Archive for June, 2011

HealthTeacher Books $5.2M To Add Games, Mobile Content

Wednesday, June 29th, 2011

By Timothy Hay, Dow Jones VentureWire                        6/29/2011

HealthTeacher Inc., the provider of an online health-and-wellness curriculum in use by millions of schoolchildren in the U.S., said it has raised new funding as it seeks to add gaming to its lessons and go mobile.

Return investor Chrysalis Ventures led the Series C round, joined by newcomer SSM Partners and company executives, said Chrysalis Managing Director Koleman Karleski. Casey West of SSM will join Karleski on the board of the Nashville, Tenn.-based company.

Petra Capital Partners, which invested in HealthTeacher’s first two institutional rounds, was bought out by Chrysalis and SSM in the $5.2 million Series C, Chief Executive Scott McQuigg said.

McQuigg declined to comment on the size of the stake that Petra held, but a $5.2 million round was enough to buy out the firm and still have capital left over for other uses, he said. He wouldn’t say how much of the round’s amount went to the company.

Petra, whose most recent fund closed in 2008, is winding down its 1999 fund, McQuigg said, and isn’t providing follow-ons for companies from that fund’s portfolio. “We were one of their last holdings,” McQuigg said. Petra couldn’t immediately be reached for comment.

Chrysalis holds a majority stake in the company, Karleski said. HealthTeacher raised about $8.3 million in three previous funding events, beginning in 2005, VentureWire records show.

As public schools scramble with budget cuts and other woes, HealthTeacher aims to make sure the health curriculum doesn’t suffer, Karleski said. The company offers lesson plans via software as a service, and content from major hospitals and other health-care providers.

The company was founded in 2005 under the name ConnectivHealth Inc. and soon began snapping up small health-care information companies–another source of content. It acquired Scottsdale, Ariz.-based FaxWatch Inc., a literature research company, in 2005, and Nashville-based Relegent Inc., a health curriculum company, a couple of years later.

Since that time, the company has been tapping health-care providers for more lessons and getting more than 10,000 schools to access and teach the growing curriculum, Karleski said.

“This is one of the fastest-growing companies in our portfolio,” he said. “They have grown a few hundred percent each year for the last three years.”

The company recently reached break-even, he said. He declined to give a valuation.

HealthTeacher generated headlines recently when a senior product manager at Apple Inc.’s iCloud service, John Herbold, left Apple to join the start-up as vice president of product.

With its Series C, the company aims to add social features like games, and make some of its curriculum available via mobile devices. “You have to meet the kids where they are,” Karleski said.

Health-care providers pay the company to offer certain lessons, the most popular of which concern childhood obesity, he said.

Potential acquirers have begun to circle HealthTeacher, Karleski said, but he declined to give further details about the company’s roadmap.

HealthTeacher Raises $5.27 Million To Expand Products, Management Team

Tuesday, June 28th, 2011

Chrysalis Ventures Leads Series C Funding Which Includes New Investor, SSM Partners

Nashville, TN (June 28, 2011) – HealthTeacher, a leading provider of online health and wellness information for children and adolescents, today announced that it has closed $5.27 million in Series C funding led by Chrysalis Ventures with new investor SSM Partners participating. Additional investors participating include Board Members Ted Dacko, Gary Facente, Jon Vice and CEO, Scott McQuigg.  In conjunction with the financing, SSM General Partner Casey West will join Chrysalis Ventures Managing Director Koleman Karleski on the company’s Board.  

This new round of financing will be used to expand the company’s product offering and management team. Following a 2010 in which HealthTeacher cemented its position as the leader in youth health education, the company is now extending its reach beyond the classroom, engaging children and their families with interactive health and wellness products. The company recently hired John Herbold, Vice President of Product, to lead the development HealthTeacher’s interactive and digital products.

“As child obesity rates reach epidemic proportions, it’s more important than ever to have engaging and interactive health and wellness programs in place to help children and adolescents make healthy choices,” said Koleman Karleski, Managing Director with Chrysalis Ventures. “HealthTeacher is responding to this critical national health problem by providing children and their families with engaging and interactive health content. We’re very excited about HealthTeacher’s tremendous growth and we see great opportunity for the company in the coming years.”

“HealthTeacher is a high growth company with the enviable ability to improve the life of a child forever.  Scott and his team are exceptional at what they do and are leading the way toward fighting the illnesses of tomorrow.  We couldn’t be more enthusiastic about our new partnership with HealthTeacher,” commented Casey West, General Partner at SSM Partners.

