Washington state’s Providence Health & Services today said it is launching a $150 million venture capital fund to help spur innovation across the healthcare system that lowers costs and leads to better outcomes.
Coincidentally, it’s the second VC fund announced in as many days on the West Coast, following yesterday’s announcement from the University of California.
Providence Ventures will invest $150 million over five to seven years, specifically targeting early- to mid-stage companies focused on six core areas: online primary care access, care coordination and patient engagement, chronic disease management, clinician experience, data analytics and consumer health and wellness, according to the announcement.
When Investment Rhymes with Canada
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The new fund will be led by Aaron Martin, senior vice president of strategy and innovation. Martin joined Providence from Amazon in early 2014.
The not-for-profit health system, which operates 34 hospitals and 475 physician clinics, is also creating its own internal Digital Innovation Group that will support startups and mid-stage companies the VC fund identifies. The group will build technology and support collaborations with the companies, developing “a consistent customer- and clinician-facing experience and innovate in areas where there are gaps in the technology marketplace,” it said in a release. That will enable Providence to not simply buy ideas but have a hand in building new innovations, the company said.
Funding and collaboration with early-stage innovators is already underway, according to Providence, and the internal group has already been put together. It was formed with both healthcare industry experts and also experts from industries that have already made strides in consumer-driven technology. To lead the digital effort, Providence has hired Mark Long as vice president of digital innovation, also from Amazon, and previously the chief technology officer of Zynx Health and a former NASA engineer.
The health system said it’s well-positioned to offer both capital and established healthcare expertise and access to its physicians for feedback and testing within the appropriate care settings.
“We are marrying the cultures of software innovation with health care delivery to create big ideas, build them using small-batch innovations and learn quickly in a rigorous, data-driven way,” Martin said in a statement. “Traditionally, collaborating with health care providers around digital technology has been difficult. We aim to change that by building a technical infrastructure and team that will make it easier for early-stage technology companies to collaborate with us so that we can improve health care delivery faster.”
“Consumers are now comparison-shopping, reading reviews and purchasing health care online. This trend will only accelerate as it has in every other industry,” he added.
The health system and its affiliates employ more than 74,000 people across five states – Alaska, California, Montana, Oregon and Washington – with its system office located in Renton, Washington.
