Greenphire, the King of Prussia-based clinical trial payments tech company, will soon.be up for sale, PE Hub reported (signup required). Riverside Company, which acquired it in 2015, will be the seller.
Greenphire is expected to appeal to both strategic and financial buyers, as well as both tech and clinical firms. The sales process will kick off in April, PE Hub’s sources tell them.
Greenphire has north of 200 employees, per LinkedIn. In this business, there’s always a fair chance that the buyer will have connections to Philly.
One source suggested it could be worth as much as $1 billion, which seems unlikely.
My Substack site for Philly EnterpriseTech is at https://tompaine.substack.com. I post breaking news, some major articles, interesting tidbits and analysis there.
James Kim, a Korean immigrant and Penn grad, founded Electronics Boutique as a single store at King of Prussia Mall in 1977. Originally selling calculators and early business productivity software, it evolved to focus on video games and eventually expanded to over 2000 outlets. GameStop acquired (technically merged with) EB for $1.44 billion in cash and stock. EB’s West Chester headquarters was shuttered and most of its senior management eliminated.
Back in the day West Chester was a hotspot for startups, with QVC and Commodore and Scala in addition to EB.
GameStop, which had been on bankruptcy watch for most of 2020, reached a peak market cap of $28 billion this morning before trading restrictions on RobinHood cooled it down.
Kim, now 85, still serves as Executive Chairman of Amkor Technology Inc., the Phoenix-based semiconductor packaging company he founded.
Qualtrics is reported to be going public at a price of $30 per share, up from its previously announced range of $26 to $29 per share. It will raise the SAP spinoff’s initial value up to close to $15 billion. Qualtrics will start trading on Thursday on the Nasdaq under the symbol “XM”. SAP will retain a controlling stake.
At the least, this answers the criticism SAP ex-CEO Bill McDermott received for buying Qualtrics for $8 billion slightly more than two years ago. The IPO price is almost double the late-2018 acquisition price.
But questions remain about how this structure will motivate the Qualtrics management team to support SAP’s strategy, as opposed to pursuing separate goals.
Jefferson Health and VC firm General Catalyst are backing Tendo. “The goal is to try to build a defining software company for health care that has the DNA of an elite health care company like Jefferson and the DNA of an elite technology company like ours,” Hemant Taneja, managing director of General Catalyst, told the Business Journal.
Dr. Stephen Klasko, CEO of Jefferson Health and president of Thomas Jefferson University, is involved in the Jefferson /General Catalyst partnership.
“We have created a digital health company that will be based in Philadelphia and [focus on] health assurance for people across the country,” Klasko told PBJ.. “The center of the universe for this will not be in the Silicon Valley, it will be in Philadelphia.”
Its important to understand that General Catalyst is not only acting as a typical VC firm, but is working with Jefferson to help plan the venture before it launches.
Klasko and Taneja co-authored a book last year, UnHealthcare: A Manifesto for Health Assurance, describing their joint vision.
Tom Paine
There’s a new digital health startup based in Philly that may turn out be a big deal. Its got a name now but is still in stealth, with 24 employees listed on LinkedIn. Named Tendo Systems, its got multiple people from places like Veeva Systems and Jefferson Health.
Dan Goldsmith is CEO. After reaching the position of EVP at Veeva Systems, he became President & CEO at Instructure, the Canvas learning management system company. He resigned in March of last year after a somewhat tumultuos period, as Instructure agreed to a $2 billion buyout by PE giant Thoma Bravo.
His sister, Jennifer Goldsmith, is President of Tendo. She also served Veeva, as Senior VP, and as strategy chief at Instructure. At Veeva, she played a key role in the development of its Vault product line.
At this point, Tendo describes itself in generalities such as the following:
“At Tendo, we believe in a world where software can create frictionless healthcare experiences for patients, caregivers, and providers. Stay tuned to see what we are dreaming up!”
Tendo is a word that has meaning in both in Latin and Japanese.
I checked the usual places to find any venture capital funding, but came up empty.
It was a busy year for IPOs, nationally and locally. There were five Philly-area IPOs, inckluding one from Allentown (Shift4 Payments) and one from Princeton (Certara).
The most notable thing is that all five IPOs were very successful, with increases ranging from 47% to 228% from their initial offering prices until the end of the year.
