Great Point Partners, a Greenwich, Connecticut-based private investment firm focused on the healthcare industry, has led a USD20m funding round in growth recapitalisation of Connecture.
Existing investor Chrysalis Ventures also co-invested in the financing.
The investment will enable Connecture to meet the demand from states for the creation of health insurance exchanges mandated by the Patient Protection and Affordable Care Act (PPACA). In addition, the investment will support Connecture’s ongoing investment in software innovation that benefits the health plan, broker and insurance exchange markets.
In addition to projected growth in excess of 50 per cent for 2012, this investment adds additional business momentum to Connecture, which recently announced its role in the development of health insurance exchanges in Maryland and Minnesota, an effort to hire more than 100 Java developers and its move to a larger facility in Brookfield, Wisconsin.
More than half of the nation’s 20 largest health insurance plans use Connecture’s technologies, and more than 25 million Americans shop for their health insurance on systems built by Connecture.
"The Great Point team has the healthcare technology and payer sector domain expertise to complement and support our strategic vision as a company, which is to eliminate friction in the health insurance purchasing process," says Doug Schneider, Connecture chief executive. "This investment will enable Connecture to accelerate building out our capacity, and it will help states, brokers and health plans meet the deadlines associated with health care reform with the best information systems in the market."
The recapitalisation adds to Connecture’s board Great Point team members David Kroin, managing director; Adam Dolder, managing director; Charles Myers, senior vice president; and Brett Carlson, vice president, as well as Chrysalis venture partner Alan Ying. Schneider and board chair David A. Jones, Jr., who is Chrysalis’ chairman and managing director, continue to serve as directors.
"Connecture has developed tools for the modern day health plan," says Carlson (pictured). "With the depth of their product offering and leadership position in the sales automation market, Connecture’s technology effectively connects consumers, health plans, employers and brokers to the new health insurance marketplaces being developed by the states and in the private sector."
