WCAS’ Ed Sobol: EMS software and communication ‘can be the difference between life and death’

UPDATED: Earlier in February, Welsh, Carson, Anderson & Stowe announced a majority investment in ImageTrend, a developer of software aimed at helping emergency medical services (EMS) professionals and hospitals collect, connect and analyze data. To find out more, PE Hub spoke with WCAS partners Ed Sobol and Ryan Harper.

Headquartered in Lakeville, Minnesota, ImageTrend sits at the intersection of healthcare and technology, the two sectors the New York PE firm invests in. Similar investments in the WCAS portfolio include Norstella, a pharma-data business and the acquisition of EnableComp, a healthcare compensation business. (PE Hub previously profiled the New York firm’s healthcare investment strategy here.)

“The next-generation software is relied upon every day by EMS professionals, as well as fire departments and firefighters in the field, who are documenting and recording personal information and clinical information with the patients or individuals they are caring for. So this is the clinical and administrative system of record that they use to capture this data, with a strong value proposition as a cost-effective software solution for first responders,” Harper said.

Importantly, that data is then sent off to cities, counties, states and hospitals these patients might end up in as well. The software also captures the different processes and requirements of varying municipalities throughout the country.

“As you think about the exchange of information between pre-hospital EMS and the hospital, if that hospital knows that there’s a stroke patient coming in 5 minutes or knows that there’s a cardiac arrest patient arriving soon, then they can get the right specialist in the unit that is elsewhere in the hospital. That time can be the difference between life and death,” said Sobol.

Sobol adds that what makes the software mission-critical is also what makes for an exciting investment.

“That’s what makes it so compelling to us from an investment standpoint but also from a public health standpoint if they can use some of that information to deliver better health outcomes for the overall population. We invest fundamentally to try to improve outcomes in the healthcare ecosystem.”

Growing organically

When asked about the potential for add-on deals, Harper responded:

“ImageTrend has been growing organically in the double digits and is nicely profitable. We will invest meaningfully in the company’s existing product portfolio and innovation, as well as support and services, all in an effort to delight our customers and accelerate growth. We will pursue M&A to the extent it allows us to better serve our customers with new features, products and services across public safety and healthcare-end markets, but there are no set targeted numbers or time frames. We are thrilled to have the opportunity to support ImageTrend in its next phase of growth.”

And when asked about the exit strategy, Harper said, “We have only just begun our partnership with ImageTrend. But we are confident that if the team executes on the strategy to accelerate growth by doing all of the things mentioned, we will have plenty of options to achieve liquidity at the right time. Until then, we are simply working hard every day to support management in building a durable industry leader that will continue to flourish well beyond our hold period, similar to several other investments that we’ve had the pleasure of being a part of over our 40+ year history, including Paycom, Clearwater, Kindred and Shields Health Solutions.”

Public safety is a vertical that is generally insulated from economic fluctuations, which helped WCAS believe it was a durable choice Harper also added.

“We’re still optimistic about the resilience and the underlying growth drivers of the two sectors,” Sobol said about healthcare and technology. “We continue to see a wide bid/ask spread as we look at private markets and how deals are getting done. Notably, in healthcare technology, deal volume broadly was down by over half in Q4 – it really just fell off a cliff. But we still see opportunities to invest in growth areas.”

Editor’s Note: An earlier version of this story mischaracterized the size of the investment. WCAS has taken a majority stake in ImageTrend.