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Contract collaboration tool developer The Contract Network (TCN) raised $8 million in seed funding, CEO Jim Wagner tells Erin.

Why it matters: Companies like TCN are trying to make it easier for health care organizations to create contract development documents using modern, collaborative tools.

Details: Tusk Venture Partners led the round.

Relativity founder Andrew Sieja participated, alongside The LegalTech Fund, Mayo Clinic, Toba Capital and GC&H Investments, an investment fund associated with Cooley LLP.

Funds will go toward honing the product and marketing.

Wagner declined to say when he foresees TCN raising a Series A.

How it works: The Atlanta-based company parses contracts into individual clauses and uses generative AI to add context to tracked changes and translate legalese into plain language.

TCN's tools let parties collaborate on contracts in real time.

"We take every change and turn it into simple, plain English so every person who's collaborating gets a simple executive summary for every turn of the agreement," Wagner says.

The backstory: Before starting TCN, Wagner built the AI-powered contract analysis company Apogee Legal, which merged in 2018 with Seal Software and in 2020 sold to DocuSign.

Be smart: The Centers for Medicare and Medicaid recently set a goal to bring all 63 million-plus Medicare beneficiaries into value-based care models by 2030, meaning more payers and providers could be in the market for contract development tools since risk contracts can carry more complexity than fee-for-service contracts.

State of play: Syntax Health, which helps health care parties collaborate on value-based contract design, in June collected $8 million in seed funds.

1 big thing: The Contract Network seeds $8M

Illustration of a cursor hovering over a health plus icon, about to click "Open" from a drop down menu.

Peak Rock Capital is preparing to bring Paragon Infusion to market, four sources familiar tell Erin, Aaron and Claire.

Why's the BFD: Several of the sources say Plano, Texas-based Paragon is a likely target for Option Care, which lost a bid for home health player Amedysis earlier this year.

Be smart: Whether Option Care has enough cash on hand to buy Paragon remains to be seen — its cash and cash equivalents balance was about $441 million at the end of Q2 2023.

Another logical prospective suitor for Paragon is Elevance Health (formerly known as Anthem) according to one source, as Paragon has a strong growth tail in Elevance states Ohio and Virginia.

What's happening: The process has not yet launched, nor has a banker been mandated, the sources say.

The company is eyeing an exit sometime in 2024, according to two sources.

By the numbers: Paragon generates roughly $50 to $70 million in EBITDA, the four sources say.

If and when the company officially puts itself on the market, that figure could increase to $100 million, one source adds.

Paragon generates about $1 billion in revenue, per two of the sources.

Paragon could sell for as much as 20x its EBITDA, one source estimates, noting Kabafusion's $1 billion-plus sale to Novo Holdings as a prospective comparable deal.

Flashback: Peak Rock in 2020 acquired Paragon for between $250 million and $275 million when the company was generating about $25 million in EBITDA.

Since then Paragon has grown at a 30% clip annually, according to one source.

How it works: Paragon provides home and on-site infusion therapy, plus specialty pharmaceuticals, rare disease care and bleeding disorder treatment.

Along with its physical centers, Paragon also offers in-office infusion suites for physicians.

The company is licensed to serve patients in all 50 states and has around 50 infusion centers located across eight of them.

State of play: Investors have been eager to help build ambulatory infusion center (AIC) networks to disrupt a market historically dominated by two big players: OptumRx and Option Care Health. Recent activity in the sector includes...

Hybrid infusion treatment startup Uptiv Health earlier this month bagged $7.5 million in seed funds.

Local Infusion, a tech-enabled AIC startup, last November raised $4 million in seed funding led by Brand Foundry Ventures and Meridian Street Capital.

InTandem Capital Partners last March debuted Vivo Infusion, an AIC network created via the firm's simultaneous investments in MPP Infusion Centers and ID Consultants.

2. The BFD: Paragon Infusion coming to the block

Illustration of a saline bag solution with money as the liquid in the bag. 

Venteur Health Insurance, which offers a service for employees to find more personalized health care plans, raised $7.6 million in seed funding, the company tells Axios Pro Fintech reporter Lucinda Shen exclusively.

Why it matters: The Affordable Care Act led to an explosion of health care startups, and now a Trump-era insurance rule is fueling the creation of another set of companies.

Details: GSR led the round and was joined by Headwater VC, Revelry Venture Partners, Houghton Street Ventures, Plug and Play, Techstars and CRCM Ventures.

How it works: Founded in 2021, Berkeley, Calif.-based Venteur offers an employer-facing insurance marketplace that helps them choose Individual Coverage Healthcare Reimbursement Arrangement (ICHRA) plans based on demographic and health data. 

Venteur helps the company personalize the plans for each employee.

Employers pay Venteur a subscription fee for each employee that opts in to one of the plans on their marketplace. Venteur also has revenue-share agreements with brokers.

Be smart: ICHRAs — typically offered as an alternative to group insurance — let employers set aside a pool of money for each employee to buy their own insurance and finance other health costs via HRAs. 

What they're saying: "I think ICHRA will be the dominant option in the next five years," Venteur CEO Stacy Edgar tells Shen, noting that pension used to be the dominant retirement savings mechanism, but companies now prefer 401(k)s.

State of play: A handful of startups have been launched since ICHRA's creation in 2020, including...

Kansas City-based Benefitbay, which focuses on ICHRA administration, raised $2.5 million in April.

TakeCommand Health raised $12 million in 2021.

Thatch, which recently raised $6 million, focuses on startups and pitches itself as a way for employers to create more curated benefits options.

3. Venteur gets $7.6M for health insurance options

Illustration of a health plus-shaped price tag with dollar signs printed on it.

Looking for a deal story? Search the Axios Pro Deals Tracker beta.

• Mendaera, a San Mateo, Calif.-based health care robotics developer, raised $24 million in Series A funding led by Lux Capital with participation from Founders Fund, Operator Partners and Allen & Company, plus insiders Intuitive Surgical, Auris Health founder Fred Moll and former U.S. Senator Bob Kerrey. https://www.mendaera.com/

• Visana Health, a Minneapolis, Minn.-based provider of virtual-first women's health services, raised $10.1m in seed funding co-led by Flare Capital Partners and Frist Cressey Ventures and joined by InHealth Ventures, Oxeon Partners, Pixel Perfect Ventures and Venture Investors. https://www.visanahealth.com/

• Ocuco, a Dublin, Ireland, and Menlo Park, Calif.-based provider of eyecare software, raised $65.3m from Accel-KKR. https://www.ocuco.com/

4. Deals o' the day

• Osama Usmani, founder of HealthPass, became CEO of Salubrum. https://www.salubrum.com/  

• Darragh Kilgallen left a post as operations manager at Arena to take the same role at Adonis. https://www.adonis.io/

• David Entwistle, CEO of Stanford Health Care, joined Redesign Health as an adviser.

4. It's Personnel

👩🏻  Femtech's untapped potential is a trillion-dollar wakeup call to investors — FastCo

🚑  Epic to launch third-party vendor program — Modern Healthcare

🩹 How Amazon's in-house first aid clinics push injured employees to keep working — Wired

5. Your daily dose

Illustration of a hand holding an eyedropper that has spelled out "daily dose" in liquid.

☀️🍸 Claire is clinging to summer and recently enjoyed a guava margarita (guavarita?) in Chicago's Humboldt Park neighborhood. 

✔️ Thanks for reading, and extra thanks to copy editor Mickey Meece. Please ask your colleagues, friends, and family to sign up.

August 17, 2023

1 big thing: The Contract Network seeds $8M