Hospitals, Health Tech

OSF Ventures just launched a $100M fund. Where will it spend the money?

OSF HealthCare has made 26 direct investments to date in addition to investing in three healthcare-focused venture funds. The latest venture fund is the largest at $100 million, putting total assets for its investment program at $250 million.

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OSF Ventures, the venture arm of OSF HealthCare, recently announced that it has launched its third and largest-to-date fund worth $100 million. 

The goal, unsurprisingly, will be to continue to identify companies that are already using or developing emerging technologies to boost outcomes, improve the patient experience, and potentially reduce health system cost.

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For 2022, some key areas of focus will be next generation business and care models, community health and social determinants of health, radical efficiency, big data and the internet of medical things, and genomics and precision medicine. 

“We’re looking at med tech products, including diagnostics and therapeutics, that can make a difference,” said Stan Lynall, vice president of venture investments for OSF Ventures, said in an email.

Each year, it receives anywhere from 200 to 300 pitches from companies developing innovative healthcare solutions. Since the inception of the venture fund in 2016, OSF Ventures has vetted nearly 1,500 opportunities. With the largest fund raised till date, perhaps many more will now have their shot.

The Peoria, Illinois based health system, which has 15 hospitals in that state and Michigan, has made 26 direct investments to date, in addition to investing in three healthcare-focused venture funds.

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With the third fund valued at $100 million, total assets under management stand at $250 million for the venture program.

To sift through the investment pitches, OSF Ventures taps clinical and operational subject matter experts and whittle down who should get a closer look.

“They are a critical voice in helping our team understand whether a solution will solve a real need, be embraced by the people we serve or can improve the standard of care,” Lynall said. “And they are the first line of approval for a majority of companies that come into the OSF Ventures pipeline.”

OSF HealthCare has worked with many OSF Ventures portfolio companies to customize products and services, including some that help the health system care for people at home. Among the examples:

  • DotCom Therapy  OSF is working with this teletherapy company that hand-matches children with therapists best suited to meet their needs through virtual therapy. (Besides direct therapy, the company also provides education to schools, health systems and community programs.) Specifically, OSF is launching a pilot to support OSF teams in helping reduce the time to diagnose autism.
  • PhotoniCare PhotoniCare developed a more precise way to detect middle ear infections in kids and adults using light wave technology to peer through the eardum. The device, called the OtoSight Middle Ear Scope, provides a non-invasive way to visualize middle ear fluid. It was successfully piloted at two OSF locations with plans for expansion, according the health system. 
  • Socially Determined  This company uses comprehensive data to help OSF HealthCare providers better understand the impact of social determinants of health and empower them to modify care models to improve community health. “Socially Determined is the data backbone that is also helping OSF HealthCare determine where and how community health workers will be deployed and most effective in our communities,” the company noted.

Lynall also points to the strides it’s made with SilverCloud, a behavioral health platform people can use for help managing feelings and causes of depression, anxiety and stress. Through its venture program, OSF has worked closely with innovators in the digital health space, and it piloted and fully implemented SilverCloud after being an early adopter.

That ability to have portfolio company technologies finding a home at OSF HealthCare has been key during the pandemic.

“Entrepreneurs appreciate early adoption of their technology and we value having access to the best, cutting edge solutions,” said Michelle Conger, chief strategy officer and CEO of OSF OnCall Digital Health in a news release announcing the launch of the third fund. “For example, we had a head start in the early days of the pandemic, because we had already vetted solutions and had strategically planned for implementing several of the new communication tools we deployed, albeit at an accelerated pace. We were prepared because of our long-range innovation plan, including important investments and collaborations through OSF Ventures.

Photo: drogatnev, Getty Images