LRVHealth is a collaborative investing platform for healthcare insiders, by healthcare insiders
Venture capital used to be a cottage industry, with very few investing in tomorrow's products and services. Oh, how times have changed! While there are more startups than ever, there's also more money chasing them. In this series, we look at the new (or relatively new) VCs in the early stages: seed and Series A.
But just who are these funds and venture capitalists that run them? What kinds of investments do they like making, and how do they see themselves in the VC landscape?
We're highlighting key members of the community to find out.
Keith Figlioli is a General Partner at LRVHealth.
Figlioli was most recently Premier, Inc.’s Senior Vice President of healthcare informatics. In this role, he oversaw the company’s enterprise healthcare technology business unit spanning strategy, sales, marketing, client support, development, delivery, and operations. Prior to Premier, Keith was with Eclipsys (acquired by Allscripts) as its Senior Vice President of Enterprise Solutions, where he was responsible for all go-to-market activities, market planning, and solution strategic direction across clinical, financial, and operational product offerings.
Earlier in his career, Figlioli was the senior business development executive at a management consulting and systems integration company focusing on Fortune 1000 companies and previously served in a variety of business development and marketing roles within the health information technology industry including work for Per-Se Technologies, Medaphis and NEC.
Figlioli has an M.B.A. from Boston University and a B.A. from Wheaton College. He is a member of the Board of Trustees at Wheaton College, founder and executive chairman of Censinet, Inc, a board observer of Cyft, Intelycare, and Diameter Health, and a strategic advisor for the SMART on FHIR platform initiative.
VatorNews: What is your investment philosophy or methodology?
Keith Figlioli: We’re an “inside healthcare” investing platform that brings together an experienced team of healthcare investors, operators, and advisors. We currently have 11 strategic health system and payer partners at the core of our fourth fund, which we announced in early 2018. Our partners deliver care to over 50 million Americans across 25 states. We work in partnership with each of these partners to create, review, and implement a specific investment thesis at the intersection of healthcare transformation and their strategic needs.
VN: What's your investment thesis and categories/stage of interest?
KF: LRVHealth’s platform is specifically designed for identifying, creating and investing in U.S.-based, disruptive, early-stage digital health companies across healthcare IT, healthcare technology enabled services, devices and diagnostics.
VN: What's the big macro trend you're betting on?
KF: In the United States, we spend an astonishing amount on healthcare. It’s approaching 20 percent of GDP with no signs of slowing down, yet quality, access to care and outcomes are no better than anywhere else in the world. In fact, they’re worse than many places that spend far less.
Turning this ship around will take time, but it’s something that has to – and will – be done. Technology can be a major part of the solution, and with the amazing network we’ve built, we can identify the most promising companies and help them quickly scale to address the industry’s biggest challenge of runaway costs.
VN: What stage/Series do you invest in (and how much is that in dollar amount for you) and what kind of traction does a startup need?
KF: LRVHealth is focused on early-stage deals across Series A and Series B but will also do some Seed investing in specific situations. Typically, the size of these rounds will be about $10 million or less. In the majority of our deals, we will be the first institutional investor for a company and help build the first institutional investor syndicate.
VN: What other signals do you look for? Team, Product, Macro market?
KF: The team is always important, especially with earlier-stage investments. For example, we generally won’t do a seed investment unless it’s with a proven entrepreneur. It has to be someone from our network or someone that we have another deep connection with. But because of the network we’ve built with strategic limited partners from inside the industry, we’re in a great position to find those people.
VN: What do you think about valuations these days? What's a typical Seed pre-money valuation and Series A?
KF: As most folks know, the digital health valuations are probably at an all-time high. Given the potential changing macro economy, we do believe that valuations will begin to drift down over the course of 2019.
VN: There are many venture funds out there today, how do you differentiate yourself to limited partners?
KF: LRVHealth is a collaborative investing platform for healthcare insiders, by healthcare insiders. If you’re simply looking for a return on capital invested, then yes, there are many funds out there to choose from. But we provide our strategic partners with more than that. While delivering superior returns is always first and foremost, we also help provide an operational advantage through early insight and access to innovations that can address the biggest challenges facing their organizations. In addition, LRVHealth’s general partners have over 70 years of collective operational experience in the healthcare industry that also separates us from most partnerships.
VN: There are many venture funds out there today, how do you differentiate your fund to entrepreneurs?
KF: LRVHealth’s network has grown to 11 health systems and payers delivering care across 25 states to almost 50 million Americans. Our collective network of strategic limited partners (SLPs) and advisors gives LRVHealth unique visibility into the nuances of regional differences across the healthcare landscape as well as access to many of the industry’s leading subject matter experts. That’s an extremely valuable proposition for any startup or entrepreneur.
Anyone in our ecosystem has the ability to see, test, and adopt new ideas from portfolio companies. And any of our portfolio companies can seek advice or guidance from our network. We also actively curate and share best practices for developing test beds, data sandboxes, and innovation processes to ensure everyone is putting their best foot forward.
VN: Name a couple of investments you're super excited about and why. What are some lessons you learned?
KF: We are extremely excited about our first two investments in our fourth fund; Sansoro Health and Upfront Healthcare. Sansoro is trying to fundamentally change the healthcare interoperability issue across healthcare while Upfront is at the forefront of redefining how consumers / patients digital interact with health systems and payers.
VN: What excites you the most about your position as VC?
KF: I’m most excited about the market I’m in. Healthcare is something that impacts all of us, so being able to find and help grow the companies that improve the way our healthcare system works is what drives me. There are a lot of challenges right now in the way care is delivered and paid for – not to mention how much it costs – and technology can be a key component to fixing these things.
It’s funny, but I don’t really consider myself to be a VC. I try to look at my role from more of a healthcare industry perspective, as someone who’s working to help drive innovation from the inside out. My previous roles helped prepare me for this – especially my time at Premier, Inc., a performance improvement company that’s owned by more than 180 health systems. I worked closely with healthcare insiders there and continuing those relationships in my role at LRVHealth has been a huge benefit. I’ve been fortunate to meet and work with some of the best minds in the industry, and in fact, I’m trying to share some of that wisdom through a podcast I just launched called Healthcare is Hard: A Podcast for Insiders. I’ll be inviting heavy-hitters from the industry to share their experiences with me and anyone else who wants to listen. We just had Bert Zimmerli, the CFO at Intermountain – a health system known for innovation – as our first guest. Talking to people like Bert and trying to figure out solutions to the healthcare challenges that impact us all in one way or another is what I love most about this job.
VN: What is the size of your current fund and how many investments do you typically make in a year and reserves you set aside?
KF: We just launched our fourth fund, which is a $100 million venture platform. We will make approximately 14 to 16 investments in this fund.
VN: Is there anything else that you think I should know about you or the firm or your thoughts about the venture industry in general?
KF: Our passion for healthcare transformation is fundamental to everything we do. Our investing partners, our strategic limited partners, our advisors, and our portfolio companies are deeply committed to not only help drive this transformation but also improve the health of all the communities we impact. LRVHealth has been investing in digital health companies for 17 years, long before this industry was popular with most mainstream investors. We invested in our first patient engagement platform in 2003. We were the first institutional investors in companies such as GetWellNetwork, Phreesia, MedVentive, lifeIMAGE, and Convergent Dental. We’re laser-focused on continuing to find and build companies that will help transform our healthcare industry and reduce the overall cost to deliver care and keep our country healthy.