In addition, Megalith Financial Acquisition Corp. which did an IPO in 2018 as a SPAC (special purpose acquisition corporation), merged with BankMobile Technologies (consisting of West Reading-based BankMobile, a subsidiary of Customers Bancorp). The merger closed on January 4,2021.
On January 12, Lawrenceville NJ-based BTRS Holdings Inc. (“Billtrust”), a B2B accounts receivable automation and integrated B2B payments leader, and South Mountain Merger Corp. (“South Mountain”), a special purpose acquisition company (SPAC), completed their planned business combination. BTRS is now trading on the Nasdaq at a market value of $2.4 billion.
Looking further ahead into 2021, I’m curious about whether goPuff will go public. Softbank, its primary owner, is likely eager to follow up with its success with the recent DoorDash offering. goPuff probably doesn’t need to be profitable if it can demonstrate pro forma profitability (or progress towards) in its more mature markets.
Also, Dresher PA-based Ascensus, a retirement plan manager, has already hired bankers for the purpose of preparing for an IPO in mid- 2021. Ascensus has built scale through a series of acquisitions. The IPO could value the company in the $3 billion range.
Ascensus has been investing in its technology offerings, and had planned to roll out a new digital sales platform before the end of the 2020.
I’ve been booted off Twitter due to no fault of my own.
They cancelled my account, @phillytechnews, because it was hacked by some unknown character in the Baltic states. I was told that they couldn’t tell if it was me or some hacker on the account. No possible fixes were identified or discussed. i’ve tried to contact a few people, to no avail.
Obviously Twitter’s been having some bigger issues to deal with lately. But for me its a big deal. I built my web presence around Twitter. Though I have a website and also post on LinkedIn and now Substack, the overwhelming majority of my followers know me from Twitter. I know many of you, if only virtually in most cases, and you’re very important to me.
There is no way I can reconstitute my follower list. And it really screws up my future plans for the site. Twitter said I was welcome to open a new account, but starting off with no followers is overwhelming.
So I’m not willing to let this go. Twitter has larger accounts that get hacked, and it seems they get back on track. I imagine that there is a solution to this, but I’ve been thrown under the bus.
If anyone has ideas as to what I might do, let me know. And in the meantime, you can follow me at PhillyEnterpriseTech.com, on LinkedIn, or breaking news on Substack, which is still free for now.
2nd.MD will enable Accolade users to obtain 2nd opinions when necessary.
Accolade CEO Raj Singh said in a statement. “With the addition of 2nd.MD, we’ll nearly double our total addressable market while providing the most comprehensive, integrated healthcare navigation experience available.”
Covid-19 has likely been a net plus for Accolade in recruiting more corporate clients, who contract for the service so its employees may access it as part of their benefits packages.
Accolade’s market value is now $2.6 billion, and it looks like its stock has climbed more than 10% in the wake of its announcement.
NJ Serial Entrepreneur and angel investor Harvey Homan leads the effort here
Howard Lubert and Harvey Homan of Keiretsu | Courtesy Lubert and Homan
On Monday, Keiretsu Forum announced the launch of a new chapter in Princeton. The chapter will be part of Keiretsu’s Mid-Atlantic Region.
Keiretsu Forum is the world’s largest and most active investment community of early-stage accredited angel investors, with 53 chapters across three continents, including the newly minted North Jersey Chapter, according to Keiretsu Mid-Atlantic Region cofounder Howard Lubert. The angel group will focus on series A rounds.
The investors are willing to consider companies in any industry, but they expect their deals in New Jersey to be primarily with tech and life-science companies since these are dominant in the state.
The new chapter is being led by Harvey Homan, a serial entrepreneur and experienced angel investor, and there are currently six accredited angel investor members. The chapter has been running virtually for the last nine months, Homan stated. He added that he will be seriously trying to grow the chapter and add angel investors to their ranks.
Princeton The Perfect Location
We asked Lubert and Homan why now is the time to enter New Jersey.
Lubert explained that the Keiretsu Forum had attempted to come into New Jersey three years ago, and had planned to set up at a facility associated with Princeton University. The logistics didn’t work out, but the interest remained, and when Homan expressed his desire to begin a chapter in Princeton, the organization jumped at the chance.
“Having a location in the Princeton area is just perfect logistically, to be able to make a stop all the way down to Philadelphia, to attract more members and more investment opportunities,” Lubert said.
