Venture investment to help expand Navicure’s analytics business

Bain Capital’s majority investment in claims clearinghouse and revenue cycle management vendor Navicure brings a new stream of investment into the company.

Traditionally serving ambulatory physicians, Navicure two years ago entered the hospital and health systems markets as well with that business line now accounting for about 15 percent of revenue.

Now, new funding gives the company opportunity to grow it more, says Navicure CEO James Denny.

Navicure launched an analytics service during the first quarter of 2016, and the Bain investment will help accelerate expansion into that area, Denny says. The analytics product includes tools to identify issues impeding cash flow, and supports comparing performance against peers and industry benchmarks. The vendor also offers additional products, such as a cost estimator of patient out-of-pocket expenses.

Navicure was looking for new funding because its previous majority holder, JMI Equity, had supported the company since 2009 and was now cashing out of the investment. As with many equity firms, JMI only keeps investments in a company for a limited time, and in essence, “the clock ran out,” Denny says. But during the time of JMI’s investment in Navicure, revenue rose from $20 million to nearly $100 million.

Bain is a substantially larger investment firm, Denny says, and his goal now is to hit $500 million in revenue.

A major goal of the new investment will be to accelerate Navicure’s work to aid physician offices and hospitals in moving to value-based care and maximizing profitability, Denny says. Having a new investment relationship also enables the company to continue operating as a standalone business while attempting to become more competitive.