Growth After Acquisition … in Cleveland
In a world where a vast majority of companies are competing to come out on top, much of their success can be determined by a number of key factors. These elements, which include convenient access to financial assets, the ability to attract and retain talent and, of course, the novel ideas on which the company builds its business platform, all can be influenced by where the company chooses to set up shop.
The world of bioscience is no different. Location is a large factor that determines whether or not a start-up company will succeed or fail, and for bioscience companies who choose to make Cleveland home, they are certainly at an advantage. From venture capital and private equity investors to nearby collaborative healthcare partners and institutions in the research and development space, as well as accelerator support and networking opportunities, Cleveland has it all, which is why so many companies have chosen to stay after completing successful exits.
Take CardioInsight, for instance. Recently, the medical device company, which was bought by Medtronic for $93 million last year, announced it will be anchoring in Cleveland, specifically Independence, for at least the next eight years. By the end of 2018, the company has also committed to doubling the size of its current staff and payroll.
The acquisition by medtech giant Medtronic is making it possible for CardioInsight to commercialize its breakthrough patented electrocardiographic imaging technology that will significantly improve the diagnosis and treatment of a number of critical heart conditions.
But before the acquisition, CardioInsight found much-needed guidance and funding from early stage investors such as JumpStart, Case Technology Ventures and Draper Triangle Ventures. Plus, the company got its start at Case Western Reserve University where the novel technology was born, and University Hospitals served as the start-up’s first headquarters, helping to save money while also offering access to patients and world-class medical resources.
CardioInsight isn’t Cleveland’s only recent exit that is committed to Cleveland. Explorys, which was acquired by IBM for an undisclosed amount in 2015, first spun off from Cleveland Clinic in 2009. Since then, the company has experienced steady growth. It now employs about 220 people and shows no signs of slowing down, with a plan to add 80 more to its University Circle headquarters this year alone.
Explorys, a healthcare IT company, takes mountains of data from electronic records and makes meaningful sense out of them, taming Big Data in a novel way that can truly transform healthcare. Local entities that supported Explorys from the beginning by utilizing its medical data management technology to improve patient outcomes include Cleveland Clinic, MetroHealth System, University Hospitals, and Summa Health System.
It’s no secret that access to these institutions helped pave the way for Explorys to get ahead, catching the attention of tech giant IBM. The company is part of IBM’s Watson Health Unit and will continue to grow in Cleveland.
Gene therapy company Abeona Therapeutics is another example of Cleveland’s appeal. Just last year, the company dedicated to rare diseases, was acquired by Dallas-based PlasmaTech Biopharmaceuticals. Shortly after the acquisition, Abeona Therapeutics’ CEO, Tim Miller, announced plans to open a new headquarters as part of Cleveland’s Health-Tech Corridor.
Parts of this blog originally appeared in Crain’s Cleveland Business, March 7, 2016