Utah-based Health Catalyst said Tuesday it had secured $33 million in new investment to help it keep up with growth in the rapidly expanding demand for electronic records for the health care industry.
The company, which has offices in the Cottonwood Heights area of Salt Lake County, said it had received the funding from Norwest Venture Partners and Sequoia Capital, both from the Bay Area, and Sorenson Capital of Utah.
The nearly 5-year-old company said the money is needed to help it expand to meet the demand for its software, which maintains databases designed specifically to help the health care industry store and analyze records.
The company is profitable, so the new funding “is much more about being able to grow at the pace the market is demanding of us,” said CEO Dan Burton. “We have grown triple digits each year for the past several years and we think that’s going to continue based on the needs these health systems have.”
Burton was an original angel investor in the company, formerly known as Healthcare Quality Catalyst, which was founded by former employees of Intermountain Healthcare, Utah’s largest health care provider.
The company had engaged in a previous round of funding in 2011 before closing the second round last month.
As part of the latest capital infusion, Promod Haque, managing partner at Norwest, will join the board of Health Catalyst. Fraser Bullock, co-founder and managing director of Sorenson Capital, a Utah-based private equity fund, will become a board observer with access to meetings and information but no voting power.
Bullock said Sorenson’s $5 million investment was prompted by Health Catalyst’s position in helping deliver efficient results for health care providers. Health care is the No. 1 economic and humanitarian issue facing the U.S., he said.
“Being able to address that with quality of care and efficiency of care is what [Health Catalyst] does,” Bullock said.
Health Catalyst provides software for what it calls a data warehouse, a database that stores information gathered by physicians and others regarding diagnoses and treatments of patients. It then analyzes that information in order to tell providers what works best for patients and what improvements might be made to improve outcomes and make systems more financially efficient.
Burton said the company in the past two years has brought out about 40 programs designed to measure outcomes and costs of specific conditions and diseases, such as diabetes.
Health Catalyst faces stiff competition from some industry database heavyweights such as Oracle and IBM, said Burton. But he said the Utah company’s advantage in the marketplace is that its products were designed specifically for health care providers and were not adopted from other industries. That’s important given the complexity of health care information and its analysis, Burton said.
The company has about 65 employees and is hiring, he said.