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Deal Radar 2009: Awarepoint

Posted on Monday, Jun 22nd 2009

Whether it’s a box of dressings or a piece of equipment costing thousands of dollars, hospitals and other medical facilities can sacrifice their quality of care and lose money when they don’t have a solid grip on their supply chain. To help ensure this doesn’t happen, Awarepoint has developed a real-time location solution (RTLS) system to track assets and handle management challenges faced by healthcare institutions. Its ‘Real-Time Awareness Solutions’ give healthcare clients such as hospitals, teaching institutions, independents and military facilities, business intelligence to improve quality of care, patient safety and clinical and financial outcomes. The RTLS, which are implemented with Active RFID tags, continually monitor the position and activity of resources, analogous to an indoor GPS.

Awarepoint’s solution was developed for Naval Medical Center’s mass casualty and disaster scenario under the technology direction of Nico Nierenberg and the strategic direction of Dr. Harold M. Koenig. Mr. Nierenberg, co-founder, and a software entrepreneur and innovator for over 20 years, founded Actuate in 1993 was CEO until 2000. Prior to that, he was CEO, and CTO of Unify, which helped create the market for UNIX relational database systems. Dr. Koenig, co-founder, retired in 1998 as Surgeon General of the Navy and Chief Bureau of Medicine and Surgery with the permanent rank of Vice Admiral after a 32-year Navy career. Dr. Koenig is chairman of the board and president of The Annapolis Center for Science-Based Public Policy, a non-profit foundation. He is a partner in Edward Martin & Associates, Inc., a consulting firm to the health care industry and serves on several advisory boards.

The CEO, Jason Howe, has been with the company for about two years. While working on M&A research for Sun Microsystems in the RFID market, Howe discovered Awarepoint. The company was at an inflection point and Howe was recruited by the board of directors to turn Awarepoint into a revenue-generating company. He spent 20 years in the high-tech and healthcare industries focusing on strategic management, international sales and marketing. Previously he was CEO of CBS2 Consulting and also served as SVP for Creekpath Systems, Federation Software, Unibex and Edgix Corporation. Howe has patented various sales process models like Campaigner Based Selling Model™ and AcuForecast™ and wrote ‘Fear and Greatness — True Solution Selling’.

The San Diego-based Awarepoint existed in a stealth R&D mode until 2006 and received only angel funding until then. The company has since raised $19.3 million: a $4 million Series led by Avalon Ventures in March 2006; a $2 million Series B with Avalon in July 2007; and a $13.3 million Series C round led by Cardinal Partners, Avalon Ventures, Venrock and individual investors in November 2008. The company also has $4 million credit facility from Silicon Valley Bank.

A recent report by ABI Research says that even in this economic downturn, the focus on RTLS remains strong. Awarepoint’s primary competitors include Aeroscout, Versus and Ekahau (Wi-Fi); Radianse (Infrared); Sonitor (Ultrasound); Time Domain (Ultra-wide Band); and RadarFind. Customers find competitive products expensive, with high infrastructure costs and invasive installation, and find them tough to maintain. Around 5-10% of the US hospital market is currently using or piloting some type of RTLS solution. Under the current economic circumstances, healthcare professionals are turning to RTLS as a solution to budget pressures without additional cost. Using an RLTS solution helps hospitals reduce equipment inventory requirements, lower equipment rental costs, reduce the time staff spends searching for equipment and minimizes equipment theft and loss. RLTS offers several opportunities. Its partnering strategy connects it with software application providers, with Awarepoint providing the network that feeds the location, status and movement information to these systems.

The company’s claims that its biggest advantage is its ease of installation: sensors plug into electric outlets to automatically create a wireless mesh network, without tearing out any walls, eliminating the risk of infection and patient disruption. Awarepoint tags broadcast low-power radio messages which allow users to quickly locate specific equipment or people and provide information about their movement and status, and the tags feature unique functionality to support a variety of healthcare applications. The relationship with UCSD Medical Center, one of Awarepoint’s early customers, proved important to the company as it gave it a chance to establish its technology and ROI in healthcare.

Awarepoint estimates the total available market within just the hospital vertical to reach $1.2 billion by 2012. It already has the largest number of enterprise-wide hospital installs. Awarepoint’s business model includes a distribution partnership with Skytron, an international medical equipment distributor, to sell its technologies to hospitals. This relationship guarantees a minimum of 25 new contracts per year. Awarepoint also offers customers a rental-based business model whereby hospitals can rent equipment on a month-to-month or long-term basis. Presently Awarepoint focuses on the acute care hospital market, with about 4,600-4,800 facilities available in the US. Their next focus is military healthcare and the international healthcare market.