“HealthTeacher’s network of schools and communities using our youth health education solutions now reaches over 5,000,000 youth nationwide.  The investment from Chrysalis Ventures and SSM Partners will help us positively impact the health and well-being of more young people,” said Scott McQuigg, CEO of HealthTeacher. “Building upon our foundation of over 10,000 schools, we will continue to evolve the health education resources used by teachers, while reaching beyond the classroom to directly engage students and their families with interactive products to measurably improve youth health.”

 

About HealthTeacher

HealthTeacher is a leading provider of online health promotion, disease prevention, social/emotional wellness and safety resources for kindergarten through 12th grade and is used by nearly 30,000 teachers nationwide. HealthTeacher helps establish community based youth health collaboratives by developing partnerships between healthcare organizations, businesses, community leaders and schools to address the growing issues affecting the health status of young people. To learn more, visit www.healthteacher.com.

About Chrysalis Ventures

Chrysalis Ventures manages one of Mid-America’s largest funds for early-stage and growth investments with approximately $400 million under management. Since 1993, the firm has invested in over 65 companies, primarily in the healthcare and technology sectors. With headquarters in Louisville, Kentucky, Chrysalis has offices in Cleveland, Pittsburgh, Ann Arbor and Houston. The firm seeks to partner with entrepreneurs to build enduring businesses in industries undergoing significant transformation. For more information, please visit www.chrysalisventures.com.

About SSM Partners

SSM Partners is one of the largest and most experienced growth equity investors in the Southeast. With approximately $300 million under management, the firm has invested in more than 50 companies since its inception. SSM invests in rapidly growing, technology-enabled companies in the business, healthcare, and consumer services industries. Portfolio companies have differentiated and proven business models, large market opportunities, and the ability to generate high returns on invested capital.  For more information, please visit www.ssmpartners.com.

Apple Inc.’s Herbold joins HealthTeacher drive to make U.S. youth health ‘cool & aspirational’

Tuesday, June 21st, 2011
Venture Nashville Connections

By Milt Capps Updated 4:30 p.m.
Posted: Tuesday, June 21, 2011 9:25 am

 

HealthTeacher, the online health-education curriculum provider based in Brentwood, has hired former Apple Inc. senior product manager John Herbold as vice president-product, said CEO Scott McQuigg.

Herbold played key roles in leveraging Apple’s development of the iOS operating system, iCloud, MobileMe and iPad-iPhone applications and cloud services. Herbold told VNC discussions with HealthTeacher began in February; he joined HealthTeacher June 13; and, his family has relocated to Middle Tennessee from the Cupertino, Calif., area.

Asked whether hiring Herbold signals broader change for 12-year-old HealthTeacher, McQuigg said, “We wouldn’t be making a hire like this is we didn’t have significant plans to evolve our offerings.”  He stressed that HealthTeacher is not “abandoning” its classroom focus, but aims aggressively to foster “digital engagement” among teachers, parents, students and others, whever they are.

McQuigg said Herbold “is in the early stages of putting together his product strategy plans [and] I envision him building a team — both staff and external resources — to develop apps, social media, games, dynamic content, etc., to enhance our current health education offerings to schools and to directly engage youth and their families.”

HealthTeacher offers curricular content, testing and related services, made available via the Web to parents, educators and others. The company’s business relies on subscription income and “funding from local hospitals to support health education in schools in their communities,” McQuigg said this morning.

Herbold said he has already found “great ideas floating around internally,” generated by the existing team at HealthTeacher. He’s now begun “defining the product roadmap” and the communications required to address benefits to customers and product attributes. Ultimately, he said, the goal is to encourage youth to view health and healthy behavior as “cool and aspirational.”

The newest HealthTeacher vice president also knows that all this has to pay-off for the still-developing company: His background includes a stint as an investment banker with A.G. Edwards & Sons, and he earned a Duke Fuqua School of Business MBA and a Miami University bachelor’s in finance.

Next, he’ll begin planning to hire “some really great engineers” and designers for his product team. “Ideally,” Herbold said, he’ll find those team members in Nashville, where he believes “the Music industry pulls in a lot of talented folks”; to get “the best talent” he’ll do “whatever I need to do to find great people who care about the problems we’re solving.”

