July 9, 2018

Here’s a Not-so-Sexy Cloud Startup that just Raised $10M from GE, NEA

By ARUNDHATI PARMAR, MedCity News - June 22, 2017

Chances are you’ve never heard of Nuvolo.

It is not a company that is at the heart of the consumerization trend in healthcare. Neither is it something that will make the lives of doctors easier. Yet if removing inefficiencies in healthcare is your goal and you want to make the hospital back office — the clinical and non-clinical equipment — hum, you might want to pay attention.

GE Ventures did and ended up leading a $10 million Series A funding round into the Jersey City, New Jersey startup, that was announced Thursday. Previous investors  NEA and ServiceNow Ventures, on whose platform Nuvolo’s software is based.  [NEA by the way, made venture capital history by raising a $3.3 billion fund announced Monday.]

“Optimizing the business of healthcare is key to our investment strategy,” said Noah Lewis, managing director of GE Ventures, in an email. “Nuvolo enables the healthcare industry to maximize the return on critical enterprise assets and facility resources while driving out inefficient costs.”

So let’s decode that. What’s a critical enterprise asset? They could be clinical like a hospital’s MRI or CT machines or they could be non-clinical like the ventilation system in the operating room.

Engineers, whether in-house or outsourced, have to be always on top of how these assets are performing. Broadly the category is called Enterprise Asset Management (EAM). Each of these enterprise assets has to be tracked in terms of location, safety record, calibration and other metrics. The process so far has been largely manual and paper heavy, said Nuvolo’s CEO Tom Stanford in a phone interview Tuesday.

By contrast, Nuvolo is bringing the sexy back [or perhaps forward] into these essential functions by digitizing the process using a cloud-based web and mobile platform.

Traditionally, CMMS or computerized managed maintenance systems made by the likes of Four Rivers, AIMS by Phoenix Data Systems, Infor, and IBM Maximo have played in this market.

“There are probably 30 companies out there that provide these services,” Stanford said. “Most of the technologies, most of the platforms are 20-plus years old.”

Lewis of GE echoed that sentiment citing IBM and Infor as competitors.

“Legacy incumbents’ products are antiquated, difficult to use and unfriendly to modern day workforces and enterprises with demanding financial goals,” he said.

[MedCity tried to reach out to some of the companies mentioned for comment but they did not list any media relations contacts on their sites. Contacted by instant messaging, an Infor live chat representative passed on a phone number for the company’s corporate headquarters in New York City. No one picked up the phone on a Thursday afternoon. The number associated with the media contact at IBM who manages global technology solutions appeared to be disabled. And a tweet to Accruent that acquired Four Rivers did not engender an immediate response.]

According to Stanford, these legacy systems are difficult precisely because they are inherently manual. He painted this picture of the daily grind facing clinical or facilities engineers tasked with managing these physical assets (slightly edited):

They go to work in the morning. They go into their biomed office. They log into their legacy 20-year-old client server. They pull up their work orders for the day. They print them, clip them into a clipboard and begin doing their rounds in the hospital. When they get to a piece of medical equipment that a planned maintenance or corrective maintenance, they write all the information down on a form or a piece of paper. [If they have reliable connectivity they may be using the client server web- based front end on their laptop]. They are transcribing or going to their office at the end of the day and inputing all that information into the 20-year-old CMMS system.

Imagine doing that for all your physical medical equipment which may not all be on the same platform even. Nuvolo gave the example of a Virginia Beach-based healthcare provider that had become larger through acquisitions and now had 14 hospitals within its fold.

“They didn’t have one platform but 17 different platforms [to manage their assets],” Stanford said of that health system that he declined to name that is now a customer.

Nuvolo, on the other hand, largely eliminates paper and pen.

“Our platform allows [engineers] on a tablet or on their mobile phone or on any mobile device to bring that work order, bring that service management service to the equipment and everything is button and tab driven,” Stanford explained. “The asset data is prepopulated, the procedure checklist is fully digitized.”

The software is also designed to work offline with the information being cached on the device and then able to sync to the cloud next time the device is on the network whether wireless or cellular. This is important given so many dead zones within hospitals.

Stanford said that Nuvolo’s software allows hospitals to ask a variety of questions about their equipment. For instance, “Is my Siemens fleet generally speaking performing better than my GE MR or CT” and “what’s my total cost of ownership.”

Historically OEMs have sold capital equipment with a corresponding, apparently lucrative, maintenance contracts that are often renewed.

“If I look at a fleet of 10 MRs and let’s say the acquisition cost was $10 million. I pay $2 million for a services contract. Now if I have a [failure rate] of one a year, why in God’s name would I spend $2 million on services and contracts…,” he said.

Talking about millions,  the $10 million that Nuvolo raised comes on the back of a $2 million seed round that NEA and Service Now Ventures also participated in in November 2015.

“The Nuvolo team very quickly achieved market validation and has already emerged as the EAM cloud category winner, rendering computerized maintenance management system (CMMS) incumbents obsolete by disrupting their capabilities in ways they have yet to figure out,” said Chetan Puttagunta, general partner at NEA, in the news release announcing the money raised.

[iMaint Online is another cloud-based enterprise asset system made by DPSI.]

Aside from clinical equipment management, Nuvolo’s software also allows facilities management. For instance, the ventilator in an OR whose proper calibration is necessary to reduce the probability of infections in patients.

Nuvolo manages more than 5.8 million clinical devices housed with more than 3,125 providers with 3,750 service workers using its EAM platform.

Photo: TAW4, Getty Images

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