Although the company is not yet profitable, Awarepoint now has over 30 enterprise-wide hospital contracts, and boasts the maximum square footage and assets under management over any other competitor in the hospitals space. Clients include Jackson Health System in Miami, Walter Reed Army Medical Center in Washington, DC, Howard Memorial Hospital in Willits, CA and San Joaquin General Hospital in French Camp, CA.

The company plans to penetrate the acute care market, then look at long-term care, assisted living and home health care. With a focus on healthcare, Awarepoint is confident of its success. Eventually, the company will explore partnering with other companies that provide international markets and are in other verticals like grocery, retail, manufacturing and building automation.

When asked about Awarepoint’s exit plans, Howe said that “Cardinal and Venrock need substantial return on investment, so we are not a quick hit or quick-flip company. Right now, our plan is to be a viable stand alone for at least the next five years, after which there is the potential for an IPO. We are always looking at M&A opportunities.”

Related Readings:
Web3.0: People ID and Plaxo
Deal Radar 2009: WaveMark
Streamlining Hospitals: Omnicell CEO Randy Lipps

This segment is a part in the series : Deal Radar 2009


. Jimmy Beans Wool
. EnerNOC
. GreenRoad
. AdvancedMD
. DecisionView
. EnergyWare
. Sungevity
. eMeter
. WaveMark
. Edutainment Resources, Inc.
. IntraLinks
. The Rubicon Project
. CollegeNET
. Central Desktop
. SnapMyLife
. Talend
. Adayana
. Vontoo
. OrecX
. CrossLoop
. Service-now.com
. Plain Black
. Shipwire
. Collaborative Software Initiative
. Open-Xchange
. Extentech
. Chaupaati
. Zoosk
. Mytopia
. Social Gaming Network
. Zynga
. MindTouch
. MuleSource
. Medsphere
. Greenplum
. VeraLight
. Dealer.com
. Kaltura
. Triveris
. Spiceworks
. SpineMatrix
. Nokeena
. Webtide
. Jivox
. xTuple
. Tangle.com
. Outspark
. concrete5
. Infinia
. UserVoice
. Vindicia
. Sonoa Systems
. SpotMixer
. SodaHead
. EnterpriseDB
. Enquisite
. Coverity
. Hydro Green Energy
. Zannel
. SoloHealth
. CAST
. Marin Software
. InQuickER
. HealthEdge
. Hippo
. Tabula Digita
. checkMD
. GlobalSubmit
. BOKU
. Awarepoint
. KidZui
. AnyWare Group
. Critical Media
. Colosa
. Convio
. Life
. Publicity Guaranteed
. SharesPost
. Aravo
. RadarFind
. Offerpal
. Confidela
. FTRANS
. HSA Global
. Skyline Solar
. Grab Networks
. Meteor Solutions
. Ancestry.com
. EQAL
. Simply Hired
. ClearCount Medical Solutions
. iControl
. Outright.com
. Rocket Fuel
. AirPatrol
. Lakshya Institute
. Elements Akademia
. InXpo
. Viralheat
. ChalkPad Technologies
. socialDeck
. IngBoo
. DubMeNow
. OrangeSoda
. NomaDesk
. SMS GupShup
. Reply!com
. Cellufun
. PSS Systems
. uTest, Massachusetts
. Kalypso
. Yola
. eXo
. Hydra
. AppSense
. Extrabux
. Shoplet.com
. Bazaarvoice
. Clearwell Systems
. Barracuda Networks
. Eloqua
. Sheet Music Plus
. Nimsoft
. LiveOffice
. Jigsaw Data
. SugarCRM
. Trustwave
. Surgient
. AppRiver
. Proofpoint
. Apptio
. Silverpop
. InfoSoft Global
. Cnergyis
. LogLogic
. PGP Corporation
. Avidian Technologies
. Force10 Networks
. SnapLogic
. Alert Logic
. MAIA Intelligence
. Orangescape
. Wirkle
. Clearpath

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[…] RFID tags, continually monitor the position and activity of resources, analogous to an indoor GPS. Click here for complete story from Sramana Mitra Share […]

RTLS – Real Time Location and Security » Deal Radar 2009: Awarepoint Monday, June 22, 2009 at 1:28 PM PT