TreeHouse Health Backs Three New Firms
Minneapolis-based TreeHouse Health has invested in three local, emerging health care companies since the beginning of the year and is continuing to scout for additional firms to back.
TreeHouse Health bills itself as an “innovation center” that invests in and helps accelerate the growth of young health care companies. Since its inception in October 2013, TreeHouse Health has invested in 12 early-stage health care companies.
“The idea is basically to provide all the resources that growth-stage health care companies need to grow,” said J.D. Blank, managing director for TreeHouse Health.
The operation is based in the Loring Corners building at the edge of downtown Minneapolis. Beyond making investments, TreeHouse offers industry expertise and office space for the companies.
Blank says that TreeHouse Health is trying to help create an “ecosystem” to help support and grow the companies. The companies that TreeHouse Health has added this year offer a diverse mix of medical products:
- POPS! Diabetes Care: Founded in 2010, the company makes a glucose-testing device, which can connect to a patient’s smartphone and help them better manage their blood sugar levels. According to a February statement by the company, TreeHouse Health led a $500,000 financing round for the company.
- Sansoro Health: The company’s core software product can be used to connect third party software to electronic medical records. Sansoro’s technology can help health care systems integrate patient data records that may be on a variety of platforms.
- Reemo: The company has developed a wristband that allows the person wearing the device to control home electronics equipment with simple hand gestures. The product was designed for seniors who are grappling with limited mobility.
Blank said that TreeHouse Health might add as many as three additional portfolio companies by the end of the year. He says that the company does not look to invest in pure startup companies, but prefers companies that have already landed some customers for their product or service.
“We’re also looking for opportunities and have a few that we are talking to pretty seriously,” said Blank of potential future portfolio companies.
TreeHouse has established a solid reputation locally.
“We are incredibly supportive. We send companies to them. As investors come to town…we like to bring them to TreeHouse,” said Shaye Mandle, president and CEO of the Golden Valley-based Medical Alley Association. “I think it’s been a very exciting addition to the community. They’re obviously focused on the digital health space.”
Hennepin County Medical Center and Blue Cross and Blue Shield of Minnesota have both partnered with TreeHouse Health; the groups are institutional-level resources that can help advise emerging companies on the changing nature of the health care industry.
Mandle says that those partnerships are the “secret sauce” for TreeHouse Health’s approach to supporting young companies.
Dr. John Blank, chairman of the board for TreeHouse Health, has extensive health care industry experience. He served as CEO of Unison Health Plans and grew its revenue to more than $950 million before it was acquired by Minnetonka-based UnitedHealth Group in 2008.
Several firms have “graduated” from TreeHouse Health as the companies have grown.
Minneapolis-based LogicStream Health—which “develops web applications that allow health systems to measure clinical process to improve patient outcomes”—relocated to the North Loop area of Minneapolis in September 2015 after 18 months in the TreeHouse Health space.
“John, J.D. and the TreeHouse team provided access and support to help us hone our message and guidance on where we were headed. Without some of those connections and opportunities to work on our business while working in our business it would have taken us longer to get to where we are today,” said Patrick Yoder, co-founder and CEO of LogicStream Health.
LogicStream, which is now cash flow positive, currently has 17 employees, but is expecting to grow by 50 percent within the next six months.