Exclusive: SEMCAP Health launches debut fund and targets $400M

SEMCAP has launched SEMCAP Health, dedicated to high-growth health tech and tech-enabled health care services businesses, the Philadelphia-based firm tells Axios exclusively.

Driving the news: With two deals already under its belt, SEMCAP Health is in the market with a $400 million target for its inaugural health care growth equity fund, says managing partner Brett Moraski, who co-heads the investment team alongside Victor Kats.

Details: SEMCAP Health, one of three impact-driven strategies at SEMCAP, targets businesses that leverage technology to advance health care quality, affordability, health equity and access.

• It takes minority or majority ownership positions, targeting businesses that are profitable or near profitable.
• Its typical check size is up to $50 million, but the firm can go up in size with co-investments.
• SEMCAP Health anticipates a first close early next year for the vehicle.

The backstory: SEMCAP Health stitched together a roster of experienced investors and industry advisers, with track records as operators and leaders within health care's various key constituents — health systems, managed care and payers, pharma services, and the government.

• Moraski was most recently an operating partner at Frazier Healthcare, he previously led strategic investing and corporate development activities at WellPoint (now Anthem) and Highmark Blue Cross Blue Shield.
• Kats is a former leader at Ascension Ventures, the strategic venture capital arm of Ascension, one of the country's largest health systems. Before that he led corporate development at Allscripts.
• The chairman of SEMCAP Health, Ralph Muller, is the former CEO of the University of Pennsylvania Health System.

What they're saying: Meshing strategic market insights with the traditional investor playbook, SEMCAP Health is positioned to help proven businesses at inflection points to scale and navigate the complexities of the health care ecosystem, Moraski says.

• Its bench of investors and nine operating partners know firsthand the pain points and how to transform mid-size businesses into market leaders, he says.

• SEMCAP Health investors and partners were "oftentimes the partners and customers of these companies we're [SEMCAP Health] targeting."

Catch up quick: SEMCAP Health has made two pre-fund investments.

• NeuroFlow, a Philadelphia-based provider of behavioral health integration technology, collected $25 million in growth capital led by SEMCAP Health in October.
• SafeRide Health, which leverages technology to support on-demand non-emergency medical transportation, raised undisclosed Series B funding in November led by Sands Capital alongside SEMCAP Health and others.

What's next: SEMCAP is eyeing companies applying disrupting technologies across various health care themes, Moraski says, including:

• Workforce optimization support and technology in the clinical care setting to address labor challenges.
• Moving care from institutional settings into more cost-efficient settings like ASCs or the home.
• Member patient engagement with health care payors to improve decision-making and access to care.