OSF Ventures, the corporate investment arm of OSF HealthCare, is joining other health care systems and strategic investors from within the healthcare industry as a strategic limited partner (LP) in Boston-based LRVHealth‘s $100M “Inside Healthcare” venture capital fund. As part of LRVHealth’s collaborative innovation platform, OSF will help identify, create and invest in early-stage companies spanning healthcare IT, tech-enabled health services, medical devices, and diagnostics.
LRVHealth’s strategic investors now include 11 health care systems and the Innovation Institute, a for-profit venture owned by six non-profit hospital systems that operate in 20 states. The institute invests in and incubates healthcare startups, connecting them with doctors and other healthcare companies.
This investment by OSF HealthCare rounds out its portfolio to include early stage opportunities. The partnership was also attractive because of shared focus on reducing costs, meeting expectations for the new consumer-driven focus in health care, and because of the distinguished group of fund advisors including the most recent addition for Dr. Karen DeSalvo, former head of the Office of the National Coordinator for Health Information Technology and assistant secretary at Health and Human Services.
The investment marks OSF’s second limited partner investment in a venture capital fund managed outside of the organization. In December of 2016, OSF Ventures announced a limited partner investment in Ascension Ventures. The subsidiary of the nation’s largest Catholic and nonprofit health system researches hundreds of health care companies annually for possible investment and shares similar values and focus as OSF HealthCare.
Investment Benefits for OSF Ventures
As a strategic investor in LRVHealth’s fourth fund, OSF HealthCare will benefit from access to early-stage companies that have been identified and vetted through a vast network that reaches across the healthcare continuum in the U.S. These companies are often in the initial phases of developing solutions to enhance patient experiences, improve outcomes, and reduce costs.
Several individuals within OSF will interact with LRVHealth and its strategic network to help identify and guide investments that further innovation in healthcare. In turn, the advisor group will be a resource as OSF HealthCare moves from a fee for service to value-based, coordinated care that emphasizes prevention.