Homan noted that one of his longtime connections, Steve Cohen, the managing partner of Morgan, Lewis, & Bockius’s Princeton office, enthusiastically agreed to become Keiretsu’s host sponsor. “So, when we go live again, we’ll be working out of Morgan Lewis’s Princeton offices.”
Homan became associated with Keiretsu in February of 2020. “I’ve been involved in the New Jersey’s startup ecosystem for the last 20 years, and started several companies in New Jersey,” he said, adding that over the years, he has worked with the former New Jersey Commission on Science and Technology (now the New Jersey Commission on Science, Innovation and Technology) and has received funding from the New Jersey Economic Development Authority (NJEDA). He “built up companies that way, but always saw a huge need for additional funding sources in New Jersey.”
After Homan sold his last company in 2017, he began angel investing, and spent a year and a half investing with Jumpstart New Jersey Angel Network. “One of the members there introduced me to Keiretsu. I started attending meetings and was enthused about the quality of the deal flow that I was seeing. The companies were great. The amount of exchange between investors in the meetings was tremendous. And it was run really, really well.”
He added that Keiretsu is focused on later-stage, series A startup funding rounds, which personally attracted him in terms of his investments. Series A rounds are typically undertaken after a startup has outgrown seed financing and now needs significant capital.
Advantages For Startups
An advantage for startups seeking funding from Keiretsu is that, while the Mid-Atlantic Region consists of five chapters, they all function as a single regional unit, Lubert noted. “So, when we invite four companies to come to present to us, they present to all of our members at all of our chapters.”
Also, companies applying to Keiretsu are impressed with the amount of due diligence the fund performs. Even if Keiretsu chooses to pass on an investment, the startup takes home a comprehensive document that can become a blueprint for improving its performance and becoming attractive to other investors.
Lubert noted that the diligence team works very closely with companies, helping them to present their best case. “We get to know the company, the CEO and the CTO very well through that due diligence process, and they get to know us. Over a 10-year period, we’ve probably executed somewhere north of 250 due diligence projects. And in that 10-year period … we’ve never once had to go outside of Keiretsu members here in North America to find the necessary subject matter experts who are also active angel investors to participate in those due diligence teams,” he told us.
“The beauty of having 33 chapters and 2,000 members is that we’ve got SMEs [subject matter experts] everywhere in every space. And that helps our members create fantastic due diligence reports that help each other come together when it comes time to write the checks.”
Keiretsu’s large number of accredited angel investor members also provides “a great opportunity for a company to come into Keiretsu through the chapter in New Jersey, but then have access to a global network. They’ll be able to achieve funding in the multimillion-dollar range.”
The Series A Sweet Spot
The most recent angel group to come into New Jersey was Golden Seeds (New York), which launched its New Jersey chapter in February of 2020, with the help of the NJEDA and New Jersey first lady Tammy Murphy. Golden Seeds is a nationwide angel network dedicated to investing in female-led startup companies. The organization has more than 300 members, including accredited investors from a diverse range of locations, sectors and backgrounds.
Analyzing the angel funding ecosystem in New Jersey, Homan pointed out that angels like Mario Casabona, of TechLaunch (Kinnelon), write checks at a very early stage in a company’s growth, and Jumpstart comes in at the stage right after that.
“I was talking to Rod Priestley at Princeton University. They fund startups through the Princeton alumni network, but they’ve lost those startups to other states when the companies go for the next level of funding, a late-seed stage or Series A round. That’s the sweet spot for Keiretsu. So, I think this solves a real need.”
Keiretsu attracts a “tremendous” amount of diversification in the startups it attracts, he added. “We attract companies from numerous industry silos, from tech and life science, which are our biggest sectors, but on to real estate, and virtually every other industry. We draw from all geographies. And we focus on diversity of leadership teams, with great interest in female-lead and black-lead companies.”
The angels are now meeting virtually, with all of the Mid-Atlantic chapters working with the South-East Region chapters to screen companies. About a dozen companies present at each meeting. The angels then choose four companies to present in depth at a forum meeting in which investment decisions are made.
Homan added that he sees the North Jersey Chapter becoming an essential part of the tech community in New Jersey. It will work closely with Princeton and other universities in the state, and with the NJEDA, TechUnited:NJ (New Brunswick) and BioNJ (Trenton). “We want to become a really, really vibrant part of this ecosystem — and a place where companies can come and learn, ask questions and be at a central point [where] they can get mentoring and get support. And I know that, from my experience with Keiretsu’s members, they are enthusiastic to do that.”
