Private equity firm Concord Health Partners has been actively shaping the healthcare landscape since its inception in 2017, focusing on two critical imperatives: reducing costs while enhancing technological advancement. As artificial intelligence increasingly revolutionizes healthcare administration, diagnostics, and service delivery, a proliferation of health technology companies has emerged. The pressing challenge for stakeholders in this sector is to discern viable innovations from transient trends, a skill deemed essential for the future trajectory of healthcare.
James Olsen, founder and managing partner at Concord Health Partners, emphasised the need for optimising healthcare outcomes through innovation, stating, “We are disrupting healthcare in a way that optimizes the outcome. Those companies that should be successful can be successful." However, he noted that early-stage companies often struggle to transition to growth stages due to limited access to capital. "I think if you have all the right players involved you’ve got a good recipe for success," Olsen said.
Headquartered in Summit, New Jersey, Concord Health Partners prioritises investments in growth-stage healthcare technology and tech-enabled services. Olsen’s extensive experience as an investment banker at notable institutions such as Jefferies, Bank of America, and Merrill Lynch—where he executed transactions exceeding $25 billion—features prominently in the firm's strategic model. The firm aims to create an effective framework for healthcare by directing funds towards technology that enhances cost efficiency, quality, and accessibility.
The Concord Health team highlighted the pivotal role of health systems and payers within the healthcare private equity ecosystem, as articulated in their recent white paper. They asserted that health systems contribute not only capital but also serve as essential testing grounds for novel ideas, offering feedback as end-users of many products.
Concord’s extensive investor base includes healthcare systems and major clients, such as the American Healthcare Association (AHA), which influence the adoption of innovations developed by the firm’s portfolio companies. The relationship with AHA is particularly significant; in 2019, Concord launched a $50 million venture fund with the association focused on early-stage companies aiming to reform care delivery. Beyond financial support, AHA provides crucial insights into policy, market data, and analytics that facilitate the commercial success of Concord's investments.
Recently, the firm participated in Thyme Care’s $55 million Series C funding round. Thyme Care offers a value-based oncology management platform focusing on personalised care and quality-of-life improvements for cancer patients. Concord also recently reached a preliminary closing for its third fund as it seeks to amass $500 million in assets.
Concord has established a network of nearly 30 strategic investors, enabling direct communication with healthcare systems to better understand their challenges associated with the adoption of new technologies. Olsen elaborated, “Because we have nearly 30 strategic investors, we regularly dialogue with health systems to understand their priorities and pain points with respect to adopting and implementing new technologies.” This collaborative feedback loop continues post-investment, enhancing the commercial uptake of their innovations by leveraging AHA's network of 5,500 hospitals.
The firm has identified mental health services as a crucial area of interest, particularly since the COVID-19 pandemic has heightened awareness of mental health issues. In this regard, Concord collaborated with Dr Harsh Trivedi, a leading figure in behavioural health, to identify new investment opportunities. Notably, Iris Telehealth and NeuroFlow exemplify innovative portfolio companies. Iris Telehealth offers a virtual clinic for behavioural health, and its AI-driven platform, Iris Insights, aims to optimise financial and operational aspects of behavioural health strategies.
NeuroFlow, another recipient of Concord’s investment, is at the forefront of behavioural health solutions, combining AI-driven analytics with effective care collaboration and consumer engagement strategies.
In discussing the firm’s strategic approach to investments, Olsen noted that growth equity represents a unique opportunity for Concord, especially as valuations across private equity have moderated since 2021. He pointed out that, despite this, growth equity investments continue to thrive, yielding significant revenue increases. “We can’t control where the multiples are or capital markets, but we can influence the quality of the company in which we invest,” he remarked.
Olsen’s insights underscore an understanding that the healthcare industry does not often experience rapid change. Yet, he reiterated the ever-present demand for value, stating, “technology is not just addressing cost though, it is also a matter of quality and access to care.” He concluded with a keen observation regarding the mental health sector: “If we want to improve quality and outcomes, whether it is single payor or the current system you will need to leverage technology.” The current journey of Concord Health Partners thus highlights a pivotal blend of investment, technological innovation, and collaborative strategy in tackling modern healthcare challenges.
Source: Noah Wire Services