Herbold, 31, said that signing-on with HealthTeacher provides a “great blend” of things he sought: After four years at Apple, including an intensive year’s work on iCloud, he was ready to work in a smaller, more entrepreneurial company, he explained. Particularly as the father of a toddler son and another child due in July, he continued, he’s eager to determine “how we can innovate to create things that kids are really going to love using,” and thereby help address declining health among youth that is of “epidemic” proportions.

Top-notch talent choosing Nashville is no small thing, said David Owens, the educator, engineer and author who is professor of the practice of management and innovation at Vanderbilt University Owen Graduate School of Management; and, faculty director for the VU Summer Business Institute (the Accelerator program).

“It’s a big decision, choosing to come here” from Silicon Valley for a job, given that follow-on opportunities are often fewer in a smaller market, said Stanford-educated Owens. Given Nashville’s healthcare services industry concentration, planting a healthcare-education venture here “makes sense” and “transplanting” Apple marketing talent could give HealthTeacher “deeper knowledge about the Cloud” and how the technology will “play-out” in various sectors, he added.

It’s easy to imagine, said Owens during a VNC interview, that nothwithstanding Apple’s vaunted creative resources and the fact that obstructions to creativity can be removed by powerful founder and CEO Steve Jobs, an executive there might want eventually to go elsewhere to try their own new ideas, rather that continuing to work within Apple’s relatively narrow “product spectrum.”

An executive making a transition such as Herbold is undertaking is inherently somewhat “at risk,” said Owens, given the degree of adjustment that may be required by both company and executive. Owens is the author of the forthcoming Creative People Must Be Stopped: 6 Ways We Kill Innovation (Without Even Trying), due out in November from Jossey-Bass (Wiley).

McQuigg said Herbold’s arrival “from the greatest product company in the world” and the prospects for HealthTeacher are “exciting.” The company is taking funding the Herbold-driven effort seriously: “In our 2011 budget,” he said, “we have allocated funds to support the company’s new product development efforts; we anticipate these investments will grow in subsequent years.”

McQuigg also expressed confidence in the Herbold-HealthTeacher fit: “I interviewed a half dozen candidates. John has demonstrated experience developing digital products that drive millions of repeat users per month, with an emphasis on creating engaging user interfaces; he has strong experience working across mobile, tablet, web and connected TV platforms; he is passionate about youth health and making a difference. I believe he will be additive to our culture,” McQuigg explained.

Lessons learned in the Apple culture “absolutely” transfer well in the HealthTeacher context, said Herbold. True, he said, he’ll now be concerned with teachers, children and others, whereas his Apple stakeholders included “pretty much every customer on the planet.”

Herbold said he’s confident HealthTeacher has already come a long toward establishing a culture similar to that at Apple: “Everybody there shares a deep desire to do the right thing for the customer, to create the best possible experience,” regardless of the effort it takes, in line with “cultural expectations of quality.” Even though he has a learning curve to master within HealthTeacher, he expects his adopted conceptual frameworks, research methods and “gut reaction” to work just as well in his new role, said Herbold.

Herbold said he takes many lessons from his Apple experience. First, he said, he’ll keep in mind that the challenge is not  ’creating new features’; rather, the challenge lies in answering the question, “How do we create a product that truly delights people, [so that] we’re not giving them ‘features’, we’re giving them something they actually desire to use” and which addresses “a real pain-point.”

Keeping such factors in mind, he said, will allow HealthTeacher to create offerings that are simple and intuitive and which solve problems that may surprise users: “Sometimes they don’t know the problem exists until we create the product.”

Second, he said, he’ll work to ensure that products are addressing identified problems and that marketing and communications are characterized by “clarity of thought” and simplicity.

Though Herbold may be a new name in Nashville, his work has preceded him. For example, Nashville-based Griffin Technology makes personal accessories for computing and digital media, many of which accommodate Apple products.

Asked about Griffin’s interest in the iCloud, Griffin spokeswoman Jackie Ballinger told VNC that the company’s software professionals recently attended Apple’s World Wide Development Conference (WWDC) and they’re now “looking forward to integrating iCloud into our existing apps, as well as upcoming app projects in development. We’ve used third-party cloud services in the past, of which Dropbox integration into our popular iTalk Recorder app is a good example.

“iCloud will be the next step in this integration,” said Ballinger, “making it even easier for us to implement cloud services into apps by simply tapping into Apple’s iCloud platform.” Griffin will also continue to use other Cloud resources, she said. VNC

 

http://www.venturenashville.com/apple-inc-s-herbold-joins-healthteacher-drive-br-to-make-u-s-youth-health-cool-aspirational-cms-625