Private equity-backed hospital software provider Strata Health receives $6 million from BDC Capital to activate its U.S. strategy
CALGARY, ALBERTA, March 7, 2022 – Strata Health, a software-as-a-service (SaaS) provider for the healthcare sector, received 6 million dollars in non-dilutive funding from BDC Capital’s Growth & Transition Capital division to help launch its growth strategy focussing on U.S. expansion. The Calgary-based company was founded by Don Schick in 2001 and is now led by president and CEO Peter Smith. Seeing its strong potential, private equity firm Polaris Partners took a majority stake in the company in 2014.
Strata Health offers hospitals and clinics a SaaS-based platform that facilitates the complex process of transferring patients to the best establishments for their evolving needs, with the goal of improving efficiency and patient care. With its solution solidly implanted in Canada, the company began to look increasingly towards the United States to grow its annual recurring revenues. It acquired Salt Lake City’s SilverSearch in early 2020 as a platform to launch its push. Following early successes and with hospital decision makers once again ready to modernize their systems since the start of the pandemic, management felt that the time had come to kick-start its multipronged strategy to sign up more hospitals to its service. The funds will largely be used for investments in product development, service delivery, sales and marketing, including new hires.
Strata Health sought out BDC Capital’s support to put in place a patient capital structure which would keep its cash balance strong. It will also provide the flexibility it needs to execute its plans over the coming years. Working closely with Strata’s CFO, Justin Kereluk, BDC Capital developed a customized mezzanine financing solution with conditions reflecting the company’s expected performance over the loan period. Features include a principal holiday and modest repayment requirements until maturity.
“We reached out to BDC Capital for our growth capital needs because they provided a unique capital offering that was flexible and accessible through clearly defined and agreed upon deliverables,” comments Justin Kereluk, Chief Financial Officer of Strata Health. “BDC Capital is a very credible organization that is recognized not only in Canada but across North America, which was important to our U.S. based majority owner. I was impressed by BDC’s ability to quickly get up to speed with our international business model and achieve an early value-added dialogue on the capital planning side. After working with Tabreez, Randeep, and their colleagues, I can understand why they are successful in the technology space based on their knowledge depth, creativity on terms and ability to work at an expeditious pace.”
This financing came out of a collaboration between BDC Capital’s British Columbia and Prairies teams which was led by Randeep Janjua, Director, Growth & Transition Capital. “We were all very impressed by the calibre, cohesion and vision of Strata Health’s management team and by the deeply committed support it receives from its private equity sponsor and robust board of directors,” says Tabreez Lila, Managing Director for the Prairies, Growth & Transition Capital. “Based on how well its solution fills a critical gap in healthcare, we believe Strata Health is uniquely positioned to rapidly gain market share in the next few years.”
About Strata Health
With a focus on streamlining workflows, we design, build and deploy software that manages the complete patient journey. From one integrated platform, care managers can efficiently and effectively coordinate care and provide patients with better choices and outcomes while reducing costs and wasted time. A complete, end-to-end technology platform, the key to Strata Health lies in its endless versatility and flexible configurations. Our platform contains a series of proven features, including provider directories, intelligent matching algorithms, end-to-end referral pathways, patient engagement tools, and real-time data and analytics. Through our partnerships with health systems, hospitals and providers, we work to build better, smarter and stronger connections that improve lives, give more time back to care coordinators and improve outcomes.
About BDC Capital
BDC Capital is the investment arm of BDC, the bank for Canadian entrepreneurs. With over $3 billion under management, BDC Capital serves as a strategic partner to the country’s most innovative firms. It offers businesses a full spectrum of capital, from seed investments to growth equity, supporting Canadian entrepreneurs who have the ambition to stand out on the world stage. Visit bdc.ca/capital.