Case Study

Overview

• Valant Medical Solutions is a leading provider of cloud-based electronic health records and e-billing software for behavioral health practices.
• The Company has been the leading EHR vendor for private behavioral health practices since 2012 and currently supports 5,000 psychiatrists, therapists, and other behavioral health professions in private practice across the U.S., including six public behavioral health practices.
• Valant’s end-to-end platform for psychiatrists, therapist, and group practices allows providers to effectively manage and grow their practices while improving patient outcomes and payment cycles.

Situation

• With over 50% year-over-year growth, Valant has a significant opportunity to become the leading practice management and billing software provider in the behavioral health sector.
• In order to take advantage of the market opportunities, the company required additional capital to continue their growth trajectory and penetrate into the public behavioral health practices.
• Valant’s ownership structure consisted primarily of angel investors with multiple series of preferences. The majority of these investors had invested in the company during it’s formation and were looking for some of liquidity.
• Valant engaged Cascadia to raise growth equity and provide some form of shareholder liquidity.

Cascadia Process

• Cascadia developed a list of potential investors with a strong track record of Health Care IT investments and the ability to provide growth capital and shareholder liquidity.
• Due to timing constraints of the Company, initial marketing efforts focused on providing a handful of investors with pre-emptive opportunity to submit term sheets before embarking upon a broader marketing effort.
• The process yielded a pre-emptive term sheet from the winning investor at the requested valuation and equity investment amount, which resulted in some shareholder liquidity and collapsing all existing preferred securities into common shares.