling technologies with a particular focus on the IoT, enhanced security and artificial intelligence, which includes predictive analytics and machine learning.
"Founded more than 60 years ago, Safeguard has helped hundreds of companies reach their potential in several strategic verticals over the decades," said Safeguard's president and CEO Steve Zarrilli. "Our pragmatic approach has put Philadelphia on the map for entrepreneurs seeking capital. While we will always focus on our traditional sweet spot of series A and B financings, we believe that it's also important to put a stake in the ground and allocate resources to a broader spectrum of opportunities to support the full ecosystem of innovation and entrepreneurship. Safeguard recognises an opportunity to spur growth in the Philadelphia region, and this seed capital will ultimately build a pipeline of opportunities potentially suitable for future rounds of financing from Safeguard."