While drugs and devices receive the lions share of venture healthcare investment, over 80% ($1.7 trillion) of U.S. healthcare spending is on services, including the care provided by hospitals, physicians, home care agencies, free-standing medical clinics and clinical laboratories. Recognizing this trend, ScaleVP has been investing in healthcare services for almost a decade.

Our primary goals are to fund companies which can increase quality of care, reduce healthcare errors, and save cost. In line with this theme, ScaleVP has maintained a long-standing belief that delivery platforms offering specialized services are particularly effective at provisioning high-quality, cost-effective care. ScaleVP believes these companies are great investment vehicles as well because the attractiveness of their services enables them to generate exceptional market traction in a capital-efficient manner.

Four successful investments which fit well into ScaleVP's thesis on specialization in healthcare services are IPC – The Hospitalist Company, LivHome, National Healing Corporation and U.S. HealthWorks.

IPC – The Hospitalist Company
IPC develops full-time physician practices which specialize in hospital-based care. A wide body of peer-reviewed publications has validated that hospitalists reduce the cost of inpatient admissions by an average of 15-20% vs. primary care oversight, while simultaneously enabling significant improvements in patient satisfaction, a reduction in medical errors and lower re-admission rates. ScaleVP originally invested in the Company's Series B round when it was generating annualized revenue of less than $10M and remained the Company's largest institutional investor through its successful IPO in January 2008 (NASDAQ: IPCM) when its annualized revenue exceeded $200M. ScaleVP worked closely with the Company's management team to craft an expansion strategy based upon both internally-generated growth as well as acquisitions, helped recruit senior executives and board members, introduced re-known, expert consultants, helped prepare the Company for its IPO and facilitated meetings with bankers and investors.

LivHome
LivHome addresses the comprehensive, non-clinical support needs of the frail elderly who wish to continue living in their homes and can afford a private pay solution. Services provided to the elderly include (but are not be limited to) counseling, homemaking, meal service, assistance with activities of daily living (ADLs), laundry, transportation and social activities. ScaleVP wrote the Company's original business plan, identified a platform acquisition in Southern California, recruited its CEO, introduced the Company to additional investors and board members, and worked with management to coordinate an internal and acquisition-based growth strategy. The Company is currently profitable and rapidly expanding.

National Healing Corporation
National Healing Holding Corporation provides outpatient wound centers for hospitals nationwide. The Company fit ScaleVP's thesis on specialization because its focus on wound care enabled it to improve patient outcomes while simultaneously enabling it to save the healthcare system money through the avoidance of costly, invasive inpatient surgeries. ScaleVP invested in the Company's Series A round in 2005 and has been instrumental in its continued growth and development. ScaleVP helped negotiate the Company's debt agreements, worked with management to expand its sales and marketing efforts, and helped design the Company's "Cost Effectiveness of Care" study, which demonstrates how the Company's expert, outpatient-based care saves cost by eliminating unnecessary hospitalizations. National Healing has enjoyed tremendous growth in revenue and profitability since ScaleVP's investment and continues to expand aggressively.

U.S. HealthWorks
U.S.HealthWorks is a leading national provider of occupational medicine and urgent care services. Operating over 100 free-standing medical centers in 13 states, U.S. HealthWorks helps employers control the cost of work-related injuries through quality medical care and effective management of claims and lost work time. U.S. HealthWorks believes its clinics provide high-quality care at roughly 50% of the cost of hospital-based care. ScaleVP invested in the Company's Series A round and was intimately involved in the Company's growth to over $250M in revenue. ScaleVP helped recruit the Company's CEO and several of its investors, worked closely with the Company on its acquisition-related growth programs and was a leading member of the committee that ultimately successfully sold the Company to a buyout consortium.